What Is Bid Strategy? Steps To Excel Your Bid Strategy

A bid strategy is a strategy that tells how your ads will compete in the online advertising world. It shows your willingness to pay when someone clicks your ad or sees it online. Bid strategy regulates your ad budget but allows it to reach the right audience at the right time.

Making the right choice for your purchase strategy will go a long way toward ensuring balanced costs and performance within your campaign, making it much more effective. Clicks, conversions, or visibility, these smart bid strategies will help you spend wisely and achieve better results.

Table of Contents

What is Bid Strategy?

Bid strategy is your rulebook for paying for ads. It is the structured approach you use to set a price for ad placements. You tell the advertising platform, like Google or Meta, what you are willing to pay.

A bid strategy is a plan used to decide how much an advertiser will pay for a click, impression, or conversion. The overall bid strategy decides if you pay per click or per new customer. Getting this plan right controls your success.

Difference Between Manual Bidding vs Smart Bidding

There are two main approaches to setting your bid strategy. You can choose to manage the bids yourself, or you can let the machine learning tools do the work:

Manual Bidding (Manual CPC):

You set the highest price for every click.
This gives you high control over your costs.
It is best for testing small campaigns or specific niche keywords.
Manual bidding is often a necessary first step for advertisers.

Smart Bidding (Automated):

The platform uses machine learning to set bids in real-time.
It adjusts bids based on data signals. These signals include the user’s device or location.
This type of bid strategy aims to maximize conversions or returns for you.
Manual bidding gives control over the input (the cost per click).
Automated bidding gives control over the output (the final financial goal).

Why Is Bid Strategy Important?

Your bid strategy directly impacts how effective and efficient your ads are. A good bid strategy is essential for success. It acts as a financial tool for your entire marketing budget.

The strategic choice of a bid strategy is crucial. It changes advertising from a simple expense into an opportunity to maximize your return on ad spend. Here is how a strong bid strategy help your business:

It Saves Your Money: A well-planned bid strategy prioritizes the highest-performing ads. This means your budget is spent only where you get results.
It Helps You Reach Goals: If your goal is sales, your bid strategy helps lower your cost per acquisition (CPA). If your goal is traffic, it maximizes clicks.
It Gives You an Advantage: You adjust bids using real-time data and market conditions. This allows you to stay competitive.
It Boosts Efficiency: Automated strategies use machine learning to predict outcomes. This helps improve campaign performance automatically.

Types of Bid Strategies

The best way to pick a bid strategy is to look at your main goal. The different strategies are grouped by what they try to achieve.

Strategies for Clicks and Traffic

These plans focus on getting many visitors to your website.

Manual CPC (Cost Per Click):

You have total command over the highest price you will pay for each click.
This is perfect if you know exactly which keywords are worth the most to you.
It lets you put more money toward the keywords that make you the most profit.

Maximize Clicks:

The system changes your price automatically.
It works hard to get the maximum number of clicks possible.
The platform makes sure you never go over your daily spending limit.

Strategies for Conversions and Sales

These plans are best for getting new customers, driving sales, or getting sign-ups.

Maximize Conversions:

The platform works to get the highest number of customer actions that you want.
This is one of the easiest Smart Bidding plans to use.

Target CPA (Cost Per Acquisition):

You set a goal for how much one new customer should cost you.
The bid strategy works on its own to hit that average cost.

Target ROAS (Return On Ad Spend):

This is usually for online stores that care most about revenue.
You aim for a specific percentage of money back from your ad spending.
The bid strategy makes better use of higher-value sales.

Strategies for Visibility and Awareness

These plans focus on making sure people see your ad. They do not necessarily try to get clicks.

Viewable CPM (vCPM):

You set the highest amount you want to pay for every 1,000 ad views.
This is best if your main goal is to build brand awareness.
It works well if your whole message is right there in the ad itself.

You must use the right bid strategy that matches your goals. If you pick a sales plan when you only need visitors, the results will be bad.

How Can Bid Strategy Be Improved?

You must watch your data all the time, even if you use automatic bidding, you cannot just set it and forget it. Making your bid strategy better needs focus, it needs you to look closely at the data.

Set Clear, Trackable Goals

You cannot make your bid strategy better if you do not know what success looks like.
First, make sure that tracking for sales and leads is set up right.
Track the high-value sales. Care about actions that bring real money. Do not just track simple page visits.

Match the Strategy to Your Goal

Ask yourself this: Do I need traffic? Or do I need profit? The answer tells you which plan to use.

If you want people to know your brand, use vCPM.
If you want direct sales, use CPA or ROAS plans.
The best bid strategy is the one that fits your current business need perfectly.

Give the Machine Enough Data

Smart Bidding works best when it has enough facts to learn from.
Start with Manual CPC if your campaign is brand new.
Data amount is important. Wait until you have 15 to 20 sales each month. Then you can switch to advanced automatic plans like Target ROAS.
Good data quality is key to a powerful bid strategy.

Guide the Automation

Automatic bidding is not an excuse to ignore your campaign.

Your job is to guide the machine. Use bid adjustments to make targeting better.
Keep checking the performance data often. Look for places where money is wasted.
Make your changes small and steady. Never make big, sudden changes.

What Is the Best Bid Strategy?

Every advertiser asks this question. There is no single “best” bid strategy that works for every company.

The perfect plan always depends on two main things. These are your goals and the data you have collected. Still, if you are confused about the strategy part, you should go with testing.

Testing is your best strategy means:

What works for one company might fail for yours. You must test.
You must test different bid strategy types all the time.
Run A/B tests. See which plan works best for the people you want to reach.
Never change a winning bid strategy if it already meets your financial goals.
The move to the “best” bid strategy means you must think differently. You must focus on making the most profit. Focus on getting the best return. This is true even if the cost per click is higher. The real sign of a successful bid strategy is that you grow profitably.

A strong bid strategy is the core of successful online ads. Start with clear goals, pick the plan that fits those goals, watch your results closely and change things slowly based on the facts. When you do this, you control your ad money and you get better results every day.

Learn to Master Bid Strategy with PW Skills

If you want to master the complexities of campaign management, including developing advanced bid strategy techniques and leveraging data analysis, consider enrolling in the PW Skills Digital Marketing course. This comprehensive program provides the foundational knowledge and practical skills needed to transform campaign performance and achieve demonstrable ROI in a competitive landscape.

FAQs

What is a bid strategy?

A bid strategy is your plan for deciding how much you pay for ads to meet your campaign goals.

Which factors impact bid strategy success?

Success is impacted by your budget, competition, target audience, and campaign objectives.

When should I use automated bidding?

Use automated bidding once you have enough conversion data, typically 15 to 20 conversions per month.

What is the difference between Manual CPC and Target ROAS?

Manual CPC focuses on controlling click price, while Target ROAS focuses on maximizing revenue return.