What is happening?
Google announced that "Starting October 4, 2017, to help you hit your advertising goals like clicks and conversions, your campaigns can now spend up to twice your average daily budget automatically". They also confirm that you won’t be charged more than your monthly charging limit: the average number of days in a month (30.4) multiplied by your average daily budget.
How will it effect Adwords campaigns?
Starting October 4, 2017, campaigns daily budgets can overspend by double i.e 200%, automatically. This was previously 120%. You might see that your advertising costs each day are a little higher or lower than what you set for your daily budget. There will be a risk of overspend, especially if you don't keep to a strict calendar month. This may also effect advertisers who are very keen to have a very even spread of clicks over the month, making it a little harder to achieve.
Why would Google do this?
This will be great for Google's Adwords revenues. They can take the demand while its there. This may result in a greater overall spend on Google. Even if this is a tiny amount per advertiser, added up over the millions of Adwords customers, this could deliver millions to their bottom line. They may also feel that customers using tools like their auto bid optimiser could get better overall performance by taking demand while its there, but this remains to be seen.
What should you do to prepare?
- You need to keep an eye on your campaigns daily budget every 2-3 days.
- You can set an email alert when costs exceed the daily cap by a certain percentage.
With ‘Overdelivery’ credits, hopefully most of this will be mitigated. Sometimes campaigns deliver over your monthly budget and in those cases, Google will credit the overdelivery cost back. This is a measure that should help advertisers feel a bit better about this change. Advertisers can see overdelivery by day from the Reports section in Adwords.