Google Ads Smart Bidding Update [what is REALLY means for you] — Transcript

Full transcript

1. 0:00From August the 17th, this year, Google
2. 0:02is changing how target-based bidding
3. 0:05will operate inside of your campaigns,
4. 0:07especially when they're limited by your
5. 0:09budget. Now, we all know that when
6. 0:11Google makes recommendations and
7. 0:13announcements, there are some of them
8. 0:15which don't really have much effect to
9. 0:17how your campaigns will operate in a
10. 0:20real account scenario. And I need to be
11. 0:22clear that this is not one of those
12. 0:24scenarios. This is an announcement that
13. 0:26you do really need to pay attention to,
14. 0:29especially if you are running target CPA
15. 0:31or target ROAS-based bidding inside of
16. 0:33your campaigns and any of those
17. 0:35campaigns are limited by budget. So, in
18. 0:38this video, we're not only going to
19. 0:40break down what this announcement means,
20. 0:42but also what you need to look for
21. 0:44inside of your Google Ads campaigns. And
22. 0:46to make this as practical as possible,
23. 0:48we will be jumping into a live account
24. 0:51walkthrough, so I can really show you
25. 0:53what to look out for and what are the
26. 0:55options that you have to make sure that
27. 0:57you're not going to see any unusual
28. 0:59spikes in performance with your Google
29. 1:01Ads campaigns once this change goes live
30. 1:04from the 17th of August 2026. All right,
31. 1:07so let's start with the short version of
32. 1:09what is actually changing. Now, what I
33. 1:12need to stress here is that this is
34. 1:13really going to affect campaigns that
35. 1:15have two things in place. One, you are
36. 1:17seeing a status warning which is limited
37. 1:20by budget. And secondly, you're
38. 1:22operating a target CPA or target ROAS.
39. 1:25Now, what would happen quite often is
40. 1:27that if you were having a limited by
41. 1:29budget warning inside of your campaign,
42. 1:32and say for example, you had a target
43. 1:33CPA of $10, quite often that campaign
44. 1:37would perform better. It would perform
45. 1:38at a cost per conversion of $5 or
46. 1:40somewhere around there. Or if it was a
47. 1:42ROAS target, you may have a ROAS goal of
48. 1:44400, but that campaign that is limited
49. 1:47by budget may be performing at 500 or
50. 1:49600 ROAS. Now, I know internally inside
51. 1:52of Define Digital Academy, we've had
52. 1:53some cases where we had a target ROAS of
53. 1:56100% where it's in reality the campaign
54. 1:59was performing sometimes for a long
55. 2:01three, four, five, six month period at
56. 2:03800 or 900% ROAS. So, let's firstly
57. 2:06start with some really simple mechanics
58. 2:08of why this is actually happening. And
59. 2:11then as I said, we'll go through the
60. 2:12full explanation of what we're changing
61. 2:14and what you need to look out for your
62. 2:16campaigns. So, what essentially is
63. 2:18happening is let's just say you've got a
64. 2:19campaign which is limited by budget and
65. 2:21you've also got a target ROAS or a
66. 2:23target CPA in place,
67. 2:26Google gets a little bit picky and it
68. 2:28becomes a little bit safer to make sure
69. 2:30that it's achieving those targets. So,
70. 2:31essentially what the algorithm is doing
71. 2:33is it's cherry-picking the cheapest
72. 2:35conversions for your business. Now, that
73. 2:38may sound like good news and and it is,
74. 2:40but one of the problems is that a lot of
75. 2:42businesses and we did find this to be
76. 2:44true is that let's just say you've got a
77. 2:46target ROAS of 200% and everything and
78. 2:49your account is performing at a three or
79. 2:50400% and then once you start to increase
80. 2:53your budget, the ROAS goes to that three
81. 2:55or 400%. So, what Google is now doing is
82. 2:58that even at an under-spending or a a
83. 3:00limited spending campaign, it will look
84. 3:03to achieve that ROAS goal or the target
