Google Ads Bidding for Hotel Marketing
In the realm of hotel marketing, Google Ads has become an indispensable tool for driving bookings and enhancing digital marketing for hotels. The platform boasts an array of bidding strategies tailored to meet various campaign objectives, be it amplifying click-through rates, boosting reservations, or optimizing return on ad spend (ROAS). However, the key to unlocking its potential lies in choosing the appropriate bidding strategy, which can significantly shape your campaign’s success and budgeting.
Google presents a full range of bidding options, from the classic manual bidding to the more recent automated strategies powered by machine learning. The tech giant’s push towards automation is evident with the introduction of tools like Performance Max. The best bidding strategy for your campaign is contingent on your specific campaign goals, media budget, and key performance indicators (KPIs) that matter to you.
In this comprehensive guide, we’ll explore the pros, cons, and best use cases of the most common Google Ads bidding strategy options available today. You’ll understand how each works and be equipped to select the approach that best matches your hotel’s needs.
Manual Bidding Strategies
With manual CPC bidding, you set the maximum cost-per-click (CPC) bid for each keyword or ad group. This bid acts as the maximum you’re willing to pay for a single click from Google Ads. Manual CPC is the most basic and straightforward bidding strategy. You manually enter the max CPC bid into the bid field for every keyword based on your targets and what you determine to be a profitable CPC.
✅ Complete transparency and control over setting your bids
✅ Ability to precisely tune bids based on profitability and targets
✅ Easy to understand and implement
❌ It is extremely time-consuming to manage bids, especially at scale
❌ Difficult to make quick bid changes in response to performance
❌ You won’t benefit from Google’s optimization capabilities
Manual CPC is best suited for:
- Niche or low-volume keywords
- Advertisers who require complete control over bids
Enhanced CPC allows Google Ads to automatically raise or lower your manual CPC bids in real-time in an effort to increase conversions. With enhanced CPC enabled, Google can adjust bids up by as much as 30% higher or down to 90% lower than your set manual bid based on the likelihood of a conversion.
✅ Gets a “boost” from Google’s optimization while maintaining some control
✅ Can help improve conversion rates while staying near your target CPC
✅ Requires less hands-on management vs. manual CPC
❌ Still time intensive compared to automated bidding strategies
❌ Google can override your manual bids
Enhanced CPC is ideal for:
- Advertisers who want to test adding Google’s optimization
- As a transitional step from manual CPC to automated bidding
Manual bidding provides the most control but requires extensive management. Enhanced CPC strikes a balance by adding some of Google’s capabilities while maintaining overall bid control.
What is Smart Bidding and how does it work?
Smart Bidding leverages Google’s most advanced automated bidding strategies powered by machine learning and auction-time bidding to optimize your account. For each and every auction your ads are eligible for, Google evaluates historical data, conversion predictions, and real-time context to determine the optimal bid. The goal is to show your ads only when Google’s algorithms believe it will contribute to your optimization target, whether that’s lowering CPA, hitting a ROAS, or maximizing conversion value.
The main Smart Bidding options available in Google Ads are:
🖱️ Maximize Clicks
🎯 Target CPA
🎯 Target ROAS
💲 Maximize Conversion Value
📈 Target Impression Share
The Maximize Clicks automated bidding strategy is designed to get the maximum number of clicks possible within your specified budget. It can be useful for driving traffic and brand awareness, but comes with some cautions.
How Maximize Clicks Works:
When you enable Maximize Clicks bidding, Google Ads takes over your bids with the sole focus of generating as many clicks as it can for your daily budget. It disregards any typical CPC targets you may have set and will instead set bids high enough to beat out competitors for top ad position and drive maximum click volume.
A few details about Maximize Clicks:
- Bids aggressively to beat out competitors for ad position
- Ignores your historic CPCs and typical ROI targets
- Will spend your full daily budget to maximize clicks
- Uses your budget as the limit for what it will bid
- Provides no control over manual CPC bidding
✅ Great for hotels looking to drive large volumes of traffic to your site
✅ Helpful for increasing brand awareness campaigns
✅ Good for initial research periods to gather data
❌ Clicks do not directly equal high-quality conversions/bookings
❌ Sometimes leads to a significantly higher average CPC
❌ Far less optimization for conversion performance
Ideal Use Cases for Maximize Clicks:
- Brand new campaigns in the research phase
- Very top-of-funnel goals like awareness
- Large budgets more focused on traffic vs. bookings/revenue
Tips for Success with Maximize Clicks:
- Use a dedicated budget separate from conversion efforts
- Run short flights to gather data then optimize.
