About commissions (per conversion) for hotel ads

Commissions (per conversion) is a way to pay only when a traveler books your hotel. Commissions (per conversion) is a Smart Bidding strategy that automatically adjusts your bid to help you maximize conversions. You pay a percentage of the booking value that you set.

• Overview of commissions (per conversion)
• Set up commissions
• Evaluate performance
• Frequently asked questions

Overview of commissions

Commissions (per conversion) helps you achieve a predictable cost per conversion. This cost is a percentage of the booking value that you set in Google Ads. The commission should represent how much revenue you're willing to spend on hotel ads for each dollar that you earn from bookings from your hotel ads.

Benefits

• Maximize your conversion value with minimum effort
• Define a consistent cost relative to revenue you earn from hotel ads
• Adaptive learning predicts performance at different bid levels to maximize conversions
• Auction-time bidding is used for every auction, not just a few times per day

Before you begin

Before you can use commissions (per conversion), you need the following from the Global Site Tag (gtag.js).

Conversion tracking with the following required parameters:

• 'value'
• 'currency'

While optional, these parameters also help Google optimize your performance:

• 'start_date'
• 'end_date'
• 'id'

How commissions works

The commissions (per conversion) bidding strategy predicts future conversions and associated values by using your reported conversion values, which you assign through conversion tracking. Then, commissions (per conversion) sets an optimal CPC (cost-per-click) bid while trying to maximize total conversions at the cost-per-conversion equal to your target.

To help improve your performance, the commissions (per conversion) strategy adjusts bids using auction-time details such as the traveler's device type and location, the Google site where the hotel ad appears, geographic location, itinerary, and hotel price.

The average cost-per-click will vary, but regardless of the number of ad clicks, you only pay if a conversion happens.

Example

For general information on conversion tracking and how Google uses conversion tracking data, refer to track sales and other conversions.

Choose the right commissions (per conversion) bid

To find the right commissions (per conversion) bid, determine what distribution margin you want to spend for your bookings.

For example, if your goal is to spend an average of 12% of booking value, maximize your booking revenue, and you have a cancellation rate of 10%, then your commission bid should be 10.8%.

If you decrease the commission, your bid in the auction will decrease and can result in less bookings. Similarly, if you increase the commission bid, your bid in the auction will increase and can result in more bookings. Keep in mind that this depends on the auction, and booking volume changes aren't guaranteed with commission changes.

Conversion metrics

Conversion metrics such as "Conversions" and "Average Booking Value" can be updated one or more days after a click occurs depending on when an individual user converts and your account's attribution window (the number of days after the customer clicked that we'll attribute a conversion to a click). This means that the cost for a campaign using a commission bid strategy can also change one or more days after a click.

Set up commissions

Evaluate performance

You can view the current conversions and cost-per-conversion for a campaign in the campaign summary table. Learn more about your conversion data.

Best practices

This section lists some best practices when setting up and using the commissions (per conversion) bidding strategy.

• To get the best performance with commissions (per conversion), your campaign should have at least 10 conversions per week. If your campaigns don't have this many conversions per week, consider merging some campaigns together when using commissions.
• Organize hotels into different campaigns depending on distribution margin or conversion rate. Commissions may perform better when partners' hotels are grouped by similar ROI goals and performance. Learn more About hotel groups.
• Allow the campaign to accumulate traffic for at least 7 days before evaluating performance and making changes.
• Don't change your commissions (per conversion) bid more than once every few weeks. This gives you time to account for any conversion delays and give the commissions autobidder strategy time to adjust.
• Ensure conversion tracking is well implemented on all landing pages and all devices. Outages in conversion tracking (complete or partial) can significantly impact your performance and volume.

Tune and evaluate

• The more data Google Ads has, the more it can optimize per conversion bids.
• Keep in mind that changes in ad performance are natural, and you may need to use the commissions (per conversion) bid strategy for some time to understand how it affects your campaign's performance.
• Don't make large changes to a campaign while using commissions (per conversion). For example, don't pause all active hotel IDs and replace them with new ones.
• Don't remove your conversion tracking code from your website or move it to a different location while running the commissions (per conversion) bid strategy. These kinds of changes can result in significant changes in which clicks lead to reported conversions. If you do change your conversion tracking code, the pay-per-conversion bid strategy might need several weeks to adjust to these changes.
• Compare your clicks and conversion rate before and after using the commissions (per conversion) bid strategy to gauge its impact on your campaign.

Frequently asked questions

Related links

• Commission-based bid strategies in hotel ads to sunset
• Set up Target ROAS bidding for Hotel Ads
• Edit bid adjustments for hotel campaigns or ad groups
• Bidding overview for hotel ads
• About bid adjustments for hotel ads