Bidding & Conversions

1. Bid Simulator

2. Conversion Tracking

3. Conversion Optimizer

Overview

Bid Simulator

Do you ever wonder … ?

… how many more impressions can I expect to get?

… if I increase my Max CPC bid from $2 to $3, how many more clicks can I expect to get?

… how much would the clicks costs?

… how can I bid more effectively?

Bid Simulator Overview

5

• A feature of the new AdWords Interface that estimates the

click, cost and impression data that ads would have received in

the last seven days if advertiser had set different maximum CPC

bids

• Provides transparency and simplicity with regards to the bidding

process

What is the Bid Simulator?

Bid Simulator | Accessing the tool (step 1)

Accessible in the Keywords tab in the Max. CPC column.

Sign into your account, and you are ready to begin.

Bid Simulator | Accessing the tool (step 2)

Click the bid simulator icon in the Max. CPC column next to the bid of any keyword you would like to see data for. You can only view simulations for one keyword at a time

Bid Simulator | UI – Scenario 1

Scenario 1: Your keyword receives adequate traffic: shows the estimates of clicks, cost and impressions for several bids

Date range of simulation

Current bid

Bid Simulator | UI – Scenario 2

Scenario 2: Your keyword receives lower traffic: shows the estimates of impressions only

Date range of simulation

Current bid

Bid Simulator | UI – Scenario 3

There are no estimates for a keyword that does not meet any threshold, either because the keyword was recently added or the bid is too low to receive any impressions. Therefore, an icon will not appear next to the keyword

Simulations only available for keywords ‘google store’ and ‘usb drive’

Bid Simulator | How does it work?

Your quality score

We know

We estimate

Your competitors’ bids and their quality scores

Amount of traffic search network received last week

Probability of a click on your ad given its position

Google’s auction system

The number of impressions for which your ad would have shown

The number of clicks you would have gotten for those impressions

The cost of those clicks

What are the advantages for the advertiser?

Bid Simulator | Advantages

• Simplifies bidding and makes it easier, no 3rd Party tool required

• Eliminates the need for constant trial and error currently

needed to figure out the results of different bids

• Adds transparency into AdWords

Bid Simulator | Things to note

When a new keyword is added or a campaign started, simulations are generated when enough click or impression data

Bid changes do not hinder our ability to simulate

For broad match keywords, the # of impressions and clicks can change dramatically with each bid.

Bid simulator does not simulate conversions or predict future results

13

Data gets refreshed once a day

Simulations are for Google.com and search partners only

Conversion Tracking

Which clicks are most valuable?

Keyword Impressions Clicks Average CPC Cost

“Roses” 1,000 50 $1.00 $50

“Flowers” 2,000 30 $1.00 $30

• Without conversion data:

Conversion data tells you:

CPC bid for flowers

is too high!

Keyword Conversions Cvr % Cost / conversion (CPA)

Profit / conversion (@ $7 margin)

“Roses” 10 20% $5.00 $2

“Flowers” 3 10% $10.00 $-3

Track ROI and make smarter decisions, for free

• Correlate ad clicks to custom conversion metrics

• Easily set up tracking for sales, sign-ups, leads, and page-views

• Measure conversion value of campaigns, ad groups, and/or keywords and optimize bids accordingly

• Track Google and non-Google ads

Conversion Tracking

• Track ROI and make smarter decisions, for free

– Correlate ad clicks to custom conversion metrics

– Easily set up tracking for sales, sign-ups, leads, and page-views

– Measure conversion value and optimize bids accordingly

– Track Google and non-Google ads

User Clicks on an Ad

Google Cookiesthe User

User PurchasesAdvertiser Account

Updated

Conversion Tracking

Implementation

• Go to Tools/Conversion Tracking

• Set-up wizard helps you choose

conversion type, customize text

image, and generate code.