85. 3:05CPA that you've chosen for that
86. 3:07individual campaign. So, and the way
87. 3:09that Google has actually said this is
88. 3:11that after August the 17th, Google will
89. 3:14look to aim consistently for your stated
90. 3:17target ROAS or target CPA goal. So, the
91. 3:20core messaging here is that what you do
92. 3:22need to be looking out for is after
93. 3:24August the 17th, you really need to be
94. 3:26looking at what your target CPA or
95. 3:29target ROAS is, not what the actual
96. 3:31performance is occurring inside of your
97. 3:33current campaign. Now, I want to stress
98. 3:36here that this does not mean that you
99. 3:37can just put on the target ROAS or the
100. 3:39target CPA that you want to achieve and
101. 3:41Google will magically give you those
102. 3:43results. That is not what's happening
103. 3:44here. You still need to make sure you're
104. 3:46achieving your data threshold, so that
105. 3:48would be, you know, conversions. So,
106. 3:50before you're using a target CPA or a
107. 3:52target ROAS, you want to be having at
108. 3:54least 50 conversions a month. And you
109. 3:56also want to be having a target goal
110. 3:57which lines up with your real account
111. 4:00performance over the previous 30 and 60
112. 4:02days. So, this doesn't change in the
113. 4:03sense that this now becomes a magic
114. 4:05wishing well where you can just tell
115. 4:06Google what you want to achieve and
116. 4:08it'll go through and do that. It still
117. 4:10needs to be backed up by data that is
118. 4:12happening inside of your account. But
119. 4:14what this does mean is that you may need
120. 4:17to either lower or increase your target
121. 4:20ROAS or target CPA if you do see a
122. 4:22mismatch between what your current
123. 4:24actual results are and what your current
124. 4:26target CPA or target ROAS is. So, I know
125. 4:29that's a lot of words for me already and
126. 4:31you may be getting a little bit
127. 4:32confused. So, what we are going to do is
128. 4:34we're going to jump over to a screen
129. 4:35share also you can really really see
130. 4:37what you need to be looking at and go
131. 4:39through the options that you can take in
132. 4:41order to see continued performance for
133. 4:43your business when it comes to Google
134. 4:45Ads. Now, one thing I do want to also
135. 4:47let you know is that the account that
136. 4:48we're going to be looking at is one of
137. 4:49our current Define Digital Academy On
138. 4:51Demand members. And if you're unsure
139. 4:53what On Demand is, On Demand is a
140. 4:55done-with-you program where we partner
141. 4:58alongside you, the business owner or
142. 5:00in-house marketing team, so that you can
143. 5:02get the best results with your Google
144. 5:04Ads campaigns. We passionately believe
145. 5:06here at Define Digital Academy that
146. 5:08businesses are best placed in order to
147. 5:11run their own Google Ads campaigns, but
148. 5:13we know that Google Ads isn't your
149. 5:15world. So, what we want to do is come
150. 5:16alongside and partner with you to give
151. 5:18you the strategic advice and confidence
152. 5:21so that you can profitably not only run
153. 5:23but scale your Google Ads campaigns. And
154. 5:25specifically designed for businesses who
155. 5:27are already spending over $5,000 a
156. 5:29month. And you can find out all the
157. 5:31information about On Demand in the
158. 5:32description below. And if you're just
159. 5:34new inside of Google Ads, don't worry
160. 5:36because we also do have our Google Ads
161. 5:38Mastery Program is really out of
162. 5:40businesses who are starting and we
163. 5:41provide daily support and also weekly
164. 5:44live coaching course so that you can get
165. 5:45all of your questions answered so you
166. 5:47can see success with Google Ads. If you
167. 5:49want all that information, follow that
168. 5:50link in the description below. But,
169. 5:52right now, let's jump into this screen
170. 5:53share.
