Demand Gen vs Performance Max: Key Differences in 2025

Choosing between Demand Gen and Performance Max campaigns can get very confusing sometimes. It’s because both campaign types help achieve different goals, serve ads across different Google platforms, operate differently, and also cater to users at different stages of the funnel.

Demand Gen campaigns are helpful in engaging users visually across Google properties like YouTube, Gmail, etc. On the other hand, Performance Max campaigns use Google AI’s automation to display ads and drive conversions across all major Google channels.

Understanding how both PMax and Demand Gen campaigns work will help you choose the right one for your next Google Ads campaign.

In this blog, we compare demand gen vs performance max campaigns, exploring their features, use cases, and more to help you choose the best fit for your marketing goals.

What are Demand Gen Campaigns? 

Demand Gen campaigns are powered by Google AI. Through these campaigns, advertisers can serve visually-appealing ads across different Google channels, such as: 

1. YouTube (on YouTube, ads mainly appear across Shorts, and in-stream videos) 
2. Google Discover feed
3. Gmail 
4. Google Display Network 

As the name suggests, these campaigns are mainly used to generate interest and demand for a product or service before a user even starts to search for it. Due to this, Demand Gen campaigns mostly cater to users at the top and middle of the funnel. 

What are Performance Max Campaigns? 

Performance Max (also known as PMax) campaigns are goal-based campaigns powered by Google AI. PMax allows advertisers to display their ads across all major Google platforms, which include:

1. Search 
2. Discover
3. YouTube
4. Gmail 
5. Display 
6. Maps 
7. Google Shopping 

Note: The list shared above isn’t exhaustive.

Demand Gen vs Performance Max: Important Differences

We’ll now explore the difference between Demand Gen and PMax campaigns. 

Category	Performance Max	Demand Gen
Used for	Maximizing the performance of your ads, their conversions, and conversion values	Spark curiosity and generate demand for products or services
Bidding	– Conversions  – Conversion Value	– Clicks – Conversions  – Conversion value
Audience Targeting	Mostly configured by Google AI, but it can be guided with signals such as Search themes and audience signals	Audience customization is allowed with certain special features, such as Lookalike segments.
Channels	Supports all Google channels such as YouTube, Search, Shopping, Gmail, etc.	Supports YouTube, Discover, Gmail, and the Google Display Network.
Measurement and Reporting	– Granular insights available for asset groups, etc. – Product level insights for GMC	– Reports available for all individual assets. – Product-level reporting supported for GMC data

1. Audience Targeting and Control 

Demand Gen campaigns offer more control over audience targeting than PMax campaigns. For these campaigns, advertisers have the option of manually selecting and defining their audience. You can select your target audience based on interest, detailed demographics, custom segments, lookalike audiences, or your proprietary data segments. 

Moreover, you can also use Google’s Optimized Targeting, which can help you get more conversions within your defined budget range. With this feature turned on, Google can expand beyond your defined audience.

However, in the case of Performance Max campaigns, you get much less control over audience targeting. Advertisers can only add signals such as search themes, audience signals, etc., which inform Google about their ideal customer profile. However, when you are adding some of these signals (for example, audience signals), Google does allow you to add a list of your most valuable customers, so that it helps their system find similar new and suitable users. 

Note: Even though you can add audience signals, you cannot strictly target a specific audience. Your signals are just going to suggest to Google AI what types of audiences it should prioritize.

2. Bidding and Budget 

For Demand Gen Campaigns, advertisers get different bidding strategies, which include:

• Maximize Conversions
• Maximize Conversion Value
• Target CPA
• Target ROAS
• Maximize Clicks. 

For budget, you can select between a daily budget and your campaign’s total budget.  And for these budgets, you also need to add a start and end date, which isn’t the case with PMax campaigns.

When it comes to the bidding strategies in PMax campaigns, you can choose between: 

• Maximize Conversions, where you can also set a target cost per action, optionally.  
• Maximize Conversion Value, where you can set a target RoAS, again, optionally. 

Apart from that, for PMax campaigns, you can select your average daily budget or set a custom budget. 

