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There\u2019s been a recent change to the functionality of Google AdWords daily budgets that will affect the accuracy of budget control capabilities going forward for PPC campaigns (SEM for our North American friends) and Display campaigns on the GDN. In the past, daily budgets could overspend on any given day by a small percentage, but now Google has authorized themselves to spend up to 2X of the daily budget. It\u2019s called \u201cover delivery\u201d. According to the documentation, the spend should balance out at the end of a 30-day billing cycle and if it doesn\u2019t, they will issue a credit.<\/p>\n
On a positive note<\/strong><\/p>\n This change allows campaign budgets to adapt automatically and capture demand that fluctuates with the day of week, seasonality, or a sudden increase in demand resulting from promotions in other channels. So, if you have a programme where demand is much higher on a Monday, this new budget flexibility will adapt to capture that traffic. Or if a new TV spot causes branded demand to spike on a given day, the over delivery would\u00a0continue to serve ads beyond the daily budget and avoid lost opportunity.<\/p>\n <\/p>\n Here\u2019s the kicker<\/strong><\/p>\n Budgets\/budget groups are ineligible for the credit if any changes are made to the budget within the calendar month or if a campaign runs for less than 30 days. So, if you have a promotional budget that lasts a week, we have no way of respecting a strict budget allocation. One idea we discussed is to create a promo account for brands that like to push short term promotions. While this gives us better control of the budget for the duration of the promotion or offer, it does bring up some complications. If we\u2019re to use the same keywords across multiple accounts, it is very likely the keywords in the promo account will have a higher CPC due to a lack of history and potentially a lower ad rank.<\/p>\n If a client wants to modify spend in the middle of a calendar month, that may do more harm than good as we\u2019d be waiving eligibility for an adjustment credit. Budget allocations will be less precise than they used to be as we now need to live with a standard deviation of up to 100%.<\/p>\n <\/p>\n Some of the problems that could arise<\/strong><\/p>\n We adjust daily budgets on a regular basis to ensure appropriate budget pacing for the month. Though we have never been able to budget to 100% accuracy in a single day (Google has always allowed for +\/- on daily budget caps) it used to be restricted to a minimal percentage overage. Going forward, this practice will not only be ineffective in achieving the desired outcome but would also make us ineligible for the adjustment credit.<\/p>\n While the total spend can be controlled by the monthly budget order, this change can lead to the target budget being met prior to month end. Despite protecting the account from over spending, it can mean there\u2019s no activity for part of the month.<\/p>\n If this isn\u2019t bad enough to contend with, larger brands can sometimes have multiple AdWords accounts and as such don\u2019t always use the account budget order as the brands require flexibility as to where the budgets are spent. Some types of businesses that could be affected by this are those with locations and\/or franchise businesses. In these instances, we need to be able to support each business unit\/franchise owner evenly or support under performers. Budget could be spent by locations\/campaigns with greater volume, meaning the smaller locations may not get the exposure they need.<\/p>\n The issue of \u201cover delivery\u201d is a problem. Over delivery means capturing demand through impressions, clicks and spend. What if we have already learnt that the daily budget set is the max we can spend before hitting the point of diminishing returns? Most advertisers will experience this. There will be a maximum level of performance before you see CPAs increase and ROI diminish. This will place a greater emphasis on the attribution analysis to justify this increased spend and traffic. I.e. What revenue is this increased traffic generating or assisting?<\/p>\n \n Get exclusive insights into digital \n \n \n Stay Forward <\/h2>\n
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