How does implementing conversion tracking directly improve bidding strategy refinement?

Implementing conversion tracking directly improves bidding strategy refinement by providing data-driven insights into which users, keywords, and ad placements are most likely to lead to desired outcomes, allowing for more efficient allocation of ad spend. 'Conversion tracking' allows you to see which ads on X result in specific actions on your website or app, like purchases or sign-ups. This data enables you to move beyond optimizing for clicks or impressions and instead optimize for actual business results. By knowing which factors contribute to conversions, you can adjust your bidding strategy to prioritize those elements, either by increasing bids for high-converting keywords or placements, or by excluding underperforming ones. For example, if conversion tracking reveals that users searching for 'discount running shoes' are more likely to purchase than those searching for 'best running shoes', you can increase your bids on the 'discount running shoes' keyword to capture more of that traffic, thereby improving your return on ad spend.