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Budget and Bidding Type
Smart optimization

About Smart Optimization
You could switch on or off Smart Optimization in the“bidding & optimization” section when you create a new ad group. This optimization function is only applicable to the ad groups that use oCPC as the billing event. As shown in the picture below, whether smart optimization is initiated shall affect your way of bidding. Details on the influence of this function shall be explained later in the section on "What's the difference". You could decide whether or not to adopt Smart Optimization based on your own requirements on the speed of ad delivery and the precision of audience targeting (to be explained later in the section on“Who's it for”).

What's the difference

Before learning about working logic and effects, you need to understand the concept of "learning phase". The learning phase refers to the process in which the ad system continues exploring new users to help your ads reach the most precise targeting audience at the initial stage of ad delivery.
Switch on Smart Optimization: In the learning phase, the system will directly adopt your target event (installation/conversion) as the objective of the optimization. The system will accumulate a certain amount of initial data and then line out the audience portraits of your target audience. Thereafter, the system will direct your ads precisely to other similar audiences based on the data above. 

Switch off Smart Optimization: The system without smart optimization will not adopt the target event (installation/conversion) as the objective of optimization in the learning phase. However, the system will adopt "click" (shown above) as the learning event to obtain initial data (In this case, you need to provide a separate bid for the "click" event that is applicable to the stage). After the learning phase, the system will adopt your target event (installation/conversion) as the objective of optimization, and direct your ads precisely to other similar audiences.
  
Who's it for
Switch on Smart Optimization: Compared to exploring target audience with "click" event in the learning phrase, exploring this audience directly with your target event under smart optimization mode would help our system adopts more precise audience portraits for stages after learning phase. However, the speed of your ad going through the learning phase would be relatively slow. If you value the precision of finding the target audience more than the speed of going through the learning phase, using smart optimization would be your better choice. 
 
Switch off smart optimization: At learning phrase, the probability of receiving "click" events will be greater than that of receiving your target events(installation/conversion) (as "click" events come before target events (installation/conversion)). Therefore, running ads without smart optimization will help your ads get through the learning phase faster. However, the target audience group chosen under this mode will be less precise than that under smart optimization. If you value more on the speed of ads going through the learning phase, then bidding without smart optimization will be a better option.