Check your Mobile Bid Adjustments. Now.

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If you are at all responsible for AdWords accounts, do yourself a favor, and double-check your Mobile Bid Adjustments. They're the most-overlooked variable in the review's I've done over the past few months, costing often thousands of dollars in wasted spend. How? Without an appropriate adjustment, it's likely that all of the competitors for that impressions are adjusted down, leaving you high and dry--and definitely winning the auction. Then, you are at the mercy of your Mobile Conversion Rates (and, to a lesser degree, your Mobile Average Order Values). If your Mobile visitors convert at one fourth the rate of your computer visitors, then you just over-paid by a factor of four.

This is an annoyance with one click, but if you're the one left in the cold while your competitors are all safe and warm behind their Bid Adjustments, then it could be hundreds of over-paid clicks. Or thousands. Or tens of thousands.

Left unchecked, I've seen Mobile clicks soak up 60% of the total expense of a large Text Campaign, and almost as much of a Shopping Campaign (the way Google displays PLAs on Mobile slightly mitigates the risk, but it's still potentially catastrophic). Considering that the same account tracked only 20% of its revenue from Mobile, that's way out of line.

Well, barring a near-science-fiction-esque multi-device tracking system, but let's be real--you probably don't have one of those. Nothing personal, just probabilities.

A Mobile Bid Adjustment is simply a coefficient that you can apply to all bids when they're for a mobile shopping impression or click. So, if you set your adjustment as a decrease of 50%, a $3.00 bid would only be worth $1.50, if the search was done from a phone.

Set perfectly, a Mobile Bid Adjustment will result in an identical Return on AdSpend (ROAS) on both Mobile and Computer segments (ROAS is reported as "Conv. value / cost". In general, you should know how many dollars of revenue you want to see earned by each dollar spent, and there are few reasons to value dollars from Mobile shoppers more than dollars from Computer shoppers. When you apply a Bid Modifier that reduces your Mobile bids, your clicks come in cheaper, and more efficient. There are fewer of them, but that's fine, because you're finally paying what they're worth. From that lower cost basis, the lower Conversion Rate (at least on most sites) is fine, as the two balance out to the same ROAS.

So, how do you pick a good Bid Modifier? Well, the ROAS itself, and many other options among the metrics in AdWords, aren't great candidates. If the metric you're using is directly influenced by the result of the modifier, then it'll produce a feedback loop, and your bids will likely over-correct, oscillating wildly.

The easiest way that I recommend is to rely on a Bid Adjustment proportional to the "Conv. value / click" metric. This passively takes into account variation in Average Order Value (as the Conv. value swings with AOV), but also the Conversion Rate, as the value divided by clicks would go down with more clicks required to get the conversion. So, if the Value per Click of Computers (in the Devices tab of the Campaign Settings) is $10.00, and the Value per Click for Mobile is $4.50, then you could start with a Mobile Bid Adjustment of -55%, as that would be proportional to the difference in that metric.

Reapplied monthly, or so, and you'll not only hone in on a fairly stable Adjustment for your shoppers' behavior, but also keep up to date as shopper behavior shifts over time.

So, do yourself a favor, take 3 minutes, and make sure you're not burning half of your marketing budget on accidentally over-paid Mobile clicks. Please.

Have questions?  Drop me a line via the Contact form--I love to talk shop.

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