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When you advertise on Google Ads, sometimes your campaigns are “budget constrained”. In other words, it means that the daily budget you have set for your campaign is insufficient and therefore you are missing impressions.
Concretely, since your campaign does not have enough funds on a daily basis, your advertisements stop running at some point during the day.
- Imagine a campaign that could garner 100 clicks per day, with a budget of 100€.
- If you set the daily budget at €20, then you may generate 20 clicks to your site,
- and your budget will be exhausted by 11 a.m. (so your ads no longer appear on Google for the rest of the day)
If you find yourself in this situation, what are the best ways to get your campaigns out of this “budget constrained” state? What can you do to effectively capture the opportunity in front of you?
There are several ways to do this, you can choose the one that best suits your situation. Follow the guide !
Preamble: why is it important to take your Google Ads campaign out of the “Limited by budget” state?
When your campaigns are “limited by budget”, an alert appears in your account, right next to the campaign concerned. You will also notice that your lost impression rate due to budget is greater than 0.
You should know that in 99% of cases, a “Limited by budget” campaign works against your interests.
Indeed, Google Ads is an advertising lever governed by an auction mechanism. The advertiser’s goal has always been to find the optimal bid that will maximize his profits, hard cash (the optimal bid corresponds to the moment when the value of a click is equal to the incremental cost of the click, c i.e. when what each click is theoretically worth is equal to the cost of getting an extra click).
Once this auction has been established and as long as the advertiser is earning money, it is important not to constrain the distribution of advertisements, under penalty of also limiting its earnings.
However, this is exactly what happens when a Google Ads campaign is in the “Limited by budget” state, which will act as a glass ceiling for your performance. In this situation, the very fundamentals of Google Ads are no longer valid: increasing your bids (normally to get more clicks and conversions) will only increase your costs and decrease the volume of conversions (since the campaign is, anyway, limited by its daily budget).
This is why Google Ads specialists do not use the daily budget to control their expenses, but auctions.
- They indicate very high daily budgets (ex: 10,000€ per day),
- but constrain the system via optimal bids,
- which mean that, in any case, the probability that the campaign will spend so much is almost nil.
This management method will make it possible to gain in performance, while adapting to changes in demand:
- If queries increase, you’re not missing out on opportunities and earning more conversions.
- If queries drop, your bids act as a safeguard and your spend is limited to the performance threshold you set.
With that preamble done, let’s take a look at how you can get your campaigns out of the “budget-limited” state.
1 / Increase the daily budget of your campaign
Of course, this is the easiest option. If your daily budget is insufficient, then simply increase it to the recommended amount to get more clicks and conversions from your campaign.
This is the best option available to you, provided your campaigns meet the performance thresholds you have set for yourself.
For example, imagine that you use Google Ads to generate leads and that you have set a goal of paying no more than $20 for a lead. If your campaign is converting at a cost per lead of $17, and it’s limited by budget, then you’re missing an opportunity for profitable growth for your business. Indeed, if you invest a little more on this campaign, it is very likely that you will win more leads, while remaining under your limit of 20€ per conversion. Why deprive yourself of it?
Ditto, if demand increases and your keywords are much more sought after, you can capture additional conversions provided your budget is not limited. It would be a shame, if suddenly an influx of potential customers are interested in your products / services, that your advertisements disappear from Google in the middle of the day, don’t you think?
If you have multiple campaigns in your account, and some are budget constrained while others don’t fully spend their daily budget, you can opt to create a shared budget.
You then free the system from your daily budgets, and let it arbitrate the distribution of expenses, depending on the volume of conversions it is able to get and your performance constraints (target CPC / CPA / ROAS). This will make the breakdown of the budget between the different campaigns more “liquid”.
To implement shared budgets across multiple of your campaigns, see the walkthrough here.
3 / Use the performance planner to optimally adjust the daily campaign budget
If the shared budget is not your preferred option, and you are afraid of deteriorating your performance by increasing your daily budget too much, another solution is available to you.
