Nobody hates FOMO like Marketers.
Whether it be new attributes in display campaigns or that core update for organic rankings, marketers are always on the lookout for the next big thing.
Performance Max campaigns are one such “thing.”
Through the last quarter of 2021, when businesses were ready to reap it big with Black Friday, Google rolled out the Performance Max campaigns to advertisers worldwide.
Two months later, Google announced that all Shopping and Local campaigns would be upgraded to Performance Max campaigns by September 2022.
But what exactly are Performance Max campaigns?
How do they differ from the contemporary ones?
Above all, how are Performance Max campaigns the next big thing?
Let’s discuss these in detail.
Performance Max Campaigns – What Is It?
Let’s assume you’ve spent more time “cuddling with Doggo” than managing your Google ads campaigns.
What’s the worst that could happen?
ROAS down the roof?
$$$ in net loss?
How about a stable and consistent conversion rate?
That’s exactly what a Performance Max campaign does for your business.
Performance Max campaigns allow marketers to run ads across a multitude of Google platforms under one single campaign. It uses machine learning and Google’s incredible depth of data to improve your advertising strategy, bringing your ads to the right audience at the right time.
Simply put, it’s the first fully automated, goal-based campaign designed to maximize performance for a specific conversion goal.
Performance Max campaigns enable you to target the right mix of audiences within multiple Google platforms like Google Map, Display, Search, Discover, and Youtube.
Complete automation. Access to a larger audience. Better Performance.
Doesn’t it sound like the perfect combo for a regular google shopping campaign?
But wait. Performance Max campaigns blow all the campaign types Google ads has introduced for eCommerce brands to date out of the water.
See How My Agency Can 10x Your Brand's Sales With Google Ads
Google Ads – effective targeting and scaling methods for ROI.
Bing Ads – dominating the market of a fairly untouched platform.
Facebook Ads (Retargeting) – helping stop the leaks from all sides of the bucket, especially with retargeting.
1 – Automated Targeting Options
In standard shopping campaigns, Google allows advertisers to create ad groups that can be used to target different types of audiences.
With Performance Max campaigns, ads are automatically displayed to the selected audience likely to convert for a particular end goal.
2 – Access To Inventory
Performance Max campaigns are eligible to run across the entirety of Google’s Inventory of platforms. Unlike regular campaigns, It’s a major differentiator that enables Performance Max campaigns to maximize the scope of your target market.
3 – Bidding Optimization
Unlike standard shopping campaigns, Performance Max campaigns enable the algorithm to gain complete visibility over auction data through every platform under Google.
As an advertiser, you only have the option to optimize for conversions or conversion value and can’t manually manage bids for your campaigns. Optimizing these settings the right way is going to help you when it comes to scaling Pmax.
Who Should Use Performance Max?
With more than 80% of all global businesses using Google ads for their PPC campaigns, it’s no wonder how Performance Max has positioned itself as a superior campaign model since its launch in November of 2021.
But at the end of the day, Performance Max is still fully algorithm based and a relatively new entrant to the PPC and eCommerce world. One must be cautious while giving up control over their campaign options and letting AI do all the Job.
So who should be using Performance Max?
- From an initial testing phase, it has been found that retailers, SMBs, and eCommerce businesses stand the best chance with Performance Max campaigns.
- Conversions have been known to be higher with single landing pages. Businesses that sell directly without making the customer sift through multiple pages have a fair chance to make it big with Performance Max.
- Real-time tests have shown that the best results came in when used for a super-specific goal. This could be anything specific, like promoting a particular event or launching an app.
Let’s now look at how Performance Max campaigns can be a perfect add-on to your marketing arsenal.
3 Reasons Why Performance Max Campaigns Are The Future
Though customers and their buying choices might seem complicated, in-depth analysis from a marketing perspective can help break down the complexity.
Credits – Blog.Google.com
With Performance Max campaigns, tracking customer journeys in an ever-evolving environment has become easier than ever.
