AdWords Target CPA Bidding: Case Study
Earlier this year, Circus attended a Google Partners Bootcamp where one of the key topics discussed was automated bidding strategies and the benefits they bring to clients and agencies.
After the event, I wrote a post that highlights why and how we should be using them, which you can read here: circusppc.com/adwords-automated-bidding-strategies
Now that a few months have passed, I want to share with you the results of some testing we conducted using the Target CPA automated bidding strategy.
The account used was a lead generation client aiming for 350 leads per month at £50 CPL (cost-per-lead).
January 2018
Bid aggression was high (£4.97 CPC) which led to relatively strong lead volume with 288 leads generated. However, CPL was also very high at an unsustainable £73.05.
| Month | Leads | CPL |
|---|---|---|
| Jan-18 | 288 | £73.05 |
February 2018
Due to high CPL in January, bids were manually decreased in February to try and bring CPL down to a sustainable level.
CPL did improve but not by much and lead volume dropped considerably to 91 leads.
| Month | Leads | CPL |
|---|---|---|
| Jan-18 | 288 | £73.05 |
| Feb-18 | 91 | £67.52 |
March 2018
Target CPA automated bidding strategy applied in March. Google’s recommendation is to start with setting the Target CPA as the current CPL so that the algorithms have time to learn and stabilise.
Target CPA set to £67. Leads improve by 93% with CPL improving ever so slightly.
| Month | Leads | CPL |
|---|---|---|
| Jan-18 | 288 | £73.05 |
| Feb-18 | 91 | £67.52 |
| Mar-18 | 176 | £66.67 |
April 2018
Google recommends reducing the Target CPA gradually only after the automated bid strategy learning period has ended.
Target CPA reduced to £55. Lead volume increases by another 50% from March to April. CPL reduces from £67 to £57.
| Month | Leads | CPL |
|---|---|---|
| Jan-18 | 288 | £73.05 |
| Feb-18 | 91 | £67.52 |
| Mar-18 | 176 | £66.67 |
| Apr-18 | 264 | £56.68 |
May 2018
Target CPA reduced to £50. May exceeds the target 350 leads and brings CPL down very close to £50 CPL target. CPC this month has come down to £1.38 (from £4.97 in January).
| Month | Leads | CPL |
|---|---|---|
| Jan-18 | 288 | £73.05 |
| Feb-18 | 91 | £67.52 |
| Mar-18 | 176 | £66.67 |
| Apr-18 | 264 | £56.68 |
| May-18 | 386 | £53.47 |
CONCLUSION
February to May shows a 324% increase in leads and a 21% reduction in cost-per-lead. These are pretty astounding results!
In addition, a lot of time and effort is saved where manual bid optimisation would normally be applied, so now that time can be dedicated to improving strategy.
In automated bidding, Google takes into account multiple factors in real time that are just impossible for a person to do manually.
Despite these great results, I would still encourage careful and phased testing rather than abandoning manual bidding altogether immediately.
Follow the best practice guidelines and be patient throughout the learning period. It is tempting to make changes when you don’t see the results immediately.
If you would like help taking your PPC campaigns to the next level then please get in touch and see what Circus can do for you.
Written by William Cheng Operations Director at Circus PPC Agency
