Enhanced Cost-per-Click (ECPC) and Target Cost-per-Acquisition (CPA) are both automated bidding strategies that take a lot of the guess work out of setting your bids if your advertising goal is to increase conversions. Picking which one to use can be a difficult choice, even for an experienced Adwords user. It is important to understand the differences between the two strategies in order to make the most out of your campaign.
Target CPA was previously referred to as ‘conversion optimizer‘ as this is exactly what it does. Your Target CPA is the amount you are willing to pay for a conversion. In order to do this, you need to have conversion tracking set up and have at least 15 conversions within the last 30 days. As this strategy uses past conversion data, the more information you have, the better. Google recommends at least 30 conversions within a 30 day period but even more, conversions will lead to more accurate bids. It also uses this conversion data to avoid bidding for unprofitable keywords. Some conversions may cost more or less than your target CPA but Google aims to keep it at the average amount you have set.
Enhanced Cost Per Click also aims to get you the most conversions but allows you to stay in control of your keyword bids. Automatically adjusting your manual bids, this bidding strategy aims to achieve the same cost per conversion. Unlike Target CPA, Enhanced CPC is constrained your max CPC bid. This bidding strategy ultimately boosts your manual bid when a conversion is more likely by adjusting bids in select auctions. ECPC will make small changes to your bids compared to automatically generating them as CPA does. If Google’s algorithms predict that a conversion is more likely, it will bump up your bid to win that specific auction for that specific keyword.
When Google introduced Enhanced Cost Per Click they guaranteed a 30% increase cap on your max CPC. Google then announced that in June 2017 it was going to remove this cap to account for differences in conversion rates. ECPC still respects your manual bid, however, and aims to keep your average CPC below your Max CPC over time. You can read more about Google changes here.
But which one should you choose?
Google recommends trialing both strategies to see which works best for your campaign, but it also lies within personal preference. If you don’t want to spend time manually managing your bids and have a steady account in which you are willing to hand control to Google, then Target CPA is the strategy for you. After working hard to make your account successful it can be hard to give it over to an automated system. Enhanced CPC allows you to manage your bids manually but gives them the slight push they need when there is a higher chance of a conversion. This strategy is much more useful for smaller businesses with accounts with a smaller budget.