What does ‘enhanced bidding’ mean?
Also known as ‘enhanced CPC’, enhanced bidding is a semi-automatic approach to bidding for digital ad space. It involves letting Google Ads make real-time adjustments to the maximum bid for clicks based on how likely they are to result in a successful conversion.
If you want a more in-depth understanding of this topic, check out the FAQ section below:
Question #1: How does enhanced bidding work?
As we have seen in the previous section, it works by letting your chosen Google Ads automatically adjust the amount you pay for each click, depending on how likely it is to translate to a conversion. It will pay more for high-potential clicks, pay less for lower-potential clicks, and completely ignore clicks that have virtually no chance of resulting in a conversion.
All you really have to do is set the total budget for your advertising campaign, and Google will handle the rest.
Question #2: What are the benefits of this bidding?
The biggest benefit of this is that it allows you to capitalize on high-potential clicks and save money on lower-potential clicks on autopilot instead of paying the same amount for everything, potentially wasting a lot of money on clicks that do not do anything for your business.
Question #3: What are the downsides to this bidding?
The main downside to enhanced bidding is that since there is no cap to how much Google Ads can bump up your bids for clicks, there is a chance it will end up burning through your campaign budget much more quickly than if you set fixed bids—that and there is no guarantee that Google will be able to identify high-potential clicks 10 out of 10 times.
This is why this approach is best used by more experienced marketers who have been using Google Ads for quite some time. The more data the platform has to work with, the more accurately it can identify clicks worth bidding more for.
Question #4: What is the difference between manual bidding and enhanced bidding?
The main difference between manual bidding and enhanced bidding is the use of automation. As the name suggests, manual bidding involves the advertiser having full control over the maximum amount Google Ads can bid for a click.
Take note that we only mentioned the maximum amount. This is because even with manual bidding, Google Ads may still end up paying less than the maximum amount set. This happens when your ad is more relevant to the user than that of competing advertisers who bid the same or a higher amount.
Question #5: Is enhanced bidding right for me?
Enhanced bidding is right for you if you satisfy the following conditions:
- You have been using Google Ads for a while
- You are looking to get conversions instead of just building brand awareness
- You have money to spare
Let us take a look at each on in more detail:
First, as we have seen earlier, it works better the more data it has to work with, and the older your Google Ads account is, the more data it probably has.
Keep in mind, though, that the main requirement here is the amount of data available. So, even if your account is just a couple of months old, if you run a lot of campaigns per month, then you should still have enough data to successfully use enhanced bidding.
Second, since enhanced bidding involves Google Ads automatically paying more for clicks that have a higher potential to turn into a conversion, it is best used for campaigns that are designed for conversions. If you are just looking to get in front of as many of your target customers as possible to build brand awareness, then there is really no point to paying more for specific clicks.
Finally, since enhanced bidding works better the more you do it, you need to be able and willing to potentially lose money when you first do it.