3. Campaign Automation 

Both campaign types offer a different level of automation. 

Demand Gen campaigns offer partial automation. For example, Google will use AI and machine learning models to pick the best visuals, text, etc., from your assets to create an ad that helps drive conversions. Moreover, even when creating CTA texts, Google allows you to automate the process. 

However, you retain manual control for other aspects, like which channels your ad should appear on. 

Thus, automation and AI capabilities are available for some aspects of your campaign creation process. 

In contrast, Performance Max campaigns are automated to a much higher degree. Google AI handles your placements, asset generation (which is optional), etc.

Apart from that, PMax also uses Smart bidding, which is again powered by Google AI, and helps to optimize for conversions or conversion value better.

Thus, if you want to micromanage aspects of your campaign, Demand Gen might be more suitable. On the other hand, if you want to leverage automation, Performance Max campaigns are worth considering. 

4. Ad Formats and Creative Control  

Demand Gen campaigns are mainly useful for running visually rich and appealing ads. These campaigns support ad formats such as single-image, carousel, and video. 

Moreover, Demand Gen campaigns offer full creative control, requiring advertisers to upload assets such as images, videos, etc. Google only helps to combine these assets, create an engaging ad, and deliver it to the most relevant placements.

In contrast, Performance Max offers a large variety of ad formats, which include (but are not limited to) text, Shopping, video, and local ads. Also, in terms of creative control, while advertisers can upload assets on their own, PMax also uses generative AI to create assets on its own. 

Further, Google AI also automatically assembles your assets to create relevant ad creatives, which can be shown across different surfaces.  

Therefore, if you want to create a single campaign that covers all major ad formats, PMax can be a great choice. Moreover, with Performance Max, you can also leverage Google AI to automatically create ad assets. 

5. Ad Placements 

As we learned earlier in the blog, Demand Gen campaigns serve ads only across some Google platforms, such as YouTube, Google Discover, Gmail, etc. Beyond this, ads can also appear across the Display Network. 

However, when compared to PMax campaigns, you might feel that the reach that Demand Gen campaigns offer is very limited. Performance Max campaigns serve ads across the entire Google Ads inventory. Based on the applicable ad format and your assets, PMax might show a Google Shopping ad on the Shopping tab, or even a video ad on YouTube.  

These placements are automated by Google AI, which uses real-time data, your inputs (in the form of signals) to decide where and how to show your ads across YouTube, Search, Display, Discover, Gmail, and Maps. But while these placements are automated, remember advertisers can exclude certain placements if they feel those aren’t driving great results and hampering their brand’s identity.

Bonus: Read our blog on PMax placements.

Thus, depending on your specific needs, type of ad formats you want to use, and the reach you expect from your Google ads, you can decide between Demand Gen and PMax accordingly. 

6. Reporting and Insights 

When it comes to reporting, Demand Gen campaigns offer granular insights. An advertiser gets access to assets, attribution, placement, and multiple other reports. 

Advertisers can easily identify which ad formats drive results for their brand. Additionally, asset-level reporting enables you to understand which types of individual creatives, like headlines, images, etc., have earned some engagement from your audience. 

Thus, you get detailed insights about the ins and outs of your Demand Gen campaigns. 

On the other hand, Performance Max is improving its reporting features. Now, with new updates that Google is rolling out, you will be able to analyze channel-level performance. You will also get engaging data visualizations to better understand the data. 

Google will also provide format-level breakdowns (specifically for video ads with product feeds) across different channels. 

While these are new features that Google will be rolling out, in general, you can view other reports, such as for asset group, placements, search terms, etc., for PMax campaigns. 

Use Cases of Demand Gen and Performance Max Campaigns  

Use Cases of Demand Gen Campaigns

Another important question to answer is when you should create Demand Gen campaigns. Let’s try to answer that by looking at their use cases: 

1. For Product Launches: As these campaigns help generate demand and spark interest amongst users, you can use them when you launch a new product or service. Thus, if your campaign’s main objectives are to drive brand awareness and product discovery, you can consider creating Demand Gen campaigns. 
2. Visual-Focused Marketing: If visual content is important to your brand’s overall marketing strategy, you will benefit from creating Demand Gen campaigns. All you will have to do is upload the same creative assets from your other existing marketing campaigns when you are adding Media for your Demand Gen campaigns. Based on your inputs, Google AI will create compelling ad combinations for different platforms.    
3. For Audience-Based Targeting: If you have specific audience targeting needs, such as wanting to create a remarketing campaign or even use lookalike audiences, Demand Gen campaigns are worth a shot. 

