What is Google Performance Max? And how can luxury brands use it?

Croud Luxe Marketing Team

20th May 2024

~ 7 min read

Google Performance Max brings elements from the following eight types of Google Ads campaigns under one dashboard:

  • Text ads on search engine results pages
  • Media-rich ads on third-party websites and apps (like AdSense partners)
  • YouTube video ads
  • Google shopping ads
  • Location-based ads designed to increase footfall to a retailer
  • Local search ads that drive traffic to a physical location
  • Google Smart campaigns – a kind of simplified beginner campaign for smaller businesses
  • Google Discovery campaigns – automated personalised ads that appear when Google detects purchasing intent

Performance Max creates AI-powered ads for your products for display across their network. It then displays those ads to consumers at or close to the point of purchase or making an enquiry. There’s a lot to get excited about with this new system but there’s also a lot of room for improvement. We hope that, in the coming years, Google listens to our and other users’ feedback. 

We’ve been working with Performance Ads since its launch on an experimental basis with clients and, below, we share with you our thoughts and experiences to date.

How Google Performance Max works

Performance Max automates:

  • Audience building. Google creates target audiences for your individual products and service using a variety of different data inputs (covered later in this feature).
  • Conversion-driven ad content creation. Using collateral like product feeds, images, videos and text that you connect to the platform, searchers see ads Google creates with AI and machine learning tech.
  • Intent-based ad display. Performance Max displays ads to users it believes are at or close to the point of conversion (making a purchase or leaving follow-up details) using behavioural and search-based algorithms.

There is an initial 72-hour lead time for Google to build your audience and get your campaign started. From launch onwards, Google manages all your Performance Max online advertising. You access your campaign setting and reports from one dashboard.

You set a daily budget per campaign with the following two bidding strategies:

  • Max Value (targeting the highest return possible).
  • Max Conversion (targeting the most conversions for the budget you set, regardless of conversion value).

Promising but imperfect

Performance Max wants to take control of everything. But then again that’s it raison d’etre – It’s primarily been designed for SMEs who want to get seen in more places but lack the time or the technical knowledge to achieve it. From that point of view, it’s fantastic.

But we believe that, while AI-driven audience selection and content creation have promise, it comes nowhere near what can be achieved by experienced data-driven marketers. For example, the Jasper AI writing tool is very clever but, without human intervention, it fails in its mission, in our opinion…

Not suitable for important ad campaigns

…and it’s for that reason we’re very selective on where we use it. We tend not to employ it on client campaigns for which we have already built a funnel and ad collateral. For each funnel, we work very hard with our clients to understand every part of the client journey as well as the target clients themselves and get great results.

But even experienced human marketers like the people at Croud Luxe can’t create separate funnels for the hundreds or thousands of products our clients offer. And it’s on these deprioritized products and services where Performance Max can genuinely be additive to luxury brands. 

Good for driving revenue on less important products – ad copy is a bit functional though

We think of the Performance Max campaigns we use to generate revenue for clients from their lesser-known products and ranges as “mini-client campaigns”. Almost like a separate activity from the big traditional luxury ad agency work we do for them.

We don’t focus on building website traffic with these campaigns here. We choose “sales” and “leads” as the conversion goals for Performance Max campaigns. After all, website traffic in and of itself only has commercial value if it adds revenue.

We’ve had promising results so far. We tend not to set an ad budget higher than £100-£200 a day for Performance Max campaigns. Anything higher than that and this is a significant investment requiring human time, in our opinion. The ads created by the Performance Max bot are very clever but they lack any real personality, being exclusively transactional in nature.

But that’s OK. They can help clients generate profitable extra revenue and create shelf space within their stores and other facilities, that’s a big win. This is what makes Performance Max as a genuinely transformative concept, arguably as game-changing as the launch of AdWords back in 2000.

Google seems to be good at guessing targets

The information you provide Google for targeting is not necessarily the information it uses when displaying ads.

It uses your data to create “audience signals”, typical data being:

  • Your data – customer databases, website visitor data and remarketing lists
  • Custom segments – previously created audiences based on apps used, websites visited and search activity
  • In-market demographics – based on interests, life events, company sizes and so on
  • General demographics – like income, parental status, gender and age.

Over time, it modifies who sees your ads based on actual conversions. Its focus is to lower the cost per lead or sale over time. With the platform still relatively new, we’ll how good it is at bringing down costs over time.

We got the best results when we provided Google with as much input as possible so that it can build its initial audience signals. We added to that success by setting micro-conversion targets for each campaign. Google learns more every time someone takes out an email newsletter subscription, view a video in full or stay on your site for a very long time.

Promising start for location-based ads but needs improvement

On location-based targeting, especially where the goal is to get the client into your stores, you can import data about offline conversions which, over time, further refine the audiences that see your ads. 

Keep an eye on the Croud Luxe blog to find out more about the Performance Max “Burst” feature when it launches, specifically designed to help retailers achieve in-store revenue objectives.

The jury’s out on the URL expansion tool

The final URL expansion tool, switched on by default on all accounts, is interesting. It directs a searcher to the page on your website that Google believes best matches your searcher’s intention. 

So, it may direct your visitor to a specific product page, an about us page or a blog page depending on perceived intent. However, you can’t instruct it to visit a particular URL even if it’s been set up to help sell a particular product. This is a flaw we hope they put right.

You can choose which channels you appear on

You can opt out of displaying ads on the Google Search network, the Partner search network and on the Display network. 

Unless a client specifically requests otherwise, we tend not to add these channels to a campaign because of poorer performance than standard Google on-SERP text ads and Google Shopping ads. It’s also a lot easier for a brand to find itself in an undesirable neighbourhood with any cross-site advertising distribution platform. 

You can remove your ads from appearing within mobile apps, a practice many marketing managers within luxury brands feel is spammy.

Upload as much collateral as possible to get the best results

To get the best results, make sure you upload as much material as possible to help Google create the most effective advertising collateral for your campaigns. 

Think of material that Google will be able to combine, especially making text related to images and video. If you don’t have your own video, Google will create campaign videos for you.

The future of Google Performance Max

Google promises to add and update Performance Max features on an ongoing basis in the coming years.

What do we hope they change? Control over Performance Max ad campaigns is limited. The dashboard is intuitive but the lack of channel-specific data is frustrating. You can’t access settings for a campaign to understand why it’s performing so well or otherwise.

Although Google denies this, Performance Max campaigns seem to take precedence over your standard campaigns. In other words, if both campaigns are targeting a particular keyword, Performance Max wants to display its ads.

You have to be careful with location-based targeting. You can select a location in the “located in” option but you can’t switch off the “interested in” options. This means that, while you will reach the audience in your target location, you’ll also reach anyone whom Google thinks wants to buy or enquire about your products and services now.  

The best way to overcome this issue at the moment seems to be to add location exclusions to your Performance Max campaign. Adding more than one country for each Performance Max campaign seems to adversely affect results so we always stick to one. Want to find out more about adding Performance Max to your planned search campaigns? Please contact us by clicking here.

We look forward to working with you!

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