Bidding/budget

31.01.2022

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To run your ads on Google, you’ll need to decide on the right budget and bidding options. Your budget establishes a charging limit for an individual campaign, so it should be the average amount you’d be comfortable spending per day. Your actual costs may be lower, depending on how you manage your bids.

Note: Google Ads calculates the budget on a daily basis. If you need to determine the monthly budget, multiply the daily budget by 30.4, which is the average number of days in a month. For more information, read Budgets overview. Utilize your Budget Report to view your monthly spend limit and monthly forecast.

Your maximum cost-per-click bid (max. CPC bid) is the most you’re willing to pay for a click on your ad. By managing your bids, you may influence the amount of traffic your ads receive, as well as the Return on investment (ROI) they generate. With higher bids, your campaign is likely to receive more traffic, although you’ll likely spend more money. With lower bids, your campaign is likely to receive fewer clicks and conversions.

This article explains how your campaign budget works, discusses different bidding options, and explains the steps you’ll need to take to set your bid and budget in a new campaign.

How campaign budgets work

With Google Ads, you have the option to set an average daily budget or a shared budget for a campaign. You can set an average daily budget with the average amount you’re willing to spend per day in that campaign. If you want to check your average daily budget across all campaigns, you can use the “Budget” column under the Campaigns tab. If you prefer thinking of your budget in monthly terms rather than in daily terms, you can calculate your monthly budget by multiplying your average daily budget by 30.4 (the average number of days per month).

Tip: Start small

If you’re a beginner, try an average daily budget of US$10 to US$50. Check your account daily after applying a new budget to see how your campaigns have performed.

You can set a shared budget with the amount you’re willing to spend across multiple campaigns for the same client. The following example shows how Google Ads optimizes your campaign performance when you use a shared budget.

Example

Say you’ve set aside $100 per day, split evenly between two campaigns. On a given day, one campaign could get fewer impressions and clicks than usual, resulting in only $40 spent. With a shared budget, Google Ads could take that leftover $10 and reallocate it to the second campaign to maximize your campaign results overall.

Shared budgets are effective when you have a number of campaigns with a shared goal for a client. For example, you can set a shared budget when you have seasonal campaigns that take advantage of specific holidays, like New Year’s Eve or Valentine’s Day, and set a client-specific shared budget to cap spend related to all their seasonal campaigns.

You can access shared budgets in the Shared library in your Google Ads account.

Shared budgets don’t work with campaigns that are part of a campaign group or campaigns that are part of an experiment.

Overdelivery

Because traffic fluctuates from day to day, Google may allow your campaign to spend more in one day than your average daily budget specifies. This is called overdelivery.

However, your campaign spend will never exceed 2 times your average daily budget on a given day, and our system makes sure that in a given billing period, you’re never charged more than 30.4 multiplied by your average daily budget amount. For example, if you budget US$10 per day, the maximum you would pay is US$304.

If Google shows your ads too often and your costs for the month end up exceeding what you should have paid in a month given the average daily budget you’ve set, your charges will still not exceed your monthly charging limit. For instance, if your monthly charging limit is US$304, and you’ve accrued US$310 in costs in a given billing period, you’ll only be charged US$304. You can see these adjustments on your Transaction history page.

Tip: View your recommended budget

Are your campaigns using up all of your budget? Your budget settings include the option to View recommended budget, which is based on analysis of your campaign performance, typically from the past 15 days.

How bidding works

When many people think of an auction, they often think of a prize being sold for the highest bid. But our ad auction uses both quality and bid to determine your ad’s position. So even if your competition bids higher than you, you can still win a higher position—at a lower price—with highly relevant keywords, high quality score and ads. You’ll often pay less than your maximum bid because you’ll only pay what’s minimally required to hold your ad position and any ad formats shown with your ad, such as sitelinks. The amount you pay is called your actual CPC.

There are many different ways to set your bids, including an entire suite of automated bid strategies. But most people start out setting their bids with either Maximize Clicks or Manual CPC bidding.

