To easily auto update your application, first make your application somehow detect a new version of your Setup.exe and make it locate or download this new version. Then, to auto update, start your Setup.exe from your application with for example the following command line:

/SP- /silent /noicons "/dir=expand:{pf}\My Program"

After starting setup.exe, exit your application as soon as possible. Note that to avoid problems with updating your .exe, Setup has an auto retry feature.

Optionally you could also use the skipifsilent and skipifnotsilent flags and make your application aware of a '/updated' parameter to for example show a nice message box to inform the user that the update has completed.