Imagine you run a small online shoe store and want to advertise your products on Google. When someone searches for terms like “best running shoes”, your ad competes with many others for a top spot in the search results.
But here’s the challenge: you don’t automatically secure that position just because you want it—you’ve to bid for it. It’s like you’re telling Google, “I’m willing to pay up to $2 if someone clicks on my ad.”
The problem? If your bid is too low, your ad might not even show up. If it’s too high, you’ll end up spending more money than necessary.
So, how do you find the sweet spot? Should you manage bids or rely on automated strategies like smart bidding? Let’s break down everything you need to know about the basics of bid management.
What is PPC bid management?
PPC bid management is the process of strategically setting and adjusting bids for your ads in platforms like Google Ads, Microsoft Ads, etc. The goal is to maximize ad visibility while controlling costs, ensuring you get the best ROI for every click.
And bids matter—they help determine both where your ad shows up and how much you’ll actually pay when someone clicks. The challenge is that bidding is dynamic. What works today might be too expensive tomorrow or too low to keep your ad visible.
Types of Bid management
There are two main approaches to managing bids:
1. Manual Bidding
You set and adjust bids manually for different keywords, ad groups, or campaigns based on performance data. This approach gives you full control but requires time and expertise.
Pros of manual bidding:
✔ Full control over CPC and bid adjustments
✔ Greater flexibility for testing different strategies
✔ Can be more cost-efficient if managed well
Cons of manual bidding:
✘ Time-consuming and requires ongoing adjustments
✘ Harder to scale for large campaigns
✘ Lacks the automation advantages of AI-driven optimization
2. Automated Bidding
Google Ads and other platforms use machine learning to adjust bids automatically based on your campaign goals.
Pros of automated bidding:
✔ Saves time by adjusting bids automatically
✔ Uses machine learning to optimize for performance goals
✔ Can quickly adapt to changes in competition and user behavior
Cons of automated bidding:
✘ Less control over individual bids
✘ Requires enough data for machine learning to optimize effectively
✘ Can sometimes overspend if not monitored properly
Manual Bidding vs. Automated Bidding: When should you choose which?
Choosing between manual and automated bidding depends on your goals, experience, and the level of control you need.
When to use manual bidding
Andrew Lolk of SavvyRevenue recommends using manual bidding in the following instances:
Limited data availability: In campaigns with insufficient conversion data, automated strategies may struggle to optimize effectively. Manual bidding allows for precise control in such cases.
Targeting brand keywords: For campaigns targeting brand-specific keywords, manual bidding can offer tighter control over bids, ensuring optimal positioning without over-reliance on automated systems.
Resetting data: When there’s a need to reset or clear historical data, manual bidding can be employed temporarily to establish a new performance baseline before transitioning back to automated strategies.
Ensuring specific ad positions: If maintaining a particular ad position is crucial, manual bidding provides the control necessary to achieve and hold desired placements.
Managing low-performing segments: In scenarios where certain segments underperform, manual bidding allows for targeted adjustments to improve efficiency and performance.
Shawn Walker of Symphonic Digital suggests manual bidding can be especially valuable when you’re just starting with a new campaign:
“A lot of the time if we’re starting a brand new campaign where there’s not much background and the client doesn’t know exactly who the audience is, we will start with manual bidding… just to get some volume out there.”
When to use automated bidding?
Automated bidding is ideal when you want to optimize for conversions or efficiency without constant manual adjustments. It’s a great fit:
When you have enough conversion data: Automated bidding works best when your campaigns are already generating a good number of conversions. Google suggests at least 15 per month, but if you really want reliable results, aim for 100+ conversions per month per campaign.
When your performance is steady: If your conversion rates and average order values are all over the place, automated bidding might struggle to optimize effectively. But if your performance is fairly consistent, automation can fine-tune bids without unexpected surprises.
When your tracking is on point: Automated bidding relies on accurate data to make smart decisions. If your conversion tracking is set up properly (ideally using the Google Ads tag), you’ll get way better results.
When you’re managing big campaigns: Got a ton of keywords, ad groups, or products? Instead of manually adjusting bids all day, automated bidding can handle the heavy lifting and optimize everything in real-time.
When competition and costs keep changing: If you’re in a competitive industry where CPCs jump around a lot, automated bidding can quickly react and adjust without you having to constantly tweak things.
