Bid Adjustment
Last updated: January 21, 2025
What are bid adjustments?
A bid adjustment – also called a bid modifier – is a powerful tool in online marketing that lets advertisers raise or lower their default ad bids by a percentage. These adjustments are based on specific criteria such as the device the user is on, their location, the time of day, or their membership in a particular audience. By selectively increasing or decreasing bids, you can deploy your campaign budget far more efficiently.
The main purpose of bid adjustments is to optimize ad performance. By bidding more for impressions that are highly likely to lead to a conversion, and less for those with lower potential, you increase the relevance of your campaigns. Platforms like Amazon Ads apply these adjustments in real time during the ad auction to determine the final bid for an impression.
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How bid adjustments affect the final bid
Calculating the final bid using adjustments follows a clear logic. Starting from a base bid that you define, the percentage value of the applicable adjustments is added together. The result is then multiplied by the base bid to arrive at the final bid.
Final bid = Base bid × (1 + sum of percentage adjustments)
In systems like Amazon DSP, individual adjustments are capped at up to 900% (+900%). When several bid adjustments are combined, an upper limit also applies in order to prevent an uncontrolled escalation of bids. This keeps the budget under control at all times, even in complex campaign structures.
Why bid adjustments are decisive for your campaign success
The strategic use of bid adjustments is a decisive factor in the success of digital ad campaigns. Instead of submitting a single, uniform bid for all potential impressions, they enable a differentiated, data-driven approach. You can focus your budget precisely on the segments that promise the highest Return on Ad Spend (ROAS), while at the same time reducing spend on less profitable areas.
This granular control not only leads to better budget efficiency, it also improves overall campaign performance. If you know, for example, that mobile users have a higher conversion rate, you can use a positive device bid adjustment for mobile devices to increase your visibility in this valuable segment and ultimately drive more sales.
Bid adjustments in action: a practical example
Imagine you run an online store for sustainable sportswear and run video ads on a platform like Amazon. Your default bid for an ad is €1.00. After analyzing your campaign data, you find that two factors significantly increase the likelihood of a purchase: users who have already visited your website (a custom audience), and ads served as video directly on product detail pages.
Based on this insight, you set up two bid adjustments: an increase of 50% for your retargeting audience and a further increase of 100% for video placements.
€1.00 × (1 + 0.50 + 1.00) = €2.50
Your bid is therefore dynamically tripled in order to win this particularly valuable impression with a high probability.
Frequently asked questions (FAQ)
Which dimensions can I set bid adjustments for?
Bid adjustments offer granular control over various dimensions of your campaign. The most common ones include devices (mobile devices, tablets, desktops), geographic locations (countries, regions, cities), times of day or days of the week, as well as specific audiences (for example, based on demographic characteristics or past user behavior). In display networks, you can also make adjustments for particular placements.
Which hierarchy applies when multiple bid adjustments overlap?
In most advertising systems, a clear hierarchy applies. Adjustments at a more specific level generally take precedence over those at a more general level. This means that a bid adjustment at the ad group level overrides the one at the campaign level for that specific ad group.
What is the difference compared to smart bidding strategies?
While manual bid adjustments are actively set and managed by you, smart bidding strategies use machine learning to adjust bids fully automatically in real time. Algorithms analyze a wide range of signals to determine the optimal bid for each individual auction and to achieve a predefined goal.
When should I use negative bid adjustments?
Negative bid adjustments are a valuable tool for increasing efficiency. They should be used whenever you want to reduce or completely stop ad spend for underperforming segments. With an adjustment of -100%, you can even prevent delivery in that segment entirely.
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