6 Ways to Optimize Performance Max Campaigns

To get the most out of your Performance Max campaigns, it is crucial to provide accurate audience signals, varied assets, and a fully optimized product feed. For campaigns that rely on product feeds, consider strategies to optimize feed-only PMax. In addition to these inputs, PMax optimization helps Google’s algorithms drive more valuable conversions, minimize wasted ad spend, and improve ROI.

Ignoring the Google Performance Max optimization process will likely lead to missed opportunities and underperforming campaigns.

So, the real question is: How to optimize Performance Max campaign? Our guide is the answer. In this guide, we have discussed all the key areas to optimize your Performance Max campaign. 

Let’s get started!

1. Optimize Assets and Asset Groups

After launching your PMax campaign, it’s important to revisit and optimize your asset groups regularly. However, Google advises you to wait 2 to 3 weeks before optimizing assets. This is because Google takes time to reflect performance data after launching the campaign.

How to update assets in Google Ads? 

You can optimize assets by visiting your specific Performance Max campaign settings. Select a PMax campaign, click on the settings icon, and start optimizing. 

Optimize Asset Groups

• You must monitor key metrics such as conversions and conversion value to optimize a PMax campaign. It offers various reports to analyze campaign performance. To identify underperforming asset groups, you can access Asset Group Performance, log in to your Google Ads account >> select ‘campaigns’ >> select a specific Performance Max campaign>> and select asset groups.

• Identify asset groups with low engagement, poor conversion rates, or inefficient cost per acquisition.
• Check the performance rating for individual PMax assets within each group and replace the ‘low’ performing assets. 
• Compare asset groups within a campaign to identify relative strengths and weaknesses.
• Google recommends uploading a diverse range of assets—ideally 15 headlines, 5 descriptions, 20 images in square, landscape, and portrait formats, and at least one video. This variety allows more combinations and improved reach.
• Organize asset groups by product sections or categories. For example, if you sell hair care products, you can organize products by: Shampoo for frizzy hair, hair care kit for curly hair.
• Ensure audience signals are relevant to the products/services in each asset group.

Optimize Assets

• You can also assess the performance of individual assets by navigating to campaigns >> Select a Performance Max campaign >> Assets >> Assets.

• Replace the underperforming assets with new and enhanced creatives. For example, if you find a particular image performs poorly consistently, replace it with an enhanced image.
• Avoid removing an underperforming asset until you replace it with a new one.
• When analyzing assets, look for an ad strength indicator to determine whether a certain asset group has sufficient assets. The asset group performance report includes the ad strength indicator.
• Assess asset performance labels (low, good, best) and conversion data. Replace the assets with ‘low’ performance labels and zero to low conversions.
• Adjust the budget for high-performing assets based on return on investment and your conversion goals.
• Advertisers can use the PMax experiments feature to understand the value of adding assets, the performance of different ad combinations, and the impact of adding videos to PMax campaigns. 
• Refer to this official article from Google for asset specifications.
• Note that Google automatically generates video. However, it recommends that you add at least one. 
• If you plan to run a sale, start the campaign 2 to 3 weeks in advance to allow Google sufficient time to reflect the ad strength indicator. Based on the status, you can refresh creatives and prepare for conversions.
• Google recommends adding seven images, including a 1200*1200 format.
• Keep adding more assets to create more ad combinations.
• Incorporate ad extensions such as callouts, calls, and call to actions to complement the assets that align with your goals.
• Give a thorough read to the PMax ad examples guide to create successful campaigns.
• Regularly review your ad creatives to ensure optimal performance.

2. Monitor & Optimize your Budget

In this section, let’s understand how to set a Google Ads budget, monitor budget utilization across campaigns, and adjust it to maximize campaign performance.

How do you update the budget in Google Ads?

You can modify the budget by selecting a Performance Max campaign and changing the value in campaign settings.

Managing Budget for PMax Campaign Using Search Ads 360

Google offers the Search Ads 360 platform for managing budgets for your Google Ads campaigns. In Search Ads 360, you can manage budgets with the bidding and planning feature.

NOTE: Search Ads 360 is ideal for agencies and large businesses managing large-scale campaigns with significant budgets. To learn more about Search Ads 360, explore our guide on Google Ads vs. Search Ads 360.

Google advises ensuring the key metric you set while creating budget bid strategies matches the PMax campaign goals. Another piece of advice for advertisers running a PMax campaign is to set only the budget, not Target CPA or ROAS. However, you can use budget bid strategy constraints such as ‘keep CPA below’ or ‘keep ROAS above.’

