CPA Google Ads: Expert Lower Strategies
How to optimize a Google Ads campaign to lower CPA?
CPA is a key performance indicator. This KPI represents the cost per acquisition of your conversions.
Depending on your business and campaign objectives, CPA in Google Ads can represent the cost of acquiring a lead (filling in a form). CPA can also represent the cost of acquiring a sale (making a purchase on an e-commerce site) or, more simply, the cost of acquiring your main conversion. The formula is as follows Media investment / Number of conversions.
Let’s take the example of an e-commerce site with a monthly media budget of €20,000 and 600 sales. Its CPA is therefore €33.3. (20.000 / 600)
A major challenge for marketers and Google ads agencies is to generate the lowest possible costs per acquisition. There are several ways of doing this, some of which we’ll explain in this article.
Summary
Keyword analysis in a Google Ads campaign
Adjusting the distribution of a Google Ads campaign
Bidding strategies in Google Ads
Keyword analysis in a Google Ads campaign
In a PPC (pay per click) environment, analyzing the costs generated by each keyword is essential for CPA optimization in Google Ads.
To do this, on your Google Ads account you need to go to the left-hand bar of the platform and select the Keywords category. Once there, you’ll have an overview of the different keywords in your account and their KPIs. When analyzing keywords with a view to lowering CPA, we need to focus on spend per keyword and CPA per keyword.
By ranking the keywords in descending order of CPA and quality score, you can already identify the :
- The most costly in terms of conversion
- The most expensive in terms of circulation
- Those responsible for the drop in quality score
Next, you need to filter them out, retaining only those keywords that generate CPA in line with your objectives. You also need to think in terms of quality score, because a quality keyword generates lower costs and better click-through rates.
Please note that a keyword analysis must be carried out with sufficient data, so it’s essential to let the campaign run for a minimum amount of time in order to judge the statistically significant figures.
We also recommend pausing less relevant keywords rather than deleting them, in order to retain data and performance history.
It’s also worth noting the importance of quality score in the impact of cost per conversion. To improve your quality score, you need to focus on optimizing 3 main levers:
- Intent levels
- Consistency between the keyword and the prospect’s search (expected CTR) and
- Relevance and composition of the landing page
Match type
There are 3 types of keyword matches in Google Ads: Broad, Phrase and Exact.
Depending on the issues involved in your strategy, it’s vital to select the right match types and ad group organization.
Broadly speaking, a strategy incorporating Broad in Paid Search aims to maximize impression levels, at the risk of losing relevance in targeted queries. A strategy focusing on Exact or Phrase is more focused on controlling costs and quality scores, with the risk of low circulation levels.
The last important element in keyword analysis is the exclusion of keywords. It is possible that keywords on which you are not placed will trigger your ads. This is caused by the integration of Phrase and Broad.
To identify irrelevant and costly keywords, go to the Search Terms section of Google Ads. Here you can see all the search terms that users have typed in to land on your ads. You can exclude the search term to stop being shown on this query. (e.g. Free / Competitors …)
Adjusting the distribution of a Google Ads campaign
Often little used, this function can be adapted and very effective for certain strategies. On Google Ads, you can adjust the delivery of your ads by optimizing three criteria.
The first type of adjustment is temporal. Using the navigation bar, you can go to the broadcast calendar section to adjust the broadcast times of your campaigns.
Once you’ve launched your campaigns, or depending on the particularities of your business (opening hours / seasonality …), you can identify the times that are most conducive to performance. In this way, you can capitalize on your budget at peak times, and reduce or stop spending at less lucrative or high-performance times. It’s worth noting that you can adjust by day and by hour.
The second type of adjustment is geographical. Like temporal adjustment, geographic adjustment is based on campaign data and the particularities of the business or issue.
Google lets you adjust your broadcasting not only by country, but also by city, region and even radius, which you can define. (Ex: 25 km radius New York)
The third type is adjustment by device. You’ve previously identified that the majority of your conversions take place on a computer, or that 60% of traffic from tablets is unqualified… Once you’ve identified insights thanks to your available data, you can adapt and adjust the delivery of your ads according to device. The exciting distinctions are as follows: Phone / Computer / Tablet / smart TV.
Bidding strategies in Google Ads
There are 4 types of automatic bidding strategies on Google. These 4 actions can also work in pairs, depending on the objective of the strategy.
- Maximize conversion volume: here you instruct the algorithm to maximize the volume of your main conversion. Targeting will therefore focus on those prospects most inclined to take action on your site. The risks of this strategy are to focus on quantity and lower quality (e.g. to generate leads).
- Maximize conversion value: here the strategy will target those prospects most inclined to generate conversions with the most value. If you sell two types of product, this strategy will push the conversion of the more expensive product. The risk is to reduce your sales volumes.
- Target ROAS and target CPA: these are the last two bidding strategies, and they can serve as a pair to the first.
When playing on conversion volumes, we recommend selecting the target CPA to keep control of your spending and give the algorithm an indication of the ideal, and therefore profitable, CPA for you.
The second option is to play on values. To do this, you can select a conversion value maximization strategy, and setting up a target ROAS is recommended. Once again, this ensures that the algorithm doesn’t generate high-value conversions that would be too costly and therefore unprofitable.
Conclusion
It’s important to note that these strategies should be implemented when enough data has been collected. We recommend switching campaigns to automatic bidding strategies when you’ve already generated around 50 conversions.
A target CPA that’s too low or a target ROAS that’s too high can limit or even halt ad delivery, as the algorithm fails to meet targets.
In conclusion, CPA is an essential element in judging performance. But its optimization depends on a number of different levers. A well-structured Google Ads account with adapted keywords / ads / landing pages and strategies is the key to lower CPA!
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