The bid you set is the maximum share of the product price that you're willing to pay for each advertised sale (CPA bid) or the number of impressions (CPM bid).
Every product you choose for a Joom Ads campaign should have a bid. You are never charged more than your actual bid.
How to set a bid?
You can set a bid while creating a Joom Ads campaign. To do this:
- Go to the Joom Ads page and click on + Create Campaign.
- Select a bid method: CPA or CPM.
- Set all other parameters and click Launch campaign.
CPA (Cost per Purchase)
CPA is a method where you pay when a purchase is made as a result of advertising impressions.
- The payment amount never exceeds the CPA bid you set for each product.
- This is a low-risk, low-reward method.
- It is measured in percent (%).
- We recommend using this method if you need to increase sales.
💡 Advice on setting the CPA bid
The best way is to set a bid within the product's gross margin. But if you want new products to quickly gain maximum traffic, you can select a bid higher than the product's gross margin.
Gross Margin (%)
Optimal CPA Bid Range
If you choose the CPA Bid method, you can turn on the Smart Discount mode.
If you leave the Smart Discount switch turned on, the Joom Ads mechanism will use some part of the potential campaign payment as a discount given to the customer.
- Your advertising expenses will not change since the sum of Smart Discount amount and Joom Ads amount will never exceed the CPA Bid.
- A discount is given only when it would most likely result in conversion. The smart algorithm will offer the most appropriate discount for every given customer.
- To find out how much money you provided in total as a Smart Discount, please refer to the Discount Sum column in the Joom Ads reports.
What are Reference Bid and eBid?
Reference Bid is a bid calculated by Joom, based on the analytics of your competitors’ bids.
- The bid is provided for your information.
- If there are not enough bids for reference in your leaf category, Joom Ads counts bids from the category one level up.
- The Reference bid is updated daily.
- If the Reference Bid is greater than 100%, it means that either the product is too cheap or the other merchants’ bids are higher (for more expensive products).
If you want your product to get more impressions, set the CPA Bid higher than the Reference Bid.
eBid (Effective Bid) is the amount you actually bid when you set the CPA Bid value.
CPM (Cost per Mile)
CPM is a method where you pay for every impression your campaign gets.
- The amount due depends on how many impressions you get.
- It is measured in euro for every 1,000 impressions your products receive.
- This is a high-risk, high-reward method.
- We recommend using this method if you need to get more impressions for your product.
💡 Advice on setting the CPM bid
While setting the CPM bid, aim for the following formula:
CPM = (Spent ÷ Impressions) x 1000
The bid value and your budget define the number of impressions your products get. You should carefully set the CPM Bid. The Joom Ads system will do its best to get you relevant impressions throughout the day, but it doesn’t guarantee you get sales for the products.
You will be charged according to the actual number of impressions your products get. You can check it in the CPM column in the Joom Ads reports.
If you choose the CPM bid method, you can also turn on Auto-bidding mode. Please refer to this file to learn more about this feature.
When setting a bid manually, you cannot choose which impressions are more valuable, and which ones you want to bid more for. Therefore, it is more efficient to use the Auto-Bidding feature and let the system calculate the appropriate bid for your case. This way, you will be able to set bids and promote products more effectively.
Which auto-bidding strategy to choose?
This strategy aims to maximize the Price Of Goods Sold (POGS).
This strategy aims to achieve maximum Price Of Goods Sold (POGS) while trying to spend no more than target ACOS * POGS.