NOTE: When you set a budget bid strategy, Search Ads 360 automatically adjusts bids for your PMax campaign.

Here’s how to create a budget bid strategy:

• In your Search Ads 360 >> go to sub-manager account >> click ‘bidding & planning’ >> in the plans menu, click the ‘+’ button to create a new plan.
• In the next step, enter the amount you wish to spend and click ‘continue.’
• You will see the ‘set up plan’ page, where you can choose your plan schedule and performance targets.
• In the ‘Performance settings’ section, select the ‘Optimize performance automatically with a budget bid strategy option.’
• Select auction-time bidding.
• Click ‘Set up plan.’

Important: Google advises you to use auction-time bidding for Performance Max campaigns to avoid inefficiency in campaign performance.

In addition to using Search Ads 360, you can follow some budget allocation strategies such as:

• Value-based Budgeting: This approach allows you to set a budget based on the potential value or ROI of different product categories, audience segments, or business goals.
• Performance-based Allocation: Reallocate the budget from underperforming campaigns to those exceeding your goals. 
• Budget Rules: Implement budget rules to adjust bids based on some specific triggers. For example, you can set a trigger to decrease the budget when the CPA exceeds a limit.

Tracking Budget Utilization

• To analyze your Performance Max campaign’s budget, create a custom Google Ads script to retrieve channel-wise data from the Google Ads API and send it to Google Sheets. For a step-by-step process, refer to this YouTube tutorial.
• Additionally, you can use Google Analytics GA4 Reports → Acquisition → Traffic acquisition. Use source/medium dimensions to segment traffic coming from: google/cpc (for paid ads), youtube.com/referral. With these options in GA4, you can analyze the channel contributing to Performance Max conversions.
• You can track budget across various PMax reports, such as ad placements report, campaign performance report (where you can analyze clicks and conversions), landing pages report, audience insights, and auction insights.
• You can also use third-party tools such as AdStage and Optmyzr to monitor budgets across channels for your Performance Max campaign.

Adjusting Budgets for Better ROI

• Be aware that a budget bid strategy requires a minimum of 3 weeks of performance data to optimize your PMax campaign budgets, bids, and bid adjustments.
• Ensure your budget allocation aligns with your primary business objectives.
• When making budget adjustments, start with small increments such as 10 to 20% at a time.
• Google recommends setting the average daily budget 3 times the Target CPA for the conversion actions.
• Set a average daily budget of $50 to $100 to enable machine learning algorithms to gather adequate data.
• Continuously monitor budget pacing to understand if your campaigns are overspending or underspending. You can use budget reports under the insights section in your Google Ads account to analyze budget pacing.
• Avoid pausing high-performing campaigns. If budget reallocation is necessary for high-performing campaigns, budgets should be decreased gradually. 
• Analyze campaigns and identify high-performing and underperforming ones. Increase the budget for high-performing campaigns and limit the spend or reallocate the budget for unperforming ones.
• Make use of the Performance Max experiments feature to optimize the budget allocation. You can find the experiments feature by selecting campaigns >> campaigns >> experiments. Make sure to select a Performance Max campaign. 

• Understand conversion values and calculate the value of each conversion to make the budget allocation process easier.
• You can optimize ‘spend’ by changing the plan in Search Ads 360. You can change the budget, bids, and bid adjustments in the plan.
• Analyze performance data regularly and make adjustments accordingly.

3. Choose the Right Bidding Strategy

Performance Max campaign has two main bidding strategies: Maximize conversions and Maximize Conversion value.

Maximizing conversions is ideal for beginners with no historical data who want to acquire as many conversions as possible. Maximizing conversion value is ideal if you have sufficient historical data, ROI goals, and various products/services to promote in your Performance Max campaign. 

To modify bidding strategies, select a specific Performance Max campaign, click on settings. Scroll down to find budget and bidding, and make changes to the bidding strategy. 