Here are three reasons why Performance Max campaigns are the future –
1 – Self Learning Models – Best Of Google ads
Performance Max campaigns are based on the data from diverse channels to maximize conversion rates on all spectrums.
Your ads are automatically tested and optimized for various attributes, which further helps predict the right mix of audiences, ads, and creatives that will yield the best possible results for your campaign.
With Performance Max campaigns, your business now has an extra edge to winning with PPC.
2 – Ease Of Use – Ad Optimization and Inventory
Once upon a time, you used to launch a bunch of different campaigns to target all the different placements Google offered.
Tons of labor work. Low morale. And not all the campaigns ended up working or producing results.
Performance Max campaigns simplify the whole process.
One lone campaign with a myriad of Google platforms at your disposal.
Whether it be Search, Display, Discover, or Youtube, if it belongs to Google and has an ad placement section, consider it fully available to run your ads.
On top of that, all data from these different placements will now be combined into one single campaign. It makes Performance Max campaigns extremely powerful, considering the fact that Google ads works purely off of the data that accumulates over time.
Now that this lone campaign targets multiple placements, it provides Performance Max campaigns an extra edge over alternate campaign models due to how precisely it can target the right audiences for your business.
3 – Reduced Marketing Costs & Higher ROI
With Performance Max campaigns, advertisers no longer need to test multiple ad formats or create custom bidding strategies manually.
AI-powered algorithms do all the hard work for you. Accumulated data combined from multiple placements under one campaign drives accurate results with less room for error. It would further skyrocket your ROI while reducing your marketing costs to the bare minimum.
I know Performance Max campaigns sound super exciting but it’s also important to know if your eCommerce brand actually needs one right at this moment.
Believe it or not, there’s a good time and a bad time to launch one.
When To Use Performance Max Campaigns
It’s been a heated discussion for a while regarding the ideal use cases for kickstarting your business with Performance Max campaigns.
Do I need a high budget to sustain Performance Max?
How long should I wait to see positive results from these campaigns?
Is Performance Max campaigns highly volatile?
- From a realistic perspective, an ideal budget to get it started with Performance Max should be $50 per day or more. It could be $500/day, but $50/day is the bare minimum to reap the best results from Performance Max.
- Getting into Performance Max campaigns is highly advisable if you have had a fair amount of success with some form of search ads.
- It would be best if you need an extra hand with your existing shopping ad campaigns and need to spend less time staring at your computer screen.
- Performance Maximization is your ultimate end goal from PPC.
If you could relate the above to your business objectives, feel free to try out Performance Max campaigns. If the case is otherwise, it would be better if you turned your focus to the existing ad campaigns.
When Not To Use Performance Max Campaigns
Like the opposite side of a coin, Performance Max also comes with certain use cases where it wouldn’t be a great choice to give up your control over current campaigns to this automation powerhouse.
Here are a few such use cases where you should avoid Performance Max –
- If your eCom brand is already stable in terms of sales, you should avoid Performance Max campaigns unless you have a new set of products not in other campaigns for it. Instead, expert advice from the best Google ads agency should be your best bet in this case.
- When a big chunk of your budget goes into video and display ads, it won’t work well when promoted to irrelevant platforms like Gmail and Maps.
- If you prefer to keep control and decide a lot of the things that happen within the campaign itself.
- Certain goal types. If you want to improve your brand value or establish an authentic voice within your target audience through a product or service, Performance Max shouldn’t be your best bet. These campaigns work well only when the goals are super-specific.
Performance Max – Pros and Cons
If you’ve read this far, you’re probably aware that Performance Max is more like a double-edged sword.
While there are cases when advertisers could skyrocket their campaign ROI with Performance Max, there are also cases when these automated campaigns turn out to be the absolute last option to opt for.
Let’s see what the PROS and CONS of Performance Max campaigns are –
- Easier for Beginners – Access to entire ad inventory by taking control over advertisers and minimizing manual efforts seems like the best deal for someone who wants to cut across the complex learning curve.
