Let’s talk about one of the highest-leverage decisions you can make in Google Ads:
Your bid strategy.
Nail your bidding approach, and you’re in for a steady stream of conversions and ROI. Get it wrong? You’re just throwing money away.
Here’s how to craft the perfect bid strategy for your ecommerce store and maximise your returns without unnecessary complexity.
Why Your Google Ads Bid Strategy Matters
Your bid strategy isn’t just a detail — it’s the foundation of your campaign. It determines how much you pay, how often your ads appear, and ultimately, your revenue and profit.
Think of targeting and bid strategy as the twin pillars of a successful Google Ads campaign. Everything else — ad copy, visuals, even keywords — comes second.
Common Mistakes to Avoid
Here’s what NOT to do when setting up your bid strategy:
Focusing Too Much on CPC (Cost-Per-Click): CPC is almost irrelevant for ecommerce. Instead, prioritise revenue-based metrics like ROAS (Return on Ad Spend) and overall profit.
Setting Unrealistic Goals: If your ROAS goal is set too high, the system will struggle to spend your budget effectively. Too low, and it will overspend wastefully. The key is finding a balanced target.
Understanding Conversion-Based Bidding
For ecommerce, conversion-based bidding is the way to go. Google Ads offers two primary options:
Maximise Conversions: Optimises for the number of sales, treating all sales as equal.
Maximise Conversion Value: Prioritises the value of each sale, giving preference to higher-value transactions.
Which Should You Choose?
Most ecommerce advertisers will benefit from Maximise Conversion Value. It ensures your budget is spent on customers who bring in more revenue. The exception? If all your products are priced the same, Maximise Conversions might work just as well.
Starting with Performance Max
For ecommerce beginners, Performance Max campaigns are a fantastic starting point. They simplify the process, showing your ads across Google’s entire network while automating key decisions.
How to Set Up a Performance Max Campaign with Conversion Value Bidding:
Create a New Campaign: Choose “Sales” as your goal.
Select PMax: This will give your products maximum exposure.
Set Bidding Strategy to Conversion Value: This focuses on revenue.
Budget Wisely: Allocate a daily budget you’re comfortable losing for up to two months, as campaigns often need time to become profitable.
Adding Target ROAS or Target CPA for Better Results
Once your PMax campaign has some data (e.g., after 50+ conversions or 4 weeks), consider adding a Target ROAS or Target CPA:
Target ROAS: Ideal for maximising profitability. If you aim for a 300% ROAS, set your target at 300%.
Target CPA: Useful if you know the maximum cost you can afford per sale.
Pro Tips for Setting Targets:
Wait before implementing a target — let Google gather data first.
Use actual campaign performance to set realistic goals.
Ongoing Monitoring & Adjustments
Daily Checks:
Ensure spend hasn’t spiked or plummeted drastically (e.g., by 3x or more than 85%).
Verify conversion tracking is working.
Monitor Search Lost IS (Budget) — this should be zero if your ROAS is profitable.
Weekly Checks:
Review spend, ROAS, revenue, and gross profit.
Use custom columns in Google Ads to track gross profit after ad spend:
Revenue x Gross Profit % - Ad Spend
Monthly Adjustments:
Lower your ROAS target or increase your CPA target to boost sales volume.
Raise your ROAS target or lower your CPA target to improve profit margins.
Don’t fix what isn’t broken — if the campaign is working well, leave it alone.
Advanced Strategy: New Customer Acquisition
If acquiring new customers is a priority, consider using Google’s New Customer Acquisition setting in PMax campaigns.
Duplicate your existing campaign.
Enable New Customer Acquisition in the duplicated campaign.
Adjust your ROAS target lower to reflect the higher lifetime value (LTV) of new customers.
Final Thoughts
A solid bid strategy can transform your Google Ads campaigns from money pits into profit machines. Use these strategies to maximise your revenue, minimise waste, and scale your ecommerce business effectively.