Performance Max Campaign Optimization Tips for Bidding Strategies

• Allow 6 weeks after launching the campaign before optimizing it.
• Google Ads experts recommend having fewer campaigns if the number of conversions for your existing campaigns is lower.
• Set specific targets for cost per action (CPA) or return on ad spend (ROAS) for better control while setting bidding strategies.
• Experiment with bidding strategies. For example, you can test “Maximize Conversions” with a target CPA versus “Maximize Conversion Value” with a target ROAS to see which delivers better results for your business goals.
• Analyze conversion volume, conversion value, CPA/CPC, ROAS, and the performance of different asset groups and audience signals. These insights can help you adjust your bidding, budget, targeting, and creative strategy.
• Bid simulator is a Google Ads tool that predicts how changes to bidding strategy impact key metrics such as clicks, impressions, and conversions. There is a bid simulator for each campaign type; for example, you can use the Performance Max campaign bid simulator for Performance Max campaigns alone. To enable a bid simulator for your PMax campaign, select campaigns in your Google Ads account, click campaigns in the drop-down section, select a Performance Max campaign, click on the bid simulator icon, and save it.
• Continuously monitor and adjust bids as you accumulate sufficient data.

Tip: If you’re just starting out, begin with a maximizing conversion strategy without a CPA target, then shift to a maximizing conversion value strategy based on performance.

4. Optimize Your Audience Signals

PMax audience signals are a starting point for Machine Learning algorithms in identifying audiences most likely to convert.

NOTE: Keep in mind that adding audience signals is optional and that Google’s AI might reach an audience outside of your signals to improve conversions. However, adding signals helps jump-start the learning phase and improve campaign performance faster.

Types of Audience Signals

• First-Party Data: First-party data includes data from your website or in-app purchases. You can upload customer match lists as audience signals from past purchases, newsletter signups, or loyalty programs. You can also use remarketing lists as signals.
• Custom Segments: Custom segments are additional signals you provide to Google about your target audience. Through these custom segments, Google shows ads to users likely to convert. 
  Pro Tip: Customer Match is a feature in custom segments, where you can incorporate customer data into custom segments for precise targeting. You can create and upload customer data such as email, phone number, etc, and use it along with other signals.
• Demographics: Demographics include customer data such as age, gender, and income. You can also upload the demographic data as audience signals to reach relevant customers.
• Affinity and In-Market Audiences: Affinity and In-market audiences represent users actively searching or expressing interest in specific topics related to your business. 

How do you update audience signals for PMax in Google Ads?

In your Google Ads account >> navigate to campaigns >> select asset groups >> click on the 3 vertical dots, and click ‘Edit Signals.’

How to Optimize Audience Signals?

Audience signals and asset groups work together to target the right audience for your PMax campaign. Therefore, when optimizing audience signals, you should also pay attention to asset groups. 

• Create multiple asset groups for different audience signals. There should be one asset group for each audience signal, enabling you to have better control over your campaign and evaluate the performance of each asset group individually. This way, when you change audience signals associated with a particular asset group, you can track the difference in campaign performance.

NOTE: The PMax campaign provides in-depth insights into asset group performance compared to audience insights. Thus, we are relying on asset group performance data.

• Avoid incorporating all the audience signals in one asset group. Ensure your creative assets in one asset group align with the audience signal so you can tailor messages accordingly.
• By segmenting asset groups and audience signals, you can also identify high-performing and under-performing audience signals, allowing you to optimize them accordingly.
• Remember to add the audience signal for the newly created asset group.
• You can also perform A/B testing for different audience signals and refine targeting strategies over time.
• Ensure that detailed and accurate audience signals are provided for desired outcomes.

If you’ve been running Performance Max campaigns for a while, you might want to explore: PMax Ad Placements PMax Search Themes How to Add Negative Keywords to PMax Campaign Performance Max Reporting Demand Gen vs. Performance Max

5. Use Ad Extensions 

Ad assets, also known as ad extensions or simply assets, allow you to add key information about your store or product. You can add these extensions for Performance Max and standard campaigns.

Category	Ad Asset Type	Description
Google Ads Extensions	Sitelinks	You can add links to specific product categories, popular offers, and general links to the homepage.
	Callouts	Use callouts to highlight your products’ or services’ USPs
	Structured Snippet	Use structured snippets to list features such as free shipping, 24/7 support, and certified products.
	Promotions	Display ongoing sales and discounts with promotion extensions
	Price Extensions	Price extensions provide transparency and attract users closer to making a purchase.
	Calls	Display your phone number within ads
Google Shopping Ad Extensions	Google Merchant Center Promotions	You can display any special offers, percentage discounts, and gifts.
	Product Ratings and Reviews	Display store ratings and reviews.
	Sale Price Annotation	Showcase discounts and offers within shopping ads.
	Price Drop Annotation	Add a price drop label prominently on the ad.
	Shipping Labels	Provide details such as free shipping and delivery date.
	Return Policy	Display returns/exchanges information for the product.
	Local Inventory Ads	You can display ‘pick up in-store’ information to promote your physical store.
	Other labels and annotations

You can also run PMax campaigns to promote your physical store. Explore our guide on PMax for store goals.

