Artificial Intelligence (AI) promises to democratize expertise, making everyone who uses it an ace writer, coder, designer and more. Over the past few years, Google has embraced AI across its offerings in the hopes of delivering on these promises for its users. One area where AI plays a significant role in producing results is Performance Max (PMax), Google’s automated pay-per-click (PPC) advertising tool. While PMax is undeniably powerful, it’s far from perfect, and like many other AI-powered tools, it performs best under the supervision of human experts.
Consequently, small businesses that manage their own advertising must be aware of the tool’s pitfalls and adopt strategies to monitor and optimize their PMax campaigns effectively.
The Promise of PMax
Creating effective Google advertising campaigns is no easy feat. It takes digital marketers years to learn the platform’s intricacies and quirks to drive results at an acceptable cost. PMax promises to change that. When advertisers use PMax, all they need to do is upload creative assets, set a spending budget and then define their desired return on ad spend (ROAS) or cost per acquisition (CPA). PMax then uses AI to automate bidding across Google’s entire ad inventory — Search, YouTube, Gmail, Maps, Display and Discovery — to find customers most likely to buy.
Advertisers no longer have to be digital marketing experts to reap the benefits of Google’s advertising reach. PMax’s AI-powered tools handle all the details, eliminating day-to-day (or even hour-to-hour) ad management and delivering nothing but profitable customers. Unfortunately, like many of its AI peers, the hype around PMax comes with a few important caveats.
The Reality of PMax
Problems begin to arise when you examine the conflicting motivations between Google and small businesses using PMax advertising tools. If the only parameters PMax uses are a budget and ROAS or CPA target, then Google will spend all its budget to achieve that target. It won’t be concerned with spending efficiency or placing ads in places that are irrelevant to prospective customers. Instead, it will maximize the available advertising budget to meet its defined campaign goals.
By contrast, human marketers will push back against Google’s tools to find efficiencies that make their precious advertising dollars go further. When an advertiser removes that friction and allows AI to make decisions 100% of the time, they may not get the most efficient results possible.
Another set of challenges brought by PMax includes a lack of visibility and control. Most users can’t see the types of ads PMax buys, making it impossible to determine the efficiency or relevancy of the advertising spend. That lack of visibility also makes it difficult for advertisers to troubleshoot problems if performance suddenly deteriorates.
Moreover, changing PMax campaigns can affect advertising within the search, shop and remarketing environments because everything is interconnected. So, whenever an advertiser changes PMax, they must watch how those changes affect their other campaigns.
Three Fixes for Common PMax Campaign Problems
Here are three ways to troubleshoot and fix the most common problems users will encounter in the PMax environment. This will allow small business owners who lack years of PPC experience to harness the power of Google’s AI tools without falling victim to its most common performance issues.
1. Limited by Budget? Change the Parameters
“Limited by Budget” is a message many users see in their accounts. It means that PMax has run out of the available budget to spend on quality advertising opportunities. PMax always reserves some budget for testing, which can be inefficient. Google’s AI also doesn’t always know that some platforms are irrelevant for some businesses (think a financial planner advertising on a children’s coloring app), resulting in wasted advertising spending. These two areas often eat up a significant portion of an account’s budget, preventing Google from targeting actual potential buyers.
In this instance, Google wants users to increase their ad spending. However, that’s not always an option for small businesses with limited budgets. Rather than increasing spend, users can respond to a “Limited by Budget” message by reducing their CPA or increasing their ROAS targets. These changes will force Google to optimize its results under tighter campaign restrictions, making it less incentivized to waste money on testing or inefficient ad placements.
2. Struggling with Low Volume? Add New Signals
PMax also frequently struggles to optimize campaigns with low conversion volume. That’s because Google’s AI needs a certain amount of information about the consumers buying products to make intelligent decisions about which new buyers to target. Google recommends advertisers have 100 conversions per PMax campaign per month to obtain the best results. The minimum recommended number is 30 conversions per month.
In reality, many small businesses lack the necessary conversion volume to meet Google’s requirements. One potential solution is to add secondary conversion actions, such as an “add to cart” option to PMax campaigns. That way, Google’s AI will receive more signals about purchasing activity so it can make better decisions about advertising spending.
3. Inaccurate Ad Creative? Actively Manage Assets
Another potential trouble spot for small businesses using PMax is inaccurate creative assets. When users set up a PMax campaign, they upload a set of existing assets, including text, images, and videos. Google’s AI can then automatically create new advertising assets that it believes will resonate with potential buyers based on the original uploaded material.
This feature is undeniably handy. However, AI-generated creative assets may not always be the highest quality or relevance. For example, content could include irrelevant imagery or messages that don’t align with the brand’s identity or marketing goals, making a “set and forget it” approach impossible. Instead, small businesses need to actively manage and input their PMax assets to more accurately guide the AI’s creative process.
Navigating PMax with Confidence
PMax can be a powerful component of a holistic marketing strategy, however, small businesses managing their own campaigns should beware. PMax isn’t perfect, and without someone knowledgeable keeping watch, it can spend its advertising budget inefficiently, struggle to target relevant buyers in low conversion volume environments and produce inaccurate or inauthentic creative assets.
Eventually, AI will be able to ingest more content to create better ads and truly level the expertise playing field. However, we’re not at the point just yet. In the meantime, small business owners should embark on PMax campaigns with caution or choose traditional PPC campaigns, which include more control and transparency. As AI continues to evolve, staying informed and proactive in campaign management will be crucial for small businesses to maximize their advertising investments and achieve sustainable growth.
Matt Bowen is the director of enterprise acquisition and strategy at Logical Position, an Inc. 500 digital marketing agency. Connect with him on LinkedIn.
Performance Max stock image by Tada Images/Shutterstock
