Why I Don't Use Max CPC Anymore
Sep 06, 2023With the myriad of changes occurring within Google Ads, some outdated strategies are no longer effective. One such strategy that needs to be added to the list is "Max CPC."
In case you are unfamiliar, the 'Max CPC' strategy involved setting a maximum bidding amount for Google Ads. You could apply this Max CPC limit at the campaign, ad group, or even keyword level.
This used to be a highly effective strategy, and I frequently utilized it in my search and shopping campaigns. However, as of 2023, it's no longer a part of my strategy.
In this article, I will elaborate on why I've abandoned the 'Max CPC' strategy and share what I now use in its place. But before we delve into that, if we haven't met yet, my name is Aaron Young from...
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With that said, let's dive straight into why I've abandoned the 'Max CPC' targeting strategy, primarily because it has become ineffective. There are two key reasons for its obsolescence.
Firstly, Google's keyword matching has evolved to encompass broader variations than it did two years ago.
The 'Max CPC' strategy excelled when setting up SKAGs (Single Keyword Ad Groups). After reviewing your data, you could fine-tune your Max CPC limits for each ad group. For instance, if a search term like:
"Jetski hire on the gold coast"
was converting at a significantly higher rate compared to:
"Waverunner hire on the gold coast,"
you could raise the Max CPC bid for the "jetski" keyword because the higher conversion rate justified a higher bid. However, this approach is no longer effective due to Google's expanded match types, where those two keywords now carry the same meaning. Consequently, it's challenging to differentiate targeting and establish the right CPC limits.
The second reason why the 'Max CPC' bid strategy is no longer viable is what I term the "Performance Max effect." Regardless of your stance on Performance Max campaigns or whether you use them, these campaigns exert a real impact on your existing search and shopping campaigns.
The major drawback of employing the Max CPC strategy for search and shopping campaigns is that when they compete against a Performance Max (PMax) campaign, the PMax campaign will typically outbid your Max CPC campaign to secure the auction. This occurs when one of two scenarios unfolds:
- The user conducting the intent-based search has already encountered the PMax campaign's display or discovery ads.
- The user originates from a pool of audiences with favorable conversion metrics in the PMax campaign.
The problem lies in the fact that your Max CPC bid does not account for the likelihood of conversion and cannot bid any higher.
Now that I've explained why I no longer use the "Max CPC" strategy and deem it outdated, let's discuss where I've observed the highest levels of success. This involves following a specific process:
Commence your campaign with "Maximize Clicks" and transition to "Maximize Conversions" once you've detected a consistent pattern of conversions. In today's market, rather than aiming for a set number of conversions, it's more effective to monitor the stabilization of conversion actions. This is because introducing "Maximize Conversions" often comes with a target ROAS or CPA.
