Changes to Google AdWords Daily Budget Caps

Changes to Google AdWords Daily Budget Caps

by Madeline Ewbanks, October 6, 2017

What exactly happened? On October 4, 2017, Google quietly announced that AdWords campaigns will now be able to spend up to twice the average daily set budget to “help advertisers reach goals, like clicks and conversions.” According to Google, “on days with lots of high-quality traffic, your costs could be up to two times your daily budget,”. As a protection, however, Google states that campaign spending eventually balances out on days when spend is below set daily budgets. While spending may ebb & flow more than it has previously, an advertiser won’t be charged more than the set monthly limit.

 

Google’s Announcement Via Twitter:

Screen Shot 2017-10-06 at 10.13.20 AM

 

What does this change mean? Google continues to shift towards more machine-learning and automation within the Adwords platform, and they are pushing hard to create opportunities for increased spending from advertisers. The immediate concern among our SEM experts is that this new setting could allow a campaign to spend through the monthly budget before the month is over, leaving campaigns dark for the remainder of the month. If a program has higher-traffic days early in the month, the new AdWords budget settings would allow for the capture of this traffic, but then the programs would run out of budget for the rest of the month.

How is PAVLOV handling this change? In order to ensure a campaign stays live throughout the month, the PAVLOV SEM team will be monitoring closely the search patterns and current budget settings to make adjustments in a timely manner. Budgets exist for a reason, and daily budget caps have been a long- standing mechanism for budget control and management. This recent change requires a new way of approaching budgeting and forecasting, as well as daily management.

PAVLOV will continue to monitor and optimize programs daily, and if we see a campaign showing signs of spending more to reach goals and realize demand, we will set up a time to discuss strategic recommendations with you.