Google Performance Max Guide: Tips to Optimize Your Ads

By Tinuiti Team

Jan 12 2024

Man using Google Performance Max on his computer

Google’s Performance Max campaigns came out of beta more than three years ago, and have grown to be a wildly popular campaign type among new and experienced marketers alike. In this article, we’ll unpack what Google Performance Max campaigns are, how they differ from other campaign types, benefits and best practices, reporting functionality, ad optimization tips, and Tinuiti’s PMax approach.

What is Google Performance Max?

Google Performance Max campaigns are goal-based, automated campaigns that enable advertisers to promote across all Google networks from the same campaign. Google announced Performance Max campaigns in October 2020 as “a new way to buy Google ads across all our inventory.”

This means that your ads can reach potential customers from a single campaign type across the following channels:

Google Shopping
Google Search Network
Google Display Network
YouTube
Discover
Gmail
Google Maps

Performance Max—or PMax, for short—is designed as a complement to your existing keyword-based Search, Shopping and fully-automated campaigns, building on learnings from the latter “to deliver a comprehensive solution that works for all advertisers across a wider range of marketing objectives.”

Over time, Google Smart Shopping, Local campaigns, and Vehicle Ads were upgraded to Performance Max campaigns, granting retailers and local marketers access to ad inventory, formats, and automation insights that weren’t previously available for those campaign types.

Other recent PMax updates and advances include:

Generative AI-powered features to help produce and enhance creative assets and build asset groups efficiently and effectively (gradual rollout)
The new Search Themes signal allows advertisers to better guide Google AI’s targeting capabilities by providing the system with relevant topics and categories. As shared by Google Ads: “Performance Max currently looks at your assets, feeds, and landing pages to predict which placements, including search queries, will perform well for your campaign. Now with the search themes beta, you can fill in gaps by adding information about your business that you expect to perform well.”
Campaign-level brand exclusions “prevent your ads from serving on specific brands on Search and Shopping inventory in Performance Max.”
Important early 2023 update announcements included the addition of account-level negative keywords, asset group reporting, page feeds, experiments to measure incrementality, budget pacing insights, and the direct integration of video creation tools—previously available exclusively within the asset library—into PMax campaign setup and editing workflows.

Highlights of Performance Max

If we think of Performance Max campaigns from a culinary perspective, the advertiser provides all the ingredients (assets) and the recipe (structure), and Google automation does the cooking (ad creation) and serving (delivering the ad to the potential customer).

With an overarching goal of efficient campaign performance, Google considers all available creative assets when crafting the ad, ultimately showing what it believes will be the most likely combination to convert on whichever of their channels that particular ad will be served.

Reach customers across the full Google Ads network efficiently

Performance Max campaigns are designed to cast a wide net, reaching potential customers across the full Google Ads network through a single campaign. If you wanted to reach that same potential audience using traditional campaigns, you would need five campaigns (minimum): a Search campaign, Shopping campaign, Video campaign, Display campaign, and Discover campaign.

Find customers that are ready to convert with AI-driven optimization

We all know the customer journey is rarely linear; shoppers move between many different channels, and rely on various resources, when deciding what to purchase. Performance Max campaigns are designed to reach shoppers that are most likely to convert, on whichever channel they’re seeing your ad across Google platforms.

Thanks to Google’s real-time analysis of user intent, behavior, and context, PMax can help you reach new audiences with the right ad at the right time.

Additionally, you can convert your first-party audience signals into actionable knowledge, optimizing ad delivery and predicting when a given user is most likely to make a purchase.

A different look to insights

As Performance Max does not require the same level of manual optimization, Google had to rethink what and how they provide data. While you won’t get the reporting you’re used to, over time you will start to see information including auction and audience insights, performance drivers, consumer interests, and search trends.

“The Insights piece is a shift from what we have been accustomed to, but Google has slowly begun to provide us with more reports to help us better understand this campaign type. Performance Max aims to look at things holistically—client gives you X budget, and here is X ROI across the funnel. Trusting in Performance Max to do its thing with the signals you give it, and shifting the way we analyze performance, is the biggest hurdle with the campaign type.”

— Courtney O’Donnell, Sr. Director of Shoppable Media at Tinuiti

Best Practices when Setting Up a Performance Max Campaign

Advertisers have compared Performance Max Campaigns to several other campaign types, including Smart campaigns, Social campaigns, and responsive Display campaigns. And while there are elements that bear similarity in varying ways to all of the above, it’s important to consider the functionality and benefits of this campaign type specifically.

Give Performance Max campaigns freedom to function as intended

We’re of the belief that if you are going to test Performance Max you should lean in, and not try to make this campaign something it was never meant to be. There are tutorials online for finagling a Performance Max campaign to be a Search campaign or a Shopping campaign, and time can be better spent focusing on how to best leverage a campaign that was designed by its very nature to bring all of that together.

Implement audience signals to set automated targeting up for speedy success

Think of audience signals as customer personas that Performance Max uses as your ideal shopper, functioning similarly to lookalike audiences on social platforms. This won’t be the only customer type that your campaign reaches, rather it will be the foundational core upon which other audiences are built—your seed audience.

