Using Google Ads Target ROAS Bid Strategy to Maximize Profits for Your Ecommerce Business
I've mostly managed lead generation campaigns with Google Ads in the past 8 years that I've been specializing in Google Ads. Over the past couple years however I've been getting more ecommerce clients and have been managing their Google Ad Campaigns to increase sales for their ecommerce business.
The nice thing about this is you can report on exactly how much revenue the Google Ad Campaign is generating for their business, so it's easy to communicate the value you bring to their business. The campaign is either making them money or it isn't.
The first few ecommerce clients I had I would just use Max Clicks or Max Conversions bid strategy on their Shopping Ad campaigns and Search Campaigns. This has produced good results but lately I found myself in a position where a campaign was under performing. This account had plenty of sales conversion data as it was generating thousands of dollars in revenue every month via Google Ads but I needed to boost the return on ad spend and my manual bid adjustments and exclusions weren't doing the trick.
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I've mostly managed lead generation campaigns with Google Ads in the past 8 years that I've been specializing in Google Ads. Over the past couple years however I've been getting more ecommerce clients and have been managing their Google Ad Campaigns to increase sales for their ecommerce business.
The nice thing about this is you can report on exactly how much revenue the Google Ad Campaign is generating for their business, so it's easy to communicate the value you bring to their business. The campaign is either making them money or it isn't.
The first few ecommerce clients I had I would just use Max Clicks or Max Conversions bid strategy on their Shopping Ad campaigns and Search Campaigns. This has produced good results but lately I found myself in a position where a campaign was under performing. This account had plenty of sales conversion data as it was generating thousands of dollars in revenue every month via Google Ads but I needed to boost the return on ad spend and my manual bid adjustments and exclusions weren't doing the trick.
This led me to try out Target ROAS bid strategy which I'd always been hesitant to use in the past. I wish I had tried it sooner. Fast forward almost a month now and this past week was this client's best week yet and this month is on track to the best month to date. This campaign is practically on auto-pilot and seems to always hit it's Target ROAS or exceed it by a great margin.
Does this mean you should always start new campaigns off with Target ROAS? Unfortunately, Google Ads won't let you use it unless the campaign has enough conversion data. So to start off a new campaign you would still want to use Manual CPC, Max Clicks or Max Conversions. Once you have roughly 15-30 conversions a month, go ahead and test out Target ROAS. I probably wouldn't start off with a super high Target ROAS when you first start using it. Try just setting it to 50-100% ROAS to start and then gradually increase your Target ROAS until you hit your desired ROAS.
Keep in mind that the higher your Target ROAS, the fewer total sales conversions you'll get generally. You have to factor in average customer lifetime value and word of mouth. Depending on your business, you could actually make more money lowering your target ROAS since it will likely increase sales conversion volume. More customers means more reorders and more word of mouth.