- Full-Focus on Performance Drivers – Performance Max makes it much easier to obtain creative optimization, PPC reporting, and campaign planning. Multi-campaign ads make it difficult to compile and analyze from different dashboards. Focusing solely on what works great through multiple Google channels under a single campaign makes Performance Max easier to use.
- Impressive results – When used correctly under appropriate use cases, Performance Max should reap insane results for you. Clear inputs combined with clearly defined goals make it easier for the self-learning algorithm to do the Job with complete efficiency.
- Limited visibility – With Performance Max, it’s not so easy to gain insights into individual campaigns or different asset combinations. It makes it hard for the advertiser to spot the best segment of audience or that right set of creatives, which helps increase conversion rates.
- Less Control – Automated bidding and campaign optimization make it hard for advertisers to gain control over their existing campaigns.
- Requires Clear and Concise Goals – The main issue with complete automation is that without accurate information, the automated algorithm wouldn’t be able to maximize performance in the way you wanted.
Now that you’ve read this far, chances are, you’ve got a rough idea of why Performance Max campaigns are the hottest buzzword in the marketing Industry.
When fully effectuated, these campaign models will undoubtedly transform your campaigns into the perfect example of automation.
With all these promising features, why shouldn’t you double down upon the advantages of Performance Max campaigns for your eCommerce brand too?
How To Set Up A Performance Max Campaign
We’ve finally got to the stage where we press a bunch of buttons and launch this powerful campaign type.
And trust me, I say “press a bunch of buttons” because it’s literally that easy. All thanks to the automation Google ads wants advertisers to become accustomed to.
Source – YT
But before you roll your sleeves back down thinking this is a piece of cake, just keep in mind that there are several essential things you need to do to launch the campaign properly.
For those looking for an official guide from Google on how to do this, you can view it here. For the rest, follow along as I walk you through it.
1 – Select Your Objective & Campaign Type
Almost the entirety of Google ads automation revolves around the objective selected for a particular campaign.
Given below is a list of objectives provided in the campaign creation section of your Google ads account –
- Sales – Drive online, mobile or in-store sales for your business.
- Website Traffic – Drive high-quality, targeted traffic to your business website.
- Leads – Compels target customers to perform an action.
- Brand consideration – General awareness objective to encourage customers to explore the products and services offered by your business.
- App promotion – Make the target audience perform App installs or register for a pre-registration event through the App.
- Offline store sessions – Encourage the target audience to visit your store in person.
Source – SF Digital
Obviously, if you’re here, the main objective for your eCommerce business is sales. I don’t recommend choosing any other goal if you want more sales.
Once we’ve determined the goal, it’s time to get into the nitty gritty details.
2 – Determine Budget & Bid Strategy
As mentioned earlier, you really have only two different choices in terms of bidding within a Performance max campaign: conversions and conversion value.
Let’s go through each one.
Conversions – If your goal is volume and you prefer to get as many sales as possible, this is the way to go. It focuses heavily on showing your products to the audience that’s most likely to convert regardless of their financial placement.
Conversion value – This bidding strategy is the exact opposite of the conversions strategy. Here, Google does its best to ensure your ads are getting shown to an audience which can purchase the highest number of items at once. Essentially, the ads get shown to people with bigger pockets who have the ability to spend more.
Remember that your budget and bidding strategy should stay aligned with your overall marketing objective.
Right below the bidding strategy selection, it gives you the ability to add a target ROAS (return on ad spend) or CPA (cost per customer acquisition) to lower your costs and get closer to targets. I highly recommend you choose the option and give it something to aim at, especially if you have previous data.
If your campaigns have been getting an average ROAS of 3.5x (350%), subtract it by 5% and use that as the target. In this case, it would be 3.3x (332%). Do the same if you’re doing CPA.
Pretty neat stuff, huh? But we’re not done yet.
3 – Additional Campaign Settings
It’s time to choose the location and I mention this on my Youtube channel often as well but never target more than one location at any given time.
This is simply because different locations have different buying audiences and all these audiences abide by different rules, regulations, policies, etc. Combining different countries inside one is like trying to make sure all your fingers are the same size; it just can never happen because each finger is unique.
