GOOGLE'S NEW ADWORDS ROTATION SETTINGS
WHAT IS THE CHANGE?
On August 29th, Google announced that ad rotation will be minimized from the current four settings to two: “optimize” and “rotate indefinitely.” This change will begin in late September and any advertisers utilizing “optimize for conversions” or “Rotate evenly” will no longer be supported. Below is our position on the change, why we believe it is occurring and considerations for advertisers as they navigate it.
WHY IS GOOGLE MAKING THE CHANGE?
Google wants advertisers to view AdWords as the best investment of their marketing dollars. For that to happen, client performance needs to be strong. The best way to guarantee strong performance, is to ensure that advertisers are utilizing AdWords features in the most optimal way. This change will help prevent advertisers from making the wrong choice, which could therefore hurt performance, and negatively affect the value of AdWords.
Also, there is a long-term trend that is forming. Recently Google announced the move away from standalone app install campaigns. Going forward, all app install campaigns will only be available as Universal App Campaigns (UAC). UAC’s do not leverage keywords and instead leverage your application page (much like dynamic search ads utilizes websites) to connect your ads to relevant searches. In both cases, these changes mean less advertiser control and fewer optimization levers.
Reducing the number of ad rotation settings from four to two is the assumed first step in the eventual transition to a more machine learning approach. Facebook, similarly, does not provide ad rotation settings, and instead displays only the ad it deems most likely to achieve its key performance indicator (KPI).
Take stock of your current ad rotational settings. Any that are set to "rotate evenly" will automatically be changed to "optimize.” Advertisers that are running creative tests, may want to avoid the “optimize” setting, unless it is the desire to relinquish the testing and optimization control to Google. Google’s announcement does not explore how this change will impact AdWords Drafts and Experiments, and whether, or not, advertisers can still leverage that product to define percentages of traffic to test against and optimize toward.
As of what we know today, it is unclear how the "optimize" setting will work. On the one hand, Google states "this (optimize) setting will optimize your ads for clicks..." On the other hand, the announcement notes "if you'd like to prioritize conversions, the best way is to use smart bidding", “best” being the operative word, implying other options exist. Additionally, a screenshot of the new settings in Google’s blog post defines "optimize" as a feature that will "show ads that are expected to get more clicks or conversions".
Google raises “smart bidding” as the ‘best’ way to “optimize” for conversions; however, if an advertiser is leveraging a third party tool for bid optimizations, then “smart bidding” would be obsolete and redundant, potentially causing performance decay. Smart bidding is not compatible with third party tools.
Advertisers should be conscious of their primary conversion source. Unless the advertiser is relying solely on Google pixel conversion tracking or Google Analytics data, the “optimize” setting is not recommended. If the conversions aggregating in AdWords are not the primary metric an advertiser optimize towards, ads could inadvertently be selected to optimize to conversions when those conversions are not a relevant measurement of success.
Lastly, ad rotation settings will now be available at the ad group level. It is uncertain if it will be available at both campaign and ad group levels, or simply at the ad group level. If it is accessible at both levels, will the ad group setting trump the campaign level setting (presumably)?
Google is once again reducing the options available to advertisers to make things “simpler”. While this may be appropriate for AdWords Express, simplifying AdWords often means reducing the levers that more experienced advertisers have at their disposal. Time will tell if this is eventually leading to an AdWords with no ad rotation settings whatsoever, or if, like their handling of device level bid adjustments, Google ends up pivoting back to provide more options and flexibility. As the transition date nears, we expect the ambiguity to clear and better defined best practices to appear.