171. 5:54All right. So, now we're inside of
172. 5:56Google Ads, and you see through here,
173. 5:57this is the notification that you'll
174. 5:59start to see. And it's saying what we've
175. 6:01already gone through. So, starting from
176. 6:0217th of August, 2026, campaigns with a
177. 6:05big targets, blah blah blah. It will go
178. 6:07It's giving you a recommendation to go
179. 6:09through and check this. Now, there is a
180. 6:11tool which they are introducing. It said
181. 6:14it was only going to come out on the 7th
182. 6:15of August, which is essentially today
183. 6:17that I'm recording. So, I don't know if
184. 6:19this is the actual tool, or if it will
185. 6:21be slightly different. And then this is
186. 6:23the tool which it's giving you. And
187. 6:24there's really three options which you
188. 6:26can go through. And this is what I want
189. 6:27to make clear is that one, you can
190. 6:29either revert back to maximize
191. 6:31conversion value. If you're running on a
192. 6:32off a target CPA, you can see here it's
193. 6:34going to get you to go back to maximize
194. 6:36conversions. Or, you can either apply a
195. 6:39budget increase, or you can change your
196. 6:42current bid target. So, they're the
197. 6:44three options that you've got uh from
198. 6:46there. So, the first option is is that
199. 6:48you go through and revert back to
200. 6:49maximize conversions or maximize
201. 6:51conversion value, you adjust your target
202. 6:53CPA goal, or you adjust your campaign
203. 6:56budget. And what I want to show you in
204. 6:58through here is that this is the an
205. 7:00account example we want you to go
206. 7:01through. Now, I've had to go through and
207. 7:03just blur out these campaign names uh
208. 7:05just for some privacy. But, you can see
209. 7:07from here with this business, they've
210. 7:08got a total of nine different campaigns
211. 7:11running. And this is an e-commerce brand
212. 7:13which runs multiple different products
213. 7:14across different countries, which is why
214. 7:16we've got uh so many different
215. 7:18campaigns. Now, I'm going to be giving
216. 7:19this as an example as an e-commerce
217. 7:21brand, but the same principle applies
218. 7:23whether you're dealing with target ROAS
219. 7:25or target CPA. You still got those three
220. 7:27levers which you can do. Let me go
221. 7:29through with them again. So, you've
222. 7:30either got to uh increase your budget,
223. 7:32you've either got to move back to
224. 7:34maximize conversions or maximize
225. 7:36conversion value, or you've either got
226. 7:37to adjust your target CPA or target ROAS
227. 7:39goal. The big one I want to go through
228. 7:41and have a look at here is this one
229. 7:43because if you look at the core metrics,
230. 7:45it's limited by budget and there's a
231. 7:48target ROAS of 340, but there is a
232. 7:52current conversion value cost, so the
233. 7:53actual ROAS is 4.31. So, we're running
234. 7:57at a ROAS of about 430%, but with a
235. 8:00target ROAS of 340%. So, there's quite a
236. 8:03bit of a different mix mismatch there.
237. 8:05Now, if we did nothing and if we just
238. 8:08kept this as its current performance,
239. 8:10what would happen is that this actual
240. 8:13performance would start to trend down
241. 8:15towards 340%.
242. 8:18So, there's a couple of things that I do
243. 8:20want you to take note of here before you
244. 8:21go through and make these decisions. The
245. 8:23first thing I do want you to think about
246. 8:24is your actual acquisition window inside
247. 8:27of Google Ads. It's important to note
248. 8:28here, we all know that conversion
249. 8:30metrics and also we also need know that
250. 8:32acquisition windows and all those things
251. 8:34are different from what Google Ads
252. 8:36reports to what your real business
253. 8:37seeing, but obviously we're only looking
254. 8:39at the Google Ads side here because this
255. 8:41is where Google is pulling the data in.
256. 8:43So, what's important to note in this is
257. 8:44if you go through and just roll over
258. 8:46your different conversion values, you
259. 8:47can see from here in this campaign, for
260. 8:49this date range this bid strategy is
261. 8:51projected to receive another seven
262. 8:53conversions. It's also projected
263. 8:55increase more conversion value. So,
264. 8:58So, what you do need to think about here
265. 9:00is as well is that this isn't it isn't
266. 9:03running in real time, so you may also
267. 9:05just want to make sure you got some
268. 9:06breathing space in through here. But
269. 9:08essentially, let's go through this
270. 9:09campaign and really take you through the
271. 9:11decision tree that we would be going
272. 9:13through and we're currently going
273. 9:15through with this business owner. The
274. 9:16first thing that what we come back and
275. 9:18ask is we're really going through is
276. 9:20that current reported value inside of
277. 9:22this campaign, is that profitable for
278. 9:24the business? So, let's just say for
279. 9:26example, does this business need to run
280. 9:28at a 400 or does it need to run at a
281. 9:30340? Now, I know the answer and for this
282. 9:33brand they need to be running anywhere
283. 9:34above 300. So, ideally for this
284. 9:38business, what we would do is that we
285. 9:40would just drop this target ROAS down to
286. 9:43300% or if they wanted to, they could
287. 9:45keep it at 350. And then from there, we
288. 9:47could do two things. We could then also
289. 9:49look to increase the budget. So, that
290. 9:51would be the first thing that you really
291. 9:52need to come back and really have an ask
292. 9:54about is really looking at in terms of
293. 9:56your business for this individual
294. 9:58campaign and the products that it's
295. 10:01marketing to the regions that it's
296. 10:02marketing, what is the true number that
297. 10:05you need for success with Google Ads?