There’s a lot of other things on this page you can change but the one main setting I recommend you switch off is the Final URL Expansion. I recommend choosing the second circle and turning this off simply because it’s not ideal to let Google decide which URL the campaign should show more of.
We’ve already handed a lot of the control over to Google’s algorithm; we don’t want to completely give up everything.
4 – Create a Group of Assets
You’re half way through the creation of your Performance Max Campaign. Brace yourself, though, because things are about to get just a little extra difficult.
It’s time to create the actual ad copy. Google gives you the ability to supply multiple things ranging from images to videos to headlines. Here’s a full list:
- Final URL to the landing page
- Images (Up to 20)
- Logos (Up to 5)
- Videos – Optional (Up to 5)
- 30-Character headlines (Up to 5)
- 90-character headlines (Up to 5)
- One 60-Character short description
- 90-Character short description (Up to 4)
- A CTA (Call To Action)
Unless you have an extremely high budget, we don’t recommend that you go out and fill all of these up. Keep the ranges somewhere in the middle for maximum impact. However, keep in mind that the automation features of Performance Max automatically group different assets to available formats to better align with your conversion goals.
More assets will create more ad formats that will look better appealing to your target audience.
This further enables Machine learning attributes to create smarter combinations for subsequent campaigns.
Once you’re finished with the ad copies, the bulk of the work has been fully completed.
5 – Select Your Audience
The last section on this page, also known as the audience signal section, is the one you need to pay attention to. And that’s simply because whatever audience you choose here lets Google find your actual audience at a much faster pace.
Full on machine learning in action.
Normally, I would not recommend you add anything within a section like this as it can cause a bit of interference but with Performance Max, I recommend you add an audience.
But don’t just add any random audience. add an audience that most closely resembles your people. It could be an audience of people who purchased in the last 180 days. Or people who initiated checkout.
Keep this audience selection to the later portions of the funnel for maximum impact.
6 – Extensions
We’re almost at the finish line. It’s time to add in those necessary extensions that’ll help your ads stand out of the crowd.
I always recommend adding as many extensions as possible but the basic ones you must have for maximum effect are sitelink and callout extensions
Not only do these make your search ads that are shown along with shopping listings bigger, but they also help increase CTRs.
Some common sitelink extensions we use for our clients over at Yoru Marketing include free shipping, order tracking, about us and more. On the other hand, for callout extensions, we often use words like 24/7 customer service, 100% satisfaction guarantee, etc.
Be sure to keep things simple at all times.
6 – Publish Your Campaign
Everything is set and ready to take off.
However, it is advisable to look at the summary page again, which helps spot any minute errors made during the campaign creation process.
If you don’t spot any, click “Publish” and get your campaign live across various Google channels with Performance Max.
Performance Max campaigns – How To Optimize
So we’ve done it.
Your Performance Max campaign is now off to the race and within the next few days to next few weeks, it should start converting.
But what’s next? How do you make the next steps easy for the campaign?
Here are a few tips (and exactly what we’re doing for our clients as well as our own brands) to ensure they grow instead of deflate and falling flat on the ground.
Before we talk about the specifics, give yourself a pat on the back for going past your comfort zone and launching one of Google’s most advanced campaign type.
You’ve already set yourself apart from 95% of other eCommerce store owners.
But we’re far from done. The real work starts now.
With product optimizations.
I personally recommend waiting at least 15 days before beginning the optimization phase but once that’s done, we begin with the products.
Your product looks solid and should do quite well. But how do you know whether this particular product is actually doing quite well with sales?
Unfortunately, Performance Max campaigns don’t have a custom interface to check individual insights, such as “conversions” or “ROAS” regarding every product sold by your business. It just has a column called “All Conversions” which doesn’t show real-time sales metrics.
In fact, the “All Conversions” column calculates all the add to carts, initiate checkouts, and everything else within your ‘conversions’ column within Google and displays it.
Instead, you should check out your sales on your Shopify backend or Google Analytics and compare them with the data presented by Google.
