Google announces significant changes to AdWords bidding and text ads

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With the news that over half of the trillions of Google searches happen on mobile, Google announced Tuesday that it will soon change the way advertisers set bids for targeting ads by device type in AdWords. Other coming changes announced at Googler Performance Summit in San Francisco include an update to Google text ads on all devices and responsive mobile display ads that can access native mobile ad inventory on the Google Display Network.

The change in bidding is significant in that it accomplishes two things: 1. Untethers desktop and tablet bids; and 2. Allows advertisers to make mobile the focal point of their campaigns. Advertisers will be able to set separate bid adjustments for mobile, desktop and tablet.

“This lets you anchor your base keyword bid to the device most valuable to your business and then set bid adjustments for each of the other devices. You will also have a wider range to adjust bids, up to +900%,” explained Sridhar Ramaswamy, Senior Vice President, Ads and Commerce, in the blog post announcing the update. The news was also announced during Google Performance Summit in San Francisco.

Advertisers will be able to set a base bid and then set bid adjustments for one or all device types in the range of -100 percent to +900 percent.

Isn’t this a big walk back from Enhanced Campaigns?

Yes and no.

First, some background. In 2013, Google introduced Enhanced Campaigns, which overhauled how advertisers set bids for ad targeting on devices. The main goal was to push advertisers to take mobile search usage trends seriously (Google saw it growing) and start bidding running ads on mobile search (even if advertisers couldn’t yet tie mobile ad clicks to ROI). Since Enhanced Campaigns, the default bid has been set at the desktop/tablet device level, with the ability to then set a mobile bid adjustment (+900 percent or -100 percent) from that base bid.

So a walk back?

Yes, in reversing the decision to group desktop and tablet bidding. Many advertisers have remained unhappy with having to set the same bid for desktop and tablet, regardless of how each performed. This will be a welcome change for many advertisers — particularly for those who’ve seen declining performance on tablets.

And no. This can also be seen as a natural evolution of Enhanced Campaigns. With mobile growing so rapidly over the past few years, the idea of having bids predicated on desktop has increasingly felt awkward, even for advertisers who continue to see the bulk of ROI come from desktop. (To help advertisers measure beyond last-click attribution, in which mobile tends to reflect poorly, Google recently announced advertisers will soon be able to assign any attribution model, not just last click, to conversion types in AdWords.)

With a maximum bid adjustment of 900 percent, it has also become challenging for some advertisers to scale mobile as much as they’d like without overbidding for desktop.

Why this change now? Jerry Dischler told Search Engine Land on Monday that before instituting Enhanced Campaigns, Google saw the fast growth in mobile search behavior happening, but the typical advertiser wasn’t ready to act on this shift. Now, Dischler says, advertisers are coming to Google saying, “We want to start on mobile and have more opportunities for mobile-first initiatives.”

Enhanced Campaigns — or something like it without the tablet/desktop coupling — likely did need to happen for AdWords advertisers to start investing purposefully in mobile search (and to enable Google to compete with Facebook).

More characters for text search ads on all devices

Also, confirmed on Tuesday is Google’s impending changes to text ads that will give advertisers more copy. As Search Engine Land first reported earlier this month, Google will soon launch expanded text ads in AdWords.

The new format comes after Google removed text ads from the right side of the search results. Because of space restrictions, right-side ads were treated differently. Getting rid of them means Google can now streamline text ad formats across mobile and desktop.

Advertisers will have two 30-character headlines instead of the current 25-character headline and one 80-character line of description copy instead of two 35-character lines.

Display URLs will automatically pull the landing page domain, but advertisers will be able to name up to two directory paths — neither of which has to be a real navigational path — to provide description about the landing page content.

Responsive Google-built display ads for mobile

Google has been working to get a foothold in native display ads and strengthen its mobile display business, which I’ve written about a bit, to compete with Facebook and other social and mobile ad networks. At I/O last week, Google touted its ads have now driven more than two billion app installs.

On Tuesday, Google announced responsive ads for display that automatically resize and adjust to the look and feel of the content to tap into publishers’ native ad inventory.  The ads are built dynamically by Google. Advertisers provide headlines, a description, an image and a URL.

The ads “unlock new native inventory” in apps and mobile websites in the GDN. Whereas those sites may have been relying on another network for native ad serving, Google is saying it can now fill that inventory demand, too.

Google also announced that it is expanding the potential reach of GDN remarketing campaigns “by giving you access to cross-exchange inventory, which includes more websites and apps around the world.”

For more about the news above and more, see our post on Search Engine Land: All the AdWords & Google Analytics changes announced today at Google Performance Summit.

About The Author

Ginny Marvin

As Third Door Media’s paid media reporter, Ginny Marvin writes about paid online marketing topics including paid search, paid social, display and retargeting for Search Engine Land and Marketing Land. With more than 15 years of marketing experience, Ginny has held both in-house and agency management positions. She provides search marketing and demand generation advice for ecommerce companies and can be found on Twitter as @ginnymarvin.