Businesses that use Google Ads often start with a Paid Search or Shopping campaign before displaying advertising. This is an excellent place to start for the majority of companies.
Display advertising on the Google Display Network (GDN) is one way to expand your advertising capabilities, further growing your leads or sales.
Display advertising on the GDN also offers some branding benefits, putting your brand in front of internet users who may be interested in your business.
If you’re considering Display advertising but are concerned about how the campaign will perform, a ‘pay for conversions’ Display campaign may be the right choice for you.
In this post, we’ll explain what a ‘pay for conversions’ Display campaign is, how to set one up, and how to make it more effective in just 12 steps.
What is a ‘pay for conversions’ display campaign?
Advertisers paying for Google Display advertising had two options in the past.
Alternatively, advertisers could pay once their ad was shown 1,000 times by setting a maximum cost per 1,000 impressions bid or pay for each time it was demonstrated by setting a maximum click price (CPC) (CPM).
On the other hand, Google released a Display campaign in 2018 that allows advertisers to pay based on conversions rather than clicks or thousand impressions.
To avoid paying too much for clicks or impressions, set a maximum amount you’re willing to pay for conversions instead. This way, you only pay when your Display campaign results in a conversion.
To create a “pay for conversions” display campaign, what are the prerequisites?
As you might expect, Google has put some restrictions on who can make a ‘pay for conversions’ Display campaign.
The specifications are as follows:
You can only pay for conversions with a standard or Smart Display campaign when using a standard or Smart Display campaign.
Target CPA is the only bidding option available for a ‘pay for conversions’ Display campaign (tCPA).
Note website or app conversions — “Pay for conversions” bidding cannot optimize offline conversions (such as store visits) or cross-device conversions.
Set aside a specific sum of money – a ‘pay for conversion’ budget. There must be separate funding for each display campaign, not a pooled one.
At most, the total cost per acquisition (tCPA) can’t exceed $200 (or its equivalent in another currency).
There must have been 100 conversions in the last 90 days for your account to qualify.
Days to conversion must be less than seven days – 90% of your conversions must occur within seven days of someone first clicking on your ad.
How do I set up a display campaign that pays for conversions?
Creating a ‘pay for conversions’ Display campaign is similar to creating a standard or Smart Display campaign; the only difference is that when you get to that stage in the setup, you will select the option to pay for conversions.
Begin by selecting your campaign goal by clicking on the blue plus symbol. You have the option of choosing ‘Sales,’ ‘Leads,’ or ‘Website traffic.’ You cannot select the campaign goals’ Product and brand consideration,’ ‘Brand awareness and reach,’ or ‘App promotion.’
Choose between the ‘Smart display campaign’ and the ‘Standard display campaign’ options.
Choose the Standard display campaign option if you want more control over your display campaign; choose the Smart display campaign option if you’re going to use Google’s machine learning capabilities to optimize your campaign automatically.
Create a new campaign as usual.
When you get to the ‘Bidding’ section, you’ll see if you can create a ‘pay for conversions’ Display campaign. You’ll be able to choose between paying for clicks or paying for conversions here.
Accounts without the ability to pay for conversions cannot run this campaign.
12 tips for creating and running a successful “pay for conversions” display campaign
Here are 12 tips for optimizing your “pay for conversions” Display campaign.
Decide on the best conversion strategy.
To maximize the number of conversions from a Display campaign, you must first decide what kind of conversions you want to target.
Using the above example, the Display campaign will value both sales and newsletter subscriptions equally, meaning that you will pay the same amount for either one when making a sale or when making a subscription.
Utilize every inch of available space
A Smart Display campaign requires only the submission of a few assets, such as copies and images or videos.
After that, Google’s machine learning algorithms will optimize the delivery of assets and target the intended audience.
Display ads allow you to use up to five headlines: one long headline and up to five description lines.
Be sure to fill out all the fields and to use unique messaging in each one. All your messaging will be split testing, so the system can determine which combination works best with your target audience.
Including a video in your’ pay for conversions’ Display campaign can help Google expand your reach by displaying your ad in more places. You are permitted to upload up to five videos.
Insert a variety of images
Use more than one image so that the system can test the performance of each image and determine which types of images perform best. Each ad can have a maximum of fifteen assets.
If you’re having trouble coming up with fifteen images to split test, look at the stock images provided by Google Ads. In the image upload area, click on ‘Stock Images’ to access the stock image section.
Customize how you target your traffic.
If you run a Smart Display campaign, Google will use machine learning to determine your target audience.
While you have no control over who sees your ads, you do have the ability to influence the algorithms. Create multiple ad groups with different messaging in the ad copy and landing pages to tailor your traffic.
