About Search Ads 360 Target ROAS bidding

How it works

The automated bidding system predicts conversions and associated values using your reported conversion values, which you report through conversion tracking. Then, the bidding system will set maximum cost-per-click (max. CPC) bids to maximize your conversion value, while trying to achieve an average ROAS equal to your target across all campaigns using this strategy.

To achieve this, Search Ads 360's Target ROAS strategy:

• Leverages advanced Google AI: Employs sophisticated machine learning algorithms to analyze vast amounts of data and predict conversion value.
• Integrates with publisher auction-time bidding: While the engines use auction signals to set real-time bids, Search Ads 360 portfolio bidding technology finds opportunities that maximize performance across campaigns.
• Optimizes across platforms: The system aims for holistic optimization across your specified portfolio.

The system optimizes across different segments to maximize your overall revenue while maintaining your portfolio ROAS target. This means some campaigns may return a higher ROAS and some may return a lower ROAS. The bidding system will try to keep your conversion value per cost equal to the target ROAS you set.

• Search Ads 360 makes changes to ROI targets for campaigns using auction-time bidding.
• For intraday campaigns, the system makes changes to max CPC bids for keywords and product groups, and bid modifiers for audience/device/location.

The bidding system will recommend a target ROAS value after you’ve set up a new bid strategy in the “Bidding and planning” section of the UI and chosen which campaigns to apply it to. This recommendation is calculated based on your actual ROAS over the last few weeks. The bidding system will exclude performance from the last few days to account for conversions that may take more than a day to complete following an ad click. You can choose whether to use this recommended target ROAS value or to set your own.

Supported campaigns

Auction-time bidding

Search Ads 360's bidding system integrates with publisher bid strategies through auction-time bidding (ATB) to further enhance performance. Auction-time bidding means that bids are optimized at the exact moment an auction takes place, using real-time signals to set the most appropriate bid for each individual impression.

When a Search Ads 360 bid strategy uses auction-time bidding, it works in conjunction with the publisher's own automated bidding capabilities to optimize bids. Search Ads 360 provides the target ROAS goal, and the publisher's system uses its real-time auction data to achieve that goal.

Bids are always optimized using auction-time bidding for Google Ads and Microsoft Advertising Performance Max campaigns.

For other campaign types, such as Search and Shopping, you can choose to enable auction-time bidding for either Microsoft Advertising or Google Ads campaigns within your Search Ads 360 bid strategy.

Advanced controls with Multiple Target ROAS

For advertisers with more complex goals, Target ROAS bid strategies can be combined into Multiple Target ROAS strategies. This allows you to set different ROAS targets for specific segments within your portfolios. You can do this for different product categories, customer segments, or geographic regions, providing greater control over your optimization goals.

Bid adjustments and Target ROAS

Bid adjustments allow you to show your ads more or less frequently based on where, when, and how people search. As Target ROAS helps optimize your bids based on real-time data, your existing bid adjustments aren't used. There is one exception: you can still set mobile bid adjustments of -100%. Take note that you don’t need to remove bid adjustments, but they won’t be used.

If you utilize intraday bidding, Search Ads 360 actively manages these signals. The system automatically optimizes device, audience, and location bid adjustments across supported engine types. However, if you explicitly set a bid adjustment, that manual setting will be used for your intraday campaigns.

Data requirements

For any Search Ads 360 bid strategy, more data generally allows the bidding system to perform better. Bid strategies with low conversion volume may experience more volatility or take longer to learn and optimize effectively.

For auction-time bidding (ATB) strategies

There are no strict minimum data requirements for auction-time bidding strategies, as they leverage real-time signals from the publisher. However, we recommend having 4+ weeks of conversion value history before launching.

For intraday bidding strategies

We recommend having at least 20 conversions per week for optimal performance and stability of intraday bid strategies.

Settings

Review the settings listed below to learn how each affects your Search Ads 360 campaigns.

Target ROAS

Your target ROAS is the average conversion value (for example, revenue) you'd like to get for each dollar you spend on ads. Keep in mind that the target ROAS you set may influence the conversion volume you get. For example, setting a target that's too high may limit the amount of traffic your ads may get.

