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set bids that maximize profit effectively to meet goals

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  • Google Search Advertising Exam – All Q&As
  • * Updated on 06-Nov-2018
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You are gaining a reputation as a true wizard of Google Ads and just won a multi- million dollar client to consult on bidding strategy. Your new client asks you to set bids that maximize profit, focus on the top 3 positions, and minimize CPA. How can you most effectively meet their goals?

  • Set bids that minimize CPA while maximizing profit, but explain that position can’t effectively be optimized simultaneously.
  • Explain that all three objectives contradict each other and the tradeoffs at risk. Understand the client’s priorities and adopt a bidding strategy with minimal contradictions.
  • Set bids that minimize CPA within the top 3 positions, but explain that profit can’t effectively be optimized simultaneously.
  • Set bids that simultaneously optimize profit, position, and CPA all to the perfect point.

The correct answer is:

  • Explain that all three objectives contradict each other and the tradeoffs at risk. Understand the client’s priorities and adopt a bidding strategy with minimal contradictions.

Explanation: In order to achieve your goals most effectively, it’s helpful to prioritize your business objectives. You can optimize your Google Ads campaigns to achieve many different goals, but tradeoffs are often necessary. Conversion rates don’t vary much with ad position, the following trends are important to remember:

  • Increasing bids generally results in more conversions at a higher average cost-per-acquisition (CPA).
  • Decreasing bids generally results in fewer conversions at a lower average CPA.
  • Increasing bids while limited by daily budget generally results in fewer conversions at a higher average CPA.

You can read more here: https://support.google.com/partners/answer/2799821?hl=en

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