Google's 17 Aug change - how to handle it?
So, we probably all know by now, Google does not want smart bidding to outperform its targets anymore. As of Aug 17, budget-constrained tCPA/tROAS campaigns that are over-performing will start taking some of that advertiser profit and transferring it to Big…
So, we probably all know by now, Google does not want smart bidding to outperform its targets anymore. As of Aug 17, budget-constrained tCPA/tROAS campaigns that are over-performing will start taking some of that advertiser profit and transferring it to Big G, if we don't take action. Not much we can against the change, BUT we do make some changes if we want to minimize the impact. What's the take of r/PPC? How do you handle this change? Here's what I do to anticipate Aug 17. For campaigns that are not running target based bid strategies (Target CPA, Target ROAS) -> do nothing. For campaigns that are not limited by budget -> do nothing. For campaigns that are limited by budget AND are running target based bid strategies: Look at the actual performance for last last 14 days, last two conversion cycles, or last date range with the minimum number (#1) of converions. Pick the one that is longest. For the date range, look at the actual CPA or ROAS performance Compute the target-to-actual gap: what percentage does the actual deviate from the bidding target? For campaigns that are under-performing (actual CPA > tCPA , or actual ROAS < tROAS) -> do nothing. For campaigns that are on par, or slightly over-performing (actual CPA > 0.8 x tCPA , or actual ROAS < 1.2 x tROAS) -> do nothing. For campaigns that are significantly over-performing (actual CPA < 0.8 x tCPA , or actual ROAS > 1.2 x tROAS), compare actual performance to the real business targets (#2) For campaigns that are significantly over-performing and the actual performance is better than the business target -> increase budget if you want more conversions/revenue at lower efficiency of spend. For campaigns that are significantly over-performing and the actual performance is at, or lower than the business target -> set new bid strategy target that is between your current bid strat target and close to the current actual (#3). I recommend you do this today if you haven't done so already. This is because Google will make the change 14 days from now. If you wait until Aug 17, and make the change that day, it's much harder to interpret what happens the weeks after Aug 17 as both you and Google have made changes that will impact performance. NB: for my Search campaigns, if I decide to make a change in targets, I like to create a campaign experiment where I only cahnge the target in the Treatment arm. That way I hope to be able to analyse both the impact of my change and Google's change. (#1) for me these numbers can vary per account/campaign, but as a general rule of thumb, I like to use these minimums: 30 for Target CPA, 60 for Target ROAS (#2) in some of my accounts/campaigns, the bid stratgies have targets that intentionally differ from the real business targets. (#3) you might want to leave some wiggle room to prevent a drop in ad spend and conversion volume
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I'm not sure why there's panic over this update. Set an ideal cpa/roas, let it run. Done.
Yeah honestly, I'm not sure that over any 30 day period, my tCPA campaigns ever over perform that much. Sure, I may get 14 days of better than avg performance, but that is ALWAYS followed up by 14 days of worse performance to still average out to my target.
lol, yeah, that could be worded much better ;-)
"what they say will happen is one thing and what will happen is another" 100% with you, Google often behaves very differently from what is being advertised. Hence, I like to test :)
bring him on! :)
"if you are using Shared Budgets along with the Shared Bid Strategies, that you should NOT see this update impact CPA ranges at the Campaign level in a portfolio" to me, this would make sense iff these Shared Budgets are not limited. If the sahred budget is limited and the portfolio bid strat is over-performing, I think you will see an impact.
this. We should Always Be Testing :)
The whole premise is that budget caps improve CVR and I have never seen that it does happen, just not always :)
yep, just look at what phrase match did to our brand keyword CPCs...
A lot of big businesses just work off monthly budgets and don't have strict in-channel CPAs. They will have overall CPA targets for the business but you are facatoring 20+ channels into that figure. I personally would prefer to just have the budgets opened up and use the tCPA as the lever to have spend go up and down depending on the business needs but the people I have to deal with have not liked that strategy, especially when Google cam spend 2x the daily budget on any given day whenever it feels like. It's certainly a stress I'd rather not have but it is what it is.
