What is value-based bidding in Google Ads, and how does it work?

Maximize conversions tries for the most conversions the budget buys, regardless of their value. Maximize conversion value tries for the most conversion value, and may bid higher in an auction that would bring more of it.

Google’s guidance is to bid on conversions where each is worth the same to you, and on value where they differ. If every conversion reports the same figure, value is the count times that figure, and the two strategies chase the same thing.

• Values that differ. Google says you must report two or more different values, and its best practices add that none should be zero. They can differ within one action, as each order’s total does, or between actions with one fixed value each: Google’s examples are a T-shirt purchase at $30 beside a sweatshirt at $60, and a phone call lead at $25 beside an online lead at $10.
• Values that mean something. Google accepts real economic values, like revenue, or proxy values, like a lead score. The strategy works to raise the number you report, so it has to move with what a conversion is worth to you.
• Enough conversions. Google’s best practices ask for at least 15 conversions a month, and Target ROAS on Search and Shopping needs 15 in the last 30 days. Demand Gen offers Maximize conversion value after 50 conversions with a value in 35 days, 10 of them in the last 7, or 100 across all your Demand Gen campaigns.
• Values reported for a while first. Google says to report values for 3 weeks, or 1 to 2 conversion cycles if that’s longer, before you switch, and not to backfill old ones. Its best practices checklist says 4 weeks or 3 cycles. A conversion cycle is the time a click takes to convert.
• Values that arrive soon. Google recommends a conversion reported within 7 days of the click, and daily uploads where the values come from an import.

A conversion value is the figure Google Ads records with a conversion as what it’s worth to you. The Conv. value column adds up the values of the conversions in the Conversions column, your primary actions, and that sum is what value-based bidding works to raise. A secondary action’s value shows only under All conv. value, and bidding ignores it unless the action is part of a custom goal. The not-converting guide sets the two kinds of column side by side.

Each action’s value starts with its own setting:

1. 01Go to Goals › Conversions › Summary and select the conversion action’s name.
2. 02Select Edit settings, then Value.
3. 03Choose how the action is valued, and save.

• Use the same value for each conversion. One fixed figure. Google fills in 1 as the default, which is right only if 1 is what the conversion is worth.
• Use different values for each conversion. The tag or the import sends each conversion’s own value, and the default you enter here is used whenever it sends none.
• Don’t use a value for this conversion action. Google marks it not recommended.

A change applies only to conversions that happen after it, and Google says it usually takes effect within a few hours.

Different values come with the conversion. For a sale, the tag passes the order’s total and its currency, or an import from Google Analytics carries the value. A lead form can set one from its answers: Google’s example values a kitchen renovation wanted immediately at $1,000 and one planned for the future at $100. For a lead that closes offline, Google recommends sending the value from your CRM with enhanced conversions for leads, its upgraded offline conversion import.

A conversion value rule changes the value of the conversions that meet a condition, without touching your tags. Google’s example is a business that values every lead at $5 and knows a lead from California is worth $10: a rule multiplying California’s conversions by 2 reports them at $10, and Target ROAS and Maximize conversion value bid on the adjusted value in each auction.

1. 01Go to Goals › Conversions › Value rules and select Create conversion value rule.
2. 02Choose the primary condition, Audience, Device or Location, and a secondary one of another kind if the rule needs both.
3. 03Set the adjustment: Add an amount to the value, or Multiply it by 0.5 to 10. Then select Save.

Only one rule applies to any conversion, and Google lists rules for Search, Shopping, Display, Hotel and Performance Max campaigns. To see what they did, select Segment, then Conversions › Value rule adjustment, which splits Conv. value into the original value and the adjustment.

Google adds a caution: Smart Bidding already reads location, device and your audience lists, so a rule is for value your reporting doesn’t show, such as a better margin or a customer worth more over time.

A lead passes through stages on its way to revenue: a form, a qualified lead, a sale. Google recommends choosing a single stage of that journey for bidding, and not selecting goals from several stages at once.

• Which stage. The sale carries the truest value. If it arrives too late to manage, Google says to choose an earlier stage such as a qualified lead: one with at least 15 conversions in 30 days, ideally one that happens within 7 days of the click.
• What value. Where you import the sale, send its real value. Where you bid on the lead, give it a proxy: a score from your CRM, as in Google’s example of a lead worth $25, $50 or $100 by its quality, or fixed values that tell kinds of lead apart.
• No way to tell leads apart. Google recommends Target CPA on qualified or converted leads, which bids for a count.

