We’ve all seen it. You set a campaign budget for $100/day and one day you go into the account to see that you spent $200 in that campaign yesterday alone – double your budget! And now your concerned that if this continues, you won’t be able to afford your marketing costs this month. How did Google let this happen??
While it can be extremely frustrating when you’re working with a limited budget, there is actually a reason that this happens, and sometimes it’s a good thing, but not always. That’s why it’s important to understand why this happens and what, if anything, you can do to maintain control when you don’t have the extra budget to lose.
Google Ads operates with specific rules and guidelines when it comes to spending your campaign budget. Understanding these rules can help you manage and control your ad spend more effectively. Here’s a breakdown of how Google Ads handles budget allocation and spending:
- Daily Budget and Pacing: Google Ads generally attempts to pace your spending evenly across the day based on your daily budget. However, Google may spend up to 2x your daily budget on any given day if it anticipates increased opportunities for conversions, especially if your campaign is performing well. This is known as the budget overdelivery rule. The key takeaway is that while the system may overspend on high-traffic days, it will try to “make up” for it on lower-traffic days to ensure the overall monthly budget isn’t exceeded.
- Monthly Budget Cap: While daily spending can fluctuate, Google ensures that your total spend in a month does not exceed your monthly budget, which is calculated by multiplying your daily budget by the average number of days in a month (30.4 days).
Unfortunately, there’s no way to prevent random spikes in your Google Ads accounts, but there are some steps you can take to maintain a little more control over your budget.
- Ensure your budgets are not set significantly higher than your typical daily spending. This leaves room for the system to ramp up spending quickly if it hits its ROAS or CPA target. Or if there’s a sudden spike in search interest for something related to your business.
- Set up alerts to email you when you’ve spent a certain amount. This can help you check in on the account as soon as possible to diagnose the problem and solve it before the spending continues for too long.
- Understand that when you launch a brand new campaign, Google will often spend twice your budget on that first day (theoretically to “make up” for zero spend the day before). So if you do not want to spend that much, set your budget a little lower those first few days.
If you’ve had issues with overspending in your Google Ads account – especially if it’s done without seeing increases in sales or leads – contact us to see how we can optimize your campaign setup and prevent Google from wasting more of your budget.