- Closely monitor click quality and prevent overspend
- Have a plan to capture and convert any new traffic
- Switch to a conversion-focused bid strategy once the research is done i.e Target CPA
Maximize Clicks can help quickly scale traffic volume through aggressive bidding. But take caution – monitor performance closely and ensure you have follow-up conversion plans in place.
Target CPA (cost-per-acquisition) is one of the most popular automated bidding strategies on Google Ads. With Target CPA, you set your desired target cost-per-conversion and Google’s algorithms will automatically adjust bids in an effort to get as many conversions as possible at that target CPA.
How Target CPA Works:
When you implement Target CPA, you first set your target cost-per-conversion goal. This is the desired average amount you want to pay for a conversion action. Google Ads will then leverage your historical conversion data, machine learning, and real-time context to predict the likelihood of getting a conversion in each auction. It will automatically adjust your bids up and down accordingly to try and maintain your target CPA on average.
Some conversions may end up costing more than your CPA target, and some less. But overall, Google aims to have your actual average CPA match as closely as possible to your set target over time.
✅ Achieve more conversions at your ideal cost-per-acquisition
✅ Requires very little management once implemented
✅ Google can adjust bids quickly based on real-time data signals
❌ You lose control over setting individual keyword/ad group bids
❌ Your target CPA must be set intelligently based on data
❌ Bids may be set too high initially during the learning period
Target CPA bidding works best for:
- Lead generation and direct response campaigns
- Accounts with healthy conversion volume and history
- Advertisers focused on lowering CPAs
How to use Target CPA right:
- Set realistic CPA targets based on historical performance data
- Take care of conversion tracking and optimization first. This is a must.
- Leverage observation period and bid adjustments
- Closely monitor performance and make changes
Target CPA can be a very effective hands-off bidding strategy for driving conversions at your ideal cost. Implemented correctly, it allows Google Ads to optimize your account better than you ever could manually.
The Maximize Conversions automated bidding strategy does exactly what its name implies—it sets bids with the goal of maximizing the number of conversions within your daily budget.
How Maximize Conversions Works:
When you have Maximize Conversions enabled, Google Ads will leverage your conversion data, machine learning models, and real-time context to determine the optimal bid needed to get the most conversions possible for your daily budget. Unlike manual bidding, you give up control of individual keyword or ad group bids. Google has full discretion to set bids as aggressively as needed to maximize conversions based on their algorithms.
✅ Helps drive more conversions from your existing budget
✅ Very easy to set up and implement
✅ Google optimizes bids toward maximum conversions
❌ You lose control over individual bids
❌ Can put heavy pressure on budgets
❌ Watch out for low-value or irrelevant conversions
Maximize Conversion bidding works best for:
- Hotels who want to squeeze more conversions from a limited daily budget
- Have well-defined conversion events to optimize for i.e. purchases or booking entrances
- Hotels that are singularly focused on increasing booking/revenue volume
How to make the most out of Maximize Conversions:
- Make sure you have proper conversion tracking setup
- Set an appropriate daily budget for your account size
- Closely monitor conversion quality and prevent budget strain
- Use observation period and bid adjustments to maintain control
Target ROAS (return on ad spend) is a Smart Bidding strategy focused on hitting a target return from your advertising spend.
How Target ROAS Works:
With Target ROAS, you set a target return on ad spend percentage based on your profit margins and goals. For example, you may set a Target ROAS of 3.0x to aim for $3 in revenue for every $1 you spend. Google’s algorithm uses your historic conversion data to predict future performance. It sets bids in each auction to try and get conversions that will help you achieve your target ROAS.
✅ Optimizes for profitability through your target ROAS
✅ Requires minimal management once implemented
✅ Leverages Google’s predictive algorithms
❌ You lose control over individual bids
❌ ROAS target must be set intelligently
❌ Significant conversion data required
Target ROAS bidding works best for:
- E-commerce advertisers with healthy order volumes
- Advanced accounts with an extensive conversion history
- Focus on profitability and return on spend
How to make Target ROAS work for your hotel:
- Set a realistic initial ROAS target based on historic performance
- Make sure you have accurate conversion tracking
- Use observation period and bid adjustments to maintain control
- Review target over time and adjust as needed
Target ROAS is one of the best strategies for hands-off optimization if you have the requisite conversion data. It can help maximize ad profitability but does require close performance monitoring.
Maximize Conversion Value
Maximize Conversion Value is a Smart Bidding strategy focused on getting conversions with the highest total value for your budget.
