I’ve always found math to be a challenge. When I was deciding on a college, my main criteria wasn’t finding the best parties or the prettiest campus. Instead, I focused on finding a college that didn’t require math courses. I successfully dodged algebra, calculus, trigonometry, and the like for five years.

However, my math avoidance ended abruptly when I began working in paid search. I had naively thought online marketing was all about creativity. How wrong I was! Between bids and budget allocation, I found myself doing more math than I could have ever imagined.

If you’re also not a fan of math, you’ll probably find that the most difficult part of managing your Google Ads account (formerly Google AdWords) is setting and adjusting bids. While you’ll eventually come up with your own advanced bidding strategies and processes, I suggest starting with these straightforward bidding tips.

Setting your initial Google Ads bids

When setting your initial bids in Google Ads, avoid going in blind and hoping for the best. There’s a wealth of data available to you—use it! Here are a few reliable ways to set your initial bids.

1. Use Google’s bid recommendations

Google Ads’ Keyword Planner is a great place to start. This free tool not only helps you discover new keywords but also suggests a bid for each term, taking into account your ad serving settings. To get the most out of it, begin by inputting your specific targeting details into the Keyword Planner.

As you might expect, the competitiveness for ad impressions can change depending on your location, language, and network targeting. These factors are considered by Google, which tailors your bid suggestion accordingly. As an illustration, take a look at the estimated pricing for “divorce lawyer” in West Virginia compared to New York City.

Keyword Planner’s bid suggestions for “divorce lawyer” in West Virginia.

Keyword Planner’s bid suggestions for “divorce lawyer” in New York City. CPCs in New York are more than twice as high as in West Virginia! These tailored insights are clearly very useful.

2. Aim for the first page (or thereabouts)

Within the Google Ads interface, Google also offers a variety of bid-related insights. You can see Google’s estimate for the bid required to have your ad appear in position one, the top section of the SERP, or simply on the first page.

To see these estimates, start by adding your keywords to Google Ads. Then, customize your columns to see any or all of these metrics.

For brand-new keywords, aiming for top positions right away can be expensive. Give yourself some room to experiment instead, such as tweaking your ads, adding negative keywords, and so on. I prefer to start by looking at the estimated first page bid for each keyword and increasing it by 20–30% to aim for the middle of the page. This is an effective way to ensure that your ads are seen without having to start at the top. From there, you can improve your Quality Scores or gradually increase your bids to move up to higher positions. Concerned about wasting money in Google Ads? Find out if your account has any errors by using the FREE Google Ads Grader.

3. Research your competitors’ bids

It can be tricky to determine the sweet spot for your bids—you don’t want to be consistently outbid, but you also don’t want to overpay for your ads. Utilizing third-party tools like SEMRush or SpyFu is one of the simplest ways to learn about your rivals’ bids.

The SpyFu report shown above gives you a decent idea of how much advertisers are paying for a specific keyword. Use these tools to learn about the competitive environment and adjust your bids accordingly.

Adjusting your bids

Setting your starting bids is only the first step. The true test comes later, when it’s time to make adjustments.

Before making any bid changes, make sure you’ve established your campaign objectives. Do you want more conversions, regardless of the price? Is there a specific CPA goal you’re aiming for? Are you determined to be in first place? All of these bid adjustments ought to be based on your goals.

Your Google Ads bidding strategies will vary significantly based on your objectives. Given that the majority of advertisers appear to prioritize CPA, we’ll concentrate on CPA-based strategies in this article.

4. Calculate your CPA

Your cost per action (CPA) is a measure of how much it costs your company to secure a conversion. Based on your sales, operating expenses, and profit margins, you should have a good understanding of how much you want to pay for each conversion. Of course, even if you succeed, it never hurts to aim for an even lower CPA.

Simply divide your overall expenses by your overall conversions for a specific time period to determine your current CPA. Or, if you truly despise math, simply enter your information into this reliable CPA calculator. CPA = Cost / Conversions With a little math, let’s deconstruct that CPA formula. In reality, cost is the sum of the number of clicks multiplied by your CPC, and conversions are the sum of the number of clicks multiplied by the conversion rate. Cost = Clicks x CPC Conversions = Clicks x Conversion Rate Remove clicks from the equation to see that CPA can also be calculated by dividing CPC by conversion rate. CPA = CPC / Conversion Rate Now, if that’s the case, basic algebra tells me that multiplying CPA by conversion rate will give me my CPC. CPC= CPA x Conversion Rate Guys, the main takeaway here is that you know exactly how much you’re willing to spend for a click on the keywords in that ad group if you know your target CPA and your current conversion rate by ad group. Use this knowledge to help you make future bid decisions.

5. Know when to raise your bids and when to lower them

Decision-making isn’t so tough with a little data. Base your decision to change your bids on your keyword-level CPAs if your objective is to manage your ad group-level CPAs. Naturally, your course of action will vary depending on the keyword, but here are a few illustrations.

• Raise the stakes if a keyword’s CPA is lower than your goal and it shows up in a low position. By increasing your bids, you can ensure a higher ranking, increased visibility, and more clicks and conversions.
• If a keyword has a very high CPA and consistently ranks highly, you might want to think about lowering your bids. You’ll undoubtedly notice a decline in its ranking and fewer conversions, but this will significantly lower your CPAs.

6. Experiment with bid management scripts

Is this post making your head spin? I understand. Math is the worst. Many people decide to completely forgo this bidding nightmare in favor of automated bidding options. Although Google offers a number of built-in, automated bidding options, I would advise against using them if you’re a novice. Instead, look at bid management scripts (the Google Ads dev site and FreeAdWordsScripts.com offer a ton of pre-made options).