It consists of using the Google Ads performance planner to determine, based on the expenses you anticipate, the best allocation between your different campaigns.
When setting up your plan, you can enter the amount you plan to spend over the period of your interest. The system will then simulate for you the total volume of conversions that you can expect from your budget, and with what performance. It will also recommend specific daily budgets to apply to your campaigns.
Thus, you retain some control over the distribution of your campaigns, and favor daily budget amounts that optimize your triptych [expenses | volume of conversions | performance].
4 / Change Strategy to Maximize Conversions / Maximize Conversion Value
In case your campaign is limited by budget, a solution can simply be to opt for the bidding strategy “Maximize clicks” (if you are only interested in traffic), “Maximize conversions” (if is lead gen) or “Maximize conversion value” (if it is e-commerce).
These bidding strategies automatically adapt to your daily budget, and will seek the cheapest clicks / conversions / sales first, which will allow you to get more results for your limited budget.
Warning: this technique is only a “facade” solution. In reality, your campaign will always be limited by budget, and you will continue to lose impression share because of your budget. However, you will ask the system to use your daily budget “as best as possible”.
5 / Further increase performance constraints (therefore lower your bids)
Even if you’re happy with its current results, the fact that your campaign is budget limited shows that your budget isn’t enough to capture all the conversions you could make at that target CPC/CPA/ROAS.
Of course, pure business logic would simply dictate that you increase your budgets even more as seen in section 1, but this is not always possible when the market is too big, or it puts too much pressure on the company’s cash flow. the advertiser.
So, since your budget is not infinite, one way to get out of the “Limited by Budget” state is to revise your performance expectations upwards.
Depending on the bidding strategy you use (manual or automatic) you can:
- lower your CPC bids,
- or lower your target CPAs,
- or increase your target ROAS.
The idea here is to “coerce” the system into higher performance, until your campaign is no longer constrained by budget and your impression rate stabilizes.
6/ Pause the worst performing keywords/adgroups
Another way to get your campaign out of the “Limited by Budget” state is to bid on fewer keywords. This will have the effect of limiting the reach of your advertisements, and therefore the daily budget necessary to cover the semantic territory you are targeting.
Take a look at which of your different keywords seem to be performing the best and stop investing in those that are performing less well.
- For example, if your target cost per conversion is $10,
- that keyword 1 has a cost per conversion of €11,
- and keyword 2 has a cost per conversion of 7€
- pause keyword 1
This logic can be applied at the keyword or ad group level (by pausing ad groups, you should normally reduce the reach of the campaign even more drastically, and therefore its daily budget).
7 / Artificially restrict the reach of your campaign to focus only on the best audiences
If your budget is really constrained, and your campaign is limited by the budget, you won’t be able to show your ads as much as you want anyway… Under these conditions, it can be smart to focus your expenses only on the audiences that are the most efficient.
If you have implemented audiences in your campaigns in “Observations” mode (eg affinity audiences or in-market audiences), you know which audiences are performing the best.
You can then switch these best-performing audiences to “Targeting” mode so that your campaigns “only” broadcast to these specific audiences. This limits the overall reach, but at least you will be able to use 100% of your budget to capture as much of the opportunity as possible on these high-performing priority audiences (and therefore avoid waste). The goal here again is that your campaigns are no longer constrained by budget.
A variant of this tactic is to exclude the least performing audiences: by excluding from your campaign all the audiences that have no conversions, or poor performances, you arrive at the same result, namely the limitation of the reach of your advertisements, and therefore expenses.
Conclusion
In the majority of cases, the “limited by budget” condition plays against the advertiser. This is why the best Google Ads specialists will seek to break out of this state, using one or more of the techniques shared above.
In any case, if you have several campaigns in your account, I always advise you to use a bid portfolio strategy to apply to all your campaigns that share the same business objective. This will give even more flexibility to the system to get more conversions, while respecting an overall objective, at the level of the whole account.
While this won’t prevent some of your campaigns from being “budget limited,” it will also automatically “balance” your spend based on the business performance each campaign is capable of delivering.