I’m personally on the side of not doing anything and seeing how it pans out because what they say will happen is one thing and what will happen is another. I’m really reluctant to make any snap changes off what is essentially a guess. Just build up data, understand the way the campaigns react, then adjust. I’ve sold it into clients so they’re expecting a week of things maybe going weird. So annoying that they’re at liberty to just change the definition of things willy nilly.
Not sure if there's much panic, but I do see a lot of people worrying about the why and what will happen, hence my recommendation to test AND prepare. Unfortunately, it's not always as simple as setting an ideal cpa/roas ; smart bidding will often not reach the target while happily spending all your budget even after 6 conversion cycles, and then, when you reduce the budget, it suddenly will reach the target :)
I laughed at number 4. If it's underperforming do nothing:) I know what you mean though, just funny in isolation.
I am part of the "I don't understand the panic". Yeah, and so because so the change is only triggers 1. if you're losing IS to budget caps and 2. your performance is better than your target. I bet this happens way less than you think. And if you actually are performing better like you probably should just open up budget caps and get that good traffic anyways. The whole premise is that budget caps improve CVR and I have never seen that. But I definitely know that caps hurt performance.
We need that fathom person to reply, imo he has the best advice
I have a franchise client where we use target cpa portfolios. While our actuals perform very close to our targets , the range of CPAs by campaigns that ladder up to the portfolio is very wide. As in some are vastly outperforming the target whereas other aren’t, and it’s netting a blended total cpa close to our target I asked our Google rep if moving forward, CPAs at the campaign level moving forward will now not have as much variance and would all be closer to the over arching target. I feel like this would completely defeat the purpose of using portfolios that have different ranges of CPAs They responded interestingly with, if you are using Shared Budgets along with the Shared Bid Strategies, that you should NOT see this update impact CPA ranges at the Campaign level in a portfolio Has anyone else heard this ?
We really need to test to see how things perform and not make any assumptions. There are many many cases in the past where Google will report that a change will perform a certain way, but actual data shows differently.
Great workflow that makes a lot of sense - ours follows a similar set of criteria, should work for the vast majority of advertisers https://www.linkedin.com/posts/optmyzr_ahead-of-googles-august-17-bidding-change-activity-7488912548411559937-XfTV/
I feel like people who "don't understand the panic" don't have a firm grasp on Google Ads bidding nor the forces that act on marketwide CPCs.
its really a big over reaction and shows how little people know how the auction works. set your tCPA or tROAS to what you want to achieve and thats it.
I'm with the top comment. It's a crappy change, but set it as your average tCPA and then keep decreasing it week over week and you should be fine tbh.
I find it amusing that they are magically going to just make your campaigns less efficient now because of budget limiting now. Shows how much control Google has over the auction and how much you're paying.
Set the target you actually want. It's that simple. Not sure why everyone is over thinking this? If your campaigns have historically generated an 8x roas while your target is 5x, bump it to 8x. Done.
The risk isn’t Aug 17 itself... it’s discovering the target entered in Google was never the business limit. A campaign delivering $70 CPA against a $100 tCPA may start buying more conversions closer to $100. That could be profitable if the next 200 customers still work at $95... but disastrous if margins break above $75. Across larger accounts, we’re not applying a blanket 20% adjustment. We’re comparing the bid target, observed performance, and the maximum CPA or minimum ROAS the business can tolerate after margins, lead quality, close rates, refunds, and conversion lag. One of my clients' SaaS accounts spends around $240k/mo and produces 412 demos at $154 each, with a 63% show rate. A higher CPA is acceptable if the show rate, opportunity rate, and customer value hold... but not if Google finds volume through weaker intent. I’d make necessary changes before Aug 17, but not anchor them blindly to 14 days of data. And experiments won’t fully isolate Google’s update because both arms experience it. This change exposes whether your bidding target actually matches the economics of the business.