A Beginner’s Guide to Performance Max Campaigns in 2024

Performance Max Campaign is a new goal-based campaign type that expands your reach across Google Ads ad formats from a single campaign. It complements your keyword-based Search campaigns and drives a higher conversion rate than running YouTube, Search, Gmail, Maps, and other channels separately. So what is Performance Max? Let’s find out together with The7 in this article!

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1. Understanding Performance Max Campaigns

1.1 What Is Google Ads Performance Max?

Performance Max campaigns are a new, goal-based campaign type designed to optimize performance. They let advertisers boost conversions across all Google Ads channels from a single campaign.

The campaign is designed to extend the reach of keyword-based Search campaigns, helping you maximize conversions across Google’s platforms, including YouTube, Display, Search, Discover, Gmail, and Maps.

Performance Max was first introduced in November 2021 with the main goal of generating leads and increasing online sales and store visits, without requiring product data from Google Merchant Center. By September 2022, this new campaign format had replaced all earlier Smart campaigns. In the past, reaching your target audiences across Google’s different channels took multiple separate campaigns. With Performance Max, you can advertise to your target audience across Google’s network through a single campaign.

1.2 Optimizing Performance Max

Goal-based Google Performance Max campaigns use machine learning to automatically serve customized ads with optimal bids to relevant target audiences, making the most of campaign performance.

In this process, keywords are not simply static targets. They act as dynamic indicators, allowing artificial intelligence to compare your input keywords and discover potential audience groups. The target group may search for these keywords directly or show similar search behavior. The AI algorithms can also analyze user patterns and behaviors that go beyond those specific keywords. This means the scope of your campaign isn’t limited to the exact keywords you originally entered. Instead, keywords are treated as interests that provide valuable signals for the AI to reference.

If the AI identifies any area where expanding the campaign’s reach with related keywords could increase conversions, it has the flexibility to target users interested in those keywords. This flexibility keeps the campaign quick to respond to users’ evolving interests and search trends, which in turn optimizes the overall performance of your Google Performance Max campaigns.

1.3 Key Features of Performance Max

1.3.1 URL expansion

By default, landing pages are selected by the URL expansion feature through machine learning, in order to send searchers to the most relevant landing page on your website. URL expansion also generates ad headlines, descriptions, and additional content so that your ads closely match your landing page content. This feature helps advertisers get the most out of their campaigns by automatically adjusting landing pages and ad headlines based on user intent and search queries, creating a more personalized and engaging user experience. This wider reach also introduces your business to potential customers who may previously have gone unnoticed, strengthening your brand awareness in the digital space.

1.3.2 Asset groups

Asset groups are collections of assets or images related to the same theme or target audience. You can create multiple asset groups within each campaign.

1.3.3 Audience signals

Audience signals are used to tell Google about your ideal or preferred audience groups for ad targeting. Gathered from search queries, browsing history, and other sources of information, these signals provide insight into the characteristics, interests, and behaviors of a target audience. This information helps marketers segment their target audiences and develop more distinctive advertising campaigns that resonate better with them.

1.3.4 Keyword automation

In the context of Performance Max, keyword automation uses advanced machine learning technology. Google’s algorithms identify additional keywords with the potential to expand your campaign’s reach, based on existing data provided to the AI as a reference point.

This gives businesses a valuable opportunity to discover new keywords that can drive their growth. While these automated keyword suggestions can bring major benefits by widening your reach to target audiences, there is one caveat to consider. The challenge lies in the possibility of irrelevant keywords being included. To mitigate this, performance specialists must carefully monitor the keywords the system generates. Any irrelevant keywords need to be identified and marked as negative keywords for the campaign. This ensures the campaign stays refined and consistently targeted at the right audience, maximizing its effectiveness.

1.4 Benefits of Performance Max Campaigns

1.4.1 Find more converting customers for your goals

With a Google Ads Performance Max campaign, you can reach unexpected potential customers across multiple Google channels and expand your target audience. This works because Google understands consumer information such as gender, location, and many other factors in real time, supplemented by the information you provide through audience signals. Goals can be customized to maximize the number of conversions or the conversion value for your business.

1.4.2 Get more value from your budget

Thanks to data-driven evaluation across different channels, you can optimize your marketing strategy to create additional touchpoints that guide customers toward conversion. With machine learning models, Google can predict the channels with the best target audiences, ad copy, and creative combinations to optimize your conversion goals.

