😱 CPCs Skyrocketed Overnight! 🆘
First, some context...
🎓 Fundamentals of Google Ads Bidding
✏️ Google Ads runs an auction every single time it has an ad space available.
✏️ Your bid puts you in the auction.
✏️ The resulting cost of a click in that auction is your cost-per-click (CPC).
🤖 Per Google: "The most you'll pay is what's minimally required to clear the Ad Rank Thresholds and beat the Ad Rank of the competitor immediately below you (if any)."
☝️ With automated bidding, Google is predicting a conversion rate for each auction.
☝️ It adjusts your bids to help you get clicks that are most likely to align with the goals you've communicated to Google (i.e. your settings).
🤓 As an example, when using Maximize Conversions, if a click seems more likely to take the action you want (e.g. sale, lead form fill, PDF download), Google will lower the bid. If a click seems less likley to convert, it will lower the bid.
🤓 A second example would be when using something like tCPA, Google will adjust bids to try to get you as many conversions as possible within your defined Target CPA and budget.
☝️ If your CPCs skyrocket overnight, it's likely that you have an automated bidding strategy connected to that change...
👉 Google felt that setting a bid that resulted in that higher-than-normal CPC would achieve the goal you communicated to it within your defined target parameters.
🕵️ Usual Suspects...
🔍 Part 1: Recent Changes
👉 Budget Changes
👉 Bid Changes (automated or manual)
👉 Targeting Changes (KWs, audiences, locations)
👉 Exclusions (KWs, Audiences, placements)
👉 Site Changes (QS)
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👉 Products/Services advertised changes
👉 Other Settings changes (e.g. auto created assets in PMax, URL exclusions)
🔍 Part 2: Competitors
👉 Existing competitor is bidding more aggressively (e.g. for general tests, for promos/holiday, etc.)
👉 New competitors entering the auctions with higher-than-average bids.
📝 Things To Check
✅ Long-term trends for benchmarks & seasonality. Is this really an outlier?
✅ Investigate major changes to performance averages (and medians), including impression share changes, as well as volume metrics (e.g. impr, clicks, cost, conversions). Common areas to check include ad groups, keywords, search terms, placements, ads, product groups, products.
✅ Use the "Explanations" feature of Google Ads.
📌 Note: This feature is currenlty only available for Search campaigns using most biddings strategies, App campaigns using Target CPA, and Performance Max campaigns. It is also only available for date ranges within 90 days and that don't include your current date (i.e. Today). Metrics available will vary by campaign type and bid strategy, but will mostly be cost and conversions or conversion value.
✅ Use the Auction Insights report
📌 Note: There is currently no feature for comparing date ranges inside the Google Ads interface. However, you can cycle through days manually or, ideally, you can download a date range you're interested in and upload it into a free tool like the Auction Insights Visualizer, from Frederick Vallaeys company Optmyzr , to visualize Auction Insights metric changes over time. It's an excellent resource!
🛠️🚧 Want More Control? Use Portfolio Bidding Strategies to set max (or minimum - depending on the bidding strategy) bid limits.
📌 Note: This feature does not currently work with Performance Max campaigns. You can only set maximum bid limits for Target CPA, Target ROAS, Maximize Clicks, and Target Impression Share Portfolio Bidding Strategies. Minimum bid limits can only be set for Target CPA and Target ROAS Portfolio Bidding Strategies.
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