Hold on to your hats PPC’ers, as Google has announced a big update to AdWords Daily Budgets. As of October 4th, campaigns will be able to spend up to two times the average daily budget. This means on occasion, Google will over-deliver your ads, causing your account to overspend up to twice your set daily budget in the account.
While this seems extreme, Google has set in parameters to ensure your account does not go over the monthly charging limit. This limit is the average number of days in the month (30.4) multiplied by your average daily budget. With this limit in place, your account will average out to your daily budget over the course of a given month. If on the off chance AdWords does show your ad too often and your account overspends more than the daily budget allotted for a billing cycle, they will credit your account for the extra costs.
What This Means For Your Account
In the long run, you will be spending the same amount on a month to month basis, but your daily budget can now fluctuate to account for days with higher and lower traffic. While many advertisers are upset with the change, in my opinion, this is a beneficial update as your account will not be bound with rigid daily budgets. For days when traffic is spiking, your account will spend more automatically and potentially pull in more conversions. This overspend will then make up for days where there is less traffic and the full budget is not being spent.
I will even go so far as to predict that for SMB accounts and accounts with sporadic traffic the daily budget fluctuations will be invaluable. The update will help balance the overall budget through the month, leading to less manual budget changes being necessary and allowing you to hit the EOM budget with greater accuracy. Even when the system goes over your budget because of the update, you will be credited with the difference, which should give you peace of mind when you see the fluctuations in your account.
It isn’t a perfect system, but it is a nice update to the daily budgets we have been using for years. The biggest downside to the changes I foresee will be monitoring for over-delivery. This is especially true for SMB accounts with tighter budgets. If your account does over deliver, you will want to ensure your account is credited.
Checking For Overdelivery
The process of checking for over-delivery will depend on which version of AdWords you are using, the classic version or the new AdWords Beta. I have attached the process for both, starting with the new AdWords beta.
AdWords Beta Overdelivery Check Process
Go into AdWords and click on the Reporting button in the top right corner, then pick Predefined Reports.
Next, go under Basic, and then choose Overdelivery.
Classic AdWords Overdelivery Process
Go into AdWords and click on Reports in the header menu.
Then click on Pre-defined Reports, go under Basic, and then click on Overdelivery.
Once you have your report, download for the range you are reporting on. From there, to calculate overdelivery, you will subtract “Billed Cost” from “Served Cost”. If there is over-delivery and the report is not showing you have been credited, that is when you should reach out to AdWords support or your Rep to let them know of the issue.
Overall, I believe the new daily budget changes will be a net positive for AdWords. Campaigns being able to spend up to twice the daily budget allow for your campaigns to over-perform on high-traffic days, making up for days when there is less traffic, leading to a steadier monthly budget in the long run. The only real issue is paying closer attention to potential overspend and ensuring you are credited when it happens. How do you feel about the recent change? Reach out to me on Twitter and let me know your thoughts!