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Imagine this: your SME is investing in Google Ads and you’ve enabled Smart Bidding to maximise your ad performance. You’re optimistic—after all, automation promises to deliver better results with less effort. But weeks go by and the results are underwhelming. Despite the potential of Smart Bidding, your campaigns aren’t hitting their targets and ROI remains frustratingly low.
This scenario isn’t uncommon. While Google Ads Smart Bidding is a powerful tool, it doesn’t guarantee success right out of the gate. Businesses often find themselves grappling with poor performance due to insufficient data, misaligned goals, or a lack of proper optimisation.
Many small businesses struggle with Google Ads optimisation. Only 1% of small business advertisers log into their Google Ads accounts every week, according to WordStream, indicating a lack of regular engagement and optimisation efforts. This highlights the importance of understanding how tools like Smart Bidding work and setting them up effectively to enhance campaign performance and maximise results for your business.
In this blog, we’ll explore the challenges SMEs face with Google Ads Smart Bidding, explain how to make it work for your business and share actionable strategies for optimising your campaigns.
Google Ads Smart Bidding is an automated bidding system powered by machine learning. It uses historical data and real-time signals to optimise bids for every auction, aiming to achieve specific campaign goals such as maximising conversions or increasing return on ad spend (ROAS).
Smart Bidding evaluates multiple signals during an ad auction, such as device type, location, time of day and user behaviour. It adjusts bids dynamically to improve performance for each impression. There are five main Smart Bidding strategies:
For small businesses, Smart Bidding offers a way to leverage Google’s advanced algorithms without requiring in-depth expertise in manual bidding. It promises time savings, better targeting and higher campaign efficiency when implemented correctly. However, its effectiveness relies heavily on proper setup and sufficient data.
Despite its potential, many SMEs struggle to achieve success with Smart Bidding. Here’s why:
Smart Bidding relies on data to make informed decisions. Without enough historical conversion data, the algorithm struggles to optimise bids effectively. For example, campaigns with fewer than 15 conversions per month may not provide Google with enough signals to predict future behaviour accurately.
Selecting the wrong bidding strategy for your objectives can derail your campaigns. For instance:
Smart Bidding’s success depends on accurate conversion tracking. SMEs often set up tracking incorrectly or fail to measure the right actions, such as sign-ups, purchases, or form submissions. This gives the algorithm incomplete or misleading data, affecting optimisation.
While Smart Bidding automates much of the bidding process, it still requires human oversight. Many SMEs adopt a “set it and forget it” approach, assuming the algorithm will handle everything. Without regular monitoring and adjustments, campaigns can stagnate or underperform.
Small budgets limit the algorithm’s ability to gather enough data and optimise effectively. For example, if a campaign’s daily budget is too low to generate consistent clicks, it hampers the system’s learning phase, leading to suboptimal results.
Setting up Google Ads Smart Bidding isn’t as simple as flipping a switch. Proper preparation ensures the algorithm has the right data and parameters to optimise effectively. Here’s how to get started:
Conversion tracking is the foundation of Smart Bidding. Without it, the algorithm can’t measure success or optimise bids effectively.
For SMEs, tracking micro-conversions—like time spent on a page or added items to a cart—can provide additional insights, especially for campaigns with limited direct conversions.
Smart Bidding thrives on past performance data. Before switching to automation:
Setting achievable targets ensures that Smart Bidding aligns with your objectives and delivers measurable results.
Once your campaigns are live, optimisation is critical for sustaining and improving performance. Follow these best practices to make the most of Smart Bidding:
Although Smart Bidding automates bids, you can still apply bid adjustments to refine performance:
These adjustments let you guide the algorithm toward areas of higher ROI without completely overriding automation.
Smart Bidding is powerful, but it doesn’t know your business like you do. Leverage your insights to improve performance:
Blending automation with human expertise ensures campaigns align with business-specific goals.
Smart Bidding isn’t a “set it and forget it” tool. Regular monitoring is essential:
Regular reviews ensure that automation continues to work in your favour.