You have more control over your target audience if you use a Standard Display campaign; however, it is still a good idea to tailor your messaging and landing page to each audience you want to target.
Make a separate ad group for each landing page. Each ad group’s ad copy should be tailored to resonate with the type of person interested in each landing page.
As a result, Google’s machine learning algorithms will learn which types of audiences perform best with each landing page. This can produce significantly better results than a single ad group with a single “catch-all” landing page.
For example, if you sell men’s and women’s trainers, the performance of your ad will vary depending on the gender of the person viewing it.
Depending on the customer’s gender, the most appropriate ad copy messaging, images, and landing page will be different.
You can start with an advertisement.
Replace underperforming ad messages
Google Ads has an easy-to-use interface that displays how well each of your ad messages is performing. Go to your ads and click on ‘View asset details’ to find this report.
The performance column indicates how well each message is doing. Your messages will be graded as Best, Good, or Low.
An excellent place to start is to replace messages with a ‘Low’ score with something else.
Allow your ads to accumulate more data after changing a message, and then evaluate the new message’s performance.
Determine a reasonable tCPA
It can be tempting to set an aggressively low tCPA to achieve conversions at a meager cost per acquisition.
However, your impressions will fall if the system believes it cannot obtain a conversion at your tCPA.
When launching your’ pay for conversions’ Display campaign, I recommend setting the tCPA higher than the CPA of your search campaigns. This will allow Google’s machine learning algorithms to experiment and learn about the types of users to target.
Once the Display campaign has generated some conversions and you begin to see performance improvements, you can gradually reduce the tCPA figure and increase the campaign’s profitability.
Think about your content exclusion options.
You may wish to avoid certain types of placements. For example, if your product is aimed at children, having your ad appear next to sexually suggestive content can harm your brand.
Use the content exclusions section to prevent your ads from being shown alongside content that could harm your brand. Within your campaign settings, look for the ‘Content exclusions’ section.
Connect a data feed
E-commerce sites with a product feed can connect it to their pay for conversions’ Display campaign.
Your feed, like a product feed for a Google Shopping campaign, must be saved in Google Merchant Centre. It must also be linked to your Google Ads account.
By connecting your product feed to your Display campaign, Google Ads will be able to further tailor your ads by incorporating products from your feed into your Display ads.
Go into the campaign settings and look for the ‘Dynamic Ads’ section to connect your product feed to your Google Display campaign. This section will appear if your feed is already linked to your Google Ads account.
Hold on tight!
When you launch your’ pay for conversions’ Display campaign, you should expect a massive increase in impressions as the machine learning algorithms learn which type of audience works best for your company.
The example below took the machine learning algorithms nine months to secure the campaign’s first conversion. After its first conversion, it began to receive a small number of modifications each month.
Recognize that there is a severance point.
While it is generally a good idea to see how low your cost-per-conversion can be, keep in mind that there appears to be a cut-off point.
If you have a fixed budget that you cannot exceed and need to reduce your spending, it may be a good idea to reduce your tCPA gradually. This means you’ll pay less per conversion and spend less money.
However, it is critical to recognize that there is a limit. If you reduce your tCPA too much, Google may decide to stop sending you traffic entirely.
This can be seen in the screenshot below of a test we ran in which the tCPA was gradually reduced to reduce overall spend. Google cut off all traffic after a certain point.
We then began gradually increasing our tCPA. To get Google to start sending us impressions again, we had to increase our tCPA to around twice before.
Keep this in mind if you have monthly conversion targets that require the assistance of a ‘pay for conversions’ display campaign; the constant reduction of the tCPA resulted in us not receiving any conversions or traffic from our’ pay for conversions’ Display campaign for a few days.
Be prepared to see changes in your reports.
As previously stated, the ‘pay for conversions’ report can provide you with a massive influx of impressions, which may then plummet the following month as the algorithms test and learn what works best for your business.
Your clickthrough rate is also likely to fluctuate as the system determines which ad messaging and audience type is best for your company.
If you hadn’t previously run a Display campaign, your reports would undoubtedly show a significant increase in impressions and clicks.
You should also expect a significant decrease in clickthrough and conversion rates. Remember all of this when updating your PPC performance report and presenting it to your manager or client.
It may be worthwhile to separate your Display advertising data into a separate report to avoid skewing the figures in your PPC reports.
Finally, we ran a ‘pay for conversions’ Display campaign for several of my clients and saw a slight increase in profitable conversions for all of them.
This campaign type is a shallow risk because you pay for conversions rather than clicks. I would advise advertisers to test a ‘pay for conversions’ Display campaign while also implementing the measures outlined in this blog post to give it the best chance of success.