Optimization within this section is no different than what I always recommend; cut out the product if it spends more than 1.5x to 3x your profit margins for that product. This number will depend on your ability to handle a loss.
Rinse and repeat the same with each product sold by your business. Continual filtering would ultimately provide you with a perfect array of winning products for your subsequent Performance Max campaigns.
Bidding Strategy Optimization
Running a successful eCommerce business with Google Ads is no small feat, and it’s more like captaining a yacht yet adjusting its sails while being caught up in a storm, all at the same time.
If you’ve taken it further and went on with a Performance Max campaign, I’m proud of you.
But if you’re getting started with Performance Max, chances are you’ll get caught up with the fluctuating CPA and ROAS patterns.
It’s more like adjusting those sails; One needs to constantly increase or decrease these two metrics with respect to the campaign results.
For instance, if the results of your Performance Max campaigns are not so great in terms of numbers, I’d recommend increasing your target ROAS. If you’re doing well and want to scale further, I suggest decreasing the target ROAS.
The same goes with target CPA. Increasing your CPA as long as you’re underspending the Ad budget is highly advisable. The reverse goes off to be true as well; the higher the Ad spent, the lower your CPA should be.
This helps maintain a consistent conversion rate output with Performance Max campaigns.
The next step of Performance Max campaign optimization is directly within the settings.
And this involves either increasing the TROAS / CPA or decreasing it; there’s no inbetween. And you want to keep things simple here as well.
Budget not fully getting spent? → Lower the ROAS or CPA
Budget fully getting spent but low profits? → Lower the ROAS or CPA
Budget fully getting spent AND profitable? → Increase the ROAS or CPA. Follow this by increasing budgets after complete budget is getting spent, no overspend or underspend.
And in each scenario, you want to only increase or decrease things by 10% to 15%.
And that’s pretty much it. Unfortunately, we can’t optimize any other things besides these two.
And this brings me to the real question; how smart are these?
Can Performance Max Replace Experts?
In a simple word, no.
To begin with, Performance Max needs clear and accurate input of data. If you think about it, your campaigns need to already have driven a sizeable amount of data to the account for the performance max campaign to kick off.
And unless you’re a professional marketer with deep insights about the entirety of how PPC works and the ability to get this data, you’d end up needing help from an eCommerce Google ads agency.
On top of that, even if you take your campaign off the ground with Performance Max, the post-launch part isn’t a piece of cake either. One needs solid expertise with all important metrics such as CPC, CTR, CPP, ROAS, Search Impression Share, and more to decide what to do next.
While I would love to guide you on how to exactly optimize performance max campaigns consistently, their presence has not been established for enough of a time to strongly suggest anything. And that’s why I recommend optimizing them as if they were a smart shopping campaign.
Just be sure not to overcomplicate things and take them one at a time, These campaign types are new for everyone.
If you’re someone who has been playing around with Google ads for quite some time, chances are, you already know this isn’t the first time Google has introduced automation with ads.
Performance Max campaigns just happen to be the best of Google ads automation so far.
But we get it – there’s just so much to cover and so many other things to do. Running an eCommerce business doesn’t just involve Google Ads, it involves a variety of different things ranging from angry Karens to fulfilling orders to ensuring the team is on track.
That’s exactly where our Google ads agency, Yoru Marketing, comes in. Look, I know what your situation is like because I run my own eCommerce brands. I know the effort that goes in and JUST how important getting the ads side of things is.
Proper ad management is the reason why your brand functions and scales without breaking. And if you’re currently doing $30,000 or more per month with your brand and would like some additional help, my entire team is here for you.
We are Yoru Marketing, a fully-fledged team of advertising Ninjas with proven PPC strategies to ensure that your business grabs that whole pie of profit from your target market.
Get in touch with us now and spearhead the next wave of marketing with Google ads.
4 thoughts on “Complete Google Ads Performance Max Campaigns Tutorial For Ecommerce”
Thank you Shri. That was a great read I have learned a whole lot!
Glad you liked it.
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