Many advertisers find success using a combination of automated and manual bidding. In fact, our study on the impact of PPC bidding strategies that analyzed over 14,584 Google Ads accounts, revealed that 48.42% of advertisers use multiple bidding strategies in the same account, while 51.58% stick to a single strategy.
Now to help you make the final call, here are some final points of differences to consider:
Factor | Manual Bidding | Automated Bidding |
Control over bids | Full control. You decide bid amounts for each keyword, placement, or audience. | Google (or the platform) adjusts bids automatically based on its algorithms. |
Time investment | High. Requires constant monitoring and adjusting bids manually. | Low. The system optimizes bids for you in real time. |
Ideal for beginners | No. Requires PPC knowledge and ongoing adjustments. | Yes. Less hands-on work and optimization is handled by AI. |
Performance optimization | 100% depends on your skills and ability to adjust bids based on data. | AI-driven optimization based on historical and real-time data. |
Risk of overpaying | High. If you’re not careful, you can bid too high or low and waste your budget. | Lower. The algorithm tries to maximize efficiency, but results depend on strategy. |
Best for small budgets | Yes. You can manually prioritize spending and avoid waste. | Mixed. Can be great if using cost-focused strategies like Target CPA. |
Works well for large campaigns | No. Becomes too complex and time-consuming. | Yes. Handles large-scale bidding across many keywords and ad groups. |
Data requirements | Works even with little data. Your experience guides decisions. | Needs enough conversion data to perform well. |
Adaptability to trends | You must manually adjust to seasonality, competition, and trends. | AI automatically adapts bids to changing trends and market conditions. |
Transparency | High. You know exactly where your budget is going. | Low. Google's "black box" approach makes it hard to see how bids are set. |
Learning curve | Steep. Requires ongoing optimization knowledge. | Easier. Once set up, it runs with little intervention. |
What is Smart Bidding?
Smart Bidding is an automated bidding strategy that uses machine learning to adjust your bids in real-time based on various factors. As Peter Oliveira from Google explained,
“The system looks at ‘billions of signals’ to set the right bid for each auction. These signals include devices, time, location, keywords, etc.”
📌Example: You're running an ecommerce campaign for a seasonal sale on winter jackets. With smart bidding, the system can analyze data such as whether someone is using a mobile device or desktop, their location (are they in a cold area?), and even the time of day. If it's a chilly evening and someone is searching for jackets on their phone, Smart Bidding can increase your bid for that specific user, maximizing the chances of conversion. |
Emi Wayner, another Googler, highlighted that:
“15 percent of queries on Google are new every day. That means there are tons of queries that we’re missing as well. We really have to depend on the combination of machine learning and our knowledge and skills to go to the next level. And that’s exactly what smart bidding helps us with.”
But….how’s it different from automated bidding? While automated bidding strategies can adjust bids based on broad metrics like past performance, smart bidding uses advanced algorithms to predict which clicks are likely to convert. |
Let’s look at some major points of differences between the two:
Aspect | Automated Bidding | Smart Bidding |
How it works | Sets bids based on basic rules and schedules. Example: Automatically increase bids by 20% during business hours. | Uses machine learning to analyze thousands of signals in real-time. Example: Increases bid by 45% for an iPhone user in NYC during lunch hour who previously visited your site. |
Data used | Basic data points like time, day, and location. Example: Bidding higher on weekdays between 9 AM-5 PM. | Complex combinations of signals including device, location, browser, weather, seasonality. Example: Learning that Chrome users on Android phones convert better on rainy Sundays. |
Optimization speed | Updates periodically (often daily or weekly). Example: Adjusting bids once per day based on yesterday's performance. | Updates in real-time for each auction. Example: Instantly adjusting bid when a high-value customer searches. |
Strategy examples | Manual CPC with automated rules, Time-of-day bid adjustments, Device bid adjustments. Example: Decrease bids by 30% after 8 PM. | Target CPA, Target ROAS, Maximize Conversions. Example: Automatically adjust bids to achieve the $100 target CPA. |
Once you’re already using smart bidding, the key to continued optimization is a careful, incremental approach. As Peter Oliveira from Google advises:
“Start with what you’re historically performing at. If you want to eventually get your 100 CPA to target a 50, let’s try 90, and then let’s give it some time. Let’s try 80 and eventually work that down.”
💡Pro Tip: You can create customized rules for bid adjustments based on specific criteria. For example, Optmyzr’s Rule Engine lets you set rules to increase bids on high-performing keywords or decrease bids on underperforming ones, helping you maintain a balance between performance and budget. |
How to choose the right bid strategy?
