Your Comprehensive Guide To Optimizing Performance Max In Google Ads

Setting up a Performance Max Campaign in Google Ads

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Performance Max is the latest solution within Google Ads offerings. With new audiences, more transparent insights, and a required diversity of assets, Performance Max campaigns have a lot to offer advertisers.

Google aimed to create a simplified campaign management, but there are a few best practices to keep in mind when setting up your new campaigns. In building your Performance Max campaigns in Google Ads, you want to ensure that you are driving the results you saw from prior campaigns. To make the most of your Google Ads properties, you want to continually feed good data into the algorithm so that the machine learning automations and insights are even more effective.

How To Get Started With Performance Max In Google Ads

Performance Max campaigns will become part of the default campaign structures by Q4 2022. There’s some time to test out the features and ensure you get the best results in time for your holiday campaigns. 

  1. Start with low-performing products (in terms of low profit margin or ROAS) when upgrading your Smart Shopping campaigns to Performance Max campaigns. Select enough products so that you can generate a good amount of volume in order to get the most data out of the learning period. 
  2. For hybrid, high-volume campaigns, group your products with the same margins in the same campaign, regardless of their historical ROAS value. 
  3. Ensure the products selected for the campaign are excluded from your other Shopping campaigns, as Google will give preference to Performance Max campaigns. 
  4. You can create different brand- or category-based campaigns if these distinctions represent different business objectives.
  5. Run this campaign and test the results for at least six weeks. Refrain from making unnecessary changes during this testing period.
  6. If different margin-based campaigns don’t lead to adequate conversion volumes, then you know you don’t need to run margin-based Performance Max campaigns in the future.

When testing your campaigns, you don’t want to run into budget issues that could hinder performance. You want your campaign to drive adequate conversions (for example, 20-30 conversions a month, consistently) so that the machine learning algorithm can gather more data quickly. Ideally, we recommend a budget of 10-15X higher than your historical target CPA of products added into the Performance Max campaign.

Determining Your Budgets and Bidding

Because you’re in the early stages of adopting Performance Max within your Google Ads account, you’ll want to consider your bidding strategies. Begin with a ROAS target which is about 20-30% lower than the historical average ROAS of the products within your campaign. Use a value-based smart bidding strategy, such as maximum conversion value with ROAS target instead of target CPA.

Google’s machine learning will optimize your asset offering to display the most relevant ad for each search query. When migrating products from Shopping campaigns to Performance Max, set a Performance Max budget that is comparable (or higher) than historical spending for the same products in the shopping campaign. Performance Max is inherently set to maximize your results and drive the most optimal performance for your ads, so you want to give the platform the flexibility to drive those results. 

Optimizing Your Audiences

Use audience signals to incorporate your top-performing audiences into your various campaigns. To boost your campaigns, be sure to include the remarketing first-party audiences that drive, on average, 80% of sales across campaigns. 

Create custom audiences around your top-performing keywords and queries. Direct query targeting is not an option currently available in Performance Max campaigns, so you will have to take an extra step to create audiences around queries. 

At NetElixir, we specialize in identifying, targeting, and engaging high-value customers. Use conversion value rules for your high-value and predictive audiences in order to maximize the auction time bids for these valuable customers. These audiences can be created by Google Analytics 4 and NetElixir’s owned proprietary customer intelligence platform, LXRInsights

Asset Groups and Product Targeting

Performance Max differs from current Google Ads structures in that campaigns are structured around asset groups, not ad groups. To make the most of these groups, create theme-based asset groups. You can put different category or brand specific asset groups in the same campaign; more products across categories can lead to more volume at the campaign level.

To ensure creative excellence within your assets, be sure to populate all the available variations from text to image. This allows the machine learning algorithm as many options as possible to create the best ad combination. You don’t have to create from scratch; use your top-performing headlines and descriptions from prior search campaigns to start and refine from there. Be sure to follow Google’s best practices to ‌get your ad strength score to good or excellent. Continually review the asset reporting to replace any creative elements that have a low rating. Check individual asset reports and combination reports to understand how your assets work together and to better inform your creative direction for the next campaign.

Listing groups, which are part of a campaign’s asset group, organize your overall listings by the attributes assigned to them in Google Merchant Center. Use similar product filters used in prior Shopping campaigns for your selected Performance Max products. Be sure to routinely check on your Google Merchant Center health to ensure your product feed does not run into any major issues.

Dynamic URL Targeting

Dynamic targeting and dynamic headlines work well for driving traffic from new inventory across new search queries. Use final URL expansion to drive this traffic. Start with products that have done well in past dynamic search ads to allow for better control over URLs for specific products.

Best Practices For Setting Up And Running Performance Max Campaigns

Follow these best practices to ensure your Performance Max campaign lives up to its name. At NetElixir, as we continue to test out these campaigns, we’ll share our team’s learnings and best practices to ensure all your Google Ads assets are efficient and effective. 

Avoid Running Performance Max and Smart Shopping Campaigns Simultaneously

As Performance Max campaigns will take priority over most of your inventory, advertisers should turn off Smart Shopping campaigns so there are no overlaps or skewed results. This is similar to what we saw when Smart Shopping campaigns were first rolled out; the newer campaign structures took priority. 

Add As Many Assets and Audiences As Possible

Because the Performance Max algorithm relies on asset and audience information to optimize ad placements, the more added for use, the better. This means that you can have multiple opportunities for the best placement of your ad. 

Remember to Update Conversion Settings As Your Campaign Priorities Evolve

To drive better results, ensure your conversion settings are always up-to-date with your latest objective. Consider using conversion value rules to target a certain subset of customers.

Use Data-Driven Attribution

Using data-driven attribution allows the machine learning algorithm within Performance Max to drive more value using incremental gains. Data-driven attribution complements auction-time based smart bidding. 

Carefully Analyze Your Initial Results

Use the ‘Insights’ tab to understand your Performance Max results beyond micro-level campaign assets. Routinely check the ‘Recommendations’ tab to understand what you can do to optimize your structure for machine learning.

The NetElixir Difference

At NetElixir, we continually run tests to determine what works and to discern new best practices for our clients. We have created proprietary tROAS adjustment scripts to maximize a campaign’s budget to drive incremental routines, as well as lower ad spend with a relatively lower impact on revenue. 

Additionally, we have standardized templates that determine bid modifiers based on search-shop-buy behaviors by hour of day and day of week to help with ad scheduling. 

To learn more about how our paid search offerings can better optimize your Performance Max campaigns to ensure your holiday campaigns won’t be affected, contact our experts today.

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