When should you change your target CPA bid in AdWords – Google Ads?

Target CPA Bidding

Question: Some of the campaigns are getting leads at well below the Target CPA bids. Should I lower my Target CPA bids? Also, I have other accounts that are also doing well as far as Target CPA is concerned, but they are underspending my budget by hundreds. What do I do to get more leads and spend more of the budget?

Answer:

You should lower your CPA bids when –

  • The number of conversions is consistent at least for two weeks
  • When your actual CPA has not crossed your target CPA at least for two weeks

In short, when the campaigns are meeting your expected number of conversions below the target CPA for at least two weeks, you may get ahead to decrease it.

Why two weeks?

There’s no rule as such. In general, that’s the period AdWords – Google Ads – needs to adapt its optimization automation strategies to the CPA changes you made.

Then, the number of conversions as well matter here. If your campaigns are getting big numbers in conversions, say 100 a day, making changes even in a week time should be fine.

By how much to decrease?

Depends on the difference of your target CPA and actual CPA. For instance, if your target CPA is $25 and the actual is $15. You can lower the target to be around $18 or $20.

However, to be on the safer side, do not decrease it by over 25% to start with.

An important thing to note here, if lowering the CPA affects the conversion volume adversely the next day, do not panic, give it a few days without making frequent changes to the campaign.

Below Target CPA, budget not spending

target CPA strategy Google Ads

If your budgets are not being utilized to the full, you are on CPA and current CPA is well below the Target CPA, you should work with keywords, ad copies, and extensions. Do not play with CPA here. Work to scale the campaign up. Try adding a few new keywords (yes, only a few to start with). You can also expand the target geography as well, but don’t add many at one go. Add one, give it a week or wait for at least 50 new conversions, add more.

The point is, if you simply increase CPA, the system would try scaling your campaign up but it might be really difficult as you already have a tightly themed campaign. You can simply increase CPA, if you believe your campaigns are broadly themed. For instance, using Broad Match keywords? If so, you can try increasing the CPA by about 10 to 20% to start with.

If you are using narrower match types, they system won’t be able to scale it up nicely by itself, that’s where you should do it yourself as discussed above.

About changes, makes sure you do step by step. Do not confuse the system by making it in overwhelming numbers.

This answer to this question was requested to me on Quora.
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