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Conversion Optimizer Avg CPC

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# 1
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Hi

 

I know much has been said about not trusting Target CPA and how it's volatile and can go crazy.

 

We've been using Target CPA for 4 years with more and less success but what has been happening in the past month is new.

Across multiple accounts, with multiple clients, Display Campaigns using Target CPA have been going nuts.

Now before you tell me about possible changes to the web sites promoted and the competitive environment - Search campaigns using Target CPA have not been effected and have stayed stable.

 

No one at google will admit a problem of course and they are unable to answer even the simplest questions 

e.g

 

* How can the Average CPC of a campaign using Target CPA with thousands of conversions suddenly double itself (Conversion Rate is the same so CPA just doubles) (e.g a display campaign running for several months at an average CPC of 0.33 suddenly jumped to 0.6 in a day - doubling the CPA). See graph below - red is average CPC

Screen Shot 2017-07-30 at 16.17.53.png

 

* How can the system bid a higher CPC than the Target CPA ?! 

* Why does the system not respond to any changes in Target CPA and just forces us to reduce budget to minimum ?

 

All these things are happening in Display campaigns only.

 

So will anyone here have a good answer ?

Will anyone at Google reading this take the challenge and answer ?

 

Probably not

But have a good weekend anyway

 

1 Expert replyverified_user

Re: Conversion Optimizer Avg CPC

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# 2
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Hello  @Alda R

My assumption is that the issue could be with the frequency of changes. Once you change the CPA, you should allow the machine learning algorithm to gain / collect a few hundreds of conversions before adjusting again the value. Making too frequent changes without letting the system first reach a steady state could cause the system to diverge. 
This is my assumption (speculation ?) about the behavior  demonstrated in the question.

Moshe, AdWords Top Contributor , Twitter | Linkedin | Community Profile | Ad-Globe
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Conversion Optimizer Avg CPC

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# 3
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Hi MosheTLV

 

Unfortunately your assumption is wrong - no change has been made to the campaigns prior to them going crazy.

In the past we did see every once in a while a day or two were the CPA spiked and attributed it to the system trying out new things. It always went back down after a day or two.

What we are seeing now is that things are not going back down.

This has forced us (after more than 2 weeks of trying to let the system correct itself) to reduce budgets and manually exclude thousands of placements. 

This is not the sign of a properly working system and is not how it performed in the past

Conversion Optimizer Avg CPC

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# 4
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@Alda R;

I would agree that this could be an algorithm issue if there were other / multiple  similar complaints. However, we are  not aware of any. Thus - IMHO- the  cause is should be looked in the account / campaigns.

Moshe, AdWords Top Contributor , Twitter | Linkedin | Community Profile | Ad-Globe
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Conversion Optimizer Avg CPC

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# 5
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Hi MoshTLV

 

As mentioned we are seeing this across multiple accounts.

In addition, the fact that our Search campaigns and Smart Display campaigns haven't seen these spikes excludes any issue with the websites themselves.

Finally, at least 4 different Google support people looked at these campaign and all claim they have no idea what is happening as they are not seeing anything in the campaigns themselves to account for this.

 

I would love for this to be an issue with our account / campaign as then we could fix it.

The fact that you aren't hearing other complaints of the same nature does not mean there is no problem.

After many calls with Google and their internal escalations, the fact that still no one is able to tell us what's going on tells me it's not a campaign / account issue

Re: Conversion Optimizer Avg CPC

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# 6
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Here's another example from another account of a display campaign going crazy (red line is avg CPC)

 Screen Shot 2017-08-03 at 09.41.52.png

Average CPC jump from 0.43 to 1.1 in a day

Search campaigns leading to the exact same page are stable

Conversion Optimizer Avg CPC

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# 7
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Can you check auction insight for competition?

Moshe, AdWords Top Contributor , Twitter | Linkedin | Community Profile | Ad-Globe
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Conversion Optimizer Avg CPC

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# 8
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As far as I know, auction insights only exist for Search or Shopping campaigns, not for Display

 

But lets assume for a minute that a large competitor entered and bid extremely high with a huge budget - why is the conversion optimizer bidding if there's no chance on earth to meet the Target CPA ? (and we are not talking about a single click - we are talking about the daily average)

If the bidding strategy were 'Maximize Clicks' or 'Use all budget' I can understand, but the strategy is 'Target CPA' so the logical thing to do if prices are too high is to not bid those high CPCs

And we are not talking about a 10-20%  increase, we are talking about more than double !

What about some sanity check ? What about not spending the entire budget on a CPA which is double the set target CPA ?

 

You say you doubt there is a problem with the algorithm however the lack of these basic checks points to a problem.

No one expects the Target CPA to be perfect (it rarely actually meets the set target cpa) but the fact that a significant parameter like CPC can double suddenly, doubling the Target CPA - only in one campaign type (this never happens on Search or Smart Display) - means there is a problem.

 

BTW - the 'large competitor' hypothesis doesn't make too much sense since as mentioned we are seeing this in different times in different accounts in different verticals only in one campaign type. 

Conversion Optimizer Avg CPC

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# 9
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@Alda R;

I was misunderstood.

The reference about auction insight was to test competitors (indeed on Search) assuming  this might suggest / hint   or shed light  about the display network. (Have  you had a chance to  check?)

Again, (and we disagree on this):  my experience with automated bids (and specifically CPA)  is that  you should let the system reach a "steady state" and to stabilize for a while, (after making changes) - otherwise, it diverges. The behavior you described (a "step change") is typical -   in my experience-  when too many changes are implemented  in a short period of time (in a given campaign).

 

Moshe, AdWords Top Contributor , Twitter | Linkedin | Community Profile | Ad-Globe
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Conversion Optimizer Avg CPC

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# 10
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Thanks for taking the time MosheTLV to think about this

 

Will definitely look at the Search insights to see if anytying can hint at a Display change.

However if I find something in the Search insights - wouldn't that effect the search campaigns ? and if it doesn't effect the search campaigns - why doesn't the display handle it in the same way ?

 

Your comments regarding change is spot on - except the fact that no change was made to those campaigns which started going crazy and they were in a steady state for quite a while.