If you’ve logged into Google Ads recently, there’s a good chance you’ve been encouraged to try Performance Max, Google’s relatively new campaign type that promises to improve advertising performance by using artificial intelligence to decide where, when and to whom your advertisements should appear. On the face of it, this sounds like a fantastic idea. Rather than spending hours researching keywords, adjusting bids and deciding which advertising channels to use, you can simply tell Google what you want to achieve and let its algorithms do most of the work for you. However, having spent many years managing Google Ads campaigns, I’m naturally a little sceptical whenever Google introduces something that promises better results while simultaneously taking more control away from advertisers.
Performance Max was introduced in 2021 and has become considerably more prominent over the last year, particularly following Google’s decision to replace Smart Shopping and Local campaigns with the new format. While Google claims that Performance Max can generate more conversions at a similar cost, there are some fairly important considerations that I think businesses should understand before handing over their advertising budgets.
What Exactly Is Performance Max?
Traditionally, Google Ads campaigns have been organised around individual advertising channels. Search campaigns allow you to target people searching for particular keywords, Display campaigns show advertisements across websites participating in Google’s advertising network, and Shopping campaigns promote products through Google’s shopping results. Performance Max combines these channels into a single campaign, with advertisements potentially appearing across Google Search, Shopping, YouTube, Display, Discover, Gmail and Maps.
Rather than selecting individual keywords and placements, you provide Google with information about your business, the products or services you want to advertise, your budget and the conversions you’re trying to generate. You can also supply advertising assets such as images, headlines, descriptions and videos, which Google combines into advertisements suitable for different placements. Its algorithms then determine where your money should be spent, based on where they predict conversions are most likely to occur.
Theoretically, this means Google can identify opportunities that you might otherwise overlook, potentially reaching customers through channels you hadn’t previously considered. However, it also means giving Google considerably more freedom to decide how your advertising budget is used.
The Problem with Losing Control
One of my biggest concerns with Performance Max is the lack of transparency compared with traditional Google Ads campaigns. If I’m running a standard Search campaign, I can examine the keywords and search terms generating traffic, identify which ones are producing enquiries and make adjustments to improve performance. I can also exclude irrelevant searches, adjust targeting and control how much I’m willing to spend.
With Performance Max, much of this information is either unavailable or considerably more difficult to access. Google does provide some reporting through its Insights section, including information about search themes and audience behaviour, but it doesn’t offer the same level of detail and control that advertisers have become accustomed to with conventional campaigns.
This creates an interesting situation where Google is effectively asking advertisers to trust that its algorithms are making the correct decisions, without necessarily providing enough information to independently verify those decisions. I’m not suggesting that Google’s algorithms aren’t capable of producing good results, but I’d certainly prefer to know where my money is going.
Is It Better for Ecommerce?
I suspect Performance Max is particularly attractive for ecommerce businesses, especially those with reasonably large product catalogues and accurate conversion tracking. Google can use information from your Merchant Center product feed to advertise individual products across its various channels, while automatically adjusting bids based on the likelihood of generating a sale.
For example, if you’re selling hundreds of different products, it would be extremely time-consuming to manually adjust bids for every possible search and customer. Performance Max can potentially handle much of that work automatically, identifying which products and audiences are most likely to generate profitable sales.
Google has reported that advertisers upgrading from Smart Shopping campaigns have achieved an average increase of 12% in conversion value at the same or better return on advertising spend. Of course, these are Google’s own figures, so I’d be cautious about assuming that every advertiser can expect similar improvements.
For businesses generating relatively few conversions, however, the algorithms may have less information to work with, making the results considerably less predictable.
What About Lead Generation?
This is where I’d be particularly cautious. If you’re running an ecommerce website, Google can potentially measure the actual value of each purchase, making it relatively straightforward to determine whether a campaign is generating profitable sales. However, things become considerably more complicated when you’re advertising a service and trying to generate enquiries.
Let’s say you’re running advertising campaigns for a company that installs kitchens. One campaign might generate 20 enquiries from people genuinely interested in spending £15,000 on a new kitchen, while another generates 50 enquiries from people looking for replacement cupboard handles. If Google is simply counting enquiry form submissions as conversions, the second campaign might appear more successful, despite producing considerably less valuable business.
This isn’t a problem exclusive to Performance Max, but the reduced control over targeting makes it particularly important to ensure that Google is optimising towards genuinely valuable conversions. Ideally, businesses should be feeding information about qualified enquiries and completed sales back into Google Ads, rather than assuming that every enquiry is equally valuable.
Could Performance Max Compete with Your Existing Campaigns?
Another consideration is how Performance Max interacts with campaigns you’re already running. Google has introduced rules governing which campaigns take priority when multiple advertisements are eligible to appear, but there’s still a possibility that Performance Max could attract conversions that might otherwise have been generated by your existing campaigns.
For example, if somebody searches for your company name after already deciding to purchase something, a Performance Max campaign might receive credit for that conversion, even though the customer was already familiar with your business. This could make the campaign appear more successful than it really is, particularly if you’re primarily interested in attracting new customers.
Google has announced additional controls designed to help advertisers exclude particular brands from Performance Max campaigns, although some of these improvements are still being introduced. For now, I’d recommend being particularly careful when interpreting conversion figures, rather than assuming that every sale attributed to Performance Max represents additional business you wouldn’t otherwise have received.
Should You Give It a Try?
Despite my reservations, I certainly wouldn’t suggest avoiding Performance Max altogether. Google’s machine learning technology is extremely sophisticated, and there are circumstances where automated campaigns can identify opportunities that would be difficult to manage manually. For ecommerce businesses with good conversion data, Performance Max could potentially become an important part of their advertising strategy.
However, I wouldn’t recommend replacing all your existing campaigns simply because Google suggests doing so. If you’ve already got Search campaigns generating profitable enquiries, there’s little reason to abandon them without first establishing whether Performance Max can genuinely deliver better results.
Personally, I’d be inclined to test Performance Max alongside your existing campaigns, where appropriate, and compare the results carefully. Make sure your conversion tracking is accurate, allow enough time for the algorithms to gather useful information and pay particular attention to the quality of enquiries or actual sales generated.
Ultimately, I think Performance Max represents the direction Google Ads is heading, with advertisers increasingly responsible for defining their objectives while Google’s algorithms make more of the decisions about how to achieve them.
Whether that’s a good thing depends largely on how much you trust Google to spend your money.
Personally, I’d still quite like to have a say in it.