An online retailer has a goal of increasing the value they see from their Search campaigns, and the Chief Marketing Officer has set a target return metric they need to achieve in the coming year. Which Smart Bidding strategy is the right fit for this organization?

Analysis of Correct Answer(s)

• Target ROAS (Return On Ad Spend) is the correct choice because it directly addresses both key objectives: increasing value and achieving a specific target return metric.
  • Value Focus: For an online retailer, "value" from Search campaigns is typically measured by the revenue generated from sales. Target ROAS optimizes bids to achieve the highest possible conversion value relative to ad spend.
  • Target Return Metric: ROAS explicitly measures the return on investment (revenue / ad spend). When a Chief Marketing Officer sets a "target return metric," they are almost certainly referring to a revenue-based return like ROAS. This strategy allows the organization to set a specific percentage return they aim to achieve, and the bidding system will optimize to meet or exceed this goal.

Analysis of Incorrect Options

• Target conversion value: While this strategy focuses on maximizing the total conversion value within the budget, it does not explicitly aim for a specific return metric or ROAS. It seeks to get the most total value, which could potentially lead to a lower or higher ROAS than desired if not constrained by a specific target. The question's emphasis on a "target return metric" makes Target ROAS a more precise fit.
• Maximize clicks: This strategy aims to drive as many clicks as possible within the budget. It is primarily used for brand awareness or traffic generation, not for optimizing for sales value or achieving a specific return on investment, which are the core goals stated in the question.
• Maximize conversions: This strategy focuses on getting the highest number of conversions within the budget. For an online retailer, different conversions (e.g., purchasing a low-cost item vs. a high-cost item) can have vastly different values. Maximizing conversions doesn't inherently maximize the monetary value of those conversions or ensure a specific return on ad spend, making it less suitable than Target ROAS for the stated goals.