1.4.3 Take advantage of Google Ads automation

Guide automation with user input by using exclusive features such as Audience Signals combined with Conversion Value Rules. This lets you improve results quickly and speeds up campaign creation during the initial phase.

1.4.4 Increase conversion volume and value

Automated bid and budget optimization for sellers across channels creates new conversion opportunities in real time. In this context, a Google AdWords Performance Max campaign helps sellers widen their reach and improve conversion performance.

The model is attributed based on sales-channel data and optimizes touchpoints well, increasing the likelihood of driving customers to convert and growing revenue.

The system uses machine learning simulations to accurately predict which ad combinations, audiences, and ad templates will perform best.

1.5 How Performance Max Differs From Other Ad Campaigns

Performance Max campaigns are goal-based campaigns. They are built on special features for goal selection and smart bidding. They also offer higher visibility than Smart Shopping. Suited to e-commerce and lead generation, Performance Max differs from other Google Ads campaign types in its structure. Unlike a Smart Shopping campaign, you need only a single campaign to manage all of your ad placements in Performance Max. The benefits of this setup include saving time and having more granular control. Below are the factors that set the Performance Max campaign structure apart from other campaign types.

1.5.1 Asset groups

In a Performance Max campaign, there are no ad groups, only asset groups. An asset group is a set of similar items or assets that can be managed together for optimization purposes. When setting up an asset group, strategists need to enter the information listed in the table, including audience signals such as custom segments, interests, and audience details that can guide Google’s bots toward the business’s preferred target audience. With asset groups, a Performance Max campaign can predict the performance of each asset group more accurately, while integrating smoothly with artificial intelligence technology, which allows real-time adjustments to live bids and other optimization factors. Unlike standard campaigns that rely on manual inputs such as keywords and budgets, Performance Max uses artificial intelligence to identify points for improvement instantly. When the AI-empowered bot spots any opportunity for optimization, it makes changes quickly, so your campaign is always performing at its best.

1.5.2 Listing groups

Commonly found on online marketplaces and e-commerce platforms, listing groups offer a way to organize and categorize similar items or products into groups. Thanks to this structure, users can easily navigate and search for specific items within a larger inventory.

Within each listing group, users can submit a list of the products they want to associate with keywords.

These groups are created based on specific product characteristics (price, brand, product ID, and other factors). Each group consists of a set of products that share similar characteristics. Example: A clothing retailer can create product groups based on clothing type, such as shoes, shirts, and pants, or by specific brands.

In Performance Max campaigns, bidding is fully automated. The advertising goal you selected for your campaign determines the bidding.

2. Running a Performance Max Campaign

2.1 Setting Up a Performance Max Campaign

Performance Max campaigns help businesses connect effectively with their target audiences and achieve their advertising goals. A campaign can be set up in just a few steps, and the process can be simplified even further with the support of a digital marketing service. Below is a video guide to this process.

Step 1: Choose your goal

When setting up a campaign, you can keep the goals already defined in the system, such as increasing online sales or generating leads, or set your own goals.

Step 2: Choose Performance Max campaigns

Choose Performance Max as your campaign type.

Step 3: Define your bidding strategy and budget

Building an accurate bidding strategy and budget is essential to reaching your campaign goals. When working with Performance Max campaigns, you will be offered two main bidding strategies: “Maximize Conversions” and “Maximize Conversion Value.” Each strategy has its own unique advantages, and you can fine-tune your strategy further based on your specific goals.

Maximize Conversions

This bidding strategy is designed to get the highest possible number of conversions within your budget. You have the option to select “Set a target cost per action,” which lets you define the maximum cost you are willing to pay for each conversion. This helps you stay in control of your budget while aiming to increase the number of conversions.

In short, “Maximize Conversions” focuses on efficiently driving more conversion actions within your allocated budget, making it the best choice when your main goal is to grow your customer base or generate potential leads.

Maximize Conversion Value

By contrast, the “Maximize Conversion Value” bidding strategy is tuned to maximize the revenue your campaign generates. You can select “Set a target return on ad spend (ROAS),” which lets you define the return on investment you want. This approach ensures your ad budget is directed toward actions that bring in higher revenue.

