The Implications of Automated Doubleclick Bid Strategies

As automated processes become smarter and more commonplace across the entire digital landscape, marketers have had to become more knowledgeable about how these processes make decisions and how much we want to allow these processes to be integrated into our marketing strategy. With our recent use of Doubleclick bid strategies, we have learned to both trust our tech and keep on our toes as we utilize the resource to further our clients’ goals.

Bid strategies work within parameters set by users to achieve specific goals with maximum efficiency by automatically adjusting bids. The automated process has the benefit of being able to make real-time dynamic adjustments without the need for a user to be monitoring bids at every waking second of the day. Dependent on the type of goal that is set – whether it be achieving the highest number of clicks or conversions, landing in the top position, or earning the highest amount of revenue – the automated bid strategies will monitor keywords and product groups and make adjustments accordingly.

Automated bid strategies adjust bids on keywords and product groups across multiple campaigns, accounts, and engines using machine learning to detect and predict patterns in performance. The system uses historical data to make incremental changes to biddable items as frequently as every 6 hours in order to funnel spend into areas of the accounts that are most likely to achieve the defined goals.

Marketers can use bid strategies to opt into automatic updates to a variety of bid modifiers to further refine and customize bidding strategy, including levers such as:

Device Bid Customization: Mobile bid adjustments

Audience Bid Customization: Remarketing bid adjustments

Geographic Bid Customization: Geolocation targets, proximity targets and location extension targets

If a marketer doesn’t feel comfortable given business priorities to opt into all available automated bid adjustment settings, the bid strategy can be configured to instead provide suggestions for changes to these items that the marketer can then pick and choose to implement manually.

Automated bid strategies can be built to align with a variety of marketing goals, depending on what the marketer is hoping to achieve through their programs. These types of bid strategy goals include:

Ad Position: This goal type optimizes bids to ensure that ads show at a specified position on the SERP and is useful for competitive blunting, brand exposure, maintaining contractual bidding agreements with partners, etc.

Number of Clicks: This goal type prioritizes traffic volume over other factors such as conversions or cost (within defined constraints) and is useful for boosting brand awareness.

ROI: This goal type optimizes across programs to invest more heavily in areas of the accounts that are more likely to yield return, measured by either of the two following metrics:

Conversion volume

Revenue

Monthly Spend: This goal type, when used in conjunction with cost and conversion constraints, can be used to ensure that a defined budget is extinguished evenly and completely over the course of a given month.

When building each bid strategy, constraints can also be defined to ensure that performance or investment, etc. is controlled to stay within given thresholds. These guardrails can be set up for the following:

Minimum & Maximum Bid – ensures no one bid either falls below or exceeds predetermined extremes

CPA – used in conversion-related bid strategies, constraints on cost per conversion ensure that conversion volume is not driven below an acceptable level of efficiency for the marketer

ROAS – also used in conversion-related bid strategies, constraints on ROAS looks at overall return on investment for programs and optimizes bids to ensure that efficiency is prioritized in the objective to drive revenue and conversions

Average Position – helps to maintain desired levels of brand exposure even for keywords, ads, etc. that may not be the most efficient but still need to show to meet business goals

In order to adequately gauge the efficacy of bid strategies, Doubleclick generates both before-and-after and concurrent performance reports that compare performance with a bid strategy in place versus without to understand how performance has changed with implementation.

Within Doubleclick, marketers can also compare bid strategy performance by applying the strategy to similar campaigns or similar geographic regions, leaving some campaigns as manual bidding to provide a control group.

Note: It is best practice to give these bid strategies at least a two week calibration period and to make adjustments gradually and infrequently (approximately every three weeks) to most effectively gauge the performance of a bid strategy.

If you are a retailer that wants to promote a specific brand or product based on publicity in social media, bid strategies will not automatically increase your bids unless there are numbers to back it up. Depending on the objective of your automated strategies, your keywords could be getting bid down if they are not driving enough traffic or a high enough ROI. For keywords that are relevant but have different objectives than your strategies, we recommend excluding these from automated bidding in order to have greater control.

As your program grows, you will need to continuously monitor and update your bid strategies to fit your objectives. For example, at an early stage when you are looking for more qualified customers, you may want to set a higher target ROI. However, when your business matures, and you want to increase the scale of your search program, leaving the ROI target unchanged will inhibit traffic increases as they will continue to only bid up on high-returning keywords, even though keywords with a lower ROI could bring in new customers in the long-run. In order to focus on the full purchase funnel, you’ll want to adjust ROI goals, target CPAs, and keyword position parameters to align with your business’s ever-changing objectives.

Most importantly, automated bidding is not here to take your job as a search marketer (not yet, at least). Instead, bid strategies are simply a tool to improve your efficiency and allow you to focus on more strategic initiatives. Bid strategies do not have the ability to think critically or anticipate the future. In order to be successful, bid strategies will need to be set up, maintained, and updated by humans. Their true value lies in improving your bidding strategy so you won’t have to spend half your workday optimizing bids when you could be focusing on that client deliverable.

As with all technologies, with the good comes some bad, but we have a few tips to help balance out the risk centered around three pillars that make bid strategies so enticing and scary.

Benefits: Efficiency, efficiency, efficiency: If bid strategies are set up properly, meaning you followed the basic tenets outlined in the intro to bid strategies than you should see significant boosts in performance. With the use of bid strategies, we’ve experienced double-digit decreases in CPCs while traffic was unharmed and an overall uptick in ROAS.

Risks: Spend stalls (but don’t panic): If bid strategies are set up with goals that are too lofty or too loose, you could impact spend cutting scale or ramping up out of your budget. We recommend downloading a bulk sheet of your original account pre-bid strategies so if you need to rollback your changes fast; you have a preserved state of your account to go back to the drawing board and recalibrate your bid strategy.

Benefits: Think beyond micro: After a two-week ramp-up period, shift the time you were making keyword level bids to now digging into wider elements of performance such as impression share to ensure consistency across the account. Freeing up this time from weekly bid optimizations gives you time to start looking at enhancing your accounts and challenging bid strategy limitations. That being said, this is not a “set it and forget it” so make sure you are making tweaks based on seasonality and shifts in performance.

Risks: Less Control: With greater time efficiency and granularity in bidding, this requires a sacrifice on control. To account for handing over the reins (slightly), we recommend testing during a stable timeframe where the budget is more fluid in case you have swings in spend. Avoid making changes within two weeks of launch and if you have to make changes track them and give them time to calibrate.

Benefits: Smarter than humans: Bid strategies take into account multiple variables so instead of a human making manual geo strategies, base bid strategies and mobile strategies one at a time – bid strategies do this instantaneously every day.

Risks: Human element of unknowns: This is where bid strategies fall short. Bid strategies are not the best at adapting to unknown boosts in performance or promotions. We recommend shifting back to manual bidding during major promos where you will have significant swings in spend and allow the account to settle for two weeks before you re-enable bid strategies.

Bid strategies are not and cannot replace paid search marketers jobs nor do they remove the human touch from marketing. Bid strategies simply make smarter, faster daily decisions so well-trained paid searchers have more time to think strategically and challenge the limitations that bid strategies are met with. With bid strategies, the paid search marketer’s job shifts from making 1,000s of manual bid adjustments towards more important initiatives such as a comprehensive search and digital strategy for a brand leading up to holiday or the new year.