Bidding & Budgets
Smart Bidding
Smart Bidding is Google's set of automated, conversion-based bid strategies (Target CPA, Target ROAS, Maximize Conversions, Maximize Conversion Value) that set auction-time bids using machine learning signals.
In practice
Smart Bidding evaluates each auction using signals a human cannot bid on: device, location, time, browser, audience membership, query intent, and hundreds more. It is genuinely better than manual bidding at auction-time prediction, provided it has two things: accurate conversion data and enough of it.
That proviso is the whole story. Feed Smart Bidding a conversion action that fires on page views and it will buy page views. Give it ten conversions a month and its predictions are guesses. Change its target every three days and it never leaves the learning phase. The manager's job shifts from setting bids to controlling inputs: the conversion definition, the value passed with it, the target, the budget, and the structure that decides how much data each campaign sees.
Bid adjustments still apply under Smart Bidding for some dimensions and are ignored for others; device adjustments, for example, act as constraints on tCPA and tROAS rather than direct multipliers.
Why it matters
Most accounts now run on it, and it is only as smart as the conversion data and targets it is given.
RELATED TERMS
Target CPA (tCPA)
Target CPA is a Smart Bidding strategy that sets bids to generate as many conversions as possible at or near an average cost per conversion you specify.
Target ROAS (tROAS)
Target ROAS is a Google Ads Smart Bidding strategy that sets bids automatically to achieve an average return on ad spend you specify across a campaign or portfolio.
Conversion Action
A conversion action is a defined event in Google Ads (purchase, form submission, call, sign-up) that the account counts as a valuable outcome and that Smart Bidding optimizes toward when set as primary.
Written by Ilya Bulychev, Founder, Live PPC Ads. Part of the PPC Glossary.
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