How do Google’s Performance Max Campaigns Work?

Google’s Performance Max campaigns are still a hot topic when it comes to Google Ads.

And even though they’re not really new anymore (just newer compared to other campaign options), there are plenty of businesses and even advertisers who aren’t exactly sure how they work and how they should fit into their overall ad system.

That’s what we want to help with today— we want to explain exactly how Performance Max campaigns work so that you can feel confident in how to use them when you go to create your first campaign.

Let’s get started!

What Are Google’s Performance Max Campaigns?

As a quick recap: Google’s Performance Max campaigns are goal-based campaign options that allow you to create ads through the entire Google Ads inventory from a single campaign. These campaigns replaced Smart Shopping campaigns completely.

You can use Performance Max campaigns for sales, lead, and conversion-focused campaigns, acting as an extension of Search Ads. Google will automatically supplement your keyword-based Search and Shopping campaigns by finding high-converting customers across the entire Google Ad inventory, including:

  • YouTube Ads
  • Search Ads
  • Display Ads
  • Discover Ads
  • Gmail Ads
  • Maps

How do Google’s Performance Max Campaigns Work?

We’ve got the description of Google’s Performance Max campaigns above, pretty much as defined by Google. But what exactly does it mean and how does it work?

Performance Max campaigns essentially allow you to create goal-oriented campaigns across many different in-network placements at once.

You don’t have to create a Search Ad campaign and a coordinating Display Ad campaign and a supplemental YouTube Ad campaign.

Don’t get us wrong— you certainly can if you want to. But if you want to streamline the process for a specific campaign on a qualifying objective, you absolutely can.

Performance Max campaigns are designed to streamline the ad creation and management process while ideally increasing results for advertisers— and when used correctly, that’s definitely possible.

These ads do make use of heavy artificial intelligence and deep machine learning to semi-automate bidding, placements, and delivery across the diverse networks. So while you do still get some control, the idea is that you can scale campaigns faster and let Google take over while it focuses on a single specific objective.

During set up, you’ll choose a single objective and goal, and then upload all the media and creatives needed to run ads across Google’s Network. This means you’ll supply all the targeting criteria, keywords, copy, and media for all qualifying ad formats at once.

As your campaign runs, Google will take note of which users engage with your ad and what actions they take. They’ll look for the action you’re prioritizing, like attracting new customers or driving conversions, and then serve your ad to users most likely to take those actions. They’ll consider the copy, placements, search terms, and more— and all of that will impact who sees your ads and in what format.

The Pros & Cons of Performance Max Campaigns

Many businesses and advertisers are wondering if performance max campaigns are right for them. The answer comes down to understanding the pros and cons of this particular ad type and knowing how to leverage it.

The Pros

These are the biggest pros to Performance Max campaigns:

  • Streamlined approach to ad creation. If you are willing to let Google take the wheel a bit, this is an easy way to streamline ad creation at scale without having to create a million campaigns for a single goal.
  • Potential of incredibly high-performing campaigns. We’ve seen some of these results with our own clients, helping some clients increase CTR and conversion rate, often at a lower CPA. You need to have the right strategy and creatives in place, but it’s absolutely possible to create high-performing campaigns at scale.
  • Great features like new customer acquisition goal. You can now use a new customer acquisition goal, which is new to Performance Max and Search campaigns. This objective allows you to optimize to bid for new customers, prioritizing customer acquisition. In many cases, you’ll see lower acquisition costs.
  • Great when prioritizing reach and/or conversion value. If you want to get a lot of reach quickly or reach new customers to maximize your conversion value, these campaigns really can help. Google does a great job learning who your audience is and where they’re most likely to convert… and if they can serve lower-cost placements and still get you that conversion, they will.
  • Can use brand exclusion lists. You can use brand exclusion lists with Performance Max campaigns to better target the right audience. Learn more about how to do this in the video below.

The Cons

While performance max campaigns do have plenty of positives, there are also a few downsides to consider when it comes to how they actually work. These are the cons to keep in mind:

  • There’s a minimum $50 ad spend to get it to work. Not technically a minimum set by Google but from what we’ve seen to spend enough to get Performance Max to work well. For some businesses, this isn’t a big deal; for others, a $50 minimum to test a new ad platform while you figure it out can be pricey.
  • You lose some control. Performance Max campaigns require you to give up a little more control than when you’re creating individual campaigns. You trade a small amount of scalability for some granular control over how you want to divvy up your budget, targeting, and more.
  • They can be a hassle. Some aspects of these campaigns are actually more of a hassle, despite the initial ease of campaign setup. In order to add negative keywords to these campaigns, for example, you actually need to get in touch with Google directly. It’s a small thing, but it can be frustrating for advertisers.
  • Sometimes AI can work against you. If you aren’t successfully creating a focused campaign, Google’s machine learning might learn the wrong lessons. This could, in theory, backfire on you, and it’s why some brands may prefer to create individualized, siloed campaigns.
  • There’s a learning curve. Getting the most out of your Performance Max campaigns takes some time, practice, and the right optimization strategies. This sometimes means investing ad spend into campaigns while you and Google learn how to navigate your new campaign structure.

Final Thoughts

Are Google PMax campaigns right for you?

The answer ultimately depends on your specific business and campaign goals.

If you were running Smart Shopping campaigns before, then you’re likely going to benefit from Performance Max campaigns now. And if you want to maximize reach, streamline the ad creation process, or prioritize acquiring new customers at a good CPA, you should consider testing this campaign type.

In many cases, these campaigns can have a learning curve. For that reason, we always recommend working with a qualified and experienced Google Ad agency specializing in data-driven research and custom approaches for each client.

Curious if Performance Max campaigns are right for you? We can help. Get in touch with us here.