The Definitive Guide to Google Ads Bidding Strategies (2024 Edition)
Bidding is the single most critical lever in your Google Ads account.
You can have the best ad copy in the world. You can have the most persuasive landing page ever designed. But if you bid too low, you are invisible. If you bid too high, you bleed profit.
For the first 15 years of Google Ads (formerly AdWords), bidding was simple: You paid for a click. It was a direct auction. You bid $2.00, your competitor bid $1.90. You won.
In 2024, that era is over.
We are now in the age of Smart Bidding. You are no longer bidding on "keywords"; you are bidding on "users". You are not paying for a click; you are paying for a probability of conversion.
This guide is the result of managing over $50,000,000 in ad spend. It is not a list of definitions. It is a technical deep-dive into how the algorithms actually work, how to manipulate them, and how to maximize your ROAS vs ROI.
Part 1: How The "Black Box" Actually Works
Before you choose a strategy, you must understand the engine.
The Shift from "Query-Time" to "Auction-Time"
In the old days (Manual CPC), you set a bid at the keyword level.
- Keyword:
+buy +running +shoes - Bid: $1.50
Every time someone searched that query—whether it was a teenager with no money or a CEO ready to buy—your bid was $1.50.
Smart Bidding introduces "Auction-Time Bidding". Google evaluates every single search query in real-time, milliseconds before the auction results are displayed. It adjusts your bid for that specific impression based on the likelihood of a conversion.
The 70 Million Signals
Google's AI (Machine Learning) uses contextual signals that you, as a human, cannot see. Accessing Google's Official documentation on Smart Bidding, we know they factor in:
- Device & OS: Not just "Mobile", but "iPhone 15 Pro Max on WiFi" vs "Android 9 on 4G". (High-end device = higher income correlation).
- Time & Location: "Tuesday at 2 PM in the Financial District" vs "Sunday at 11 PM in a residential suburb".
- Browser History: Has this user visited your competitors sites recently? Have they been researching this topic for 3 weeks?
- Demographics: Age, Gender, Parental Status, Household Income (Top 10%).
- Remarketing Lists: Have they visited your site before? When? Did they abandon a cart?
- Ad Characteristics: Which headline is likely to perform best for this user?
- Seasonality: Is conversion rate historically higher on this day of the year?
The algorithm calculates a p(Conv) (Probability of Conversion).
- If
p(Conv)is 2% (Low), and your Target CPA is $50, it bids $1.00. - If
p(Conv)is 20% (High), and your Target CPA is $50, it bids $10.00.
It does this calculation millions of times per day. You cannot beat this manually.
Part 2: The Bidding Strategy Hierarchy
Not all strategies are created equal. We categorize them into three tiers based on maturity and control.
Tier 1: The "Control" Strategies (Manual)
- Manual CPC: You set the max bid. No algo interference.
- Enhanced CPC (eCPC): You set the bid, Google adjusts it +/- slightly. (See Google's deprecated status on eCPC).
Tier 2: The "Volume" Strategies (Semi-Auto)
- Maximize Clicks: Get as much traffic as possible.
- Target Impression Share: Dominate the top of the page.
Tier 3: The "Value" Strategies (Fully Auto)
- Maximize Conversions (tCPA): Get leads at a specific cost.
- Maximize Conversion Value (tROAS): Get revenue at a specific return.
Let's break down each one.
Deep Dive: Manual CPC (The Control Freak)
Status: Legacy / Niche Use Only
Manual CPC is the only strategy where your bid is your bid. If you set $5.00, you will never pay more than $5.01 (due to ad rank mechanics).
When to Use It
- Brand Protection: When bidding on your own brand name. You want to pay pennies (e.g., $0.10) just to ensure you show up. You don't need an algorithm to find "high intent" users for your own brand; everyone searching your name has high intent.
- New Accounts (Data Starvation): If a campaign has 0 conversions, Smart Bidding has 0 data to train on. It will flail wildly. Starting with Manual CPC for week 1-2 allows you to "buy data" and establish a baseline CTR and CVR.
- Low Volume / B2B: If you get 5 conversions a month, the algorithm will never learn. You are better off manually curating high-intent keywords.
The eCPC Trap
Enhanced CPC (eCPC) used to be the bridge between Manual and Smart. Do not use it in 2024. It is the "worst of both worlds". It doesn't have the full power of Smart Bidding signals, but it ignores your manual caps enough to mess up your data.
Deep Dive: Target CPA (tCPA) (The Sniper)
Status: The Gold Standard for Lead Gen
Target Cost Per Action (tCPA) is the primary strategy for SaaS, Service Businesses, and Lead Generation. You tell Google: "I want to pay $50 for a Lead." Google does whatever it takes to get leads at an average of $50.
How It Works
- Some leads might cost $10 (easy wins).
- Some leads might cost $90 (expensive auction).
- Google balances the portfolio to hit the $50 average at the end of the month.
The "Truthful Bidding" Concept
If your break-even CPA is $100, do not set your tCPA to $20. If you starve the algorithm with an unrealistic target, Google will simply stop entering auctions. It calculates that it cannot win a conversion for $20, so it bids $0. Your traffic drops to zero.
Best Practice: Start with a tCPA higher than your historical average (e.g., Average CPA is $50, set tCPA to $60). This encourages the algorithm to explore. Once you have steady volume, slowly walk the target down 10% every 2 weeks.
