In this video Aaron Young, a Google Ads expert from Define Digital Academy, explains why the traditional Max CPC bidding strategy has become ineffective. He outlines two main reasons: (1) Google’s keyword matching has broadened, making it impossible to isolate performance of individual keywords or SKAGs, and (2) the “Performance Max effect,” where competitors using Performance Max or other smart‑bidding campaigns outbid fixed Max CPC limits with just a marginal increase. Young then presents a practical alternative workflow: start campaigns with the Maximize Clicks strategy to gather data, monitor for a stable conversion volume over three‑four weeks, and then switch to Maximize Conversions (or other smart‑bidding options like Target CPA/ROAS). He demonstrates this transition with a screen‑share, showing how conversions rise dramatically while CPC spikes temporarily but remains acceptable when conversion volume is high. The video concludes with a recommendation to adopt Google’s smart bidding strategies for higher conversion counts and a call to view extended training for detailed setup instructions.
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With all of the significant changes that has been happening in Google Ads recently, very quickly there is more and more strategies that used to work that are just no longer working anymore. And I want to talk about another one that has just been added to that list and that is that the bidding strategy of Max CPC just doesn't work anymore, in my opinion. Now, for those of you who are unaware of what the Max CPC strategy is all about, is that where you would give to Google a maximum limit that you would be willing to bid on any given search term query and you could set this at the campaign level, the ad group level, or the individual keyword level. Say for example, for individual keyword you may go that I don't want to pay any more than $2.10 for that individual click. Now I will admit that this was a great strategy that I used to use a lot on my search and shopping campaigns, but over the last 12 months I haven't been using it nearly as much and I it's even now to the point where I just don't even consider it as a strategy that I should be implementing. So in this video I'm going to take you through the exact reasons for why I don't use the Max CPC strategy anymore and why I don't believe that it's the best strategy going forward. But if you're new here, welcome. My name is Aaron Young, I'm from Define Digital Academy and I'm your 15,000 hour Google Ads Master. And if you found yourself here because you're setting up your first Google Ads campaign or you're looking for answers on how you can improve your current Google Ads campaigns, I I want to help you further by giving you access to my how to Win a Google Ads Planner. And this is a great tool that you can use which goes through the different types of Google Ads campaigns and what they're best suited to achieve and then it goes through and asks you some questions in a workbook format which then brings you to the point where you can design your own Google Ads campaign and account structure for greater success for your business and your clients in 2023. And if you would like to get free access to that how to win a Google Ads Planner, all you need to do is to to follow that link in the description below. But with all that said, let's now get into the big elephant in the room and the fact that the Max CPC bid limit strategy is now dead. And there are two core reasons for why this strategy doesn't work anymore. And the first reason is that Google Ads keywords targeting options are now much broader. Where I found great success with using the Max CPC bid strategy is that when we could use single keyword ad groups or our commonly referred to term skags, where you would have individual keywords set in different ad groups, this was a great strategy because, for example, let's just say that you had one ad group that was targeting the specific keyword of Jet Ski higher on the Gold coast and that had a conversion rate that was twice as high as another ad group in that campaign, which was WaveRunners for High on the Gold Coast. What you could do is that you could then go through and increase the CP limit or on the Jet Ski for hire on the Gold coast ad group because you're willing to pay more for that keyword because it had a much better conversion profile. But what the problem is now is that because Google's keyword matching is a much broader both of those keyword themes would trigger for very, very similar searches. So there's no way that you can properly separate them out even if you do have negative keywords in the alternative ad groups. So that you can try and block Jet ski in the WaveRunner group, or try and block WaveRunner in the jet Ski group and vice versa. The problem is, is that even with all of those negative keywords, you still don't get all of the data in the user search term reports, so you don't really know if you're actually segregating that properly. And also what we don't also know with all of those other search terms is that you don't know those similar and related themes that are now targeted and triggering ads for your search terms. So that Max CPC bid strategy or worked well when we had a high level of confidence that the keywords that we were targeting were pretty close or pretty much spot on to the user search terms that were triggering our ads. But because we don't know the exact search terms that are triggering our ads anymore, the Max CPC bid limit just becomes very, very tricky. And I've been finding more and more before I stopped using that strategy that we just weren't able to have any great confidence to be able to increase certain Max CPC limits for certain keywords and then decrease it for other ones that were underperforming. And that brings us to the second reason for why the Max CPC bid strategy doesn't work anymore. And I'm putting this down to something that I call the Performance Max effect. Now, whether you like or love Performance Max or whether you're using or you're