Google Performance Max for Retail – Is It Worth It?

Performance Max campaigns for online stores are essential to an e-commerce marketing strategy. Compared to local campaigns, they make it possible to increase sales and achieve defined business goals effectively. And for anyone who got used to Google Ads in the past, setting it up should be a walk in the park. 

However, the optimal use of their potential in an online store requires preparing a precise plan. We will show you why Performance Max campaigns are crucial for online stores, what benefits they can bring, and how to implement them effectively to maximize sales in your store.

About Performance Max Campaign

What is Performance Max? It’s a campaign in Google Ads that is controlled automatically and replaces smart product campaigns. Its goal is to reach specific marketing goals as quickly as possible, using the information provided by the marketer. Google states that Performance Max helps you reach a larger audience by leveraging Google’s various channels, so it’s worth using it to increase your ad reach. 

A Performance Max campaign can be displayed in channels such as:

• Google Search network
• Google Ads network
• YouTube
• Gmail
• Google Maps
• Google Discover

It is worth knowing that Performance Max has replaced Smart Shopping Campaigns. The new campaign was designed to make improvements in the functioning of the previous version and help improve the quality of advertising campaigns.

How Does It Compare to Standard Shopping Campaign?

The crucial difference between PMax and Standard Shopping is automation. While PMax is 100% automated, Standard Shopping campaigns need preparation. However, it has some sort of automation too.

Here is the essential information about the Standard Shopping Campaign:

• Takes longer to prepare.
• Requires hands-on checking of different ad parts like pictures and text mixes.
• Gives total authority over every part of the plan but requires more time for handling.
• Lets you turn off online spots, aim at particular places, and include unwanted keywords.
• Allows for including numerous landing pages to test ads.
• Shows solely in search findings and the shopping area.

In Standard Shopping, you can create ad sets in your plans that include similar items with matching configurations (such as language or location). These ad sets consist of multiple product ads, which are unique ads featuring individual products.

How Does Performance Max Campaign Work in E-Commerce?

Google Performance Max for E-commerce campaigns work by automatically optimizing and displaying ads in a way that is most likely to achieve the business goal. The system uses machine learning algorithms to deliver ads efficiently. The algorithm analyzes data from multiple sources, such as user behavior on the website, conversions, ad interactions, locations, and many other factors, to determine which ads and ad channels are most effective.

There are various automated campaigns in Google Ads, including flexible search network ads, which, like Performance Max, use automation to adjust ad rates and content. Performance Max, however, is distinguished by the fact that it allows one campaign to target multiple channels, increasing the ad’s reach. In one of our articles, we’ve covered in-depth how to create Performance Max campaign.

Jyll Saskin Gates, Google Ads expert, spoke about Performance Max with nothing but superlatives:

In addition, Google offers two strategies for setting campaign rates: maximizing the number of conversions and maximizing the value of conversions. This allows marketers to choose the strategy that best suits their goals. For example, you can create one campaign with many asset groups to diversify your strategy. You can also remove all creative assets from the asset group and make it like a Smart Shopping campaign instead. This way, you can align the campaign structure with your client’s goals.

When You SHOULD Use Performance Max Campaign?

The Performance Max campaign allows you to forget about the laborious completion of exclusions and focus on your advertising strategy. The key factor influencing the effectiveness of activities in these campaigns is the accuracy and meticulousness of signal input and historical data and conversions of the entire account. 

The Performance Max campaign is goal-oriented and allows you to use all available advertising channels in a single campaign, which increases the chances of maximizing the results achieved, which is why it seems like an ideal idea for promoting an e-commerce business. 

Performance Max campaign is especially recommended for entrepreneurs who:

• have a clearly defined advertising goal and conversion target;
• are focused on maximizing campaign results;
• want easy access to all advertising channels within a single campaign;
• seek additional campaign reach and increased conversions over keyword-targeted search network campaigns.

The main thing that sets Performance Max and Standard Shopping Campaigns apart is how much they’re automated and how easy they are to set up. Here Below is a table showing the big differences between these two types of campaigns.

Performance Max Campaigns	Standard Shopping Campaigns
Simple and fast setup	Hard setup
Full automation	A lot of manual work
Ads shown everywhere	Ads shown in Google Images, The Shopping tab, and Google Search
Relies on automation	Full control of the campaigns
As of now, not enough reporting information	Detailed reports on search queries
Ability to add negative keywords at account level	Ability to add negative keywords at both campaign and account levels
Not very accurate targeting, unless you add relevant audience signals	Very accurate targeting
Not possible to make bid adjustments	Ability to make bid adjustment

When SHOULDN’T You Use Performance Max Campaign?

If you’re just starting out in your business, lack a conversion/sales history, and don’t have a well-defined goal, it’s not worth using Performance Max campaigns. Any new type of action suggested by Google will be ineffective if you don’t pay enough attention to the details of your business. Remember that a Performance Max campaign is a demanding tool that may not produce the expected results if you cannot provide quality products and services, a good reputation, and a professionally made website. 

Before launching a Performance Max campaign, you should focus on improving the quality of your products/services and taking care of your corporate image and website. Only after making sure that these elements are in good condition can you consider using a Performance Max campaign, which will allow you to use your advertising budget more efficiently and better and increase the reach of your campaign.

