Bid per click formula

The algorithms we use to calculate bids per click are quite complex. The factors it takes into consideration are:

  • ACoS target (set by user)

  • Average order value

  • The conversion rate of each keyword in each ad format, placement, and hour of the day.

At a high level, the formula used to determine bids per click for each keyword is:

Bid = Conversion rate (%) * Average sale price * Target ACoS(%)

This approach adjusts bids in response to changes in ACoS target, ensuring that the keyword's ACoS remains aligned with your goal over time, across various ad formats, placements, and times.

We don't use Artificial Intelligence for bid-per-click calculation because we don't believe it's the most appropriate tool for this problem, even though it is very popular these days and would have made our marketing smarter.

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