In short, “Maximize Conversion Value” steers your bidding toward earning higher revenue from each conversion, making it the ideal choice when your main goal is to increase revenue and maximize the value of every transaction.

An effective bidding strategy helps the digital marketing industry improve ad campaign performance, drive more traffic to their websites, and optimize return on investment (ROI). It determines where and how often ads appear based on ad relevance, ad quality, and bid amount.

Define your budget

Your budget sets the monthly spending limit for each campaign. This limit can be calculated by multiplying your preset average daily budget by the average number of days in a month. It’s important to check your account daily to see how your campaigns have performed so far.

Step 4: Choose additional campaign settings

Choose the locations, ad schedule, campaign run dates, and languages you want to target. You can also choose to turn on final URL expansion to help you optimize the performance of your Performance Max campaign. With this feature, you can replace your final URL with a more relevant landing page, based on search queries and user intent.

Step 5: Create an asset group and enter audience signals

You need an asset group to bring your ads together and set up an inventory for all the ad formats that apply to your advertising goal. An asset group is made up of the following elements:

• Images
• Logos
• Headlines
• Videos
• Descriptions
• Audience signals

Step 6: Add extensions

Next, expand your ads by providing more information about your business. Ad extensions matter because they improve your ads by letting you add extra links and buttons. These extensions create additional links from your website and can appear through sitelink extensions beneath your ad. They lead to pages on your website, whether product pages, blog posts, or information pages, which helps increase your click-through rate (CTR). At the same time, your customers benefit from a range of unique features.

2.2 Combining Performance Max With Other Campaign Types

You can combine Performance Max with other campaigns to generate more conversions. Performance Max can ramp up easily if you keep running your existing campaigns while you test it.

Performance Max uses artificial intelligence (AI) to test different keyword combinations and automations. Thanks to machine learning, the right sets of keywords and assets can be identified and generated for businesses. Because a Performance Max campaign runs across Google’s various networks, it also helps identify which channel generates the most conversions. That way, it helps business owners or campaign managers find the platforms and ads (Search, Display, YouTube, Maps, Shopping) that deserve more optimization and investment. Moreover, marketing companies apply SEM practices with machine learning technology to achieve optimal returns for their campaigns.

3. Things to Keep in Mind When Running Performance Max Campaigns

3.1 Track Conversions Accurately and Comprehensively

Performance Max campaigns rely almost entirely on automated bidding and goal selection. Conversion tracking has always been a key factor in Google Ads, and it plays an equally important role in Performance Max campaigns. Although it is fairly easy in e-commerce, many leading businesses still struggle with lead quality.

That’s why you should comprehensively track enhanced conversions, offline conversions, CRM integrations, and more.

3.2 Be Careful With URL Expansion

A Performance Max campaign merges several Google Ads formats: Display, Search, Discover, Shopping, Local, and Video. You could say Performance Max “borrows” many features from other campaign types.

One of those features is easy to overlook: URL expansion.

By default, Performance Max campaigns always have URL expansion turned on. If you don’t turn this feature off, the campaign is allowed to send users to landing pages other than your default URL. It is similar to Dynamic Ad Groups.

With Dynamic Ad Groups, however, you can point your targeted ads to the specific landing pages you want to drive traffic to. You can do this by listing specific web pages or by creating a set of rules, for example “URL contains product name”.

3.3 Add Videos

Providing content in multiple formats is one of the hardest parts of building a Performance Max campaign. It isn’t as simple as a bidding strategy or Audience Signals. Because the campaign serves many different ad types, you need to supply plenty of images, videos, and text for each campaign.

When you set up Display Ads, you can choose your own video content. In a Performance Max campaign, you can’t. If you don’t upload video content, Google Ads will create it for you.

Marketers can create additional visual effects or short videos with free tools such as Canva.

As with Google Ads, you need to upload your video to YouTube first, and only then use it to run the campaign. You can set it to private if you don’t want the ad to appear on your own YouTube channel.

3.4 Be Careful With Complex Location Settings

You can customize location targeting yourself based on people who are interested in a location or are near it, under “Presence or Interest”. Or you can choose only “Presence” to target as precisely as possible and limit impressions in locations outside your target.

If you choose “Presence or Interest”, Google Analytics will show the locations that are driving the most traffic.

3.5 Use Performance Max Only for Conversions

Like Discovery campaigns, Performance Max campaigns only let you bid on Conversions or Conversion Value.