298. 10:07Remembering my comment before is that's
299. 10:09the true value of the reported value
300. 10:11inside of Google Ads, not the real data
301. 10:13inside of your account because Google is
302. 10:15only using this data. So,
303. 10:18you're only using the data that's inside
304. 10:19of your Google Ads dashboard. And that
305. 10:22just brings us to an important side note
306. 10:23is that remember, especially for us at
307. 10:26Defined Digital Academy, when we're
308. 10:27talking about your ROAS, your reported
309. 10:30ROAS, or your reported cost per
310. 10:31conversion inside of Google Ads, we
311. 10:33don't take that as that's what's
312. 10:35actually happening in your business. We
313. 10:37very much use this as an optimization
314. 10:39tool to either increase the spend or
315. 10:40decrease the spend or put a break on
316. 10:42that spend or look to increase
317. 10:44performance. So, we're very much talking
318. 10:45on that side of it. So, for this
319. 10:47business, what we're currently talking
320. 10:49to is because we know their target ROAS
321. 10:52is the actual target ROAS of what they
322. 10:54need for profitability inside of Google
323. 10:56Ads to represent inside of their
324. 10:57business is actually a 300. So, what we
325. 11:00would be doing, we could do two things
326. 11:01here. One, we could drop that target
327. 11:03ROAS down to 300. Or the other thing was
328. 11:06what we're probably going to lean to is
329. 11:07that we would just remove the target
330. 11:09ROAS goal and move over to maximize
331. 11:11conversion value. Now, the reason for
332. 11:13why we'd feel comfortable doing that is
333. 11:15because we know this account is already
334. 11:17performing well above the target ROAS
335. 11:19goal. So, if you've got the case where
336. 11:21you've got some long-term history in the
337. 11:23account where it's performing above what
338. 11:26your target ROAS goal, for me in most
339. 11:28cases, we just look to revert back to
340. 11:30maximize conversion value. and then if
341. 11:33we needed to, then we could reintroduce
342. 11:35a target ROAS if we needed to down the
343. 11:37track. So, now let's look at another
344. 11:38option. You can see with this one in
345. 11:39through here is that we're running
346. 11:41pretty close. So, we've got a target
347. 11:42ROAS of 375 and an actual of 385. So, in
348. 11:46this case, purely what we'd look to do
349. 11:48is we wouldn't change the target ROAS at
350. 11:50all, but what we would potentially look
351. 11:52to doing is if we wanted to, we could
352. 11:53actually start scaling that campaign.
353. 11:56Now, one of the things that I do need to
354. 11:58stress is because quite often there is a
355. 12:00little bit of difference between what
356. 12:02Google announces and what should happen
357. 12:03in theory as to what happens in a
358. 12:05real-world scenario. So, what we would
359. 12:07do here is we'd firstly look to increase
360. 12:09the budget by 20% and then really look
361. 12:11to see whether these scaling metrics
362. 12:13hold true. So, please don't hear from
363. 12:15this, like I said earlier in the video,
364. 12:17that this means that things are going to
365. 12:18be a lot more secure with scaling. I
366. 12:20don't see that changing at all. You
367. 12:22still need to do it in increments of
368. 12:24about 20% every 5 to 7 days and just to
369. 12:27make sure that everything stays in
370. 12:29check. And then let's look at this third
371. 12:30case, and this is the case where the
372. 12:32target ROAS of 350 is actually much
373. 12:36higher than the actual performance. So,
374. 12:38so far I've shown you examples where the
375. 12:41the actual account performance is
376. 12:42performing better than the target ROAS,
377. 12:44and in those cases, you've got two
378. 12:46options. You can either increase the
379. 12:48budget or go back to maximize conversion
380. 12:50value, or if you wanted to, just to
381. 12:52adjust the target ROAS to what is
382. 12:53actually happening in the account. That
383. 12:55first example, if it was 430 and your
384. 12:57actual target ROAS was 3 340, I'd
385. 13:00probably look to set it at about that
386. 13:01400% knowing that for that business,
387. 13:03they're happy with anything above 300%.