The audience signals you provide Google are used to determine ‘the right direction’; Google then follows those paths to find additional users it feels your campaign is also suitable for. Audience signals work best when used in combination with your own data and custom segments.

Because you can create multiple audience signals, we recommend experimenting with different signals to see how each performs. Consider including the following:

Remarketing
Customer Match
Search Themes
Interests
Foundational Demographics

How does Google automation handle each of these signals? Are some of these signals proving more helpful than others?

Decide if you’ll use Final URL expansion

If you want to give Google even more control with Performance Max campaigns, similar to dynamic search ad campaigns, you can allow them to choose the landing page URLs for each of your ads. LP exclusions are available if there are specific pages you never want used; these can include exclusions based on URL parameters (ex. blocking a full sub-folder) or individual landing pages.

To choose or not to choose your final URL expansion—that is the question! And the decision is 100% yours to make. That said, by default Performance Max campaigns are set to allow Google to define the final URL.

If you want to take back some control, you can toggle OFF the URL expansion. This will send your search ad traffic to the final URLs you submit within your asset groups.

Decide whether the New Customer Acquisition goal is right for you

The new customer acquisition goal, also available for Search campaigns, presents an exciting opportunity for advertisers looking to target new-to-brand audiences. Using this goal, advertisers can choose from the following bidding options:

New Customer Value mode: Campaigns are optimized to bid higher for new customers (not available for store goals)
New Customer Only mode: Campaigns are optimized to only bid for new customers

Define Asset Groups

Keep all your creative organized by breaking out thematically-similar or same-audience assets into their own asset groups, using multiple asset groups for each campaign. Asset groups help you to give Google the best array of options to choose from, while ensuring you don’t get a ‘mixed bag’ of creative for a given ad.

Think of building out your asset group as packing a lunch, except the lunch is for Google. In each asset group you’ll want to pack a nice selection of images, videos, headlines, logos, and other textual elements. The higher-quality assets you feed Google, the better your ads will look.

If you are a promotional brand, you should consider creating evergreen asset groups and promotional asset groups in order to easily shift creative between promotional and non-promotional periods.

Don’t turn off your Search campaigns

Performance Max is designed to complement your existing Search campaigns, not replace them. There is some campaign overlap on non-exact match keywords you’ll have to consider to safeguard against self-cannibalization. We recommend that for any keyword for which you’ll want to have complete control and in-depth reporting, you ensure it is an exact match keyword in Search. Also, monitor Search performance after launching to see if broad match keywords dropped off for a specific category once PMax was launched.

Consider brand safety

The lack of control over what ads will show where, and with which creative, is what makes many brands nervous about Performance Max campaigns. That said, despite it being true that there is less control overall, you can run a placement report, sort destinations by impression volume (unfortunately you cannot see spend by placement), and then exclude any sites you don’t want to show ads on. Exclusions are set at the account level.

Tinuiti’s PMax Approach: The Five Pillars to Success

Thanks to Performance Max’s unparalleled audience targeting that leverages the most sophisticated machine learning, our teams consider Performance Max the perfect complement to your current Search strategy. We develop Performance Max campaigns in tandem with existing Paid Search efforts to minimize potential cannibalization or duplicated targeting.

Our approach to a thoughtfully executed PMax and Search strategy is built on what we’ve dubbed Five Pillars to Success.

1. The Tinuiti Intent Matrix (TIM)

Our teams developed the Tinuiti Intent Matrix (TIM) as a solution that combines traditional SEM (search engine marketing) efforts with modern AI and machine learning techniques. Our campaigns are structured around user intent, allowing us to hyper-target users in a way that traditional approaches—like SKAGs and keyword sculpting—don’t allow for.

Learn more about TIM in our 2024 Google Ads Guide.

2. Adopt an Audience-first Approach

Our audience-centric approach prioritizes the needs and preferences of our target audience, ensuring maximum campaign messaging and creative resonance by…

Establishing goals and metrics (ex. new customer growth, increased revenue, improved brand awareness, etc.)
Determining which audiences and segments we want to target. To give ‘better handling’ to your campaigns, we recommend layering in audiences across three pillars: first-party audiences; search themes and demographics; in-market and affinity audiences. Our teams also collaborate with our Lifecycle Marketing experts, leveraging their insights for more informed audience ideation, segmentation, and list automation
Developing customized creative assets for each of our asset groups. These assets include ad copy, images, video and more

The first reaction when coming up with a strategy is a one-campaign-to-one-asset-group ratio; this ensures that the conversions you are seeing at the campaign level are 1:1 with the asset level. For example, if you create a ‘womens’ winter jackets’ campaign, you will know exactly how that segment performs versus grouping it into a larger womens’ jackets campaign.

However, there is a delicate balance—being too segmented will make data limited, while making it more difficult for Google to optimize. Conversely, being too high-level will give you limited insight into how sub-categories are performing. The need to find the appropriate strategic balance to realize the greatest outcome is one of the reasons why you should work closely with internal and external stakeholders to decide what to run through PMax, and what other considerations need to be made.

