Did you notice the drop in Google’s stock recently? If you are like me and hold a few shares it was painful to watch. The pandemic has changed advertiser’s strategies with some dropping out and changing the Google Ads marketplace. Year over year revenue dropped for the first time in Google’s history and that supports this theory that many advertisers have shifted to defensive mode. Since Google Ads are market priced, a drop in competition creates a drop in cost per click. If you stand still at a time like this you are spending too much.
When you have the right conditions the Race to the Bottom strategy to get the most out of your budget is an excellent idea. But, you have to have the right conditions:
There are many tools you can use to reduce the bids but my favorite is time slicing. You should do this in cycles of about 3 days between adjustments. This is enough time for the change to be reflected in the daily numbers. Impression share posting is not done in real time and is commonly delayed, often by several days. Google’s documentation says it is posted several times a day but our experience is that it can commonly be 2-3 day time lag. In the immediate term, watch the raw impressions for each cycle and then confirm this over a longer period of time with the lost to budget percent.
Reduce the bid, wait three days, then check conditions again. The increment of the bid reduction is a judgement call but I normally start at 10% per cycle. When you hit the bottom then move the modifier up by 1% to do the fine tuning. Race to the bottom requires continued adjustments but it can produce some great results. Remember that impressions are not consistent from day to day or week to week. When you hit bottom on Monday it is likely that Tuesday may not. On a daily basis you do want some budget left over because there is no such thing as a perfect setting.
Once you have the bidding adjustments completed, then you need to apply this to the keywords to pick up other opportunities. If a 20% time adjustment gives you the number you want then look at the keyword performance and give the best performers more of the budget. This might mean a 10% cut for one class of words and 30% for others but this is the finer tuning.