Interface showing Google Performance Max campaigns and optimized product listing

Advertisers are constantly working to reach the right customers at the right place and time. Google’s Performance Max Campaigns, first unveiled in November 2021, are designed to do just that. By combining the power of machine learning with a vast ad network that reaches 90% of global internet users, Google enables businesses to get the most out of cross-channel promotion in a single advertising campaign.

Are you ready to get started with Performance Max campaigns? Continue reading to learn what they are, how they work, and whether you should use them in your online marketing strategy. We also share expert insights from one of our Certified Agency Partners, Duane Brown, Founder and Head of Strategy at Take Some Risk, about this new campaign from Google.

What is a Performance Max campaign?

If you have used Google Ads in the past, you are familiar with the several types of campaigns you can create to target audiences on individual channels across Google’s network. What sets a Performance Max campaign apart is that it combines smart bidding and targeting features into a single goal-driven campaign across the entire Google network.

How is Performance Max different from Smart Shopping?

A Performance Max campaign bears a striking resemblance to a Smart Shopping campaign. But unlike Smart Shopping campaigns, which only focus on maximizing sales conversions, Performance Max campaigns let advertisers select multiple conversion goals and prioritize what they want to achieve.

Google new campaign dashboard

For example, if you want a campaign to increase new customer leads and website traffic, you can select both of these objectives for your Performance Max campaign. You can then set the conversion values for each goal to rank the importance of each conversion within the campaign. If a customer lead is worth more to you than receiving website traffic, you would set that conversion value higher. As Google learns more about your ideal customers and their habits, the campaign automatically adjusts the bidding strategy or specific channel targeting to better align with your goals.

Smart Shopping and Local campaigns will automatically upgrade to Performance Max in 2022.

To ensure advertisers are prepared to use Performance Max campaigns by the 2022 holiday season, Google has established a schedule to upgrade existing Smart Shopping and Local campaigns. Beginning in April, Smart Shopping campaigns can be upgraded to Performance Max campaigns with a one-click tool in Google Ads, and the same tool will be available for Local campaigns starting in June.

Google will start automatically upgrading your Smart Shopping and Local campaigns in July and August, respectively. Upgrading to Performance Max will not delete your previous Shopping or Local campaigns, only deactivate them. New Performance Max campaigns will be generated using your previous campaign data. The historical data from your legacy Smart Shopping and Local Campaigns will still be available for analytics purposes.

Google’s one-click tool gives you the option to upgrade one campaign at a time or all at once, so we recommend that you slowly begin to upgrade your Smart Shopping and Local campaigns yourself when it becomes available, rather than waiting for Google to automatically transition you. Upgrading on your own minimizes the chances of potential campaign conflicts and allows you to grow accustomed to the new features while you experiment with Performance Max. Performance Max will take the knowledge learned from the original campaign to help maintain consistent campaign performance.

If you opt to gradually transition your campaigns to Performance Max, it is important to remember these new campaigns will still be running alongside your existing Smart Shopping and Local campaigns. To prevent this, Google’s recommendation in a recent webinar is to avoid having any overlapping products and targeting within your Smart Shopping campaigns. For Local campaigns, you should avoid having any duplicate products or creative assets in both campaigns for the same business location.

“People sometimes don’t realize that priority settings don’t work with Performance Max. Performance Max will take priority over standard Shopping campaigns if they contain the same SKUs. In some cases, we see what looks like cannibalization with Smart Shopping campaigns. One way around this is to put unique SKUs in the Performance Max campaigns. Performance Max will inherit all the features and settings—good and bad—of Smart Shopping campaigns, and thus need to be treated like any other Smart Shopping campaign.”

How does a Performance Max campaign work?

Performance Max creates optimized ads for you.

Similar to a Smart Shopping campaign, Performance Max dynamically creates ads using the assets you provide. Assets can include logos, images, videos, and ad copy for your brand or products. Based on your campaign data and the audience you are hoping to reach, Google automatically builds ads that are expected to best help you achieve your campaign goals. When more creative assets are provided, the campaign can generate a wider range of ad formats to appear in more places within Google’s network.

Google utilizes a broad network for cross-platform advertising.

Once creative assets are loaded into the campaign, Google’s algorithm decides when and where to show these ads across Google’s advertising channels and inventory, including YouTube, Display, Search, Discover, Gmail, and Maps. 

Google serves these ads to wherever your ideal audience appears to be most active. In a recent study, Google found that immediately following the discovery of new products on their feed, 91% of feed users made a product-related action. Sellers can use a Performance Max campaign to more easily tap into that 91% and greatly increase their rate of conversion.

Performance Max automates bidding and budget strategy.

Performance Max does not allow manual bidding. Instead, it uses automation and machine learning to maximize conversions and get the most out of your budget. Though you cannot control your bids, you can control the type of bid strategy and the target “cost per action” (CPA) of your campaign. 

If you designate multiple goals for your campaign and each one has a different conversion value, you can select “Conversion Value” as the campaign’s focus. This tells Google to concentrate on achieving the higher valued goals. If all of your conversions have the same value, you can select “Maximize Conversions” for the algorithm to focus on all goals equally.

