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Location Bid Modifiers. When to update?

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# 1
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Hi All,

I've moved a couple of our campaigns to ECPC and added location bid modifiers to help increase conversions. I used the formula from the Google Blog Post "Bid Like A Pro", which is

 

Location Bid Adjustment = 100 x ((campaign goal / actual performance) -1)

 

This formula initially worked well, but CPA is starting to increase. I have yet to reassess  the bid modifier, so my questions are how often are people updating their bid modifiers and has anyone used a different formula to calculate their bid modifiers and had success?

 

Thanks,

Curtis

 

2 Expert replyverified_user

Re: Location Bid Modifiers. When to update?

Top Contributor
# 2
Top Contributor
Hi CBWY5,

May I ask why you'd be using ECPC and Location Bid Modifiers together? ECPC is a conversion based bid modifier on it's own, I'm curious if you'd really need another level of bid modification. Also, Google is using your historical conversion data to make it's decisions regarding ECPC so from my perspective, it would seem a bit much to be overriding the ECPC system whether the adjustment was an increase or decrease. Especially with a decrease in bid, you could in essence be taking away a modification by ECPC. If you really want that level of control, I think you could just continue manual bid management without ECPC.

Just my thoughts on the subject.

-Tommy
Tommy Sands, AdWords Top Contributor | Community Profile | Twitter | Philly Marketing Labs
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Re: Location Bid Modifiers. When to update?

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# 3
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Hi PPCBossman,
Thanks for the feedback. The reason it was set up this way was to have a more control of both our top and bottom performing locations, which is about 10 states while letting Google use ECPC on the remaining states. While running only on ECPC some states had very high CPA's that we decided to bid down and vice versa the states that had a CPA well below our target with high conversion rate were increased to hopefully get more conversions.

Thanks,
Curtis

Re: Location Bid Modifiers. When to update?

Top Contributor
# 4
Top Contributor

Hi CBWY5, how much data do you have upon which to make your decisions?  I've found that any bid modification really needs a lot of data behind it before you can make sensible changes, and even then results can be mixed.

 

I've no hard and fast rules but I'd be wanting to look for at least 10 conversions per day and then to use data for a period of at least 3 months before really trusting the outcome.

 

The less data you have the more likely it is that your location based decisions are unreliable - you may see that Ohio, for example, seems to perform very poorly but if you only have 3 conversions for that State in a month, that appearance could be misleading.

 

I've been working a lot on location-based adjustments and have found that even with reasonable data (~ 5 conversions per day over a 12 month period) I can still be surprised.  Based upon my analysis I hit Ohio with a -10% adjustment and just yesterday that State converted with one of the largest sales of the year.

 

I'd also suggest you make sure your location data isn't seasonal.  As the year passes different States have varying degrees of change and even if your product isn't obviously related to the season you might find that there are variations.  For example, maybe Ohio converts well in the Fall but no other season.

 

Jon

AdWords Top Contributor Google+ Profile | Partner Profile | AdWords Audits

Re: Location Bid Modifiers. When to update?

Top Contributor
# 5
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Hi,

I don't see any problem with doing this...I'm just unsure of how the combination of bidding options/changes will perform. I've definitely found some success with ECPC.

How were you bidding prior to enabling the ECPC on these campaigns? Were you using the bid modifiers previously or were both of these changes done at the same time?

Sometimes I prefer to make gradual adjustments to campaigns so I can get a better understanding of the results.

For instance. ECPC on it's own may have accounted for the differing performances by location and made the bid adjustments you were looking for. Or, with your bid modifications alone, you may have found better success. It's just hard to say.

-Tommy
Tommy Sands, AdWords Top Contributor | Community Profile | Twitter | Philly Marketing Labs
Did you find any helpful responses or answers to your query? If yes, please mark it as the ‘Best Answer.’

Re: Location Bid Modifiers. When to update?

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# 6
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Cobnut & PPCBossman,
Thanks again for the feedback...I'll try and address both of your posts here.

Prior to this method of ECPC and bid modifiers all campaigns were running on conversion optimizer. The reason they are switched is based on having significant inventory and low traffic...after all other campaign optimization has been done I decided to move from conversion optimizer to have more control with the goal of increasing traffic and ultimately conversions.

Once moved to ECPC campaigns would usually gather data for a month before any bid modifiers were added....with locations having higher than the our target CPA being addressed first. After being switched to ECPC, the campaigns have all shown an increase in conversions. Then only when CPA increased to well over our target I would look at adding bid modifiers.

Seasonality definitely plays a part in these campaigns as they are focused on niche activities such as hunting or apparel items such as sandals. Since conversion rate has risen over last year I would say it is an improvement but will definitely need to be re-evaluated once the season is over….which I’m not sure exactly how to do at this point. Maybe once the season is over and the campaign’s spend/conversions decrease significantly I can adjust modifiers back +/- 0 for the offseason.

Thanks,
Curtis