Here are a few tips to help you set a target ROAS that’s right for you:

• Try setting a target ROAS based on the historical conversion value per cost data for the campaigns you'd like to apply this strategy to. This will help you maximize your conversion value, while reaching the same return on ad spend your campaigns have been getting.
• To find your historical conversion value per cost data, you'll need to select Modify columns from the “Columns” drop-down and add the Conv. value/cost column from the list of "Conversions" columns. Then, multiply your conversion value per cost metric by 100 to get your target ROAS percent.

Bid limits

Google doesn’t recommend setting bid limits for target ROAS because it can restrict the bidding system from using Google’s AI to optimize your bid. It can also prevent the bidding system from adjusting your bids to the amount that best meets your target ROAS. If you do set bid limits, they’ll be used in Search and Shopping Network auctions only.

• Maximum bid limit (ATB and intraday): The highest CPC bid you want the bidding system to set for any keywords using target ROAS.
  • For Intraday campaigns, the maximum bid limit is the highest max CPC SA360 will set at keyword level. Your final bid may be higher than this based on factors such as bid adjustments.
• Minimum bid limit (ATB and intraday): The minimum max. CPC bid you want the bidding system to set for any keywords, ad groups, or campaigns using target ROAS.
  • For Intraday campaigns, the minimum bid limit is the lowest max CPC SA360 will set at keyword level. Your final bid may be lower than this based on factors such as bid adjustments.

Average target ROAS

Your average target ROAS is the cost-weighted average ROAS that your bid strategy optimized for. It averages the changes you’ve made to your target ROAS for any given time period. For this reason, your average target ROAS may be different from the target ROAS that you set.

This metric lets you measure the ROAS that your bid strategy targeted for specific time periods. By changing the date range, you can discover what your strategy actually optimized for over that period. Keep in mind, you won’t have an average target ROAS for time periods without traffic.

You can find this metric in your bid strategy report beside your “Conv. value/cost” column, which represents the actual ROAS that this strategy was able to achieve. You can also find this metric in the campaigns table by selecting “Avg. Target ROAS” from the “Performance” category when adding a new column, or by adding it to the performance chart.

Google Ads Smart Bidding Exploration

Google Ads Smart Bidding Exploration is an opt-in feature that uses Google’s AI to bid on potentially high-performing search queries across Google search campaigns. The algorithm captures new searches and secures additional conversions from the traffic you’re already eligible for. As a result, your impressions, clicks, and conversions will be driven by more unique search term categories.

Smart Bidding Exploration lowers your effective target ROAS. For example, if your target ROAS is 200% and you choose a 10% ROAS tolerance, the effective average target ROAS will be 180%.

Ad group targets

You can apply ad group targets for portfolio bidding strategies.

Keep in mind, if you don’t need to set targets for individual ad groups, a portfolio strategy may be able to offer better performance.

Troubleshooting

Adjusting bids and budgets is the best way to control performance.

When using value-based bidding with a target ROAS, if you want to increase conversion volume, consider gradually reducing the target ROAS. This allows the bid strategy to enter more auctions and generate more volume.

Alternatively, if you want to increase conversion value, you may raise the target ROAS. When you change targets, the bidder will react immediately but will need some time to hit the new target (give it 1-2 conversion cycles).

Follow these troubleshooting tips to set a target ROAS that’s right for you:

• Before transitioning to value-based bidding, ideally you will already be bidding to the desired conversion goal using a tCPA bid strategy. Be sure to report values across all relevant campaigns for 4 weeks or 3 conversion cycles (whichever is longer) before determining your ROAS target and activating value-based bidding.
• Your ROAS target should be at or below the ROAS compared to your historical performance.
• To find this, select Modify columns from the “Columns” drop-down and add the Conv. value/cost column from the list of "Conversions" columns. Then, multiply your conversion value per cost metric by 100 to get your target ROAS percent.
• Ensure the time frame of your ROAS evaluation excludes the most recent conversion delay period to get an accurate view of campaign performance.
• Target recommendations can also be found in the “Recommendations” tab, during campaign construction, or while creating a strategy at the campaign or portfolio levels.

If you need more information about platform related bid strategies, learn more about Google Ads Target ROAS bidding and about Microsoft Advertising bid strategies.

Related links

• About automated bidding