Here’s how ad extensions appear for shopping ads

Look at how the shopping ad includes an image and price, but it also highlights the discount and ratings to provide key information upfront. This rich combination of information makes the ad more compelling and informative for users.

Here’s how to add ad assets to your PMax campaign:

• Select a Performance Max campaign >> select assets under campaigns >> here you can see ad assets recommendations.
• These recommendations are closely related to your goals for enhancing relevancy and engagement.

6. Optimizing Goals for Performance Max Campaign

When you set specific goals for your Performance Max campaign, Google AI optimizes your ad serving and budget allocation to match your chosen bidding strategy.

Therefore, setting a conversion goal for your PMax campaign impacts budget, bidding, and how your ads are displayed across Google Ads inventory. 

To update the goals of your PMax campaign, select a specific PMax campaign, click the settings icon, and modify conversion goals.

How to Optimize Goals for PMax campaigns?

• If you are running standard and PMax campaigns, Google advises you to set the same goals for both campaign types. Having one goal enables bidding strategies to optimize Performance Max campaigns toward that goal.

Learn the difference between a standard shopping campaign and a Performance Max campaign through our comparison guide on PMax Vs. Standard shopping campaigns.

• Remember to set up a new customer acquisition goal when you target new customers. This goal ensures optimized Performance Max campaigns to acquire new customers and allows you to set competitive bids for high-value new customers.

Tip: Google highly recommends using ‘New Customer Value Mode’ to increase sales and acquire new customers.

• Explore different conversion goals by testing different conversion actions. If you wish to track multiple conversion actions, such as website purchases or lead form submissions, try running two campaigns with each conversion as a primary goal.
• You can use a ‘conversion value’ goal to maximize revenue or profits.
• Set up conversion tracking accurately to prevent any data leaks. 
• Set conversion values while selecting the bidding strategy to prioritize essential conversions.
• Use conversion value rules. Conversion value rules let you modify the value assigned to conversions based on location, device, and audience segments. These rules are useful when certain customer segments are more valuable to your business. You can create a conversion value rule under Goals in your Google Ads account while creating a campaign or add it in campaign settings during the PMax optimization process. 

Conclusion

We hope this guide on how to optimize PMax campaigns helped you understand the importance of campaign optimization, including refining audience signals, optimizing asset groups, setting budgets and bidding strategies, and more.

Remember, optimizing a Performance Max campaign is a marathon, not a sprint. You must follow the PMax campaign best practices, monitor the performance, and make changes when necessary. In addition to optimizing campaigns, performing a thorough Google Ads audit every 6 months helps reduce wasted ad spend and increase return on ad spend.

We wish you luck!

FAQs

How can I effectively allocate budget across different asset groups in Performance Max campaigns?

You can’t allocate budget asset groups in Performance Max as the system automatically distributes your campaign-level budget across all channels and inventory. However, you can influence budget allocation by providing stronger audience signals, organizing asset groups, monitoring asset group performance, and ensuring high-quality assets.

What are the best practices for setting up conversion tracking in Performance Max campaigns?

Identify conversion actions that matter to your business, choose the right conversion tracking methods, ensure that the conversion tracking is set up correctly, use conversion value rules, and optimize conversion tracking settings.

How can I optimize creative assets for better performance in Performance Max campaigns?

 Follow Google’s quality guidelines, provide high-quality and relevant assets, check the ad strength indicator, and continuously monitor asset performance.

How do I troubleshoot underperforming asset groups in Performance Max campaigns?

To identify underperforming assets, analyze performance metrics such as conversions, evaluate the asset quality performance, and ensure audience signals align with messaging in asset groups.

How can I use Performance Max campaigns to reach new customer segments?

You can reach new customer segments by optimizing asset groups with diverse assets, defining clear conversion actions, providing stronger audience signals, and carefully monitoring campaign performance.

Check Out These Related Articles:

• Performance Max Ad Specs
• Upgrading Dynamic Search Ads to Performance Max
• How to Exclude Brands from Performance Max Campaign
• Performance Max vs Smart Shopping
• How to Use Generative AI in Performance Max