On 4 October 2017, Google Ads changed the way they managed your daily budget.
Your campaign can spend twice the average daily budget to help you reaching your advertising budget.
Google Ads states this change is designed to show ads more when traffic is high and to balance them when traffic is low.
However, for campaigns where you pay for conversions, your daily spend may exceed your average daily budget by more than two times.
Google says: If your ads don’t show up much because of low traffic, then we’ll make up for that by showing them more when traffic’s higher. On days when traffic is very high, your cost could be up to two times your daily budget. You will not be charged more than your monthly limit, basically, the average number of days in a month (30.4) multiply by the average daily budget. https://support.google.com/google-ads/answer/1704443?hl=en-GB&co=ADWORDS.IsAWNCustomer=true
In most accounts, the daily budget has not been affected by the change.
It is common practice to set a daily budget higher than what you want to spend, although you may never reach it or spend it. This is because a low daily budget may restrict your number of impressions and reach.
Cost per conversion
Compare all your campaigns by Cost per conversion.
Analyse a 30 days period, or 7 days, if your daily budget is very high.
In this example, three campaigns show increased costs and higher conversions.
Although the daily budget has increased, the conversions have also increased. The daily budget in this campaign should not change, or it should even be increased according to your profit.
In this example, a campaign shows increased cost, but lower conversions.
Although the daily budget has increased, the conversions have decreased instead. The daily budget in this campaign should not be increased. If that cost is far too high, the daily budget should be decreased instead.
CPC (Cost per click) bids
Irrespective of changing your daily budget, do not increase/decrease your CPC (Cost per click) bids.
Over-deliver shows you if Google Ads charged you more than your allocated daily budget multiply by 30.4.
If Google Ads charged you too much, you will get some credit for the extra costs. If your daily cost each day is a little higher or lower than your allocated daily budget, you should not worry.
The Over-delivery report
Reports > Predefined reports (Dimensions) > Basic > Billed cost.
To calculate over-delivery, subtract Billed cost from Served cost.
Budget planner forecasting tool
This is a new feature beginning to roll out on all Google Ads accounts.
The tool is designed to provide insights into how changes in spending may affect the performance of your existing campaigns.
TOOLS & SETTINGS > PLANNING > Budget Planner.
You select a forecast period, a metric (clicks or conversions) and your target which is optional.
The target can be: clicks, spend or average CPC (Cost per click) when clicks are the key metric or conversions, spend or average CPA when conversions are your key metric.
Selecting the target allows you to enter your target amount, or choose from ‘previous period’ or ‘same time last year’.
Google Ads shows you the plan forecast and lets you know if your budget is already optimal.
The plan shows how any changes in spending can impact your key metrics, and you can toggle to see the spending curve based on different goals.
The COMPARE tab
You can compare your current settings and your forecast settings against past performance.
Not every campaign is eligible as the tool needs enough history.
Forecasts are directional and are updated every 24/48 hours.
They use recent campaign history as well as auction data.
It takes holidays and other seasonal traffic into account depending on business type and location.
Google also says forecasts are more accurate the closer they’re generated to the start date.
Update. Monthly budget
It is now possible to set a monthly budget.
A monthly budget is the maximum that you’ll spend in a month. Google Ads will attempt to spend your budget evenly over the month, though daily spend will vary based on traffic and quality.
You’ll see higher spend on days that your ads are likely to see more traffic, balanced by lower spend on other days – but in a month, you won’t pay more than the monthly budget.
When to use monthly budget
You have strict monthly financial planning.
You can’t exceed your spend every month.
Update August 2019
Google announced that starting on 17 September 2019, the accelerated delivery option will be removed and standard delivery will be the only option for Search and Shopping campaigns, as well as for campaigns with shared budgets.
The accelerated delivery option will still be available for Display and Video campaigns, Google said.
– If you are prepared to spend all your allocated daily budget, move any unused budget to the best performing campaigns.
Script to stop running out of budget
If you want to stop Google Ads spend altogether more than your daily budget, you should consider this script that pauses campaigns when they go too far over budget.
The script warns you when you reached a certain percentage of your daily budget, as chosen by you.
Script source: Daniel Gilbert https://www.brainlabsdigital.com/
Extract from my Book ‘Making Google Ads Work’.