Five

conversion

types

Language Selection

• Choose Language & Security

• AdWords automatically generates code

• Webmaster can copy & paste code from AdWords onto Conversion Pages, then publish onto the live site

• With a live campaign and live code, conversion data automatically populates your account

Implementation

Code

Conversion Tracking Facts

• Cookies last 30 days

• There are 5 conversion types: sale, lead, sign-up, page view & other

• New code is needed for each conversion type

• It only tracks conversions through AdWords traffic

Google Confidential and Proprietary

Conversion Optimizer

Conversion Tracking

Free tool helps you track ROI and make smarter online advertising decisions

•Easy set up by placing a small

snippet of javascript into your

confirmation page

•Measure the conversion value

of your campaigns, ad groups

and keywords

•Use the conversion data to

make better bid decisions

Makes bidding easier, but

manual work (CPC) still required

How Conversion Optimizer works

You provide a Max CPA bid for each ad group

Then finds the optimal equivalent CPC bid for your ad each time it's eligible to appear

…in order to calculate a predicted conversion rate for each auction (based on historical data). . . .

user location

query performance

partner sites

more . . .

Conversion Optimizer considers many factors…

1

2

3

4 Max CPA is combined with thePredicted Conversion Rate and Quality Score to produce Ad Rank

Conv. Optimizer: free AdWords feature for managing CPA bids

• Specify a Max CPA for each

ad group

• The Conversion Optimizer

automatically finds optimal

CPC bids for each auction

• Uses historical information

about your campaign

• You still pay per click, but

you no longer have to

manually adjust your bids to

reach your CPA goalsSet a Max CPA

bid for an

AdGroup

Eligibility

• Advertisers who have Conversion Tracking enabled and 10+ conversions in

the last 30 days for eligible campaigns.

• Stable conversion rate with no major recent changes (such as those caused

by redefinition of conversion event or moving of conversion tracking code)

Conversion Optimizer Benefits

WHY should I

use it?

Save time. Set your max CPA, and Conversion

Optimizer will automatically adjust your CPC bids for

each auction

Save money. Conversion Optimizer uses different bids

in every ad auction, allowing you to spend more

money in situations where you’re likely to get

conversions

Free. Third-party bid management tools are

expensive!

Access lots of inventory. Allows you to advertise on

both the search and content networks

Easy to try! If you turn off Conversion Optimizer,

previous CPC bids automatically restored

Conversion Optimizer Interesting Facts

• Multi-dimensional Bid Management tool which can improve your campaign’s performance

• Works on both content and search

• Available to campaigns using AdWords Conversion tracking which have received 10

conversions in the past 30 days

• No additional charge for AdWords advertisers

• Campaigns adopting CO achieve a 20.7% increase in conversions and 14.1% decrease in

CPA*

Optimizes your placement in each

ad auction to avoid unprofitable

clicks

Gets you as many profitable clicks

as possible

Gets you more conversions at

lower costs

* Source: detailed analysis in Feb 2009 completed by Paul Liu, a Senior Economist on at Google. Campaigns who have adopted Conversion Optimizer are compared to a control set of comparable campaigns

Simple vs. Multi-dimensional Bid Management

Simple Bid Management Multi-dimensional Bid Management

• Varies bids by keyword (only)

• No other factors taken into account

• Examples: manual bid management, 3rd party bid management

• Considers many other factors that indicate the value of a click (Examples: user location, match quality, user query, content site, etc.)

• Optimizes performance in real time based on the specific characteristics of each auction

• Opportunity to achieve much better performance

Google Conversion Optimizer

Keyword is not the only predictor of conversion rate

Conversion Optimizer considers many other auction factors in optimization, including:

Search targeting

• Broad vs. exact match

• Particular broad-match query

• Search partner site

Content targeting

• Content site “topic”

• Match quality between ad and content

• Actual content site

User attributes

• User location

• Browser

• Operating system

• Language setting

Factors unavailable to

simple bid management

10 Important things to know about the Max CPA bid

1The Max CPA bid is similar to the Max CPC bid – the most you want to pay for a conversion

2Although you are bidding with a CPA, with the Conversion Optimizer you still pay per click. It is like being charged a little piece of your CPA for each click

3

A Max CPA is not an average or target. Your average CPA will usually be less than your bid. (Just as if you bid a Max CPC and your average CPC is less than this, you might bid a Max CPA and get an average CPA below this.)

