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When to revert bid adjustments after geo/daypart targeting

Visitor ✭ ✭ ✭
# 1
Visitor ✭ ✭ ✭

Does anyone have a particular methodology when deciding whether a bid increase worked or didn't work at the geo or daypart layer?

 

Example: Based on statically significant historical data, we decide to bid up the state of Georgia because of the low customer acquisition cost at $150. A week later, the acquisition cost is now at $200. What number of clicks is significant to determine whether this was a bad idea or not?

 

Any help would be greatly appreciated. Thanks. 

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Accepted by topic author Johnny H
September 2015

Re: When to revert bid adjustments after geo/daypart targeting

Collaborator ✭ ☆ ☆
# 2
Collaborator ✭ ☆ ☆
Hi,

The key element here is your goals. If your goal is to increase the number of conversions, consider increase your bids. Increasing bids generally results in more conversions at a higher average cost-per-acquisition (CPA). If your goal is to maximize profit, consider increasing your budget while leaving your bids the same as long as your campaign is profitable.

For example, within one month a campaign had a CPA of $100 and the number of conversion was 10 and the conversion value is $200. Then Profit= 2000-1000=$1000. ROI= Total profit/ Total cost= 1000/1000= %100

Within the same period, after increasing bids the CPA has raised to $150 and the number of conversion has reached to 30 and the conversion value is $200. Then Profit = 6000-4500= $1500. ROI= Total profit/ Total cost= 1500/4500= %33

As you can see after increasing the bids the number of conversion have increased, this is because higher positions tend to get more clicks and therefore more conversions in total. On the other hand, if you seek maximizing profit, you better increase the budget without changing bids, this would increase your profit.