When it comes to selecting a bid strategy, it’s essential to choose one that aligns with your campaign goals. Below are some of the most common bid strategies, each tailored to different objectives.
Clicks (CPC - Cost Per Click)
The CPC bidding strategy is designed to get as many clicks as possible for your ads. You pay each time someone clicks on your ad, and the goal is to drive traffic to your website. This strategy is ideal when your main focus is increasing website visits.
📌Example: If you are running a blog or ecommerce site and your goal is to get more visitors, you can use CPC to bid for clicks on your product pages or articles. For instance, an online store selling winter jackets would benefit from a CPC strategy to drive potential customers to view its latest collection. |
Conversions (CPA - Cost Per Acquisition)
The CPA bidding strategy focuses on optimizing for specific actions, like purchases, sign-ups, or downloads. With CPA, you pay when a user completes the desired action, making it ideal if you’re focused on driving measurable conversions.
📌Example: For an online course platform, you could use CPA bidding to pay only when a user registers and completes a course purchase. This ensures that your ad spend is focused on actual conversions, not just clicks. |
Brand Awareness (CPM - Cost Per Thousand Impressions)
With CPM, you’re paying for ad impressions, not clicks or conversions. This strategy is best when your goal is to increase brand visibility and awareness. You’re looking to get your ads in front of as many people as possible rather than focusing on direct interactions.
📌Example: If you're launching a new product or promoting your brand to a broader audience, CPM would help increase the visibility of your ads. For example, a fashion brand could use CPM to show ads to users who may not be actively looking for their products but are likely to be introduced to the brand. |
Views (CPV - Cost Per View)
The CPV bidding strategy is commonly used in video ads. You pay when someone watches your video ad or engages with it. This strategy is suitable when your goal is to increase engagement or views on video content.
📌Example: If you're running a YouTube campaign to promote a product launch, you could use CPV to pay only when users watch your video ad for a set duration (such as 30 seconds). This strategy ensures you’re getting value for your ad spend and measuring engagement with your content. |
Goal | Clicks (CPC) | Conversions (CPA) | Brand Awareness (CPM) | Views (CPV) |
Increase Website Traffic | ✅ | ❌ | ❌ | ❌ |
Drive Sales or Conversions | ❌ | ✅ | ❌ | ❌ |
Boost Brand Visibility | ❌ | ❌ | ✅ | ❌ |
Maximize Video Engagement | ❌ | ❌ | ❌ | ✅ |
Poor bid management can cost you dearly
Bid management isn’t just about adjusting numbers—it’s the difference between a profitable campaign and one that drains your budget. Without the right strategy, you risk:
❌ Overpaying for low-quality clicks that don’t convert.
❌ Losing valuable traffic because your best keywords aren’t getting the bids they deserve.
❌ Wasting time on manual adjustments that never quite hit the mark.
That’s where Optmyzr can help by putting your bids on autopilot—without losing control. Instead of manually adjusting bids and hoping for the best, it helps you automate the process based on your specific goals, so you don’t have to worry about missing the mark.
Here’s how:
- Automated bid adjustments: Optimize for your specific goals (like hitting a target CPA or maximizing ROAS) without constant tweaking.
- Custom rules: Create custom rules that fit your unique campaign needs. If a keyword or campaign is underperforming, you can set it to lower the bid automatically.
- Data-driven insights: Get to the root cause of performance issues with our PPC investigator tool and see exactly what’s driving performance and adjust bids with confidence.
- Efficient budget allocation: Ensure your best-performing areas get the investment they need.
Choose the bid strategy that works for your goals
Some advertisers swear by manual bidding, tweaking every bid themselves to stay in control. Others prefer automation to save time while keeping performance strong. Then there’s smart bidding, using AI to adjust bids based on signals like device, time of day, and location.
The real question isn’t which method sounds best—it’s which one actually drives the best return on ad spend for you. Your strategy should match your business goals, time investment, and campaign complexity.
Want to get it right? Stick around for our next article, where we’ll break down every Google Ads bid strategy and help you find the best fit.
Or, skip the wait and try Optmyzr free for 14 days. Test different bidding strategies, optimize faster, and see what works (before competitors do).
Thousands of advertisers — from small agencies to big brands — worldwide use Optmyzr to manage over $5 billion in ad spend every year.
You will also get the resources you need to get started and more. Our team will also be on hand to answer questions and provide any support we can.