A store’s funnel works the same way: an add to cart or a begun checkout is a stage before the purchase. Google’s advice is to set only bottom-of-funnel actions as primary, and the conversion tracking guide shows how to find a stage counted beside its sale.

1. 01Go to Campaigns › Campaigns and set the date range to the last 30 days.
2. 02Select the columns icon above the table, then Modify columns, and add Bid strategy type, Conv. value, Value / conv. and Conv. value / cost. Note which campaigns bid on value, and each one’s Conv. value / cost.
3. 03Select Segment, then Conversions › Conversion action. Each campaign gets a row for each action it counted. Cost and the columns built on it show “--” under this segment, which is expected.
4. 04Read Value / conv. for each action: its conversion value divided by its conversions. Ask of each figure whether one conversion of that action is worth that much to you.
5. 05Open any action whose figure looks wrong, under Goals › Conversions › Summary, and read its Value setting.

Four things to look for, and what to do about each:

• A sale or a lead at 1.00. It’s the default nobody replaced, and a target ROAS of 400% on it asks for 4 conversions for each dollar. For a sale, choose Use different values for each conversion and check the tag sends the order’s total. For a lead, enter what one is worth.
• Every action at one figure. Value-based bidding has nothing to choose between. Give the actions values that differ, or bid on conversions.
• A step valued like the sale. Divide the sales by the steps and multiply by the average sale: that share is the most a step can be worth. Make the step secondary, as Google advises, or set it well under its share.
• A zero. Google advises against conversions with a value of 0 in value-based bidding, and recommends removing them from the data if they are worth nothing to you.

Every day Goldbeater reads each enabled conversion action your bidding counts and what it recorded over 30 days: a primary action in a goal a campaign bids on, or any action in a campaign’s custom goal. It raises a sale or a lead that a campaign on Maximize conversion value or Target ROAS counts, where 5 or more conversions carried 1 or less each. In a currency whose unit is worth less than a dollar, the line is a dollar’s worth.

That is the table’s Showroom booking row, with the 4 campaigns bidding on value. Competitors bids with Maximize conversions, so it isn’t among them. What a booking is worth is yours to say, so Goldbeater drafts no change here.

The second check works out a step’s share of a sale from your own 30 days, for an add to cart, a begun checkout, a lead or a sign-up that bidding counts. The share is how many of your primary sales were recorded for each step, at most one, times the average sale, read from 5 sales or more. Goldbeater raises a step that carries its share or more: medium where a campaign counting it bids on value, and low where none does.

The sum is the one under the table. Goldbeater drafts the step’s value at half its share, $39.30 here, which you can change to any figure under the share. Once you approve it and press Apply, every conversion of the step counts at that value, whatever its tag sends, and each sale keeps its own. At Apply, Goldbeater reads the action again and refuses the change if it would no longer lower the value, or if a guarded campaign counts the action.

A cart counted beside its purchase is a finding of its own, in the conversion tracking guide. The attribution guide covers how a conversion’s credit is shared between clicks, and the audit checklist puts conversions first, since every bid reads them.

What’s the difference between Maximize conversions and Maximize conversion value?

Maximize conversions tries for the most conversions your budget buys, whatever each is worth. Maximize conversion value tries for the most conversion value, and may bid higher where a conversion would be worth more. If every conversion reports the same value, the two chase the same thing.

How many conversions does value-based bidding need?

Google’s best practices ask for at least 15 conversions a month, and Target ROAS on Search and Shopping needs 15 in the last 30 days. Google also asks for two or more different values, none of them zero, reported for at least 3 weeks before you switch.

How do I set a conversion value in Google Ads?

Go to Goals, Conversions, Summary, select the conversion action, then Edit settings and Value. Choose the same value for each conversion and enter the figure, or different values for each conversion and have the tag or import send each one’s value. A change applies to conversions that happen after it.

Why does every conversion show a value of 1?

1 is the default Google fills in for a conversion action’s value. Either the action is set to use the same value for each conversion and nobody changed it, or it’s set to use different values and the tag sends none, so the default is used. Check the action’s Value setting, then the tag.

What are conversion value rules in Google Ads?

Rules that adjust a conversion’s value when it meets a condition you set: an audience, a location or a device. A rule adds an amount or multiplies the value by 0.5 to 10, and Target ROAS and Maximize conversion value bid on the adjusted value. They’re under Goals, Conversions, Value rules.

Can I use value-based bidding for leads?

Yes, if you can give leads different values: a score from your CRM, fixed values for different kinds of lead, or the sale’s value imported with enhanced conversions for leads. Google recommends bidding on a single stage of the lead’s journey. If you can’t tell leads apart by value, Google recommends Target CPA on qualified or converted leads.