How does google choose between CPC and CPM on display network?

[Oimachi2]

I have 2 campaigns

A. CPC display network
Add Group X
Placement X

B. CPM display network
Add Group X
Placement X

For now the adds only seem to be showing up exclusively as CPM, but nothing shows up on CPC...

Is there a precedence, hierarchy, cascading rule?

Can I only have one or the other? I need this for split testing to see what converts better, CPM or CPC

Thanks

[RhinoFish]

It's a CPC auction.
When you bid CPM, they convert it to an equivalent effective CPC, so you can enter the auction on the same bid basis as everyone else competing for imps.

"split testing to see what converts better, CPM or CPC"
For the same ad viewer, the same ads, on the same placements... CPC or CPM won't effect CR.

Think of CPM as "CPC in disguise", where it was added for people who are comfortable bidding on a CPM basis.
G will guess your likely CTR, and convert your CPM bid into an eCPC bid, and you then enter the auction.

Because of the way pricing works...
For people who are more likely to click, your CPM bid will be a lower eCPC bid, and your actual CPC will be lower.
For people who are less likely to click, your CPM bid will be a higher eCPC bid, and your actual CPC will be higher.

So your habit of bidding in CPM terms, will elevate your actual CPC for the less relevant traffic, and will depress your actual CPC for the more relevant traffic.

So long story short...
Ditch your old CPM habit.
:-)

If you run these side by side anyhow, see if it turns out that way... assuming your actual CPC is the same for both, meaning your "CPC bid" and your "eCPC bid via your CPM bid" are the effectively the same on average, you'll pull less relevant traffic to your CPM Ad Group more often, so it's CTR will be lower, it's CPC will be higher, it's CR will be the lower (you're attracting less relevant buyers to your CPM bids), and your ROAS will be lower.

Shoot, that's a bold prediction huh?
I mean look at the info you gave me, hardly anything, and I've outlined specific results anyhow.
:-)
Gerald: You're a bold kid Arnold, a bold kid

Whatever you do, have fun!

[Oimachi2]

Fantastic response! Thanks