4

You should start with the recommended bid presented when you first turn on Conversion Optimizer. Raise and lower your bid once you have some data to optimize your performance.

5 You can set a different Max CPA bid for each ad group

6Don’t set too low of a bid, particularly when you first turn on Conversion Optimizer. A very low bid is likely to reduce traffic.

7Monitor and tweak your Max CPA bidsas you would any other bid, to get the most profit from your campaign.

8Change your Max CPA as often as you like. If you’d like more conversions, raise your bid. If you’d like a lower average CPA, lower your bid.

9Your average depends on factors outside Google's control, so your actual CPA may sometimes exceed the maximum CPA you specify

10 Experiment and find out what works best for you!

10 Tips for Conversion Optimizer success

1Start with the recommended CPA bidand modify your bids often to find your “sweet spot”.

2It’s easy to try, so try it out. If you choose to turn off the Conversion Optimizer, your campaign will revert to the previous CPC bids you were using.

3

Use the Conversion Optimizer with existing campaigns. The longer a campaign has used conversion tracking, the more data the Conversion Optimizer has available.

4

If you don't have a campaign yet, but want to try Conversion Optimizer, create a new CPC campaign and let it run for a few weeks with conversion tracking. Then turn CO on, but keep in mind performance will improve over time as CO gets more data.

5

Keep in mind that changes in ad performance are natural, and you may need to use the Conversion Optimizer for some time to get an accurate understanding of its effects.

6Don’t make huge changes to a campaign while running Conversion Optimizer. (Example: deleting all ad groups and replacing with new ones.

7

Do make small changes to your campaign that fit your business needs. (Examples: adding/deleting keywords, changing creative, changing landing page.)

8Don’t remove your conversion tracking code from your website or move it to a different location while running Conversion Optimizer.

9

Raise your Max CPA bid if you want to increase traffic and conversions. Lower your Max CPA bid if you want to lower your average CPA. Traffic will likely decrease.

10Compare your CPA and # conversions before and after using Conversion Optimizer so you know how much improvement it made on your campaign.

Select the campaign you want to enable for and click on “Edit Settings”’

Enabling Conversion Optimizer: Step 1

Enabling Conversion Optimizer: Step 2

Under Bidding & Budgeting, click on “Advanced Options” link

Enabling Conversion Optimizer: Step 3

Select the option “Focus on Conversion” to use Conversion Optimizer and click “Save”’

Use recommended bid or customize your bid: Step 4

You can start with the recommended bid or create a custom bid

It can be good idea to start with the recommended bid and then tweak the bid up and down to find the ideal spot for you

Conversion Optimizer Tips

• How to best structure campaigns?

• Each Conversion Optimizer campaign should have products and services that are related

• Don’t create excessive number of AdGroups

• Don't create new campaigns

• How do I get more conversions?

• Turn on Content Network

• Add more keywords

• Increase CPA bid

• Any tweaks to increase CTR or conversion rate, including changing the ad creative and landing pages

Only works with Conversion Tracking

Question

Our company doesn’t use AdWords Conversion Tracking. Can I use

Conversion Optimizer with Google Analytics or a third-party product?

Response

Conversion Optimizer requires AdWords Conversion Tracking. Keep in mind

that you can use AdWords Conversion Tracking along with other conversion

tracking systems. For instance, many of our customers have Google Analytics

and AdWords Conversion Tracking tags on their conversion pages.

•Increases your profits

Conversion Optimizer: Increases profit and saves time

Easy to use

No additional charge for AdWords advertisers

Multi-dimensional Bid Management for AdWords better matches ads with customers

Improves AdWords’ease of use with less time spent managing bids

No extra fees or new interfaces to learn

•Conversion Optimizer website

http://www.google.com/adwords/conversionoptimizer/

•Conversion Optimizer video

http://www.youtube.com/watch?v=ynMJyem7lSM

•Product FAQs

http://adwords.google.com/support/bin/topic.py?topic=12045

URL to complicated?

Just search for “Conversion Optimizer” on Google or YouTube

Resources

Q & A