Google’s New Campaign Total Budget vs. Daily Budget Setting: Which Should You Use?

The first question most advertisers must answer when planning any advertising campaign is, of course, what budget they can dedicate to their ads.

AdWords is no exception to this rule, and managing your campaign budgets can seem like a full-time job at times. Especially after Google began allowing campaigns to serve up to twice their daily budget in October, many seasoned experts admitted that they need to spend even more time monitoring their budget pacing.

Luckily, Google’s newest budgeting feature should be a relief for busy advertisers. As of late last week, advertisers now have the choice between setting up a daily budget or a campaign total budget when managing their campaigns in AdWords.

Daily budgets will allow advertisers to specify how much on average you’d like a campaign to spend each day – with actual spend fluctuating up to double each day.

Campaign total budgets, however, allow you to specify the maximum amount of budget you’d like for your campaign to spend over the period in which it runs, much like Facebook’s lifetime budgets. Google will serve your ads through your campaign end date so long as your campaign has remaining budget, meaning that you won’t need to change or monitor your campaigns budget daily. Currently, this new setting is only available for video campaigns.

Per AdWords’ official explanation of campaign total budgets:

AdWords will try to spend your total budget evenly over the duration of your campaign while taking into account higher and lower traffic days to optimize your campaign’s performance. For example, let’s say your video campaign gets fewer views on Mondays and Tuesdays and more views on weekends. AdWords will optimize performance by spending more on days when your video is likely to get more views, while keeping your overall budget goals on track.

With a campaign total budget, you’ll only be billed up to the amount you enter for a campaign, even if AdWords serves more views or impressions than your budget allows.

Lifetime budgets pose an opportunity for advertisers, but now you’ll have to choose between using daily budgets and lifetime budgets.

Let’s review some of the advantages and disadvantages of both campaign budget types.

Benefits of Campaign Total Budgets

Easier management of fixed budgets.

Sometimes your budget is your budget and you can’t spend more, even if your ROI is positive. If you’ve got a very fixed budget for the run of your campaign, AdWords campaign total budgets may be right for you. AdWords campaign total budgets will respect that hard budget cap and won’t overspend your budget like daily budgets will occasionally.

Less time managing your budget, more time managing your campaign.

None of us became marketers because we wanted to also become accountants, but sometimes managing budgets can take up a lot of our time. AdWords lifetime budgets frees up all the work and intricacies of managing budgets with a simple set it and forget it solution, so you can spend more time testing ads and adjusting targeting.

Disadvantages of Campaign Total Budgets

Your campaigns must have an end date.

In order to set up campaign total budgets, your campaign must have a start and end date. Although your ads can run as soon as they’re approved, even the same day, your ads will stop running on the campaign end date. While your campaign is running, you can always adjust your end date, but doing so will potentially stretch your remaining budget thinner. Make sure you’re prepared for your campaigns to end, otherwise you may be in for a surprise to see your ads not showing!

Campaign Total Budgets can’t be shared budgets.

A campaign total budget must be dedicated to a campaign and cannot be used as a shared budget across campaigns. If you’re trying to juggle spend across multiple campaigns, you may need to monitor a shared budget across campaigns or revisit your campaign structure to find a better way to manage your campaigns.

Campaign Total Budgets are only available for Video campaigns.

At the moment, only video campaigns may use campaign total budgets.

Benefits to Campaign Daily Budgets

More flexible budget management.

Daily budgets remain the default budget setting and used by many for the control they provide. You can adjust your budget every day and invest so long as your ROI is positive, or decrease your budget on under-performing campaigns. Your campaigns can run on any network and can run indefinitely or have a set end date.

Shared budgeting options.

Daily budgets can be shared across multiple campaigns, even if they’re running on different networks. This could potentially allow you more control over how much money your entire account or different groups of campaigns spend each day.

Disadvantages of Campaign Daily Budgets

Daily budgets can vary a lot and spend up to twice their daily budget.

If your daily budget is the absolute maximum you can spend in each day, you may need to be cautious using daily budgets. Spend can vary a lot depending on the day of week or breakout searches, so you shouldn’t expect your campaigns to spend the same amount day to day. Campaigns can also spend up to twice their daily budget on any given day, which can make controlling a budget over a period difficult.

Depending on how your advertising budget works, you may find using daily campaign budgets or total campaign budgets easier. If you plan to run your AdWords campaigns indefinitely and adjust your investment so long as they’re profitable, you’ll likely want to continue using campaign daily budgets.

However, if you’ve got budget dedicated to running a temporary video campaign for a few weeks or months or if you’re just looking to create some brand lift with a set budget, campaign total budgets may be a great option for your campaigns!

About the author:

Mark is a Senior Data Scientist at WordStream, focused on research and training for the everchanging world of PPC. He was named the 5th Most Influential PPC Expert of 2017 by PPC Hero. You can follow him on Twitter, LinkedIn, and Google +.

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