Deep Dive: Target ROAS (tROAS) (The Capitalist)
Status: The Gold Standard for Ecommerce
Target Return On Ad Spend (tROAS) is for businesses that pass dynamic revenue values (Ecommerce URLs with prices). You tell Google: "For every $1 I spend, I want $4 back (400% ROAS)."
The "High Margin" Strategy
Smart advertisers segment their campaigns by product margin.
- Campaign A (High Margin Products): Set tROAS to 250%. (You can afford to bid more aggressively).
- Campaign B (Low Margin Products): Set tROAS to 600%. (You need high efficiency to make profit).
The Minimum Data Requirement
Google officially says you need 15 conversions in 30 days. Reality Check: You need 50+ conversions in 30 days for tROAS to work reliably. If you have fewer, use tCPA or Maximize Conversions first to build volume.
Deep Dive: Maximize Conversions (The Aggressor)
Status: Use with Caution
"Maximize Conversions" (without a target CPA set) tells Google: "Spend my entire daily budget every single day, and get as many conversions as possible."
The Danger
If you set a Daily Budget of $200, Google WILL spend $200. Even if the conversions are terrible quality. Even if the CPA is $150. It prioritizes spend first, conversion volume second, and efficiency last.
When to Use It
- Aggressive Scale: You have a launch or a limited-time offer. You don't care about CPA; you just want volume.
- Feeding the Pixel: In the early days of an account, you might sacrifice efficiency to get 30-50 conversions on the board quickly, just to train the account.
Pro Tip: Always add a "Target CPA" cap to Maximize Conversions strategy as soon as you have data. This effectively turns it into tCPA strategy.
Deep Dive: Target Impression Share (The Ego Strategy)
Status: Niche / Branding Only
This strategy ignores conversions entirely. Its only goal is: Be at the top. Settings: "Target Absolute Top of Page" (Position 1) or "Top of Page" (Positions 1-4).
The "Competitor Conquesting" Play
This is lethal for bidding on competitor keywords.
- Keyword:
[competitor name] - Strategy: Target Impression Share (Absolute Top) = 100%.
- Outcome: Every time someone searches your competitor, YOU show up first.
Warning: This is expensive. Your CPCs will be 3-4x higher than normal. Only do this if you have a high LTV (Lifetime Value) and can afford to pay a premium to steal market share.
Part 3: Portfolio Bid Strategies
Most advertisers set bidding at the Campaign Level. Advanced advertisers use Portfolio Bid Strategies (Shared Library).
This allows you to group 5 different campaigns (e.g., "SaaS - USA", "SaaS - UK", "SaaS - Canada") under one single brain.
Why Portfolio Bidding Wins
- Data Aggregation: The algorithm learns faster because it sees data from 5 campaigns instead of just 1.
- Max Bid Caps: In tCPA strategies, you can't set a "Max CPC" limit at the campaign level. But you CAN set it in a Portfolio Strategy.
- Scenario: You want tCPA $50, but you never want to pay more than $20 for a single click.
- Solution: Create Portfolio Strategy → tCPA $50 → Advanced Options → Max Bid Limit $20.
Part 4: The "Learning Phase" Myth
You will often see the status "Learning" or "Learning Limited".
What is the Learning Phase?
Whenever you make a major change (Budget >20%, Bid Strategy change, new conversion action), Google resets the algorithm reliability. It enters a 7-day calibration period.
How to Escape "Learning Limited"
"Learning Limited" means your ad set is not generating enough data (usually <30 conversions/month) for the AI to optimize. Fixes:
- Consolidate: Combine 3 small campaigns into 1 big one. (See Account Structure Guide).
- Broaden Match Types: Switch from Exact to Broad Match (with smart bidding) to capture more volume.
- Move Up Funnel: Instead of optimizing for "Purchase" (hard), optimize for "Add to Cart" (easy). This gives the algo more signals.
Part 5: Seasonality Adjustments
Black Friday. Cyber Monday. Christmas. During these times, conversion rates skyrocket. If you leave your tCPA at $50, Google might view the high-cost clicks (due to competition) as "too expensive" and bid down. This is the opposite of what you want.
The Tool: Tools & Settings > Bid Strategies > Advanced Controls > Seasonality Adjustments.
You tell Google: "From Nov 24 to Nov 27, expect conversion rate to increase by 50%."
Google will temporarily loosen the bid caps and bid aggressively during that window, then return to normal instantly after.
Conclusion: The 2024 Bidding Framework
If you remember nothing else, follow this logical progression:
- Brand Keywords: Manual CPC. (Don't overpay).
- Competitor Keywords: Target Impression Share. (Be invisible or dominate).
- New Generic Campaigns: Maximize Clicks (with bid cap) -> Wait for 30 conversions.
- Established Generic Campaigns: Target CPA (Lead Gen) or Target ROAS (Ecom).
- Scaling: Use Portfolio Strategies to pool data.
Bidding is not "Set and Forget". It is "Set, Monitor, and Adjust".
If your campaigns are stuck or you suspect you are overpaying for clicks, you need a forensic audit of your bid strategy.
About the Author
Performance marketing specialist with 6 years of experience in Google Ads, Meta Ads, and paid media strategy. Helps B2B and Ecommerce brands scale profitably through data-driven advertising.
Need this implemented for you?
Read the guide, or let our specialist team handle it while you focus on the big picture.
Get Your Free Audit