The Holy Trinity of Bid Strategies, Explained

[00:00:00] It is Friday March 22nd. Today it's happening again, meta-charging more than your daily

[00:00:07] budget allows but is this a case of operating as intended? Also a deep dive into the three

[00:00:14] main bid strategies in which you should be using. The myth of the TikTok Watch Time might

[00:00:20] be busted. Oh and you know that anonymous review you left the other day? This is awkward

[00:00:27] but it might have your real name on it now. I'm Tod Maffin, that's ahead today in Digital

[00:00:33] Marketing. Well every Friday we check in with our meta ads correspondent Andrew Foxwell.

[00:00:40] Andrew has visibility into $300 million in meta-adspend through his Slack community called

[00:00:45] Foxwell Founders. If this doesn't interest you you can skip to the 10 minute 10 second

[00:00:50] mark or if you're subscribed to the premium podcast just tap the next story in your chapters.

[00:00:56] Andrew this week I noticed on social media a lot of media buyers talking about which bid

[00:00:59] strategy we should be using now that it's you know we're getting close to a new quarter.

[00:01:04] There are the three main the lowest cost bid cap and cost cap can you walk us through what

[00:01:09] those are and what you recommend to your clients for what we should all be using these days?

[00:01:15] Yeah definitely. I mean there's I think it kind of depends on obviously what your goal is

[00:01:20] but for a long time most of us used lowest cost and I still use a lot of lowest cost bidding

[00:01:26] and what this does is finds the person that's most likely to convert at the lowest cost

[00:01:31] and you're sent you know entered into the auction that way while still getting volume

[00:01:36] to find the lowest cost conversion that you can at that time. This is also known as an

[00:01:42] auto bid because it's what meta defaults to there was a rework of a lot of different bidding

[00:01:49] types last year and a lot of people don't know about it but then the next one is a cost cap

[00:01:55] and cost caps were used a lot and we're essentially they find a conversion for you based on a range

[00:02:03] that you set so you say I would like to ironically it's called a cost cap but you say I'd like

[00:02:10] to find a conversion for a hundred dollars and it'll find you conversions for within the auction

[00:02:15] for around a hundred dollars essentially. Now some days that might mean that you're paying $200

[00:02:21] even though your cost cap is set at a hundred but generally it tries to keep things in a range

[00:02:26] but you do sacrifice volume so you're not going to get as many people coming in as you would

[00:02:32] but you're going to get them around a cost. The one that has been around but hasn't been used

[00:02:39] as much but seems to be becoming more popular is bid caps and bid caps essentially are the ability

[00:02:48] for you to find at a conversion at let's say it's $100 as an example again or below so you're

[00:02:55] sacrificing a significant amount of volume but you are finding a conversion at $100 or below

[00:03:02] and it will not go above that number and that's originally actually how cost caps were supposed

[00:03:06] to work but they changed them. But the downsize is with bid capping is you're sacrificing a significant

[00:03:13] amount of volume so on some days you will have days where you aren't spending anything and on other

[00:03:19] days you will be spending your whole budget. So there's also rules of how budgets relate to this

[00:03:27] generally you will use bid caps where you are also using bigger budgets and that could mean

[00:03:36] you're spending a thousand or five thousand or ten thousand dollars a day because when it's good

[00:03:44] you want it to be able to scale essentially and when the volume isn't there you don't want it

[00:03:49] to be able to do that. So there's a lot of debate about this about which one's the best and I think

[00:03:57] that if you look across direct response media buyers in direct to consumer world right now

[00:04:03] most people are utilizing some form of a bid cap probably where they have you know they want to

[00:04:10] get conversions under a certain amount and then they're also utilizing an auto bid or a lowest cost

[00:04:17] bid on prospecting more often where it's letting the volume come in and you're letting you know

[00:04:25] that auction kind of you're more subject to the auction but you're utilizing two different bid types.