Smart Bidding requires a learning phase (usually 7-14 days) to gather sufficient data. During this period:
stabilises.
The best way to optimise Smart Bidding is to test different approaches:
Testing ensures you’re consistently improving performance based on real-world data.
For SMEs, Google’s Performance Max campaigns can complement Smart Bidding by automatically running ads across all Google properties. Combined with Smart Bidding, this can help expand reach while maintaining cost efficiency.
While Google Ads Smart Bidding is a powerful tool, certain mistakes can limit its effectiveness or even harm your campaign’s performance. Here are the most common pitfalls and how to avoid them:
Smart Bidding simplifies campaign management, but it’s not a substitute for active oversight. Many SMEs adopt a “set it and forget it” approach, assuming the algorithm will automatically optimise everything. Without regular monitoring and adjustments, campaigns can stagnate or fail to adapt to market changes.
How to Avoid: Schedule weekly performance reviews and use data insights to make informed adjustments to audience targeting, budgets, or creatives.
Real-World Example: Reducing Cost Per Conversion by 68% for CERT Property
CERT Property, a client in the property sector, faced high costs per conversion in their advertising campaigns. By implementing a holistic strategy that included paid marketing, Google Ads and conversion rate optimisation, Mr Digital helped CERT achieve remarkable results.
Within the first month, the cost per conversion dropped by 68%, demonstrating the value of a data-driven approach combined with continuous campaign optimisation. This success underscores the importance of regular monitoring and refinement, even when using automated bidding strategies like Smart Bidding.
For SMEs, the lesson is clear: while automation can streamline processes, human oversight and strategic adjustments are essential to achieving significant results.
Smart Bidding requires a substantial amount of historical conversion data to optimise effectively. If a campaign has fewer than 15 conversions per month, the algorithm may struggle to make accurate predictions.
How to Avoid: Start with simpler strategies, like “Maximise Conversions,” to gather data before moving to advanced options like Target ROAS or Target CPA.
Using the wrong Smart Bidding strategy for your campaign objectives can lead to wasted spend. For example, choosing “Target ROAS” for a brand awareness campaign prioritises revenue over reach, missing the mark entirely.
How to Avoid: Match your bidding strategy to your campaign goals. Use “Maximise Conversions” for lead generation or “Target CPA” for cost-controlled performance.
Smart Bidding doesn’t account for external factors like seasonality, competitor activity, or sudden changes in customer behaviour. These variables can significantly affect performance.
How to Avoid: Adjust your campaigns during peak seasons, product launches, or competitive shifts to ensure your bidding strategy remains effective.
Even the best Smart Bidding strategy won’t save a campaign with poor ad creatives. Low-quality visuals, irrelevant messaging, or weak CTAs reduce engagement, making it difficult for the algorithm to optimise.
How to Avoid: Continuously test and improve your ad creatives to ensure they resonate with your target audience.
Google Ads Smart Bidding has the potential to deliver significant results for SMEs, but success depends on proper preparation, strategic implementation and ongoing optimisation. By understanding how Smart Bidding works and avoiding common pitfalls—such as over-reliance on automation or insufficient data—you can set your campaigns up for success.
The key is balance: leverage automation for efficiency while applying manual insights to guide the algorithm toward your unique business goals. Regular monitoring, accurate conversion tracking and alignment with your campaign objectives will ensure that Smart Bidding becomes a growth-driving asset rather than a source of frustration.
Struggling to optimise your Google Ads campaigns? Let our experts help you create data-driven strategies that deliver real results. Contact us today!
Joshua is a Senior Content Writer with a diverse background in journalism and storytelling. He has a passion for crafting engaging and informative content that resonates with target audiences. Joshua's experience in writing and his understanding of digital marketing ensure content is both captivating and effective in achieving marketing goals.
Ryan is a Client Success Director with a wealth of experience in developing and executing successful digital marketing campaigns. He has worked with renowned brands like Krispy Kreme, honing his skills in various online channels and achieving exceptional results. Ryan's expertise and dedication to client success make him a trusted advisor in the digital marketing landscape.
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