What is the formula for bids per click?
At high-level, the formula used to set bids per click for each keyword is similar to:
Bid=Salesย priceโˆ—Conversionย rateโˆ—Targetย ACoSBid = Sales \ price * Conversion\ rate * Target\ ACoS
This formula guarantees that in the long run, if the sales price or conversion rate does not vary, the keyword will have an ACoS equal to your Target ACoS.
The conversion rate and sales price change over time, so Advigator calculates all bids every day according to all available data.
The conversion rate is calculated at different time periods (year, quarter, month), for the specific ad format (SP, SD, SBV) and search term.
We do not use any artificial intelligence methods to formulate bids per click. While this would make our marketing materials cooler, we have seen that thorough data cleansing and basic statistics generate better-performing results - and provide more control over budget spending and ease of inspection.
Last modified 5mo ago
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