Google Performance Max 101: The Basics

If you run a Google Ads account, you've probably heard or seen information about Google's Performance Max campaigns. There's a lot of information out there, and it can be confusing trying to make sense of it all. But today, I'm going to give you the lowdown on Performance Max so that you can decide if it's a good fit for you and if you should spend your valuable digital marketing budget on it.

In this detailed blog post, we'll cover some of the basics of Performance Max campaigns, such as what they are, how they work, their pros and cons. By the end of this post, you should have a good understanding of what Performance Max is and how it can help you get more bang for your buck in your PPC marketing.

What is Google Performance Max?

Google's Performance Max campaigns were unveiled in November 2021. They combine the power of machine learning with almost all of Google's ad placements that reach 90% of global Internet users. This includes Search, Shopping, YouTube, Display, Discovery, and Maps.

Performance Max is available for both ecommerce businesses selling products and businesses aiming to generate leads. In 2022, Google's Smart Shopping campaigns, which were based on automation, were migrated to Performance Max. For ecommerce businesses, Performance Max is similar to Smart Shopping but includes a few more placements, like Discovery and Maps, that Smart Shopping did not.

How Does Performance Max Work?

Performance Max leverages almost all of Google's network:

• Search

• Shopping

• YouTube

• Display

• Discovery

• Maps

For Performance Max, you upload a collection of assets into what Google calls an "asset group." This group includes headlines, descriptions, images, videos, logos, and more. Google picks and chooses the type of ad to create based on the assets you provided.

Audience Signals

Once you create an asset group in Performance Max, you have the ability to add an audience signal. Audience signals help inform Google's algorithm about who your ideal target audience is. For example, maybe it's people with a particular interest or people who have previously searched for a term on Google.

Contrary to popular belief, audience signals are not used for actual targeting; they're merely used as suggestions.

Insights and Data

Google is selective about what insights and data they share from a Performance Max campaign. However, some reports can be found inside the "Reports" tab of Google Ads. In addition, within the Performance Max campaign, you'll find an "Insights" tab on the left-hand side, offering a range of information.

Bidding Strategy

Bidding in Performance Max is not manual. Instead, Google tries to maximize conversions for your campaign within your given budget. You can tell Google what Target ROAS (Return on Ad Spend) or Target CPA (Cost Per Acquisition) you would like to hit, which can significantly impact the efficiency and spend in your campaign.

Pros of Performance Max

1. Wide Reach: Performance Max leverages most of Google's ad placements.

2. Automation: Utilizes machine learning for optimization.

3. Asset Versatility: Allows uploading various assets to create multiple ad formats.

4. Audience Signals: Helps inform Google about your ideal target audience.

Cons of Performance Max

1. Control: Google handles much of the automation, which might lead to less control for advertisers.

2. Video Assets: Google will create a video if none is provided, which may not be very good.

3. Junk Conversions: More "junk" conversions for lead generation due to extensive placement use.

4. Dynamic Search Ads: Can auto-generate ads similar to dynamic search campaigns, which might not always align with your goals.

Criticisms of Performance Max

One major criticism is Google's extra step in controlling success through automation. For instance, if you don't upload a video asset in a Performance Max campaign, Google will create one for you, and it's often of poor quality. This can be a significant downside, especially for advertisers focused on brand image.

Another common complaint comes from advertisers focused on generating leads. Performance Max tends to generate a lot of junk conversions because the system uses any and every placement possible within Google's inventory. There have even been instances of accidental clicks from kids on their parents' phones while playing games like Angry Birds.

Dynamic Search Advertisements

One differentiator of Performance Max is its ability to create dynamic search advertisements for advertisers. If you've ever launched a dynamic search campaign where Google crawls your website and automatically creates ads based on your content, Performance Max does something similar. If you don’t want a lot of impressions in the DSA-like format, you’ll ned to disable "final URL expansion."

Overall, Performance Max has its flaws, but it can be successful if you do your homework and set it up correctly.