TLDR: Performance Max improves CPA by up to 44% vs Search campaigns – start testing it now!
For all those that don’t know what Performance Max for Google Ads is, it’s the new campaign type in beta that allows Google Ads to create ads in a similar fashion to Responsive Search ads, but with images and videos, whilst showing this ad unit across all of Google’s properties (Search, YouTube, Discover, Display, Gmail and Maps).
If you want a deep dive into the exacts of Performance Max, this has been covered well in significant detail on Search Engine Journal’s everything we know about Performance Max – the aim of this article is to show live performance data alongside other Search campaigns, my view on best practice and ensure you sign up to the beta and get testing asap!
I’ll be using two clients for this analysis who have agreed to allow their PPC data to be used and published anonymously.
Client 1
Client company information can’t be detailed; however, I can note the brand is lead gen and runs across Search and Video and is now testing Performance Max.
Other account notes to make – Target CPA is being used across both Performance Max and Search campaigns, with the same CPA target of £3 being used (Portfolio Target CPA used on Search, individual Maximize Conversions (Target CPA) bidding strategy on Performance Max).
As you can see from the above data (90 days data, Dec 2021 – Mar 2022), Performance Max is outperforming Search campaigns, with a CPA that is 13% lower. It’s even out-performing Pure Broad match, which also has been noted for good performance nowadays, with its ability to match to broader lower CPA converting search queries.
Campaigns are also noted for having very low CPCs, showing across properties such as Display and Discover, which are known for their low CPCs, however Smart bidding ensures converting traffic is still maintained to hit its CPA target.
Client 2
Client company information again can’t be detailed; however, I can note the brand is also lead gen, running across Search primarily and is now also testing Performance Max.
Other account notes to make – Target CPA is being used across both Performance Max and Search campaigns, same as with client 1, with the same CPA target of £2.50 being used (Portfolio Target CPA used on Search, individual Maximize Conversions (Target CPA) bidding strategy on Performance Max).
As you can see from the above data (90 days data, Dec 2021 – Mar 2022), Performance Max is again significantly outperforming Search campaigns, with a CPA that is 44% lower.
You can see again that CPCs are lower, however, so is conversion rate – ultimately, this is of no concern, as overall CPA is lower for Performance Max vs Search campaign.
Hopefully, the above client data has persuaded you or at least started to persuade you in testing Performance Max.
Below is now the detail of my view on best practices for Performance Max (so far, the campaign type is still so new) and the reasons why brands may not have yet tested Performance Max.
Best practices:
- Add enough images, videos, headlines and description lines to get at least a ‘Good’ ad strength on the Asset Group
- Use as much data as possible to create a relevant Audience Signal:
- Use relevant keywords
- Use 1st party audiences (from Google Ads or Google Analytics)
- Use relevant in-market audiences
- Use Smart bidding with a CPA or ROAS Target (not using a target can lead to a less efficient result)
- Recommend using the same CPA/ROAS target as Search campaigns to keep the test fair and even
- Enable Final URL expansion to allow the most relevant landing page to be selected (exclude non-commerce pages such as privacy and terms pages)
- Like with all testing, start small with budgets (~10% of account budgets) and increase budgets over time as CPA/ROAS performance targets are met
- Leave the campaign at least 14 days to reach its target CPA or ROAS
- Sometimes it can take time to start performing (which can be frustrating), however, if you leave it the full 14 days, you’ll very likely be pleasantly surprised with just how good of a CPA/ROAS it can reach
Reasons why brands/advertisers may not yet be using Performance Max:
- The quality of traffic isn’t as good
- Traffic may be lower quality at times (especially from Display or Discover), however, performance is still very strong overall, therefore this doesn’t matter, as long as the CPA target is being met (or exceeded)
- It’s stealing traffic from other Campaign Types (e.g. Search)
- This may or may not be the case (running alongside Search campaigns still does well as demonstrated above), however, as Google is moving towards more automation and less account management time, a campaign type like Performance Max hoovering up all traffic is only going to be the defacto in the future
- We have set budgets for each channel (Search, Display, Shopping, YouTube)
- Some brands have to budget this way (monthly/quarterly/yearly budget plans) and so it’s understandable there’s hesitation – however, brands also need to adapt to the changing environments that performance platforms are making, and potentially merge budgets into DR and Brand, or in fact just have one topline pot for advertising budgets, which would allow new campaign types to be tested without delay
- I don’t like the idea of Performance Max!
- Unfortunately, this campaign type is here to stay and with it now replacing Smart Shopping (Performance Max for Retail), it’s only going to increase in popularity and eventually become the main campaign type we lead with when running PPC accounts
Conclusion
Get testing with Performance Max! – also run alongside any other campaign types (Search/Display/YouTube), whilst keeping a check of its CPA/ROAS performance vs other campaign types.
As its still in beta, I’d recommend this is done sooner rather than later, before Google releases it to the public as a standard campaign type (and therefore its usage will skyrocket, increasing competition).
Feel free to email/message your views together with any results you may have!
Comparison is key (if it’s anonymous data) to help more brands and advertisers shift their mindset to the automation that Performance Max offers.