Performance Max vs Search Campaign – Which One Is Better?

In the ever-evolving online advertising landscape, Google Ads remains a cornerstone for driving business. 

Yet, the dilemma of choosing the right campaign type often perplexes business owners and managers. 

Should you harness the AI-driven efficiencies of Performance Max or rely on the tried-and-true Search Ad Campaigns?

Or should you run both Performance Max and Search simultaneously? 

This post aims to demystify these options, setting you on the path to informed decision-making so you can squeeze the most value out of your Google Ad spend.

Prefer to Watch A Video?

Understanding the Campaign Types

What is a Performance Max (Pmax) campaign?

Performance Max is Google Ads' latest venture into harnessing the power of automation.

What makes it unique is that Pmax campaigns offer a more comprehensive approach than Search ads. It does this by leveraging bidding strategies and a host of ad formats across Google's properties, including Search, Maps, Gmail, YouTube, Discover, and the Display Network. 

Its main benefit lies in its ability to optimize ad placement using audience signals and machine learning, thus promising reach and performance beyond what manual campaigns might achieve. (To have the best-performing campaigns that grow sales and profit, your digital plumbing needs to be set up. Read our blog post on how to track your conversions and feed the data back to Google Ads.) 

The Google Ad Channels Where PMax Ads Show:

Pmax ads can appear across various channels, and their appearance may significantly differ from text ads in Search, depending on the channel.

When you build Pmax ads, you add what Google Ads calls Asset Groups - you ad Headlines and descriptions for the text ads (so far, that's the same as Search ads), then you add Images and even videos for the Display, Gmail, YouTube, and Discover ads.

Google uses these assets to build the best combinations that work for each of the five different channels it shows the ads. 

Here's an example of what ads can look like across each of the five channels - Gmail, Display Ads, Search, Discover, and YouTube:

What is a Search Ad Campaign in Google Ads?

Conversely, keyword-based Search Ad Campaigns are the bedrock of Google Ads, presenting text-based ads that show when specific keywords are searched.

These campaigns offer a more hands-on approach, with manual or smart bidding strategies and focused keyword targeting. It gives advertisers granular control over who sees their ads and in what context.

Performance Differences Between Search Ads and Performance Max Ads

The results can be quite different when comparing Performance Max campaign results to Search campaigns. 

One setting that significantly impacts the performance differences and metrics between the two types of campaigns is the Customer Acquisition choice under Settings. 

There are two types of Customer Acquisition:

The choice plays a significant role in the results Performance Max or Search ads deliver. 

Bidding: New and Existing Customers Equally

When you bid for both new and returning customers in a Performance Max or Search campaign in Google Ads, it means you are adjusting your advertising strategy to target and reach both individuals who have never interacted with your business before (new customers) and those who have previously engaged with your business, whether through making a purchase, visiting your website, or using your app (returning customers).

This approach allows you to not only expand your customer base by attracting new users but also to re-engage those who are already familiar with your brand.

Below is the Customer Acquisition section under Settings in a Google Ads campaign - this is set to bid equally for new and existing customers by default. 

Here are the general performance differences when bidding equally for new and existing customers - your mileage will vary based on your unique situation:

Bidding: New Customers Only

When you bid for new customers only in a Performance Max or Search, it means that you are focusing your advertising efforts and budget specifically on reaching individuals who have not previously interacted with your business or made a purchase from you.

Google Ads allows advertisers to target their campaigns towards acquiring new customers by using audience targeting options and bidding strategies that prioritize users who are likely to be first-time customers.

Below is a case study we ran comparing key performance metrics between the two campaign types:

Which Campaign Should You Run? 

The answer to the question of which is better and which you should run boils down to your goals. 

When to Run Search Campaigns

Use Search campaigns if you're targeting direct lead generation or sales with a clearly defined audience intent. The precision of keyword and ad copy control lies at the heart of its effectiveness.

When to Run Performance Max Campaigns

Meanwhile, use Performance Max campaigns if you're seeking an efficient, broader audience reach.

With Pmax, automated bid optimization and diverse ad formats cater to a wide funnel marketing strategy. 

Run Both Search and Performance Max Together and Maximize Performance:

Utilizing both campaign types is a good strategy and can drive tangible benefits.

Drawing from a case study, integrating Performance Max with Search Campaigns can optimize budget allocation while amplifying brand visibility across all of Google's channels.

When you run both campaigns together, you create a full-funnel strategy - targeting users who are ready to buy from high-intent search terms and users who are just in the beginning stages of research, which you can reach in multiple channels. 

Setup Considerations

If you run both, set the Search campaign to target New Customers ONLY and Performance Max to target New and Existing Customers.  A setup like this targets high-intent searches with the Search Campaign but also retargets and maintains broad awareness across multiple Google channels.

Performance Max Cannibalization?

The Fear of Canary in the Ad Mine:

Given the distinct targeting objectives—Search ads focusing strictly on new customers and Performance Max on a broader audience—cannibalization will not be an issue if managed properly. 

Since the campaigns have different primary objectives, they can complement each other by covering different segments of the market more effectively. Performance Max can help in re-engaging existing customers or reaching new customers who may not be captured through search-specific efforts.

Google Ads employs advanced algorithms and machine learning to optimize bidding and placement. Over time, it should theoretically adjust to minimize internal competition and optimize for overall performance, recognizing where each campaign type performs best.

Conclusion:

So, which one is better?

Both Performance Max and Search Campaigns have distinct benefits tailored to specific business objectives.

Aligning your campaign choice with your goals is paramount for success in Google Ads. Whether separately or combined, these campaigns are powerful tools in your digital marketing arsenal. I would encourage you to split-test these campaigns and see what works best for you - every situation is unique.

Let's navigate these digital waters together for maximum impact. Leave your comments in the blog, or reach out to us now.