What is the Enhanced CPC Bidding Strategy?
Enhanced CPC is an automated smart bidding strategy that optimizes on conversions at a given budget. It is often paired up with the manual CPC bidding and offers more control on automation. This bidding can be used for both search and display campaigns. It can be used as a standard strategy for a single campaign or as a portfolio strategy across multiple campaigns.
ECPC tries to maintain the average CPC below the maximum set cost per click. Unlike other smart bidding strategies, you could still use ECPC for display campaigns without setting up conversion tracking. In any case, it is recommended to do so as Google will have more data to optimize on the bids.
How does Enhanced CPC Work?
Harnessing the power of machine learning, Google uses multiple signals like user browser, location, day parts, etc to determine optimal bid for that auction. Based on these contextual signals, the algorithm will raise the bid for the auctions that are likely to lead to a conversion. Similarly, it would lower the bids in the auctions that may not lead to a conversion. Prior to 2017, Google would only raise the bid up to 30% higher than the set max CPC. However, the cap on the bids was removed to optimize the conversions but will maintain the average CPC below the max CPC. If you would like to have greater control, you could also set max and min bid limits which will be illustrated at the below section of this post.
In order to understand this better, let us consider Sam’s watches campaign. Sam has set a maximum CPC as $3 for his campaign and has used manual bidding with Enhanced CPC as his bidding strategy. So when Google identifies an auction that is likely to convert, the bid would be $4 and for the low-quality auction that would not convert, it would bid $1 while maintaining the average $2.5 which is less than $3.
When to Use ECPC?
As mentioned above, if you would like to have greater control over your bids while getting more conversions then use Enhanced CPC. It helps you get the best of both worlds>> Manual + Automation. It is recommended to have more than 15 conversions over the last 30 day period to use this bidding efficiently. In case you are moving from manual to automated, be patient and give sufficient time for Google to collect data to make better decisions. Once you have data over 30 day period, you could easily compare it with the previous month to see if ECPC worked well for your campaigns. Test, learn, Optimize, Repeat! This motto always helps in this online marketing world 😇