Understand Bidding on the Google Display Network

One of the most important aspects to learn for being successful with AdWords is the art and science of bidding. There is a lot to know, and it gets a little complicated. This article is meant to explain the different bidding options available for display advertising (as opposed to search advertising). Display advertising on the Google Display Network allows you to place advertisements next to content around the web, and mobile apps, and even in gaming systems.

The basics of display network bidding

First of all, you can certainly use cost per click bidding with the display network, just as with the search network. For your different targeting methods, you can set the maximum cost per click that you are willing to pay.

Display network advertising offers another bidding option, though, called CPM bidding. CPM bidding is where you bid based impressions, and not clicks. When you make a CPM bid, you’re bidding for the amount you’re willing to pay per 1000 impressions, or appearances, of your ad. This type of bidding is most commonly used for branding campaigns, and not normally recommended for direct response marketing goals.

If you choose cost per click bidding, and you are tracking a continuous flow of conversions with conversion tracking, you can choose to enable Conversion Optimizer. Conversion Optimizer allows you to bid for the amount you’re willing to pay for a conversion. So, rather than make a cost per click bid, you are making what’s known as a CPA bid, or cost per acquisition bid.

Another option, as with the search network, is that you can apply a flexible bid strategy to either a campaign or an ad group targeting the display network.

Targeting structures that let you optimize your bidding

Display network advertising allows you to use several different targeting methods, either alone or in combination. For example, you can target topics, which tells AdWords to display your ads on webpages related to certain topics. You can target interests, which tells AdWords to display your ads to people showing particular interests. You can also target based on demographics and other methods.

When you’re using several targeting methods in a layered fashion, such as: people with a certain interest, who are of a certain gender and age bracket, AdWords will first check to see if you set a custom bid for a particular targeting method. You can specify a custom bid for only one targeting method in an ad group. For example, you might apply a custom bid for the gender, or age bracket, or targeted interest. All other targeting methods in the ad group will then inherit the ad group level default bid. If you choose not to set a custom bid, AdWords will simply use the ad group default bid. After doing that however it will then look for bid adjustments that could be applied for any targeting method.

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