How does Maximize Conversion Value work?:
When you enable Maximize Conversion Value, Google Ads will automatically bid with the goal of maximizing the total value from conversions. It looks at the value assigned to each of your conversion actions and optimizes bids to get more of your high-value conversions. The overall conversion volume may be lower, but the total conversion value will be higher.
Please note that this bidding strategy may not be the best for hotels due to the length of stay and average daily rates (ADR) being fluid.
✅ Focuses bids on your most valuable conversions
✅ Can improve return on ad spend (ROAS)
✅ Requires very little ongoing management
❌ May reduce overall conversion volume
❌ Need significant historical conversion data
❌ Conversion values must be set accurately
Maximize Conversion Value bidding works best for:
- E-commerce advertisers focused on sales and revenue.
- Advanced accounts with extensive conversion data
- Businesses with clearly defined conversion values.
- May not be the best for hotels with random lengths of stay per booking
How to make the most out of Maximize Conversion Value:
- Make sure you have accurate conversion tracking set up
- Set data-driven values for each conversion action
- Use observation and bid adjustments to maintain control
- Monitor conversion volume and implement caps as needed
Maximize Conversion Value can optimize for profitability through value-based automated bidding. But keep a close eye on volume and make sure your conversion values are set appropriately.
Target Impression Share
Target Impression Share is an automated bidding strategy focused on hitting specific impression share and ad positioning goals.
How does Target Impression Share work?
With Target Impression Share, you set a target percentage for how often you want your ads to be shown. You can also choose where you want your ads to appear – anywhere on the page, top of page, or absolute top of page. Google will then automatically set bids with the goal of meeting your target impression share at your desired ad position.
✅ Optimizes for awareness and impression volume
✅ Can help you appear at the top of the page
✅ Lets you choose exact positioning goals
❌ More expensive to hit high impression share
❌ Optimizes for impressions, not conversions
❌ Still requires close monitoring of spend
Target Impression Share bidding works best for:
- Brand awareness and impression goals
- Businesses willing to pay a premium for visibility
- Top-of-funnel and impression-focused campaigns
How to make the most out of Target Impression Share:
- Start with a reasonable impression share target i.e. 90% is recommended for brand keyword traffic for hotels.
- Use a dedicated budget for impression campaigns
- Implement appropriate bid limits for your goals
- Track clicks and conversions as secondary metrics
Target Impression Share allows granular control over impression goals. Just be wary of high costs and keep a close eye on overall performance.
Let’s talk about Performance Max, Google’s new automated campaign type that uses machine learning to optimize campaigns across Search, Display, YouTube and more to drive conversions.
Performance Max campaigns can be a great option for advertisers who want a simplified way to access Google’s inventory and leverage automation and machine learning to optimize campaigns. The key is setting up the campaign properly with clear conversion goals, high-quality ad creatives, and robust audience targeting. Pmax gives the algorithm inputs like your goals, creatives and audiences and then uses machine learning to determine the optimal placements, bids, attribution models, etc. to get conversions. It can unlock new customer segments and simplify cross-channel optimization.
However, the tradeoff is less visibility and control. You’re putting more trust in Google’s “black box” optimization. Results can be strong if you set up the building blocks well. But it’s not a silver bullet or replacement for an optimized campaign strategy. Our recommendation is to use Performance Max as a supplement to search campaigns, not a wholesale replacement.
Selecting the right Google Ads bidding strategy is crucial to the success of your campaigns. There is no one-size-fits-all approach that works for every business.
The best bidding solution depends on factors like your goals, budget, funnel stage, target metrics, and more.
➡️ Manual bidding provides the most control but requires extensive management. It’s best for newer advertisers or niche cases.
➡️ Automated bidding hands the reins to Google but requires diligent monitoring to prevent misspends. It’s ideal for direct response goals.
➡️ Smart bidding provides powerful optimization through machine learning. But it requires ample data and close performance oversight.
➡️ Align bidding strategies to your funnel. Use manual bidding for discovery, automated bidding for consideration, and smart bidding for conversion.
➡️ Conversion tracking is critical. The more conversion data you can feed Google’s algorithms, the better performance.
Performance Max is Google’s new goal-based campaign type that allows performance advertisers to access all of their Google Ads inventory from a single campaign. The main point, as with anything in digital marketing, is that every hotel is different and you have to leverage the tools available to you that are going to help you reach your goals.
Hopefully, this guide provides a solid foundation for choosing, implementing and optimizing Google Ads bidding strategies tailored specifically to your business’s needs.
- 27 Oct 2023 By Kevin Wiggan