Use Cases of Performance Max Campaigns

You should create Performance Max campaigns for: 

1. Maximizing Conversions: PMax campaigns can help you get 18% more conversions compared to other campaigns at a similar cost-per-action (CPA). This increase is mainly attributed to their broader reach and use of automation.  
2. Full-Funnel Coverage: Performance Max has the ability to cover every stage of a buyer’s journey from discovery on Google Search to final purchases via a display or shopping ad. 
3. Consolidating Your Campaigns: If you don’t want to create separate Display, Search, Shopping, or other types of campaigns, you can use PMax. 

Integrating Demand Gen and Performance Max 

By now, you would have easily decided whether to create a Demand Gen or PMax campaign. But another obvious question in the Demand Gen vs PMax comparison is whether you can run both together?

The answer is yes, you can set up Demand Gen and PMax campaigns within your Google Ads account.

You need only ensure that each campaign serves a distinct purpose: Demand Gen should focus on brand awareness, and PMax should focus on increasing sales by targeting high-intent users. 

We have also shared some tips below that will help you properly structure your Demand Gen and PMax campaigns. Moreover, these tips will also help you avoid any type of overlap between the two campaigns: 

1. Ensure you turn off Optimized Targeting in Demand Gen campaigns. When this feature is enabled, Google will expand beyond your defined audience, which might cause overlaps with your Performance Max campaign. 
2. In your PMax campaign, you can select to bid higher for new customers. This will help you acquire new customers while still driving overall sales. 
3. When you have both Demand Gen and PMax campaigns running, you should exclude brand keywords from your PMax campaigns. That will prevent PMax from serving ads to customers already searching for your brand. Why this move? This is because Demand Gen campaigns will fulfill this goal, and you can focus your PMax campaigns on driving more conversions, rather than creating brand awareness. 
4. Additionally, ensure that you are using unique creatives for both campaigns. That will prevent your audience from seeing the same message across different touchpoints. 

Conclusion 

We hope this blog on Demand Gen vs PMax helped you. Both campaigns are useful across different stages of your marketing funnel. 

Choose based on your goals, or you can run both campaigns together with proper structuring and clear goals. 

FAQs

1. What is the difference between Demand Gen and PMax in Google Ads?

Demand Generation campaigns mainly target ToFu and MoFu audiences, whereas PMax campaigns target every stage of the marketing funnel. Additionally, Demand Gen campaigns and their settings can be manually configured to a large extent. But for PMax campaigns, most settings are automated from Google’s side.

2. When should I use Demand Gen instead of Performance Max?

If your campaign’s objective is to drive brand awareness, and you wish to run visually appealing ads across platforms like YouTube, then you should choose Demand Gen over PMax campaigns.

3. Google Demand Gen vs Performance Max: Which campaign type is better for conversions?

If you compare Demand Gen vs Performance Max, Performance Max campaigns are more likely to drive conversions. This is because they are powered by Google’s advanced AI and display relevant ads across all Google channels. 

4. Can I run Demand Gen and Performance Max simultaneously?

Yes, you can run both campaigns together. However, you must be careful about audience targeting and other elements, such as using different creatives for both campaigns. This is to prevent any overlap between the two campaigns. 

5. What types of creatives work best for Demand Gen vs Performance Max?

For Demand Gen campaigns, Google recommends that you upload high-quality images in all the important aspect ratios, such as landscape, square, portrait, and vertical. This ensures that your ad is properly displayed across placements like YouTube Shorts, Discover, and Gmail. 

Whereas for PMax campaigns, you should upload different headlines, images, etc., so that Google AI can create combinations of these assets and come up with visually appealing ads. 

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