Key points summary:
- The question: Is Performance Max the best type of Google Ads campaign for B2B businesses?
- The answer: The AI-driven automation of Performance Max can be brilliant for increasing click-through rates, finding new audiences across the Google Network, and automatically adjusting budgets to focus on your set goals. However, more clicks do not necessarily equate to higher conversions, and PMax is not transparent about where your budget is being spent (and potentially wasted).
- The conclusion: Whilst Performance Max campaigns can be very useful for B2B businesses, their automation and black box approach to ad spend can waste money on vanity metrics (e.g. high click-through rates), and doesn’t always bring in high value conversions and customers ready to spend.
What is Performance Max?
Performance Max is a goal-based type of Google Ads campaign which has transformed the way advertising functions across Google and its affiliated sites. It allows you to access the entire Google Ads inventory – including Search, YouTube, Gmail, Maps, and Display – from a single ad campaign.
From YouTube to Google Maps, ‘PMax’ campaigns can position your ads right where your audience are most likely to see them. Performance Max is also increasingly using Google AI to tweak campaigns in line with real-time data, to try and get the most out of your ad spend.
We closely manage every ad campaign we run for our PPC clients and, whilst Performance Max is frequently helpful, other fully-managed ad campaigns are often still the right option to make ad budgets go further.
How Performance Max works
Performance Max campaigns work hand in hand with Google AI to help drive the best conversions at a low cost. When you create a Performance Max campaign, it takes into account all the settings and assets (images, bidding goals, data feeds, etc.) you provide, and uses Google AI to automatically optimise campaigns based on your goals.
1. Conversion goals and values
When you build your campaign, you define the conversion actions you value and, if needed, assign an optional Target ROAS (Return on Ad Spend) or Target CPA (Cost Per Acquisition). These optimise your ad auctions for specific costs or goals, to help you get the most value out of your ad spend. This can help you hit ad goals quickly.
You can also enable Smart Bidding, which uses Google AI to conduct auction bids based on the probability your ads will convert. It bases this bidding on real-time data signals such as time of day, user intent, location, and more.
2. Audience signals
By sharing your preference for the interests, demographics, and behaviours of your customers, you can help Google AI get your Performance Max ads in front of the most relevant audience.
When you set new audience signals for Google AI to focus on, in can take up to two weeks for these to fully integrate and start working.
3. Spending budgets
To get the most out of your ad budget, you should set daily spend targets for your Performance Max campaigns. This is not a ‘hard cap’ on ad spend (i.e. on high traffic days, your ads could spend more than your target) but it sets an amount that you are willing to spend, on average, for every day your campaign runs.
Google AI can then automatically direct your budget towards the ad placements and inventory assets that help your ads perform best.
When you should use Performance Max
There are many benefits to using Performance Max, and many scenarios when it is the best ad option:
- Hit conversion goals and find new audiences: From increasing online sales to generating new leads, real-time analysis of customer intent enables PMax campaigns to target very precisely and convert customers according to specific goals.
- Simplify campaign management: With PMax, you can access every Google advertising channel through a single campaign. The automation options Google AI enables can drive huge click-through and conversion value for simple goals.
- Go beyond keyword-driven campaigns: Real-time data and Google AI powered predictions about audience behaviour and strategic ad placements help get your ads in front of users who aren’t searching for your services, but are likely to be interested in them.
- Audience and industry insights: PMax is also useful for insights into rising search trends and asset performance. These can help you understand where trends are shifting in your industry, and adjust your business and ad strategy accordingly.
PMax vs. Search campaigns: The drawbacks of Performance Max
There’s no doubt that Performance Max can drive a huge number of clicks. However, a high click-through rate doesn’t always mean these are high-quality leads that will earn a good ROAS. PMax can waste budget on ramping up these vanity metrics, whilst failing to earn you relevant conversions.
For B2B businesses that want good-quality leads, or businesses with a limited PPC budget, Performance Max campaigns have some drawbacks – and Search-focused campaigns are often the better choice.
1. Performance Max can have lower conversion rates
PMax campaigns are not keyword-driven – unlike Search campaigns, where your ads only appear when someone specifically searches for what your business offers.
Sometimes, this lack of keyword focus is an advantage; PMax campaigns can appear for people who aren’t searching for terms specific to your business offering, but have attributes that make them potentially interested in your ads (behaviour, location, etc.).
However, this is a double-edged sword; as, logically, people actively searching for your services are far more likely to convert (even if there is a smaller pool of them to appeal to). Your PMax campaigns are likely to appear to more people than pure Search ones, but the conversion rate can be far less.
2. Click-through costs
Performance Max campaigns spread your ads across the entire Google Network – a huge asset, in many ways. Your ads might crop up at the start of a YouTube video, at the top of the Promotions and Social tabs in Gmail inboxes, in local business listings in Google Maps, and more.
The increased exposure of your ads is of course likely to increase your click-through rates – again, a blessing and a curse. Many people will click your ad because they are vaguely interested in what your business offers – however, unlike people who are actively searching for your services, they are far less likely to convert.
Your business pays the click-through cost, whether visitors stick around or not. If you want to focus your ad spend on highly relevant users likely to convert, Search campaigns can be a better option.
3. Hidden ‘black box’ ad spending
Google is getting better all the time at understanding user behaviour and adjusting PMax campaigns in line with this. Smart Bidding, for example, learns from your ad performance and tries to determine how it can generate more conversions in a cost-efficient way.
However, it’s an imprecise science at best, and Google is notorious for withholding information on exactly how PMax campaigns determine where to spend your ad budget. The ‘black box’ design of PMax automation means the exact budget allocations of your ads across every channel of the Google Network are hidden. Increasing your ad spend is still likely to bump up your conversion rate, but there’s also a chance PMax is wasting a chunk of your budget on Google channels that earn you very little revenue.
4. Limited control over campaigns
Controls for PMax campaigns are also very limited, meaning campaigns are almost guaranteed to waste budget on unwanted clicks whilst it goes through the trial and error of fine-tuning campaigns. Currently, you cannot set caps for specific areas of the Google Network, or ask PMax to target sites where your ads do well.
By contrast, in Search campaigns you know exactly where your money is being spent and what is generating good-quality conversions, so you can fine-tune budgets accordingly.