Setting the target CPA directs Google to try and achieve as many conversions at this target as possible.

“Similar to Smart Shopping campaigns, the SKUs used in the Performance Max campaign matter because they are one of the few levers you can tweak within the campaign type. It is important to take that into account as Performance Max will become the only option to show on Google placements that go beyond search engine results pages. Getting the right SKUs and campaign set up is more important with Performance Max.”

Performance Max helps identify issues automatically.

In July 2022, Google launched diagnostic insights for Performance Max campaigns. This new tool helps advertisers get automatic alerts to identify potential issues related to:

  • Your account and billing status
  • Policy violations
  • Conversion tracking
  • Campaign status and budget
  • Bid strategy target
  • Ad strength

The diagnostic insights tool also provides helpful recommendations to troubleshoot any errors. Over the next few months, diagnostic insights will be made available for other types of Google Ad campaigns, too.

When should you use Performance Max?

When you should use performance max

You want to find new customer segments.

Marketers who use three or more channels in their marketing strategy see a 287% higher purchase rate than those employing a single-channel strategy. With Performance Max, ads are automatically shown on more channels across Google’s wide network. Google makes it easy to unlock an omnichannel approach by targeting audiences on channels you might not have tried before, such as YouTube, Gmail, or Maps, without the need for additional campaign setups.

You want to optimize your campaigns for specific touchpoints.

If you have several specific advertising goals, Performance Max reduces the number of campaigns you need to accomplish them. Rather than having one campaign to generate leads, another to drive sales, and a third to promote brand consideration, Performance Max allows you to combine these goals into a single campaign.

You want to tap into a lot more data.

Performance Max employs advanced machine learning using the data it gathers from the campaign, audience signals, and performance metrics taken from your previous keyword search campaigns. The algorithm perpetually tweaks your bids based on all of these factors to boost your conversion rate.

“When starting out with Performance Max, treat it like how you would a Smart Shopping campaign. Think about using Performance Max to market top-selling SKUs or SKUs that are in a hyper-competitive market. This allows Google to optimize the bid strategy at a far higher level than a single human can.”

When should you NOT use Performance Max?

When should you NOT use Performance Max

You have no prior campaign history.

Performance Max relies heavily on data to optimize bids and targeting. It should be used alongside your core, keyword-based search campaigns, not alone. Google needs to have more information about your business and the keywords you are targeting for Performance Max to work as it should.

You do not have the budget to allow time for Performance Max to “learn.”

Something to remember with all of Google’s ad campaigns is that when you launch a brand-new campaign, it is important to have budget flexibility. Google suggests that for Performance Max campaigns focused on online sales, you should wait one to two weeks before evaluating your campaign’s performance. For in-store goals, Google instructs advertisers to wait three to four weeks. A new campaign is the beginning of an experiment, and Google needs time to learn about your audience to best promote your campaign.

Are your products ready to list on Google Shopping? Find out with a free feed audit today.

Let’s look at some of Google’s Performance Max campaign case studies!

Many early adopters of Performance Max campaigns have seen encouraging results. Google has shared a few of these success stories to highlight Performance Max’s power and capability. Each business had different bid strategies and goals, and relied on Google’s algorithms to optimize the performance of their campaigns. 

Case Study: MoneyMe

MoneyMe, a digital financial services company based in Sydney, Australia, looked to Google Ads to help grow its customer base. The team decided to utilize Performance Max campaigns to increase lead generation while also reducing overall CPA. 

To create a baseline CPA, MoneyMe chose to maximize conversions as its campaign focus without a target CPA. Once a baseline cost was set, the team changed its bid strategy for Google to then focus on reducing the CPA.

After six weeks of utilizing Performance Max, MoneyMe was able to decrease its overall CPA by 20% while also increasing its conversion rate by 22%.

Case study MoneyMe for Google Performance Max Campaigns

Case Study: SAIC-MG Motors

SAIC-MG Motors, a multinational automotive design and manufacturing company based in Shanghai, China, looked to Performance Max to help break into the highly competitive automotive industry in Vietnam. Its campaign objectives included brand awareness and lead generation.

In addition to uploading excellent creative assets, the team created audience signals from remarketing data from its company’s website to help boost the campaign. The final result was an 83% decrease in cost-per-lead and a 39% increase in new leads.

How can you get the most out of your Performance Max campaign?

The secret to excellent Performance Max campaign results is providing high-quality, optimized data to Google from the start. If you have hundreds or thousands of products to add to your campaign, the process of painstakingly reviewing every single product to ensure that you are uploading the ideal data can be overwhelming. Take the guesswork (and headache) out of what information Performance Max needs to drive the best results by partnering with a data feed management solution.

How can Feedonomics help with Performance Max?

Feedonomics’ full-service solution for advertising streamlines data optimization and product listing for Google Shopping, while our feed specialists provide 24/7 support to ensure your Shopping feeds always run at their full potential.

“Optimization always matters when it comes to your Google Shopping feed. This data is what you relay to Google and how you outrank competitors. Since Performance Max has fewer ways for marketers to tweak campaign settings, it is even more important to start with all of the data that Google could possibly need.”