[00:04:30] This isn't this was not the case six months ago I don't think that a lot of people were using

[00:04:36] multiple types of bidding in one account and I think it's because of the way that they reworked

[00:04:42] these within meta within the auction and within their ad tool. Would it be a fair strategy to say

[00:04:49] you know especially as things become more machine learning base that at the start of a campaign we

[00:04:54] want to give data meta as much data on on how consumers are responding to the ad campaign as

[00:05:00] possible and therefore we would go in with lowest cost because that would drive a enormous amount

[00:05:06] of learning data into the campaign and then once things settle down and we have a sense of what the

[00:05:11] cost is the real world is cost is going to be we may tweak that a little and then change the

[00:05:16] campaign settings to say a bid cap is that's what my gut would tell me to do totally and you can

[00:05:23] certainly do that if you're new or you're a lower spender you're probably not going to be

[00:05:27] utilizing and by lower spender I mean you're spending let's say under five thousand dollars a

[00:05:31] month on your entire account you're probably not going to be utilizing a lot of capping either cost

[00:05:37] capping or bid capping but if you because you want volume now if you are very interested you don't

[00:05:44] care about volume and you're very interested in controlling costs a bid cap can be a really good way

[00:05:51] to achieve that I think that most people see the progression as lowest cost cost cap bid cap

[00:05:59] and as you scale you will utilize them that way but yes if you're starting new

[00:06:06] as much volume as you can at learning is absolutely going to be the right strategy

[00:06:10] and over time experimenting with these is okay and I think there's a tendency that everybody

[00:06:17] that you have right as a media buyer or a person that's buying Facebook ads it's like

[00:06:22] well if I drive a Ford truck I can never drive another type of vehicle like I love Ford and

[00:06:28] I'm always going to do it that way and that used to be the way it's like I'm a lowest cost person

[00:06:32] I'm never going to do anything with capping and now you see these you see mixtures more often

[00:06:38] and it's rare that you'll see one account with like we have a member currently talking about

[00:06:43] and giving a lot of examples of he's switched one entire account to cost caps and he's in the united

[00:06:48] kingdom and overall has it been more productive he thinks it's been more productive by about 15

[00:06:55] percent reference to efficiency but this is a higher spending account they can afford to have bigger

[00:07:00] swings you know and there was another account that hadn't ever that I'd prove that I like know the

[00:07:09] information about they hadn't ever been really focused too much on understanding the true profitability

[00:07:16] and once they actually started to do that they realized what they really could pay for a conversion

[00:07:20] instead of looking at all well we need a 2x on meta they realized we actually need conversions

[00:07:25] that $65 or under and they used to spend $300,000 a month and yet that entire account is now

[00:07:33] on bid caps and it's only spending roughly between 30 to 40,000 a month because that's where

[00:07:40] that's how many conversions they can find so it's sort of like you have to

[00:07:45] utilize both and I think most people are doing that now at this point so it's something if you've

[00:07:48] not experimented with it's worth checking out sometimes when you go into a meta campaign this is

[00:07:53] true for most platforms not just meta certain things will trigger will go back into a learning phase

[00:07:59] or it will erase the data that it's learned so far is there any danger in taking an existing

[00:08:04] campaign that you've run on lowest lowest cost to accumulate a bunch of data to using that same

[00:08:11] kit like to editing the bid strategy on that actual campaign live or should we be doing the old

[00:08:18] duplicate the campaign pause the first one make edits to the duplicated one and kick the duplicated

[00:08:22] one off running yeah I would probably do new if you're going to be changing the bid strategy I'm not

[00:08:28] saying it can't work if you switch a campaign but what you're essentially telling me that is oh

[00:08:33] you've been going down this highway it's been going really well just to continue with my car meta 4

[00:08:39] what I need you to do now is ride at the next 60 miles with the brakes on

[00:08:44] and you're like I don't understand I was going along fine and that's essentially what you're

[00:08:47] telling the auction and so if you start by being like look you're gonna start this journey and your

[00:08:51] brakes are gonna be on a little bit the whole way the expectation is different and this is

[00:08:55] the same thing within the adhuction so I I always think that you should do it new if you're going to

[00:09:00] do that if it's running and it's doing decent profitability wise on a lowest cost keep that running

[00:09:06] and then start to experiment potentially with cost capping or bid capping in the middle part of

[00:09:10] your funnel and see if that does anything or potentially to new part of the audience that maybe a

[00:09:14] little bit more experimental you know like maybe you aren't sure if this is gonna work to people

[00:09:19] like this or like that or with B in a broad audience or whatever and you can cost cap or bid cap

[00:09:26] that and you can see like what the ranges are that come in so but utilizing those same ads if

[00:09:34] you can right now I'm just in a new campaign container yeah interesting good stuff thanks Andrew

[00:09:39] thanks Andrew Foxwell is our meta ads correspondent you can learn more about Andrew's digital ads

[00:09:45] training at b dot link slash Foxwell or his slack community of senior meta ad buyers at b dot link

[00:09:53] slash founders both of those are affiliate links and you can find those links at the bottom of our

[00:09:57] show notes and you can watch our full unedited interview there is a link to it in today's newsletter

[00:10:02] which you can sign up to for free by tapping the link at the top of the show notes or going to today

[00:10:07] in digital dot com slash newsletter.