388. 13:05But for this scenario where the target
389. 13:08ROAS is significantly higher than the
390. 13:10actual conversion value cost, what I
391. 13:13would look to do here is that from here
392. 13:15is that we would use what we call a
393. 13:17ladder method. So, you'd look to because
394. 13:19we can't just revert this back to
395. 13:20maximize conversion value because the
396. 13:24actual underlying data has got that at
397. 13:26best at a 200% ROAS. In the case of the
398. 13:29other scenario where the actual campaign
399. 13:32conversion value cost or actual ROAS was
400. 13:34higher than the target goal, I would
401. 13:37feel comfortable moving it back to
402. 13:38maximize conversion value. But in this
403. 13:40case, because the the goal that this
404. 13:44business wants to achieve of 350 target
405. 13:47ROAS is higher than the conversion value
406. 13:49cost, which is only at 200 or 188 to be
407. 13:53precise, what we would look to do here
408. 13:55is to actually move this target ROAS
409. 13:57back to about 200% and then look to
410. 14:00slowly step at that target ROAS as we
411. 14:03completed other rounds of optimizations.
412. 14:05And the way that you do that in the
413. 14:07sense the same way that you increase
414. 14:08your budget, you once we get enough data
415. 14:11at say for example 200 and we've we've
416. 14:13got some really good data for about
417. 14:15three or four weeks that we're achieving
418. 14:16at a 200 ROAS, I would look to maybe
419. 14:19increase that target ROAS by by increase
420. 14:21that target between 10 to 20%. So that
421. 14:23would take us in that case probably step
422. 14:25up to about 220, see how the campaign
423. 14:27performs and then look to increase it
424. 14:29further and further down the track. So,
425. 14:32that is my update with what is changing
426. 14:34with the target bidding strategies. I'd
427. 14:36love to hear your take on what you're
428. 14:37looking at, how you're going to go
429. 14:39through with this change. But the main
430. 14:41thing to remember is that these changes
431. 14:43will come into effect from the 17th of
432. 14:45August. So please make sure that you're
433. 14:47watching for any anomalies or any
434. 14:48changes in your accounts because
435. 14:50sometimes these changes can happen
436. 14:52pretty quickly once Google pushes that
437. 14:54data live from their side of things.
438. 14:57All right, thanks for joining me. My
439. 14:58name is Aaron Young from Define Digital
440. 15:00Academy. It's been an absolute pleasure
441. 15:02having you here. And remember, if you
442. 15:03are a business owner or an in-house team
443. 15:06optimizing and running your Google Ads
444. 15:08campaigns for your business or brand and
445. 15:10you need some more strategic help, want
446. 15:11you follow that link in the description
447. 15:13below where you can find out more about
448. 15:14our on-demand program if you're spending
449. 15:16over $5,000 a month. Or if you're just
450. 15:18starting your journey or just working
451. 15:20your way up to that $5,000 spend, when
452. 15:22you're in the link in the description
453. 15:23below, you can find out more about our
454. 15:24Google Ads Mastery program. Thank you
455. 15:27for joining me. And if you want to stay
456. 15:28on YouTube and learn more, why don't you
457. 15:29go through and watch this video right
458. 15:30here, where it takes you through my
459. 15:32expert tips on how to get more sales and
460. 15:34conversions with your business right now
461. 15:36in 2026. Thanks for joining me. See you
462. 15:38next time.