There are a few optimization solutions on the market that can help you generate more clicks and conversions for your PPC campaigns, but at what cost?
We’ve compared Google AdWords Conversion Optimizer with Acquisio’s machine learning Bid and Budget Management (BBM) solution to showcase the difference between the two, focusing on the different problems they each solve, how they each work, and what’s missing.
If you’re tired of manually adjusting bids for your PPC campaigns and you want to start seeing improved results without changing your budget, this guide will help you get set up with the right solution for you and your business.
How AdWords Conversion Optimizer Works
AdWords Conversion Optimizer is an automated bid strategy that sets bids to help get as many conversions as possible at the target cost-per-acquisition (CPA) set.
In other words, “instead of manually manipulating bids and generating conversions at any cost, conversion optimizer automatically adjusts bids so conversions are generated within a defined CPA boundary,” explains Jeff Baum on PPC Hero.
Conversion Optimizer acquires conversions within this defined boundary by analyzing campaign history and performing a behind-the-scenes predictive analysis of which Search or Display auctions are most likely to convert. Bids are automatically increased or decreased based on whether AdWords believes a specific auction will convert or not. Manual bidding only reduces cost per click, but doesn’t take into account what auctions are most or least likely to convert, and this is the value Conversion Optimizer adds.
How BBM Works
Acquisio’s machine learning Bid & Budget Management is a feature that automates bid adjustments and paces budget to help acquire the most clicks or conversions possible within a given budget constraint, while also respecting cost per click or cost per acquisition restraints and distributing the budget evenly throughout the full day and full month.
The BBM algorithms run continuously throughout the day and also use campaign history and predictive analysis to determine which auctions are most likely to convert. Using 30-minute update cycles, BBM makes multiple decisions per second, and more than 2.4 million bid adjustments a day, to ensure the right bid is made in the right auction at the right time.
This allows marketers to take full advantage of intraday inefficiencies in the auction in order to decrease CPA, maximize conversions, and better manage spend control.
Solving Different Problems
It’s clear the two solutions have differences, but the main difference between BBM and AdWords Conversion Optimizer is that the two do not solve the same problem.
- The goal of Conversion Optimizer is to get you the most conversions given your cost-per-acquisition (CPA) goals. Ex: Sally wants as many plums as possible, but will only pay $2 a plum, how many can she get? The number of plums she gets depends on how high her budget is, and getting more usually means paying more.
- The goal of BBM is to get you the most clicks or conversions so you can:
- last all day in the auction
- spend the full daily and monthly budget
- respect the max CPC or CPA limits
- achieve Avg. CPC (CPA) Parity on mobile and desktop devices
Ex: Sally has $50 to spend that month on plums and she wants to get as many as she possibly can, how many can she get? The number of plums Sally gets depends on what she pays for each one. The cheaper the plum the more she can get.
AdWords Conversion Optimizer attempts to target a specific CPC or CPA, and in doing so often recommends increasing the budget. This is easy to see with the Sally’s plums example. Google wrote, on their About Conversion Optimizer page, that, “If you’re consistently hitting your budget, increase it to allow more visibility for your ads.”
Acquisio’s machine learning BBM operates on a different principle, and does not believe increasing the budget is the only answer. BBM targets the budget with precision, and works to maximize the clicks or conversions at the lowest achievable average CPC or CPA. By getting cheaper clicks and conversions you can get more, without increasing budget.
What AdWords Conversion Optimizer Does:
AdWords Conversion Optimizer works to maximize the number of conversions while either:
- Targeting a desired CPA
- Respecting the limits of a maximum CPA
What Acquisio’s BBM Solution Does:
BBM maximizes the number of clicks or conversions achieved while:
- Respecting the limits of a maximum average CPC (or CPA)
- Spending the full Daily Budget and Monthly Budget accurately
- Lasting all day in the auction, using “Accelerated Ad Delivery”
The main thing that is missing from AdWords Conversion Optimizer, which is extremely relevant to agencies, is the budget management aspect. AdWords Conversion Optimizer may be free to use, but the value added by Acquisio’s machine learning Budget Management means the solution is fairly priced, and worth the investment given the expected return.
No direct relationship to budgeting exists within AdWords Conversion Optimizer. Only using “Standard Ad delivery” with Daily Budget provides some control on pacing of a Daily Budget, but “because standard delivery spreads your budget throughout the day, you will miss out on some morning searches in order to show up later in the day,” wrote Jenny Hatch of Disruptive Advertising. This means that there are times when you ad won’t appear, and you aren’t participating in the auction when you could or potentially should be. In some cases this results in significantly higher than optimal CPA or CPC values and Impression Share loss.
For BBM, spending the Monthly Budget without over or under spending is a major priority, and the solution has been shown to spend the budget as accurately as + or – 2%.
AdWords Conversion Optimizer has no Monthly Budget or Budget Period considerations other than a multiplication of your daily spend, and even then, precision on Daily Budget spend is very poor, with up to 20% overages being common and contractually allowed.
Acquisio’s machine learning Bid & Budget Management solution ensures that you bid in the auction throughout the day, moderating spend to guarantee Daily Budget does not “bust” before the day is through.
Unlike Conversion Optimizer’s Standard Ad Delivery where you are cut from the auction at certain points of the for the budget to last, BBM uses accelerated ad delivery and carefully monitors spend to make sure you stay in the auction all day and still evenly distribute spend from morning til night. By updating every 30 minutes, bids are adjusted to make sure your ads are seen throughout the day.
AdWords Conversion Optimizer and BBM solve very different problems.
If you work in an agency where a fixed budget is crucial and clients won’t accept overages, pacing budget and managing monthly budget is something AdWords Conversion Optimizer doesn’t solve for. BBM allows you to maximize clicks or conversions, stay active in the auction all day, and respect your budget period constraints.
If you want a solution to simply optimize for CPA targets, Conversion Optimizer will work.
In the end it depends on the complexity of your company’s needs. Both are leading solutions in the market, it’s just a matter of deciding which solved the most problems.