not using Performance Max, it doesn't shield you from what I'm calling the performance max effect, and that is that as more and more of your competitors, so if you're not using Performance Max, but more and more of your competitors are switching over to performance, which is a trend that I'm seeing grow every single week, you're going to then face this problem. And the problem is this. We do know that with Performance Max campaigns, they will outbid and bid more aggressively for search terms. When one of these two things happen. Firstly, the user that completes that buying or converting search intent, if that user had previously seen the ads from that Performance max campaign in display element or a discovery element of that campaign, the Performance Max campaign will bid more aggressively and will easily outbid your search campaign with its Max CPC bid limit. And then secondly, even if that individual user hasn't seen any of your ads, or you're in the discovery element or the display element, but that user comes from an audience segment or a collection of audiences that has a high conversion metric, so a user search term that is not only targeted, but it's showing a high intent for converting or, or that they're ready to buy, the Performance Max campaign is once again going to bid more aggressively. And that is the problem with the max CPC limit. You're seeing that it just gets outbid by a performance max campaign or even a search campaign that's using a maximized conversions bidding strategy. So the problem that the Max CPC bidding strategy has is that it's going up against these bidding strategies. So whether that would be a complete campaign in the Performance max campaign or a search and shopping campaign that is using our Target CPA or Target roas, those campaigns with the extra layer of data that they're leveraging off are well prepared to double or triple your max CPC limit in order to get that conversion. And because you've put that ceiling or the upper limit on the maximum amount that you're willing to pay, those other bidding strategies only need to go $0.01 above your max CPC in order to win that auction. So now that I've given you the reasons for why that max CPC limit doesn't work anymore, rather than just explain the problem, I want to give you the solution to how you can overcome this. And the way that I'm starting search and any shopping campaigns that I'm using is that I do start them on a maximize clicks bidding strategy. And what we're looking at doing here is that we're looking at getting as much data as possible so that we can then introduce the maximize conversions and bidding strategy as soon as possible. And let me show you what that looks like. So let's go to a screen share right now. So what I want to show you here is the process of what I go through when we start at maximize clicks and then we move over to a maximized conversion strategy. So what I want to show you in through here is that this is where we started the campaign and I've broken this down to a weekly view for us. And as you can see, the campaign started in through here and then we start to get some conversions triggering, but they'll still a little bit up and down. And then we saw this massive increase in the amount of conversions conversions that came through. And right here is where we added in our maximized conversions. But the data that I was actually looking for is what I call a stabilization of your conversions. And what you can see through here is over this three or four week period we went from 11 to 7 to 8 conversions. We then added in that maximized conversions. And it's not unregular to see a little bit of a drop down. And then our conversions started to skyrocket that so much. So within two weeks we were up at over 31 conversions in a week. And then from there it's been hovering in and around those mid-20s and sometimes even touching 30 conversions for an individual week. So the first thing you want to be doing is that you want to be starting with a maximized clicks and then when you start to see a fairly regular amount of conversions over a three or four week period, that's when you can then introduce those maximized conversions. Now previously we would all say to look out for about 30 conversions, but I'm seeing more and more. What is more important is the stabilization of those results. So you don't want to be doing it where you're seeing really up and downs. You want to sort of see a range that you're happy with and then you can add in your maximized conversions. But what I do want to do is I also want to give you a warning on this is that to don't freak out because what you will also see is that you will also see a really big increase in your CPC. So as you can see, we had the CPC going from $2 up to 293, up to then $5.46. Now that started to come down again. But what you can also see that the actual total number of conversions has also gone up. So we have no problems in paying the higher cpc as long as we're getting the same level of conversions. And then what you can do is that through your optimization process, then you can focus on once again dropping down that cpc. But what you can see from here, the catalyst of us being able to get that high number of conversions was us to put in a bidding strategy that was allowing us to win those auctions. And this is where the max CPC limit falls down, is that in this campaign we were able to heavily increase the number of conversions we got because we're willing to increase our CPC through enlisting that maximized conversions bidding strategy. So that's the reason why you need to be leveraging more on Google's smart bidding strategy around its maximized conversions or target roas or target cpa so that you can get a higher number of conversions. And if you'd like to learn more about how you can set these bidding strategies correctly, I want you to go and watch this extended training that I've already released on YouTube right here. Once again, thank you for joining me and I look forward to seeing you in this video right now. See you later.