3. Optimize Your Creative

High-quality, relevant, compelling creative assets are essential to Performance Max success. Our teams work with clients to test a variety of creative elements to determine which best resonates with target audiences. By continually refining headlines, images and more, we ensure our clients are leveraging PMax to its fullest potential.

If your team needs help with creative asset productions, Tinuiti offers a video creation service catered specifically to Performance Max campaigns. We can use your existing assets to produce a high-performing creative unit, or shoot the video from scratch.

4. Control Your Product Feed Levers

Through Tinuiti’s partner Feedonomics and our internal MobiusX platform, our Shoppable Media team can easily run campaigns with millions of SKUs. We will manage your product feed and continuously improve the data within it. For Performance Max’s feed-based channels to perform at their best, feed optimizations are crucial, so Tinuiti works with client teams to ensure the product feed has as much relevant data as possible.

Once the initial setup and optimizations are complete, Tinuiti devises a scheduled cadence for further testing and optimizations. We work with your team to test feed attributes (like titles, descriptions, and images) and plan feed-related tests to drive increased visibility and revenue.

5. Tinuiti’s Enhanced Performance Max Reporting

As a performance marketing firm, data-driven decisions are at the core of all that we do. But the out-of-the-box reporting PMax campaigns offer doesn’t paint a full enough picture. To help add color to PMax’s black boxes, we developed proprietary Performance Max reporting that compares the percentage of spend and revenue derived from each channel. Our customized reports also document any performance changes following campaign bid changes or altered creative.

Expert Tips to Optimize Google Performance Max Ad Campaigns

Now that we’ve established best practices, let’s explore some optimization tips from the experts…

Consider Performance Max for sub-brands, best sellers, or tentpole events

Kelsey Fortner, Director of Paid Search at Tinuiti, shares one way her team leveraged Performance Max campaigns for a client:

“One of our clients launched a sub-brand for which they wanted to get some exposure and traffic to the site. Because we weren’t using any of those URLs in our Standard campaigns, running them through Performance Max was a perfect fit, with no self-cannibalization risk. We gave it a unique product feed so it only featured things we weren’t already talking about or bidding on. The campaign itself was an easy-lift that didn’t require a robust campaign build-out that reaching all those channels through Standard campaigns would require. This makes Performance Max ideal for a variety of scenarios, including tentpole initiatives, or advertising areas of the business you might not have before.”

Take a hybrid approach

You don’t have to only run on Performance Max. Nick Jones, Growth Media Strategist at Tinuiti, explains:

“Just as I did on Smart Shopping, I always have a branded and non-branded Standard Shopping campaign running in the background. You can maintain your branded coverage pretty heavily through a Standard campaign, and also use an upper-funnel non-branded campaign to harvest search term data and trend. I wouldn’t rely on those campaigns for high conversions; it’s more so for coverage. This gives us a chance to say, for example: “ We’ve noticed mens’ sweaters trending the last 14 days, so we’re going to push harder on PMax.” Also considering the degree of branded traffic PMax leans into in order to hit revenue/return targets, we can have a true measurement of growth and success by using a hybrid approach.”

Performance Max Takeaways, Considerations and Recommendations

“There is not a one-size-fits-all approach to Performance Max, and I recommend working closely with your advertiser on the best strategy based on your goals. Google regularly enhances Performance Max campaigns, so I’m excited to see what new features will continue to roll out. It’s ever-evolving that way, and the Performance Max campaigns we’re building today may look very different from those we’ll be running in just a few short months.”

— Courtney O’Donnell, Sr. Director of Shoppable Media at Tinuiti

“Performance Max campaigns have proven valuable for the majority of clients I’ve tested them with. I would estimate that 90% are successful. When it is working, great! The issue comes in when a Performance Max campaign isn’t performing. Not only do you have less granular insights than you would with a standard campaign, but you also have fewer levers to pull. As more data, tests, and verticals have come through, I’ve had to poke more holes in the numbers, and it’s harder to know what to do next when it isn’t working. So we start testing from a structural perspective, asking ourselves questions to inform testing, then testing to figure out what sticks. A few tests that have worked for me are excluding “junk” placements such as mobile apps. Feed Only PMax campaigns have been great for shopping heavy strategies, removing all creatives, headlines, and descriptions, creating a shopping SERP forward campaign.”

— Nick Jones, Growth Media Strategist at Tinuiti

In addition to the benefits PMax offers today, it will continue to evolve as AI advances, future-proofing your marketing strategy. Simply put, Google isn’t going to let one of their key products fall behind. The time and energy you put into learning and optimizing Performance Max campaigns will continue to be time well-spent for the foreseeable future.

Want to learn more about how to best leverage Performance Max campaigns to reach your goals? Drop us a line and we’ll be in touch!

Editor’s Note: This post was originally published by Shannon Mullery in September 2022 and has been updated for freshness, accuracy, and comprehensiveness.