The Untapped Potential of pMax

Let’s start with a balanced overview of why pMax could be a valuable asset to your digital marketing strategy:

Diverse Ad Placement: The platform offers a comprehensive ad placement strategy that can significantly increase your brand’s visibility across multiple Google channels.
Streamlined Campaign Management: For those who appreciate a more hands-off approach, pMax comes close to being a self-managing system. The machine learning algorithms continually adapt to market changes, saving you both time and manual effort.
Data-Driven Optimisation: pMax is constantly learning. It uses a vast array of metrics to continually refine its targeting and optimisation techniques.
Cost-Efficiency: We’ve seen pMax produce competitive CPA (Cost Per Acquisition) figures, making it an advantageous choice for budget-minded campaigns.
Agility and Responsiveness: pMax excels at adapting to shifts in consumer behaviour, a necessity in today’s ever-changing market landscape.

Now that we’ve set the stage, let’s delve deeper into the strategies that can enhance your pMax experience.

Feed the Platform Accurate Data

Quality data is the lifeblood of any machine learning system. Conduct thorough audits of your conversion tracking metrics to ensure that you’re providing the most accurate data possible. A robust measurement framework coupled with regular data governance checks will allow pMax’s algorithms to make more informed decisions, thereby increasing the ROI on your ad spend.

Avoid Cannibalisation

Keyword overlap can distort your campaign performance metrics and create an artificial sense of competition between your own product categories. By carefully structuring your campaigns and being mindful of keyword selection, you can mitigate these risks. Implementing a tiered bidding strategy based on keyword value and relevance can further refine your approach. (more specifically on cannibalisation here)

Test, Refresh, and Optimise Your Asset Group Creative

It’s crucial to keep your ad creatives fresh and relevant. Stale, repetitive ads can lead to ‘ad fatigue,’ reducing click-through rates and overall engagement. Regularly updating your asset groups also allows for A/B testing, providing invaluable insights into what resonates with your target audience. Seasonal updates and thematic variations can add an extra layer of relevance, elevating your campaign’s performance.

Audience Targeting: The Subtle Art

Effective audience targeting is critical for the success of your pMax campaigns. Leveraging Google’s ‘Similar Audiences’ feature can broaden your reach without diluting the quality of your leads. Concurrently, excluding irrelevant audiences can tighten your campaign focus, ensuring that your ads resonate with the most likely potential customers.

CRO/Experimentation: The Science of User Experience

Conversion Rate Optimisation (CRO) is not merely an add-on but an integral part of your overall digital marketing strategy. Utilise A/B testing methodologies to trial different landing page elements and layouts. Advanced techniques like heatmapping can provide nuanced understandings of user behaviour, which can be directly applied to improve the user journey and, consequently, your conversion rates.

Conclusion

Performance Max is more than just a tool; it’s a dynamic platform enriched by machine learning and data analytics. While it may present certain challenges, its benefits, particularly in terms of reach, cost-efficiency, and adaptability, make it a compelling choice for modern advertisers. With strategic input and ongoing optimisation, pMax has the potential to be a powerful ally in your digital marketing efforts.

So let’s embrace the future of advertising with both its challenges and opportunities. After all, in the rapidly evolving digital landscape, adaptability isn’t just an advantage; it’s a necessity.

CPA is possibly the word I hear most during the week; why has it increased, why has it decreased, what can we do to improve it…. Like most metrics, CPA is interconnected with many other factors that makes it difficult to give a single answer.

Client is spending around £100,000 on advertising, to keep things simple lets say its PPC.

They are generating £1.25 for every £1.00 spent and have a CPA of £20, they want to reduce this to get a better return.

Sound familiar? Here starts the race to the bottom!

Reducing CPA, usually means reducing bids, spending less and generally narrowing your opportunity to increase sales, but sure your ROAS will improve. Doesn’t sound all too bad.

Unfortunately businesses don’t run on CPA, they don’t run on ROAS, they rely on customers and those customers spending cash with them regularly.

Unpicking that descriptor, key metrics such as Average Order Value, Lifetime Value and Incrementality are being ignored.

Look at these two scenarios, scenario 1 shows you the typical example I gave and scenario 2 shows the version with improved CPA with decreased spend and in turn less sales.

	Scenario 1	Scenario 2
Average Order Value	£25	£25
Average Orders per customer in 12 Months	5.0	5.0

Advertising Cost	£100,000	£60,000
Online Orders	5,000	4,000
Revenue	£125,000	£100,000
CPA…..	£20	£15
ROAS	£ 0.25	£ 0.67

12 Month Lifetime Value (revenue)	£ 625,000	£ 500,000
Incrementality	£ 500,000	£400,000
Additional Spend	£40,000

This example explores the bigger picture, which arguably takes some effort to fill in the gaps, and this is partly the issue that making micro decisions in mass on a day-to-day basis means we’re often led to use metrics that are easily accessible.

The conclusion here is that a scenario with a higher CPA, larger spend and lower ROAS can actually lead to a larger cash return when you factor in lifetime value and the incremental revenue generated from a larger pool of customers.

Of course there are cases where sales can be increased by keeping CPA at a similar level or even reducing it, this very much depends on how well your PPC is being optimised, this is really an example for scenario planning when your PPC is already firing on all cylinders!

These results can of course be further improved by increased average order value and conversion rate through a dedicated CRO programme!

Performance Max Tips: The AI Overlord You’ll Actually Want to Work With