Google Ads Performance Max Campaigns – How They Work & When to Use Them

Google Ads Performance Max is a new goal-based campaign type that provides advertisers with access to all of their Google Ads inventory through a single campaign. This campaign type is intended to supplement keyword-based search efforts by assisting marketers in locating more converting customers across all Google channels, including YouTube, Display, Search, Discover, Gmail, and Maps.

In this blog we’ll do a deep-dive into Performance Max campaigns and how you can use them to drive more conversions for your campaigns.

How Performance Max Campaigns Work

Advertisers may use Performance Max to drive performance based on conversion goals, delivering more conversions and value by optimizing performance in real-time and across channels with Smart Bidding. The campaign type incorporates Google’s machine learning technology for bidding, budget optimization, audiences, creatives, and attribution, among other things. All of this is enabled by the advertiser’s unique advertising aim, such as a CPA (cost-per-aquisition) or ROAS (return on ad spend) target, as well as the creative assets, audience signals, and optional data feeds they offer.

Performance Max campaigns have a big reach. This table shows which campaign will enter the auction if you have both campaign types in your account.

If that third column says Performance Max, it’s pretty clear what will happen. Performance Max will show, and your existing campaigns will not. But in all the other cases, it’s much harder to predict what will happen.

Performance Max and Other Google Campaigns

Let’s take a closer look at the interaction between a branded Search Ads campaign and a Performance Max campaign in your Google Ads account. When both campaigns are active, which one will appear in search results?

There are three specific factors that determine this:

1. Keywords in your Search campaign: If the keyword a person is searching for is included in your branded Search campaign, then your Search campaign ad will show up. This isn’t dependent on keyword match types, but rather the actual “matched” query. For example, if someone searches for “canada goose crofton jacket,” and none of your branded search keywords exactly match this search term, the campaign with the higher ad rank will show.
   
2. Ad rank: If the exact matched query isn’t part of an existing Search Ads campaign, the campaign with the higher ad rank will prevail. Ad rank is determined by the maximum cost-per-click (CPC) bid multiplied by the quality score. To improve ad rank, you can increase your max CPC bids or improve your quality score, which is largely determined by your click-through rate (CTR). However, with Performance Max, you have no control over bids or quality scores, so your best bet is to work hard on your existing Search campaigns and aim for a high ad rank.
   
3. Negative keywords: In branded search, you can add negative keywords to your Performance Max campaigns to block certain searches from triggering those ads. However, you can’t add negative keywords yourself, and will need to go through Google support or your CSS partner if you’re in Europe. Keep in mind that adding brand as a negative keyword in Performance Max will also block it from showing in Google Shopping, so you’ll need a Standard Shopping campaign to target those queries.

Understanding these three factors can help you strengthen your overall account structure and improve the performance of your campaigns.

Key Benefits of Performance Max

Let’s dive into some of the key benefits and considerations of using Performance Max:

1. Identify more converting customers: Advertisers can tailor their targets to maximize conversions or conversion value. Advertisers can use Performance Max to engage customers across Google’s platforms. With Google’s real-time awareness of consumer intents and preferences, along with the advertiser’s input via audience signals, Performance Max can uncover previously unknown customer groupings.
2. Drive more value: Data-driven attribution across channels optimizes for the most incremental touchpoints that lead to conversion. Machine-learning algorithms are used to produce more accurate predictions about which ads, audiences, and creative combinations are the most effective for the advertiser.
3. Acquire rich insights: Performance Max asset reporting can assist advertisers in understanding which creatives are influencing performance and in optimizing campaign creatives to drive ROI. New data, such as rising search trends, can assist advertisers in understanding performance changes and informing their overall business strategy.
4. Simplifies campaign management: From a single campaign type, advertisers may access the entire Google Ads inventory, including shopping Ads. This streamlines campaign administration and saves time.
5. Automates the creation of ads based on assets: Performance Max automates the creation of ads based on the assets the advertiser provides.
6. Complements keyword-led search campaigns: Performance Max complements keyword-led search campaigns to help find maximum consumers that are converting across the Google funnel.
   

Considerations for Performance Max

Performance Max campaigns offer major benefits but given the ‘black box’ nature of the cross-network campaign type, here are some considerations:

• Limited control: Advertisers have limited control, especially when they would want to test various bidding strategies for different asset groups within a single campaign.
• Poor setup with incorrect inputs: A poor setup with incorrect inputs (Target ROAS or CPA) while assigning goals can lead to low-quality conversions that may hold no value to the advertiser’s business.
• Image or video assets are mandatory: Image or video assets are mandatory for the campaigns to run. The setup is not successful with test ads alone.
• No possibility of data segmentation: There is no possibility of data segmentation.
• Can overspend the daily budget: Performance Max can overspend the daily budget on a random day without generating conversions so close monitoring is key.
• No transparency on where ads showed up: There is no transparency on where the ads showed up (placements).
• Multiple changes cause campaign fluctuations: Multiple changes cause the campaign to go back into the learning phase and lead to fluctuations in numbers.
• Takes time to deliver results: In the majority of cases, it takes a month or more for Performance Max to deliver results.

When to use Performance Max

Performance Max is the best option to use when:

1. Advertisers have specific advertising and conversion goals, such as driving online sales or lead generation.
2. Advertisers want to maximize the performance of their campaign, and they aren’t limited by which channel their ads appear on.
3. Advertisers want to easily access all of the Google inventory.

Lastly, here are pending or new updates for Performance Max campaigns that all the advertisers are eagerly awaiting:

• Account level negative keywords started rolling out last month for brand suitability and other purposes.
• Campaign level brand exclusions for branded queries on Search and Shopping inventory. Campaign-level brand exclusion will apply to most misspellings and brand searches in foreign languages.
• Page feed support in Pmax will help you send search traffic to a specific set of landing page URLs on your site.
• Experiments to test how Pmax can drive incremental conv./conv. value. Test the impact of adding a Pmax campaign to your current mix or test Pmax vs Standard shopping campaigns targeting the same products.
• Asset group level reporting will soon include conversion value cost and other metrics.
• Budget pacing insights on the insights page will surface opportunities to optimize your budget allocations, including where you could shift budgets between campaigns to get more conversions.

Got questions on Performance Max campaigns? Reach out to us today!