[00:10:13] Well regardless of the bid type you use you might run into meta over spending your campaign

[00:10:18] budget this is when you tell the ads manager that you have a certain budget say $100 daily

[00:10:23] and it spends more than that and sometimes very quickly here's what dtc media buyer David Herman

[00:10:29] posted on social media last night quote I'm almost speechless at tonight's ad spend

[00:10:34] overage on meta for over a month we've endured bugs and overspend issues left and right

[00:10:40] I'm so mad for businesses investing into this platform right now we've been told by meta reps left

[00:10:45] and right that there are no issues with the auction this isn't about performance it's about basic

[00:10:51] ad spend pacing that meta has somehow managed to fumble three times in a month that I'm angry about

[00:10:57] we've got brands that had spent almost 40% of their daily budgets in one and a half hours tonight

[00:11:04] at CPAs 10 to 15 times what they should be I'm sure we'll get a random refund with little to zero

[00:11:10] communication about it but the damage is already done what meta doesn't understand is these issues

[00:11:16] impact the downstream effect for days later the sad thing was until this overspend we're finally

[00:11:23] getting things back on track from the late February overspend unquote it is not clear of course why

[00:11:30] this is happening but it's a good time to remind you of our reporting a few months ago that meta

[00:11:34] is now happy to overspend your daily budget by as much as 75% as long as it gets the daily

[00:11:41] average in line with your budget across the entire run in simpler terms if you're spending $100

[00:11:49] a day for five days it's quite possible that meta would spend $150 then $150 the next

[00:11:57] then a couple of days at $50 to bring things back in line before your campaign ends again it's not

[00:12:03] clear if this is what's happening here and as usual meta is silent on the issue just maybe checking

[00:12:08] with your campaign spends just to be sure putting our podcast and newsletter together can get

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[00:13:18] today's episode is sponsored by nerd wallets smart money podcast

[00:13:22] nerd wallets trusted financial journalists use fact-based reporting for some much needed

[00:13:27] clarity in the finance world helping you make smarter decisions with your money

[00:13:32] and if you like the format of this podcast you will love theirs it's packed with information

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[00:13:58] will thank you scientists say they have cracked open a bit of the mystery box of tiktok's algorithm

[00:14:04] and found that watch time long considered to be one of the biggest factors in a video success

[00:14:10] may not be the holy grail after all the data coming from thousands of users in europe

[00:14:15] who downloaded their data that's a new feature that was implemented in the app because of

[00:14:19] stricter european privacy laws and they gave that data to the researchers and that data revealed

[00:14:25] that between 30 and 50 percent of the first 1000 videos tiktok users see are because of their

[00:14:32] past interactions whether they like the similar video who they follow on the platform and so on

[00:14:38] 30 to 50 percent which I think is lower than a lot of people assumed and one surprising note

[00:14:45] the effective watch time wasn't as strong as earlier thought certainly the percentage of a video

[00:14:51] that the user watched had some effect but tiktok might be scaling that back that's it odds with

[00:14:57] the last couple of years of best practices which is why you often hear carry to start their video

[00:15:01] with something like and be sure to stay to the end because the last thing is amazing

[00:15:05] algorithms do change and this is a good reminder to always be testing and not locked into a strategy

[00:15:12] that might actually be years old

[00:15:19] if you've ever used the website glass door to anonymously complain about your former employer

[00:15:24] heads up that website might be doxing you to that employer glass doors always been a good place for

[00:15:30] people to leave anonymous employer reviews but it seems the site has quietly changed its policy and

[00:15:36] now mandates the use of real names for account holders worse some users say this happened without

[00:15:43] their knowledge or consent and that the only option support is offering is to delete your entire

[00:15:49] account along with your reviews and even then account deletion confirmation emails users are

