AI Bid Strategies & Performance Max.

Many of our prospective clients are wary about using AI bid strategies. Here we bust 3 of the most common misconceptions about them – including Google Ads’ new Performance Max feature.

Misconception 1 – Loss of Control #

The first misconception that prospective clients are worried about is losing control. There is a strong fear that the AI will run amok with the account and create more problems than it solves. Whilst there is potential for this to happen on an account that is not managed well, this is where the expertise of PPC Geeks really comes into play. Expert human intervention, data analysis and alignment with business goals is vital to control and utilise the AI to its fullest potential.

Our PPC experts have a wealth of training and experience in working with AI to make sure appropriate goals and boundaries are set. In effect, we teach the AI to target the correct user profiles, with the right messaging, at the right time and inline with your business goals.

As an analogy, consider Amazon recommendations of ‘products you might like’. In the case of Amazon, the AI is trained to recognise the likes and dislikes of each user profile and to present the right products at the right time.

This is where the power of Google Ads Performance Max comes into play. A properly trained Performance Max campaign learns which user profiles are most likely to buy your products/services. A well trained Performance Max campaign learns to present your products to exactly the right user profiles at a time when they are most likely to purchase.  

Our team of PPC experts train Performance Max AI according to your business goals, target market and budget limits. This is why it takes up to three months to see effective results. The training phase is vital to optimising the power of AI. There is one caveat to mention: the Performance Max campaign is likely to see a dip in performance within the first three months due to the learning phase. Just as a tennis student will hit a large number of balls outside of the court before learning the perfect serve, Performance Max, in essence, does exactly the same. Once the system is fully trained and has learned the perfect serve – the user profiles most likely to buy your products – it can target those users within a much wider range of channels, customers and bids than the standard campaigns. 

Misconception 2 – AI bidding will spend all my money, and more! #

AI bid strategies, of which Performance Max utilises, are actually an extremely cost effective way to gain conversions. Many of our prospective clients have a general cost per click target and don’t want to lose control of that. Whilst this is understandable, it misses a key benefit of AI bid strategies: AI targets the user profile most likely to convert and, when appropriate, bids higher to gain that conversion.

As an example, say your average Cost Per Click (CPC) is £1 and your ads are showing for a general audience that searches on your keywords. It’s a general audience so each user profile is in different stages of the sales cycle. Some are in the early stages and researching products, some are in the latter stages and are ready to buy. Because your campaigns are targeting user profiles in all stages, a high percentage is not ready to make a conversion.  Let’s say for this example it takes 25 clicks to provide a conversion. The total cost per conversion is therefore £25.

Now, let’s say we use an automated bid strategy where the AI is trained to recognise user profiles who are in the latter stage of the sales cycle. Those user profiles have already done their research and are ready to buy. These user profiles are also searching from a location and device type that the AI recognises as most likely to convert (perhaps you sell luxury products that are most likely to convert from affluent postcodes via an iPad). For this user profile, the AI will bid higher to ensure your ad shows above your competition’s. It may display your ad at a CPC of £2 in this instance even though it is double the cost of our £1 CPC limit. The AI is now presenting your ads only to user profiles who are in the latter stage of the cycle and with a high probability of conversion. 

With a higher likelihood of a conversion, it takes fewer clicks to gain a conversion. If it now takes only 10 clicks to gain a conversion from this highly targeted audience, the total cost per conversion is £20. This is lower than our previous cost per conversion (£25) when we had capped CPC at a lower value.

This is the power of AI bid strategies and Performance Max. The overall CPC can go up but the increase in conversion rate due to the user profile targeting of AI provides a much more cost effective way to gain conversions.

Misconception 3 – There is no reason to change to Performance Max #

The third concern we hear from prospective clients is that their current campaigns are providing ‘satisfactory’ results, so why change? As experts in the field, we are able to see all areas that are not fully optimised. Some of the biggest problems we see in accounts are the lack of AI, lack of audience targeting and no proper utilisation of all available channels to increase visibility to user profiles that are most likely to convert. Performance Max covers all of this within the one campaign. This allows greater control for our experts to train the AI system for maximum performance according to your business goals and target market. 

Performance Max allows us to locate customers with a high probability of converting across all of Google’s channels such as YouTube, Display, Discover, Gmail, and Maps. This really opens up the demographics and allows for increased reach and visibility.  

In addition, Google has already stated that in the very near future, Smart Shopping will automatically change to Performance Max. When the automatic change takes place, it will be without user supervision of assets such as headlines, descriptions, images, videos or audience targeting. Nor will the change be performed with appropriate training of the AI according to specific business goals. 

This highlights the importance of making the switch to Performance Max now, in order to train and optimise the AI with appropriate audience targeting before it is automatically pushed onto accounts. Helping you drive performance and deliver more conversions of value, we train Performance Max with appropriate goals, targeting and boundaries and that is where the power of PPC Geeks and Performance Max really shows.