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Conversion optimizer increases conversion decreases CPA.

Written by power @ 10:15 PM permanent link on Tuesday, March 24, 2009 | Post a Comment |

Google Adwords team claim conversion optimizer a feature in Google Adwords conversion tracking when used effectively will give better conversions with lower Cost per acquisition.
Conversion tracking is a feature of Adwords conversion tracking data to get more conversions for a lower price. With the Conversion Optimizer, you bid using a maximum CPA, which is the most you're willing to pay for each conversion (such as a purchase or signup). Using historical information about your campaign, the Conversion Optimizer automatically finds the optimal equivalent cost-per-click (CPC) bid for your ad each time it's eligible to appear. You still pay per click, but you no longer need to adjust your bids manually to reach your CPA goals and can benefit from improved ROI.

To calculate the optimal equivalent CPC bid, the Conversion Optimizer first calculates a predicted conversion rate for each auction. The Conversion Optimizer takes many factors into account, including your ad's conversion history, the keyword's broad match query, the user's location, and the conversion rates of Google's search and content partner sites. The feature then generates an ad rank by combining your CPA bid, quality score and predicted conversion rate.

According to Adwords blog:

"We've just completed a new analysis on the performance of campaigns which have adopted Conversion Optimizer. We found that on average, these campaigns achieved a 21% increase in conversions while at the same time decreasing their CPA by 14%.

The analysis compares the performance of Conversion Optimizer campaigns with a control set of campaigns and represents the average impact of Conversion Optimizer. The actual impact will vary from campaign to campaign (and a small number of advertisers could conceivably perform better without Conversion.

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