Flexible Bidding, is the new kind of bidding strategy option added by Google, in the past few months in accounts across the world. This Option you can find clicking on the settings tab, choosing from bidding options. To activate it, you have to set it up through Shared Library.
Go to Shared Library, click on bids and find, Target Search Page Location >Top of the Search Page, Option. You will find details of this bidding strategy on the following pages, which has several advanced options for you to set up according to your preferences. Give it a name(e.g., TopClick) and click save. It will start showing as an option in Bidding Options in settings and also in Bid Strategy Tab at Campaign, adgroup and keyword pages. You can also create another strategy, say Maximize clicks within budget. You can shift between different strategies through,the Bid Strategy Tab. Flexible Bidding has Target Search Page Location and Maximize Clicks as Bid Strategy type. You may choose either Target Top of the page, or First page as option in the first type.
What Top of the Search Bidding does?
If you have chosen, Top of the Search Page option, it will dynamically raise and lower your bid to produce maximum above the fold clicks. The greatest merit of the algorithm behind this is that it adjusts different bids for different keywords, taking into account Quality Score and probably budget too. It is wise enough to judge what percentage of keywords should be given top bids, if enabled for entire campaign or adgroup. You can also enable it for one, two or more keywords!
Whenever, you want, you may shift to manual bidding through simple click on Bidding Strategy.
For those who were unhappy with the absence of position preference and run the rule now option should find this as a better solution. It is indeed better and economical than earlier features, retired now, intended to produce top rank click on adwords ads.