Google Ads Target CPA (2022) - Target CPA Bid Strategy Explained

In this video on Google Ads Target CPA I will go over the target cpa bidding also known as target cpa bid strategy and will explain everything about the bid strategy in detail.

0:00 Intro
0:10 What Is Target CPA
0:54 What Are The Benefits
1:48 When Should You Use Target CPA
3:38 How To Set Your Campaign To Target CPA

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Google Ads is an online advertising platform developed by Google, where advertisers bid to display brief advertisements, service offerings, product listings, or videos to web users. It can place ads both in the results of search engines like Google Search and on non-search websites, mobile apps, and videos.

About Target CPA bidding
Note: Starting in 2021, you’ll find optional target fields in Search campaigns for new Maximize conversions or Maximize conversion value bid strategies. With an optional target, Smart Bidding will optimize to these goals the same way it would for Target CPA (cost per action) and Target ROAS (return on ad spend). Maximize conversions with a set target CPA will behave like a Target CPA strategy does today, and similarly, Maximize conversion value with a set target ROAS will behave like a Target ROAS strategy does today.

Target CPA bidding is a Smart Bidding strategy that sets bids for you to get as many conversions (customer actions) as possible. When you create the Target CPA (target cost-per-action) bid strategy, you set an average cost you'd like to pay for each conversion. When a customer does a Google search that fits your product or service, Google Ads uses your Target CPA to set a bid based on the auction's likelihood to convert.

Note: For App campaigns, Target CPA is the same value whether the conversion is for installing the app (cost per install) or for using the app (cost per in-app action).
Target CPA is available as either a standard strategy in a single campaign or as a portfolio strategy across multiple campaigns. This article explains how Target CPA bidding works and what its settings are.

Before you begin
If you don’t yet know what type of automated bid strategy is right for you, read about automated bidding.
Before you can set up a Target CPA bid strategy, you’ll need to set up conversion tracking to manage your conversion.
We recommend that you review your budget settings to make sure you feel comfortable spending up to 2 times your average daily budget, while not exceeding the monthly charging limit. Learn more About spending limits
How it works
Target CPA bidding automatically finds an optimal bid for your ad each time it's eligible to appear by using historical information about your campaign and evaluating the contextual signals that are present at auction-time.

Some conversions may cost more than your target and some may cost less, but altogether Google Ads will try to keep your cost per conversion equal to the target CPA you set. These changes in CPA take place because your actual CPA depends on factors outside Google's control, like changes to your website or ads or increased competition in ad auctions. Additionally, your actual conversion rate can be lower or higher than the predicted conversion rate.

For example, if you choose a target CPA of $10, Google Ads will automatically set your bids to try to get you as many conversions at $10 on average. To help improve your performance in every ad auction, this strategy adjusts bids using real-time signals like device, browser, location, time of day, remarketing list, and more.

Create a Target CPA bid strategy
You can create a Target CPA bid strategy for a single campaign (standard strategy) or multiple campaigns (portfolio bid strategy):

Create with a new campaign
Create or change from campaign settings
Create from the Shared library “Bid strategies”
You can create an automated bid strategy for a single campaign (standard strategy) or multiple campaigns (portfolio bid strategy).

Explanations for Target CPA performance
Explanations give you insights into large changes in your Google Ads account performance. If you see a significant fluctuation in performance for a Search campaign or ad group using target CPA strategy, explanations help you quickly find out why it happened.

Settings
Target CPA (or cost per install/cost per in-app action for App campaigns)
This is the average amount you’d like to pay for a conversion. The target CPA you set may influence the number of conversions you get. Setting a target that is too low, for example, may cause you to forgo clicks that could result in conversions, resulting in fewer total conversions.