How To Deal With 70% Cpc Increases + Conversion Drop In Google Ads? Looking For Advice

Hey everyone,

I'm managing Google Ads for a client in the lead gen business (=product for founders). This year, we've hit a bit of a wall and I'd love your insights.

Here’s the situation:

• CPC across all campaigns is up ~40% vs. last year.
• The main (Search) campaign has seen CPCs spike +65% compared to last year (maybe it's worth noting that I am still on tightly controlled phrase and exact match Search campaigns. I once did an A-B-Test with broad match but the results were not that great).
• Particularly expensive keywords have jumped +93% year-over-year (the offer is the same but it's true, competition has increased. I got Ad depth numbers from Google and more ads show up and also more competitors in the field).
• Naturally Conversions are also down (20 to 30%)

The offer, website, and funnel are unchanged, and there’s no big seasonal effect, so I believe it’s mostly a market/competition shift.

Ideas I’m currently working with:

1. Manual keyword pruning:
Pausing keywords with high spend and CPC but low conversion volume/ROI (maybe in the original campaign or even as an A-B-Test?)

2. Portfolio bidding with CPC cap:
Instead of pausing keywords: Switching to a strategy like Maximize Conversions with a max CPC limit (e.g., CHF 20) to stop runaway CPCs. Downside: Google then allocates budget more freely across ad groups, so there’s less control (currently I do this manually).

3. Bidding strategy tweak:
Currently running Maximize Conversions. Considering testing Target CPA bidding to better control cost per conversion. What's your experience with that?

What's your take on this and how would you approacht the situation?

Thakns in advance.