How to Maximize Your Results

A Performance Max e-commerce campaign can bring numerous benefits, but it’s important to act thoughtfully and effectively, avoiding random decisions. We have three key tips prepared for you to help you make the most of Performance Max in e-commerce. 

Patience

Performance Max is an automated system requiring time to learn and collect data to create effective ad campaigns. During the initial phase of the campaign, you can expect a drop in performance, but after a few weeks, the system will begin to deliver better and better results. In some cases, the achieved results may even surpass those acquired through Smart Shopping Campaigns.

For most e-commerce brands, it takes about four to six weeks for the previous customer acquisition cost (CPA) to level off, so patience is key. At the same time, it’s worth remembering that not all e-commerce brands will benefit equally from Performance Max, and the individual needs of your business should be taken into account. 

The Performance Max campaign has a steep learning curve, which means that initially, campaign performance may be low, and it will take a long time and patience to achieve good results. If you are not ready to make a long-term investment or don’t have the time to manage these campaigns during their learning period, consider trusting experts to help you achieve better results faster.

Diversify

A Performance Max campaign should not be the only type of ad campaign used by an advertiser, as it is designed to complement other campaigns, not to run on its own. Google calls Performance Max a “finisher” that helps leverage the results of other ad campaigns. To get the most out of Performance Max, it’s still important to run keyword-based ad campaigns, Google Shopping ads, and other ad types.

It’s worth remembering that if you have Performance Max campaigns and search campaigns running, and the query you entered matches a keyword from a search campaign, it’s the search campaigns that take precedence. However, sometimes existing keywords may appear in Performance Max instead of your search campaigns due to factors preventing them from qualifying. In other words, if you want to control which keywords appear in which campaigns, you should be careful with Performance Max.

It may take some time to get the right balance between different types of campaigns. Nevertheless, by making small adjustments, you can determine how much money to allocate to awareness campaigns in other channels to support Performance Max’s increasingly effective conversion strategies.

Experiment with Budget

The Performance Max campaign works more effectively with a larger pool of funds because it allows you to test different ad strategies across multiple platforms. This Google Ads campaign uses advanced artificial intelligence algorithms that learn from data and can optimize the campaign in real-time to achieve better results. The more data available, the more effective the algorithms can be. Therefore, it’s crucial to know how to optimize Performance Max campaign. 

We are aware that a larger investment in Performance Max will probably mean moving some of your budget from other campaigns, but such a tactic can be very beneficial! With advanced automation and campaign optimization for conversions, Performance Max can help you achieve a higher number of conversions for the same budget, or achieve the same number of conversions with a smaller budget.

MoneyMe, a company that helps with money online, used a Performance Max campaign to quickly get more customers and spend less money on advertising. After using Performance Max for six weeks, MoneyMe limited their expenses by 20%, and got more people to sign up, increasing its conversion rate by 22%. MoneyMe still uses Performance Max along with other ways to advertise.

Richard Bray, Head of Marketing at MoneyMe said:

“We loved the Performance Max concept and how it delivered creative and messaging across a variety of Google spaces that were perfect for conversion!”

Deliver

Performance Max campaigns use machine learning algorithms that need a lot of data to learn. Providing more data allows the algorithms to learn faster and adjust campaigns in real-time to achieve the best possible results. In addition, the more data you provide, the easier it will be to determine the optimal budget and strategy for your Performance Max campaigns. As a result, you will be able to achieve the best results at a minimal cost.

It’s a good idea to provide this data from at least one permanent data file, such as your Google My Business profile, Google Merchant Center, or product data file, to get even better results. It is also advisable to actively engage through the Audience Signals interface during setup to increase conversions.

Don’t Rely on Performance Max ONLY

A Performance Max campaign should not be the only type of ad campaign used by an advertiser, as it is designed to complement other campaigns, not to run on its own. Google calls Performance Max a “finisher” that helps leverage the results of other ad campaigns. To get the most out of Performance Max, running keyword-based ad campaigns, Google Shopping ads, and other ad types is still important.

It’s worth remembering that if you have Performance Max campaigns and search campaigns running, and the query you entered matches a keyword from a search campaign, the search campaigns take precedence. However, sometimes existing keywords may appear in Performance Max instead of your search campaigns due to factors preventing them from qualifying. In other words, if you want to control which keywords appear in which campaigns, you should be careful with Performance Max.

It may take some time to get the right balance between different types of campaigns. Nevertheless, by making small adjustments, you can determine how much money to allocate to awareness campaigns in other channels to support Performance Max’s increasingly effective conversion strategies.

Additional Tips

What else should you keep in mind when creating a Performance Max campaign for E-commerce? Keep the following four tips in mind.

• When creating a Google campaign, remember that the default setting is to target users based on presence or interest, which can lead to ads being shown to users outside your location of interest. To prevent this from happening, change the setting to “presence” and focus on targeting ads to users from your desired location.
• When creating a Performance Max campaign, assigning the order in which the headlines and ad text are displayed is impossible. Google will mix them on its own, so it is important that all combinations sound logical. It is worth taking care of this at the campaign creation stage to avoid unwanted combinations and ensure consistency of ad content.
• Remember that a Performance Max campaign can also display ads to users outside the designated target group if Google determines an increased probability of getting a high conversion value.
• To increase the effectiveness of your Performance Max campaign, you can provide additional information about your audience. This will help you refine your target audience demographics faster. For example, focus on providing demographics, interests, behaviors, and preferences.