As of December 2025, automated bidding strategies within platforms like Google Ads and Microsoft Advertising use machine learning to optimise bids for conversions or conversion value, rather than relying on manual, rules-based adjustments. These systems analyse a vast number of signals to predict the likelihood of a conversion for each individual ad auction.
Currently, Google Ads offers several automated bidding options including Target CPA (cost per acquisition), Target ROAS (return on ad spend), Maximise Conversions, and Maximise Conversion Value. These strategies work by setting a desired outcome – for example, a specific cost you’re willing to pay for each customer – and the system automatically adjusts bids in real-time to achieve that goal. Microsoft Advertising offers similar strategies. In 2026, these systems will continue to leverage Google’s Privacy Sandbox initiatives, impacting signal availability and requiring adaptation. Data-driven attribution models, now standard, assign conversion credit across various touchpoints, informing bidding decisions. Australian businesses should be aware of compliance with the Australian Privacy Principles (APPs) when utilising these data-driven features. Google has announced Performance Max campaigns will continue to integrate with more inventory sources in 2027.
Automated bidding functions by continuously learning from campaign data and adjusting bids to optimise performance based on the chosen strategy and defined goals.
