Why Use Target CPA Bidding In Adwords?

CPC and CPM bidding are the go-to for most advertisers when it comes to setting up a new AdWords campaign, but did you know there are a lot more options?

One of the more important, smarter options is Target CPA Bidding. CPA means Cost-Per-Acquisition, Cost-Per-Lead or Cost-Per-Order – however you want to look at it, it’s the cost of driving an action on your website. This PPC bidding strategy means you’ll be bidding on Conversions rather than clicks.

Smart Bidding

Target CPA bidding is one of Google AdWords ‘Smart Bidding’ strategies, using complicated algorithms and machine learning to determine where you can make headway with your ads. Rather than bidding on a keyword to get a click, Adwords will bid higher on Keywords that are more likely to drive a conversion once the user lands on your website, whilst trying to maintain a CPA target that you have set for the campaign.

Target CPA can be a little scary if you don’t know which metrics to look at. I have seen across various accounts that once you are bidding for Leads rather than Clicks, your CPCs (Cost-per-click) can rise exponentially. This is because you generally pay more to get the higher quality clicks – therefore you’ll probably notice a drop in your traffic, but this isn’t always a bad thing.

On the other side of this, you’ll notice that Pages per session, Avg. session duration and Bounce rate will all improve over time. Users will start finding more value in your website as they are being driven to your landing page by much better, higher intent search terms.

Using CPA Bidding

I recommend testing CPA bidding on one or two campaigns over a few weeks to start with to make sure that it works for you. Bidding strategies can, on occasion, have an adverse effect on your campaigns but this should not stop you continually testing to maximise your return.

Don’t forget, you can only use CPA bidding if you have conversion tracking set up on your website.

The more you test, the better data you get, allowing you to see value new opportunities.

You should also read our post on CPC versus CPM bidding before making a decision on which bidding strategy is right for you.