What is Bid Strategy?
Bid strategy tells platforms how to value conversions—e.g., maximize value at a ROAS goal or get installs at the lowest CPA. It’s a lever you align to economics and growth stage.
Understanding Bid Strategy
Bid strategy translates business goals into how the platform values conversions in auction. Value‑based strategies (tROAS) reward higher order values, while CPA strategies optimize for the lowest cost per conversion. The right choice depends on price dispersion, margin, and cash constraints. Catalog advertisers often benefit from value‑based approaches paired with feed and creative improvements. Targets should be feasible given current conversion rates and AOV.
Healthy bid strategies balance control with learning. Aggressive targets can choke volume if value density (feed/creative) is weak. Gradual changes help the system relearn without resetting. Separate prospecting and retargeting so each has a coherent goal and budget. Read performance by product set to ensure the model is optimizing toward profitable items.
Why Bid Strategy matters
Bid strategy matters because it ties delivery to margin and cash realities. Clear, realistic targets keep scale while protecting efficiency. It also sets shared rules so teams adjust inputs (feed, creative, audiences) instead of randomly toggling budgets.
- Economics: Aligns delivery with margin realities.
- Control: Sets guardrails without micro-managing bids.
- Scale: The right strategy expands eligible auctions.
How Bid Strategy works
Bid strategy works by selecting an objective and, optionally, a numeric goal such as ROAS or CPA. The platform then bids into auctions it predicts can meet the goal given your data quality, creative, and audience. Value‑based bidding prioritizes higher‑value orders even at higher CPCs, while CPA bidding chases cheaper conversions with steadier costs. Targets that exceed what your funnel can support throttle volume. Improving feed clarity and template performance raises value per click, expanding eligible auctions. Adjust goals slowly and allow enough time in learning to stabilize.
Meta Information
- Primary Keyword: Bid Strategy
- Secondary Keywords: bidding, tROAS, tCPA, value-based bidding
- Target Word Count: 900–1,100 words
- Meta Title: What is Bid Strategy? How to Tell Platforms What You Want | Marpipe
- Meta Description: Bid strategy sets how platforms value conversions (ROAS targets, CPA targets). Learn how to choose and adjust for profit.
- URL: marpipe.com/ad-glossary/bid-strategy
# What is Bid Strategy?
Bid strategy tells platforms how to value conversions—e.g., maximize value at a ROAS goal or get installs at the lowest CPA.
It’s a lever you align to economics and growth stage.
Understanding Bid Strategy
Bid strategy translates business goals into how the platform values conversions in auction. Value‑based strategies (tROAS) reward higher order values, while CPA strategies optimize for the lowest cost per conversion. The right choice depends on price dispersion, margin, and cash constraints. Catalog advertisers often benefit from value‑based approaches paired with feed and creative improvements. Targets should be feasible given current conversion rates and AOV.
Healthy bid strategies balance control with learning. Aggressive targets can choke volume if value density (feed/creative) is weak. Gradual changes help the system relearn without resetting. Separate prospecting and retargeting so each has a coherent goal and budget. Read performance by product set to ensure the model is optimizing toward profitable items.
Why Bid Strategy matters
Bid strategy matters because it ties delivery to margin and cash realities. Clear, realistic targets keep scale while protecting efficiency. It also sets shared rules so teams adjust inputs (feed, creative, audiences) instead of randomly toggling budgets.
- Economics: Aligns delivery with margin realities.
- Control: Sets guardrails without micro-managing bids.
- Scale: The right strategy expands eligible auctions.
How Bid Strategy works
Bid strategy works by selecting an objective and, optionally, a numeric goal such as ROAS or CPA. The platform then bids into auctions it predicts can meet the goal given your data quality, creative, and audience. Value‑based bidding prioritizes higher‑value orders even at higher CPCs, while CPA bidding chases cheaper conversions with steadier costs. Targets that exceed what your funnel can support throttle volume. Improving feed clarity and template performance raises value per click, expanding eligible auctions. Adjust goals slowly and allow enough time in learning to stabilize.
Best practices
- Back goals into margins (POAS/ROAS math) before setting targets.
- Separate prospecting vs. retargeting; goals differ.
- Improve feed and templates to lift value density before tightening goals.
- Adjust slowly and give time to learn.
- Exclude low-performing SKUs to protect profit.
Key Takeaways
- Bid strategy determines how platforms optimize your budget (lowest cost, target ROAS, manual, etc.).
- Choose strategies aligned with your goals: awareness (impressions), consideration (clicks), conversion (ROAS).
- Feed quality and creative relevance improve predicted performance, helping any bid strategy work better.
- Test strategies systematically and allow learning phases to complete before changing.
