Ad Snack: Campaign budget constrained?

If your campaign is budget constrained, should you just increase your Google Ads budget?

You could just ask your Google Rep…

Or maybe not.

When does it actually make sense to increase the budget?

When your cost/conv is below target.

Or conv.value/cost is above your target.

The really simple rule is that if your conversion KPI is positive, then you can add more budget and scale.

The potential downside is that the closer you are to saturation (spend vs market share), the bigger the impact on performance.

Conversion volumes scales with spend, but conversion cost also go up.

However, once a business covers its standing costs or overhead, it can afford to pay a bit more per lead or sale.

Don’t want to spend more?

Try decreasing your bids, lower target CPA or increase target ROAS.

Just a touch.

You will either get more conversions for your budget and pay less per conversion.

Or you won’t. But it’s low risk.

How much should you increase budget?

Start with small increments and assess the impact week on week.

Google’s suggestions can be rather… lofty, but use them to get a feel of what might happen.

Then confirm it by looking at the past 2 weeks of data.

Segment by day and see if you’re constantly banging your head off the budget, or going over.

If you’re going over by 10% on certain days, start with that as your increment.

You should avoid changing the budget and bidding at the same time.

Do one, or the other.

By Ed Leake

Ed Leake is a seasoned professional with decades of experience in the world of internet and advertising. He was one of the earliest adopters of domain ownership and website monetization. Ed built his first website in 1996 and has since managed over $250 million in ad spend. He is an agency owner, SaaS product owner, Ad Tech builder, PPC specialist, investor, and mentor. He has been running his agency, Midas Media, for over 13 years and acquired Adboozter in 2018. Ed also built AdEvolver, a tool to automate Google Ads accounts at scale. He uses his expertise to help businesses grow from small to large, leveraging Google Ads and Analytics, along with a significant focus on conversion optimization.