If you want to target the top or middle of the funnel, you can choose a conversion action right at the campaign level. Example: When you test Performance Max with a behavior goal, you should create a “page view” conversion action and optimize the campaign for page views.

3.6 Add Audience Signals

When Performance Max launched, Google Ads introduced the Audience Signals feature. When you set up a campaign to target an audience, Google Ads needs to know exactly who the users are that you want to show your ads to.

Performance Max uses user segments only as a starting point for ad delivery. Once it has collected data, Performance Max branches out from your direction. At the same time, it shows ads to groups of people who are likely to convert based on their behavior.

This is how targeting works to optimize Discovery, Display, and other campaigns. However, even after you’ve chosen your audience segments, Google can still show ads to groups of users it considers likely to convert. Switching from “Optimized Targeting” to “Audience Signals” is a smart move, because users get more control than when the machine runs on autopilot.

All Audience Signals have their own tab in the Audience Manager in your Google Ads account. When you create them in a Performance Max campaign, you can still access them at the account level. This shows that Google also places a lot of focus on Audience Signals, so it’s worth learning more about them.

3.7 Check the Insights Tab

Performance Max campaigns have also drawn many reports of a lack of transparency, even though they offer quite a lot of useful information in the Insights tab. After a campaign has been running for a few days or weeks, “Search Categories” and “Audience Segments” work quite well.

Search Categories are groups of similar search phrases. Although these reports aren’t as clear as the Search Terms Report, they are still enough to answer the two questions below for you:

1. Is Performance Max concentrating on branded or non-branded searches?
2. Is Performance Max targeting new searches or the same search goals you set up in your Search campaigns?

3.8 Don’t Copy Images From Merchant Center

Once you’ve connected your Google Merchant Center data source to Performance Max, it works much like a Shopping campaign. In that setup, Performance Max needs data such as price, title, images, and stock status to create ads.

So you shouldn’t use “e-commerce images” as standalone content for Performance Max, because the campaign will treat this image data as duplicated. Instead, add images that show the products and services customers actually use.

Here are some content tips for you:

• Show real images and real content
• Avoid overlapping text or too few words.
• Show a prominent image that takes up 30% or 40% of the overall layout, in an eye-catching central position
• Use images that include people.

3.9 Monitor Your Customer Acquisition Rules

The Performance Max strategy can replace the Smart Shopping strategy because of its customer acquisition rules. In the settings, you can easily adjust bids for new customers.

The new customer bidding rule is what helps a Performance Max campaign focus on Search and remarketing for the brand. You can also use this format for customer acquisition conversions. However, a Performance Max campaign targeting acquisition won’t perform as well as a Performance Max campaign targeting bottom-of-funnel conversions. So it takes a longer time and more ads to convert new users into customers.

4. Performance Max Campaign Success | Google Case Studies

4.1 Case Study 1: MoneyMe

MoneyMe is an Australian digital financial services company that offers digital credit card options as well as fast, easy personal loans. By running Google ads, MoneyMe is quickly finding new customers (online applications that lead to funded loans) at its target acquisition cost. It partnered with an independent firm, Sparro, to reach high-intent consumers across different channels and drive higher-quality leads within its target CPA limit through Performance Max campaigns. MoneyMe’s Performance Max campaign aimed to increase the number of newly funded loans for the company’s personal loans. Several creative assets were developed for this Performance Max campaign to present the company’s key benefits and build trust among tech-savvy consumers in the country. As part of its initial automated bidding strategy, MoneyMe used Maximize Conversions to establish a baseline CPA target and spend its budget. The team then switched to a target CPA bidding strategy to scale the campaign profitably and efficiently within the set performance goal. In addition, MoneyMe used offline conversion imports to measure and optimize for completed online applications that resulted in a fully funded loan.

Thanks to the 6-week Performance Max campaign, MoneyMe’s conversions increased by 22%, passing $800,000 in revenue from newly funded loans. The company also saw a 20% reduction in overall target acquisition cost across the entire account.

4.2 Case Study 2: Allianz

Performance Max campaigns help advertisers achieve an average of 13% more total conversions at a similar operating cost. Overall, Performance Max helps you reach your goals in the following way:

Increase conversion volume and value

Allianz partnered with its agency, Jellyfish, to use Performance Max campaigns to increase the number of quality car insurance leads by 15%, at a lower cost per lead than regular Search campaigns.