[00:15:55] receiving ad that they might actually keep some of that data around anyway even if they do remove

[00:16:00] your accounts by request as far as anyone can tell this is actually due to an acquisition the

[00:16:05] company made a while back of an app called fishbowl it's a networking app for professionals and

[00:16:11] that app required users to use a real identity somehow the data architecture seems to have made

[00:16:17] it up to the main site either way if you've bashed a company or boss on glass door it might be

[00:16:23] worth double checking to make sure your name isn't suddenly right alongside it all so this is

[00:16:33] weird Microsoft is buying ads to promote its search engine Bing and it's buying them on Google

[00:16:40] that's not the weird part though the weird part is the ads go to a live Bing search

[00:16:47] so if you're searching Google for best hearing aids you might see an ad for Bing with the page title

[00:16:55] top five best hearing aids and that link goes to that same search on Bing

[00:17:00] it's sort of like search engine inception that specific example returns a list of ads on Bing

[00:17:05] for hearing aid pages and products many of them pages stuffed with affiliate links

[00:17:11] Bing has bought ads on Google before but until now it's been to throw people to the front page

[00:17:16] of Bing or promote its AI search something Google is probably not happy about but it doesn't want

[00:17:21] to rock the antitrust boat so they're just letting it fly practice isn't new ask.com did this more

[00:17:28] than a decade ago quoting search engine round tables coverage of this today quote it makes you wonder

[00:17:34] if Bing is doing this to win over Google users or if they have some sort of model where they can

[00:17:40] make more on their ad clicks than what they are paying for the Google ad click unquote either way

[00:17:48] definitely did not have that one on my big go card. Instagram has made a small but important

[00:17:56] change to how hashtags are used in the app now when you tap on a hashtag you will get a broader

[00:18:02] range of search results related to that hashtag than the previous top posts feed the new results

[00:18:07] page looks basically the same as the explore feed quoting social media today quote you can still

[00:18:13] follow a topic via the tag page but you don't have the full results like accounts audio places and

[00:18:19] reels that you would get via a similar search and explore by providing access to these additional

[00:18:24] elements Instagram's hoping to improve profile discovery as opposed to only highlighting content

[00:18:30] it'll also ideally expand user search behaviors by linking them through to the various elements

[00:18:36] so it's not a radical change but a logical one as the explore overview enables users to dig into

[00:18:43] different elements instead of being confined to the top posts feed unquote. What does this mean

[00:18:49] for marketers well it might be who view to include your brand's target keywords in your profile

[00:18:55] profiles that come up in this new search screen don't always have the hashtag or keyword in the media

[00:18:59] caption anymore but most do have that in their profile somewhere

[00:19:08] and a small correction yesterday we reported on lifts new video ad product

[00:19:12] we reported that the ad product in question was tablet based it turns out those video ads

[00:19:18] actually play in the lift mobile app

[00:19:21] so really enjoying the quest 3 the VR headset that we got a couple of days ago

[00:19:28] we had a rift in the old old version of it and it was fine but this one you know

[00:19:33] it's so much easier because there's no you don't have to like hook up little cameras to watch

[00:19:37] for your hands or you don't have to hook it up to a piece or anything the big problem though is

[00:19:42] you know remember you're strapping a computer to your head and it's heavy it's not as heavy as

[00:19:48] what I understand the apple headsets be but yeah it's quite it's quite heavy and you end up with this

[00:19:54] like I don't want to call it a weld like a mod definitely an indentation in your forehead

[00:20:01] for it and so anyway I've ordered this very elaborate and somewhat expensive like headset for

[00:20:08] the headset that will apparently take the weight off of it and we'll see anyway I bought

[00:20:14] Assassin's Creed and apparently it's like a full-fledged Assassin's Creed game I did try it for

[00:20:19] a couple of minutes it's it's kind of nuts you know being in 3d when you have to crouch under

[00:20:23] something you don't just press the crouch button you actually physically crotch your body so

[00:20:28] I don't know it looks really cool as probably what I'm doing this weekend either way that will do

[00:20:33] it for the week today in digital marketing is produced by engage q digital on the traditional

[00:20:38] territories of the student aim first nation on Vancouver island our production coordinator is Sarah

[00:20:43] Gild our theme is by mark blevus ad coordination by red circle and be high i'm Todd nafton have

[00:20:50] a restful weekend my friends I will see you on one day