How does CPC bidding work for Google Hotel Ads?

How does CPC bidding work for Google Hotel Ads?

November 8, 2019 0 By Luis Garrison


This video covers how you can use cost
per click or CPC bidding to bid on your Google Hotel Ads. Let’s start with some
reasons why you might choose to use cost per click bidding. CPC bidding lets you specify
the most you’re willing to pay for a click on a Hotel Ad. Then you only pay when
somebody actually clicks on your Hotel Ad, often less than your max CPC bid. If
you plan to actively manage your Hotel Ads campaign, using CPC will give you
granular controls to optimize your performance based on your marketing and distribution strategy. Using CPC bids with Hotel Ads is pretty straightforward: you
set a base bid. This base gets multiplied by any bid multipliers you set, and the
result is your total CPC bid. Let’s walk through these two components in more
detail. When you’re setting a CPC base bid, you have two options: First you can
bid a percentage of the room rate. Since hotel rates fluctuate based on factors
like weekday vs weekend and the type of room, using percentage of the room rate aligns your investment with the potential revenue from that booking. As an example, let’s say you bid one percent on a property with $150 per night rate, and that property is eligible to show to a searcher looking for two nights. Since
all bids get multiplied by the number of nights in the query, you would end up
having a total bid of $3. Your second CPC option is bidding a fixed cost per click per night. This bid is the maximum cost you’re
willing to pay for a click on a property. And taking the example from before, let’s say you bid $2 for that same
property, your $2 base bid gets multiplied by two nights for a total bid of $4. In most
cases when you’re using CPC, we recommend using percentage of room rate bidding
because it tailors your willingness to pay to the revenue of the room being
booked. In other words more expensive rooms automatically get higher bids. As
mentioned before, your base bids can get multiplied by any bid multipliers you
choose to set. These multipliers allow you to custom tailor your bids to any conversion rate trends
you see around factors like the user’s device, country or length of stay. In total you have six bid multiplier options. Hopefully the names on most of these let
you know what they do, but as a quick review you have: the device type
multiplier which lets you increase or decrease bids for users on mobile
devices; User country where you can adjust bids according to any conversion
rate trends you see around user location; Length of stay which is typically used
to decrease bids for longer stays since they typically have lower conversion
rates; Google site which lets you adjust bids
according to where your users are engaging with your Hotel Ads; Check-in day which
helps you adjust bids by day of the week, for example bidding more for Friday
check-ins as they tend to have multiple night stays, and last but not least,
Advanced booking window which can be used to increase bids for searchers
looking for accommodation sooner as they’re more likely to need to book
sooner. Let’s look at how all these multipliers work together to determine your total bid. Let’s say someone searches for a $150
room for two nights on Google Maps from their mobile device. Taking our 1 percent of room rate bid
base from earlier and adding two bid multipliers, here’s what happens: First, the base bid calculation from earlier in this video occurs, so 1% bid times $150 rate times two nights, equals a $3 base.
Next we multiply the two multipliers: a 10% increase for Maps and a 5% decrease for mobile phone users. And the final result is a $3.14 total bid. Note
how bid multipliers are additive and independent of one another. This means
you need to ensure you’re considering your overall strategy and you’re aware
of the cumulative effect of your multipliers.