Why is my Average CPC higher than my Bid Cap?

Ad Badger's Bid Algorithm has a feature known as a "Bid Cap." You can find more information on setting a bid cap in the separate help doc, "How to Set a Bid Cap."

If you're on this help doc, perhaps it's because you've noticed that your "Average CPC" is sometimes higher than your Bid Cap. Why ?

Let's start with some definitions:

  • Average CPC: Your total amount of ad spend over the amount of clicks for a certain scope and timeframe. You can look at the average CPC at the campaign level, account level, ad group level, product level, and of course keyword level.
  • Bid Cap: The highest Ad Badger will set your CPC Bid for a single keyword.

Let's say you have a keyword or campaign that was generating clicks at an average CPC of $2.00 for the past 30 days.

Then, you come to Ad Badger and set a bid cap of $1.50. All of your future clicks will not be higher than $1.50.

However, if you're viewing your average CPC for the past 30 days, you will likely have an average for the month to be close to $2.00. Your average for the day-- see the difference-- will not be over your bid cap because you're just looking at the cost and clicks for a single day when the bid cap was activated.

Another scenario where your bid might be higher than your bid cap is when you look at your ad group default bids. Ad Badger does not optimize your ad group default bids. Why? Because when you have an active keyword bid in Amazon, Amazon uses your keyword bid, not your ad group bid.

Have more questions about bid caps and average CPC's? We're here to help! Use the message bubble in the bottom right of any page.

We hope this article was helpful. Thank you for checking us out!

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