Right after the main holidays, most advertisers anticipate a huge drop in conversion rate, usually for 2-3 weeks. So, they have to decide: should they reduce bids or pause ads completely for this period?
If you pause ads for a couple of weeks, AI bidding algorithms stop getting data. When you resume ads after such pause, you’ll need a few weeks of relearning before you get to the desired CPA consistently.
I prefer reducing target CPA bids, this is why. Here is the case of how the bidding strategy responded to 2x bid decrease this year:
As you can see from the screenshot, Google easily responds to the target CPA decrease with the fact CPA decrease. In fact, the fact CPA for the last 14 days is almost identical to the average target CPA. One thing to bear in mind, though: this account has a lot of conversion data. Accounts with a low number of conversions may go to a similar point longer.
In this case, the 2x bid decrease led to a ~2x decrease in the number of conversions. But, in other cases, this ratio may be different because there’s no direct correlation between bid, fact CPC and the number of clicks.