Does Target CPA in Google Ads work and is it for you?

CPA in Google Ads

Automated bidding, such as target CPA, can be a contentious topic amongst Google Ads agencies. Some argue that it makes their lives much easier by automatically managing their bids and driving great results. Others argue that it can be equated to giving the sheep to the wolves and hoping for the best.

There are cases in which Target CPA is beneficial for a Google Ads agency, driving more value for your customers, and there are some cases where it just isn’t the right solution for you. Here we’ll look at the times that you can implement target CPA (and get good results) and times where manual bidding is the better option.

When Target CPA will work

Google often makes a couple of assumptions when they release a new feature on the Ads platform. One of these is that the website you’re marketing to is massive, and that your clients are spending a lot (R 80 000+) on Google Ads. With this in mind, they’ve set up their automated bid strategies with the following best practices in mind:

  • The campaign should have 30 conversions in a 30 day period,
  • The daily budget for the campaign should be your Target CPA x 10
  • You shouldn’t make changes of more than 10% on your target CPA bid within 14 day periods.

As you can see, having clear and valuable goals set up in your Google Ads account is non-negotiable in running Target CPA. Remember to exclude conversions you do not want the automated strategy to optimise for.

If you have a client that’s running on a higher budget, you should definitely consider switching to Target CPA as this can drastically improve your campaign results.  We’ve seen a mixed bag of results on campaigns with automated bidding, but in the cases where our clients match the criteria, we’ve seen a 50% improvement in the conversion rate and a 37% reduction in the cost per acquisition.

However, if your clients’ accounts don’t match the criteria, it’s better to try our other automated bidding strategies in an experiment to see if you can improve results.

Where to start

PPC Hero gives a complete breakdown on what they’ve seen works and what doesn’t in terms of their results. The consistent theme, and warning to all advertisers, is that your Target CPA bid shouldn’t be too low. This will harm your results and actually decrease your conversion rate and the number of conversions generated.

On Experiments

Cautious advertisers will argue that you should run an experiment on automated bidding before diving in. I used to be one of those, but thus far my experiment results always proved me right in terms of automated bidding. My suspicion is that this may be due to the fact that Google needs the conversion data on your campaign to make informed decisions on when to adjust your bid.

If you want to run an experiment before launching the bidding strategy, I would recommend that you set your main campaign’s bidding strategy to Target CPA, and keep the experiment campaign’s bidding strategy as is.

However, if you are a “shoot first and ask questions later” PPC Pro, apply Target CPA to your main campaign and compare its performance over a 30 – 60 day period (depending on click and conversion volumes) before deciding against Target CPA.

Not sure how to create experiments?

Here’s a quick ‘where to click’ video on how to set up experiments in the new Google Ads interface.