Smart Bidding is a set of automated bid strategies in Google Ads that use machine learning to optimise bids in real time for each auction, based on signals such as device, location, time of day, and user behaviour.
How is Smart Bidding different from manual bidding?
With manual bidding, you set a maximum cost-per-click and Google uses that figure as your bid across all auctions. With Smart Bidding, Google adjusts your bid automatically for every single auction based on the predicted likelihood of conversion. The algorithm processes far more signals than a human could account for manually, making real-time adjustments that a fixed bid cannot replicate. The trade-off is that you cede direct control over the bid amount.
What Smart Bidding strategies are available?
The main Smart Bidding strategies are:
Target CPA (Cost Per Acquisition): Google sets bids to achieve as many conversions as possible at your target cost per conversion.
Target ROAS (Return on Ad Spend): Google optimises for conversion value, aiming to hit a target revenue return on your ad spend.
Maximise Conversions: Google spends your budget to get the most conversions, without a specific CPA target.
Maximise Conversion Value: Google spends your budget to achieve the highest total conversion value, without a specific ROAS target.
[Screenshot: Google Ads campaign settings showing the bidding strategy selection with Target CPA chosen and the target cost input field visible. Alt text: Google Ads bidding strategy settings showing Target CPA selected with a target cost per acquisition field.]
What does Smart Bidding need to work effectively?
Smart Bidding depends on conversion data. The algorithm needs a sufficient volume of conversions to learn from: Google recommends at least 30 conversions per month per campaign for Target CPA, and more for Target ROAS. Accurate conversion tracking is essential.
If conversions are not tracked correctly, the algorithm will optimise towards the wrong signals. New campaigns with limited data may see unstable performance during the learning phase, which typically lasts one to two weeks.
How do I choose the right Smart Bidding strategy?
The right strategy depends on your goal and your account's conversion volume. For lead generation campaigns with a target cost in mind, Target CPA is the most straightforward choice. For e-commerce where different products have different values, Target ROAS is more appropriate.
Maximise Conversions is useful for new campaigns building data before moving to a target-based strategy. We assess each client's account maturity and conversion tracking before recommending a Smart Bidding strategy, and monitor the learning phase closely to ensure the algorithm has what it needs.
Related KB articles:
• What is ROAS and How Do You Calculate It
• What are Google Performance Max Campaigns
• What is a Conversion in Digital Marketing
External links:
• Google Ads Help, Smart Bidding