How Often Should You Change Your Keyword Bids, Really?

Manual keyword bidding isn’t something all of us need to do. But, for those of us who do, we can be unsure of how often we should change our bids, especially if we’re trying to optimize a budget for a client.

For the most part, everyone knows how the bidding system works. AdWords uses an auction-like system to decide the ads it shows from which advertisers and in what order. The more you pay, the higher you rank.

You can set your AdWords account to automated bidding, give it a cap, and leave it alone. This is an ideal situation for companies who have a bit more wiggle room on a budget. However, there are some businesses which cannot afford to potentially waste money on over-bidding.

Micro-Manager Tendencies

Agencies, in particular, are always strapped to their budget. They have the converse situation where if they’re under-bidding, they might not have enough success and, as a result, lose their client’s business. Unfortunately, the result is many agency account managers and SEO consultants micro-manage the heck out of their AdWords accounts.

The bad news for businesses that need to manually bid on AdWords is they constantly feel the pressure to always be doing something. What often translates in the SEO services world when you say “I left the bids alone” is “I didn’t do my job today.” This results in a ton of wasted time and potentially a lot of wasted money.

Bidding Methods

There are a couple of ways to decide how and when to bid in AdWords. The first is to evaluate the performance of a keyword over a set period of time. This can be daily, weekly, monthly, or even quarterly.

The second is by determining the keyword position. If your keyword is ranking too low, bid it up. The problem you experience with this method is the price can fluctuate immensely over days or even weeks. It can be highly inaccurate and cost-ineffective.

The third method is evaluating the return on ad spend, or cost per lead. This is a more sophisticated approach which requires some calculation on your part. If a keyword has a CPA higher than the average of the account, you should bid it down, and vice versa if you have a CPA lower than the account average.

Problems with Manual Bidding

The problem with manual bidding almost always comes down to not having enough data.

Ultimately, what these agency account managers are doing to themselves is stripping their ability to make a rich data decision. They don’t leave the keyword bids enough time to do their thing to collect data.

For example, if you have a couple hundred impressions, ten click-throughs, and one conversion, that tells you absolutely nothing about what was successful (or not) about the bid. You cannot possibly have any indication of the deciding factors of that ad with one data point, yet people have the idea they need to constantly adjust the bid. In most cases, they’re likely moving away from the deciding factor that made that one conversion successful.

Another problem many people encounter is they forgot the adjustments they made last week. If you’re in the habit of changing your bids every few days or on a weekly basis, you’re muddying the data water. This means you get two to three bid-levels of data collected into one batch which cannot give you any conclusions about what’s successful for that particular keyword.

Account managers also aren’t in the habit of keeping track of their changes. You almost always get situations where someone lowers a keyword only to adjust it back up the following week because they forgot the adjustment they made last week.

What’s the Solution?

Patience! And time. Leave your bids alone for at least a month, a quarter if you can. This will give you more data from which you can make better informed decisions for adjusting your bids.

Here are some basic guidelines to help you understand timing for bidding:

  • B2C, low-price, high-volume product: evaluate keywords on a monthly basis (sometimes weekly is appropriate)
  • B2C, higher-price, low-volume product: evaluate monthly, sometimes push to quarterly
  • B2B services: relatively stable prices evaluate keywords every quarter

You might need to be more hands-on for markets that fluctuate a lot or markets that have certain cycles like personal income tax filing.

If you can’t bring yourself to sitting on keywords for a month, you can always evaluate what’s going on without making adjustments. You can also associate keywords with other keywords which allows you to evaluate them from the campaign level or ad group level.

If you take away anything, let it be this: Changing your keyword bids every other day is damaging to your efforts because you can’t collect enough data to make a better decision for your company or client. The way to combat it is to learn how to evaluate your keywords’ performance without making adjustments and understanding that no action is action.

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