4.3 Case Study 3: Deezer

Discover new and potential customers

Deezer is primarily an app-based advertiser, but it was looking to boost web sign-ups and reach new customers across media channels. Thanks to Performance Max, Deezer and its agency, Artefact, were able to increase sign-ups by 28% on the web path, at a 15% lower cost per sign-up than the app path.

4.4 Case Study 4: SAIC-MG Motors

Partnering with automation

SAIC-MG Motors used Performance Max campaigns to explore Vietnam’s strategic and highly competitive automotive market, in line with the brand’s global expansion plans. SAIC-MG Motors successfully recorded an increase of up to 39% in test-drive leads, at a cost per lead 83% lower than the account average, thanks to Performance Max. As part of its core media strategy, Performance Max was used to find new customers, while the brand focused on importing custom segments and past website visitors as audience signals. The power of automation was accelerated to optimize results.

4.5 Case Study 5: Joybird

Wanting to take its automation to a new level, furniture retailer Joybird partnered with its agency, Go Fish, to achieve an increase of up to 95% in revenue with a 40% higher ROAS by deploying Performance Max campaigns. Previously, the brand had successfully recorded outstanding online sales with Smart Shopping campaigns.

Case study 5: Joybird

4.6 Case Study 6: MotorK

MotorK, a leading automotive consumer technology and marketing technology company in Europe, was looking to expand quickly and capture new leads for its partner brands at a fixed acquisition cost target. It also aimed to strengthen its media mix strategy through innovation and automation. As a result, the company used Performance Max campaigns to test a brand-new solution designed for digital performance. As an early adopter of the solution, MotorK benefited from the campaigns in its search for new potential customers, while setup and ongoing management were simplified through a single, unified campaign. In the end, MotorK saw an increase of up to 24% in quality leads (based on online forms requesting vehicle quotes) at a fixed acquisition cost, compared with Search and Display performance. Paving the way for its future prospects, the MotorK team is investing more capital in its initial test and Performance Max campaigns to expand its geographic coverage. It is considering additional countries such as Italy, France, and Spain. The team also wants to use its business feed to include automotive inventory information in its ads.

5. Performance Max FAQs

5.1 How Many Conversions Does a Performance Max Campaign Need to Be Effective and Provide New Insights?

To start receiving insights, you need at least 1,000 impressions and 100 clicks per month. In general, the longer you run a Performance Max campaign, the better the insights you will get.

5.2 How Quickly Should I Adopt Performance Max?

Although it is recommended to adopt Performance Max as early as possible, it ultimately depends on many factors and your specific business goals. Consider your business’s readiness, the complexity of the campaign, and your budget and resources. If you’re unsure when or how to proceed, consider consulting digital marketing experts or companies that specialize in Performance Max.

5.3 Who Should Use Google Ads Performance Max Campaigns?

Google Ads Performance Max campaigns can be a valuable tool for a wide range of businesses and advertisers, but they are especially well suited to specific situations and goals. They are a great choice for e-commerce businesses looking to generate online sales. The ability to optimize conversion value and reach potential customers across multiple Google networks can be very effective in this context. If your main goal is to capture quality leads, a Performance Max campaign can help you effectively collect contact information or inquiries from potential customers.

5.4 When Should I Launch a Performance Max Campaign?

A Performance Max campaign is most effective when it fits choices such as:

• Targeting specific conversion and advertising goals (Example: Increasing online sales, attracting potential customers, etc.)
• Optimizing campaign goals and minimizing cases where ads rarely appear on a channel
• Accessing Google’s advertising channels easily with just a single campaign
• Expanding your reach and increasing conversion value beyond keyword-based Search campaigns.

In short, Performance Max campaigns represent an important step forward in the world of digital advertising. Their main strength lies in the ability to serve ads across Google’s vast network, giving businesses an unmatched opportunity to reach a larger and more diverse audience.

For businesses that want to widen their reach, connect with new potential customers, and strengthen their online presence, Performance Max is a gateway to achieving these goals effectively. By harnessing the power of automation, machine learning, and Google’s vast network, Performance Max opens the door to a broader vision.

>>>> See more: What Are Google Keyword Ads? Top Tips for Choosing Keywords