The essentials
- Definition: Smart Bidding covers the bidding strategies that set the CPC at each auction according to the estimated probability of conversion: target CPA, target ROAS, maximise conversions, maximise conversion value.
- Prerequisite: reliable conversions and enough volume, around 30 conversions over 30 days for a target CPA, 50 for a target ROAS.
- Learning phase: 7 to 14 days after each significant change; do not change the target by more than 15 to 20% at a time.
- What the algorithm does not do: check that your conversions are worth anything, or fix a poor structure and mediocre ads.
Smart Bidding has become the default bidding mode in Google Ads: in 2026, more than 80% of Search spend in France goes through an automated strategy. The algorithm calculates a different bid for every search, based on signals (device, time of day, location, history, audience, query) that no manager could process by hand. It is effective when it has correct data and a coherent objective, and expensive when either of the two is missing. Here is how it works, which strategy to choose and how to set it up.
The available strategies and their logic
| Strategy | What the algorithm optimises | Recommended volume | Use cases |
|---|---|---|---|
| Maximise conversions | The largest number of conversions within the budget | From 10 to 15 conversions per month | Launch, data collection phase |
| Target CPA | An average cost per conversion close to the target set | 30 conversions over 30 days | Lead generation, stable value per contact |
| Maximise conversion value | The sum of conversion values within the budget | 15 to 30 conversions with a value recorded | E-commerce in a growth phase |
| target ROAS | An average return on ad spend close to the target | 50 conversions over 30 days | E-commerce with a known margin per product |
| Maximise clicks | The largest number of clicks (not a Smart Bidding strategy in the strict sense) | None | Account with no measurable conversion, brand awareness |
| Target impression share | An impression share in a given position | None | Brand campaign, defending a position |
Since 2021, target CPA and target ROAS are no longer separate strategies but options added to “maximise conversions” and “maximise value”. The behaviour remains the same: with no target, the algorithm spends the whole budget; with a target, it limits the bid to the searches that look compatible with the objective.
The conditions without which the algorithm drifts
- Conversions that are worth something: the algorithm optimises what you give it. If a visit to a “contact” page counts as a conversion, it will look for curious visitors, not customers. Remove secondary conversions from the “Conversions” column; see Google Ads conversions.
- Enough volume: below 15 conversions per month, the estimates are noisy and bids swing. Group the campaigns into a portfolio strategy or move up a level (counting quote requests rather than signed sales) to reach the volume.
- An unconstrained budget: a campaign “limited by budget” with a target CPA cannot explore; the algorithm then narrows delivery to the safest times and queries, which brings the volume down.
- Stable measurement: any change of tracking (a new tag, consent, a GA4 import) resets learning to zero. Enhanced conversions and consent mode v2 are essential in Europe for the algorithm to see enough conversions; the GA4 and GDPR report covers this point in detail.
Setting and adjusting the target
The first target is set from the cost per conversion observed over the past 30 days, not from the objective you would like. If the account converts at €42 on “maximise conversions”, a target CPA of €45 maintains the volume; a target of €25 halves impressions within a few days, without bringing the real cost down. After that, the adjustment happens in steps:
| Step | Action | Time before reading the results |
|---|---|---|
| How to set it up | Target equal to the actual CPA of the past 30 days, or 5 to 10% above | 14 days |
| Lowering the target | A reduction of 10 to 15% maximum | 7 to 14 days |
| Budget increase | An increase of 20% maximum per week | 7 days |
| Change of strategy | Moving from target CPA to target ROAS, or the reverse | 14 to 21 days |
| Expected seasonal peak | Seasonality adjustment for events of 1 to 7 days | Immediate |
The account goes into learning at every change: the “Learning” status appears in the Status column, and performance is unstable during this period. Avoid stacking changes; one per week and per campaign is a reasonable pace. The list of metrics to watch during these phases is in the Google Ads KPIs.
Portfolio strategies and value-based bidding
A portfolio strategy groups several campaigns under a single target; it makes it possible to reach the minimum volume and to set a maximum CPC, a setting absent from the standard strategies. This cap is useful in sectors with a high CPC (insurance, legal, training) where the algorithm may bid €30 or €40 on a search it judges promising. Value-based bidding goes further: instead of a single CPA, each conversion receives a value (the product margin, the value of a quote according to the size of the company, a lead quality score), and the algorithm optimises the total. It requires additional measurement work but improves ROAS by 10 to 20% on accounts that have conversions of very different values. The calculation of this value is explained in ROAS.
What automation does not replace
The algorithm decides the price of each click, not what surrounds it. The manager remains responsible for: the account structure, negative keywords, ads and their assets, landing pages, location and audience exclusions, and above all the check that the conversions counted correspond to real business. An account on Smart Bidding with poorly defined conversions is more dangerous than an account on manual CPC: the algorithm applies a wrong instruction with complete consistency.
How GreenRed helps
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Frequently asked questions
How many conversions do you need to use Smart Bidding?
Google recommends at least 30 conversions over 30 days for a target CPA and 50 for a target ROAS, at campaign or portfolio strategy level. Below that, “maximise conversions” without a target remains possible from 10 to 15 conversions per month, but with less stable results. Grouping the campaigns helps to reach the threshold.
Why does my performance drop after switching to target CPA?
Most often because the target is too low compared with the real cost per conversion: the algorithm then reduces bids and delivery. The 7 to 14 day learning phase also creates normal instability. Set the target at the level of the observed CPA, wait two weeks, then lower it in steps of 10 to 15%.
Can you set a maximum CPC with Smart Bidding?
Yes, only within a portfolio strategy, which accepts a bid cap. The standard strategies at campaign level do not offer one. A cap that is too low neutralises the algorithm; set it at two or three times the average CPC observed to limit extreme bids without blocking high-value searches.
Does Smart Bidding work without cookies or consent?
It works, but with less data. In Europe, consent mode v2 lets Google model part of the conversions from visitors who refuse tracking, and enhanced conversions recover conversions from the data entered in forms. Without these two mechanisms, the algorithm sees 30 to 50% fewer conversions and bids too low.