How Smart Bidding enhances automated bidding for Search campaigns

Smart Bidding leverages the benefits of goal oriented automated bidding and applies them to conversions (clicks converted to purchases or services) and conversion values. It factors in a wide range of auction-time signals that include device, location, time of day, remarketing list, language, and operating system to capture the unique context of every search. Smart Bidding uses a feature called “auction-time bidding”, that sets a bid for every query. Target CPA, Target ROAS, Maximize conversions, and Maximize conversion value are all Smart Bidding strategies

Types of automated bid strategies

Goal	Bid strategy
Increase site visits.	Maximize clicks automatically sets your bids to help get as many clicks as possible within your budget.Maximize clicks is available as either a standard strategy in a single campaign or portfolio bid strategy across multiple campaigns.
Increase visibility.	Target impression share automatically sets bids with the goal of showing your ad on the absolute top of the page, on the top of the page, or anywhere on the page of Google search results.Target impression share is available on the Search Network only, as either a standard strategy in a single campaign or portfolio bid strategy across multiple campaigns.
Get more conversions with your target CPA.Smart Bidding	Target CPA automatically sets bids to help get as many conversions as possible at the target cost-per-action (CPA) you set. Some conversions may cost more or less than your target.Target CPA is available as either a standard strategy in a single campaign or portfolio bid strategy across multiple campaigns.If Maximize conversions or Maximize conversion value is available for your campaign type, we recommend you use that instead of Target CPA.When you are using Maximize conversion value without a Target CPA set, we will aim to spend your budget to maximize conversion value for your campaigns.When you are using Maximize conversion value with a Target CPA set, we will help get as much conversion value as possible at the target return on ad spend (ROAS).
Meet a target return on ad spend (ROAS) when you value each conversion differently.Smart Bidding	Target ROAS automatically sets bids to help get as much conversion value as possible at the target return on ad spend (ROAS) you set. Some conversions may have a higher or lower return than your target.Target ROAS is available as either a standard strategy in a single campaign or portfolio bid strategy across multiple campaigns.
Get more conversions while spending your budget.Smart Bidding	Maximize conversions bidding will help you optimize towards conversions.You have the option to set a Target CPA on your Maximize conversions bidding strategy, which means Smart Bidding will try to get as many conversions as possible at the target cost-per-action (CPA) that you set. If the Target CPA option is not set, then Maximize conversions will aim to spend your budget to get as many conversions as possible.Maximize conversion value bidding will help you optimize towards conversion values. You have the option to set a Target ROAS on your Maximize conversion value bidding strategy, which means Smart Bidding will try to get the highest conversion value possible at the target return on ad spend (ROAS) that you set. If the Target ROAS option is not set, then Maximize conversion value will aim to spend your budget to drive as much conversion value as possible.Maximize conversion values emphasizes the area you want to maximize, but limits spending to your specified budget
Get more conversion value while spending your budget.Smart Bidding	Maximize conversion value automatically sets bids to help you get the most conversion value for your campaign while spending your budget.Maximize conversion values emphasizes the area you want to maximize, but limits spending to your specified budget.When you are using Maximize conversion value without a Target ROAS set, we will aim to spend your budget to maximize conversion value for your campaigns.When you are using Maximize conversion value with a Target ROAS set, we will help get as much conversion value as possible at the target return on ad spend (ROAS).When you create a Maximize conversion value bid strategy, you can set a Target ROAS (return on ad spending).

Automated bidding uses Machine learning to set the right bid for every auction. Automated bidding uses machine learning to algorithmically help you set the appropriate bid for each and every auction. This takes much of the heavy lifting and guesswork out of setting bids, so you can meet your performance goals more efficiently and accurately.

Maximize Clicks vs. Manual CPC bidding

If your goal is to gain clicks to generate traffic to your website, there are two cost-per-click bid strategies to consider:

Maximize Clicks is the simplest automated bid strategy. All you have to do is set an average daily budget, and the Google Ads system automatically manages your bids to bring you the most clicks possible within your budget.

Manual CPC bidding lets you manage your maximum CPC bids yourself. You can set different bids for each ad group in your campaign, or for individual keywords or placements. If you’ve found that certain keywords or placements are more profitable, you can use manual bidding to allocate more of your advertising budget to those keywords or placements.

Tip: Estimate keyword traffic

Try Keyword Planner to get traffic estimates, like estimated clicks, estimated impressions, or estimated average CPCs for your keywords. These estimates can help guide your decision on which bids and budgets to set.

Bid adjustments

You can set bid adjustments that increase or decrease your bids when your ad is competing to appear on mobile devices, in specific locations, and at particular days and times. Bid adjustments can give you more control over when and where your ad appears, and are applied on top of your existing bids. You can also customize your bid strategy by setting multiple adjustments that work together, such as location and time of day, or time of day and mobile devices

Instructions

Sign in to your Google Ads account.
Click Campaigns in the page menu.
Click the plus button, then select New campaign.
Select the campaign type you’d like to create.
(Optional) Set a campaign goal, and enter the URL of your business’s website.
On the “Select campaign settings” page scroll to the “Bidding” section and select a bid strategy.
Scroll to the “Daily budget” section and enter an individual daily budget or use a shared budget.
Finish choosing your other campaign settings and click Save and continue.