Budget Killers in Your Account: Quickly Identify Unprofitable Campaigns and Optimize Google Ads

One of the main differences between SEA and SEO is time. While SEO measures need time to show growth and performance improvements, paid campaigns require quick actions as any delay costs money. Even if your campaigns appear to be set up correctly at first glance, you can’t rely on hope and a good gut feeling if they aren’t delivering profitable results. 

In the following article, I will demonstrate three signs that help you recognize unprofitable campaigns at first glance and what could be behind them. Additionally, I will show you specifically how you should optimize your Google Ads campaigns in these cases. 

However, before we get started, there are three points that can provide a quick explanation for poor performance. If your campaigns still perform poorly despite these factors, you should choose a different approach to improve the figures and reduce Google Ads CPCs . 

Your tracking isn't working 

It’s a commonly underestimated problem: Unexpected changes on your website, such as the creation of new landing pages or migration to other data platforms, can disrupt your tracking. This can result in your campaigns showing 0 conversions. Ideally, the Google Ads managers are informed in advance about such planned changes, but in reality, that’s not always the case.

An example: Once, a client of mine removed a CPA button that we had measured as a soft conversion goal. My campaigns began to struggle significantly, and I had to quickly find a solution to reduce Google Ads costs. In the end, we couldn’t see any conversions because there was literally no conversion action on the website that could trigger conversions in Google Ads. 

Tip: Regularly check if your tracking is functioning correctly. Without working tracking, you cannot optimize your Google Ads. It’s still possible for conversions to be generated, but they won't appear in Google Ads, only in the backend. Once the tracking problems are resolved, your campaign might perform well again. 

Your campaign is still in the learning phase 

Paid campaigns need patience, even though we all want to see good results as quickly as possible. That would prove our expertise and help us further optimize and scale the Google Ads campaigns. However, new campaigns cannot always work wonders, as the algorithm needs time to learn and improve performance. The official learning phase usually lasts up to four weeks. Depending on the business model, this process can also be shorter because the quicker the campaign generates conversions, the faster the algorithm learns. However, this development is not always guaranteed. For instance, the average customer journey in the B2B sector generally takes more time. Additionally, it often includes several touchpoints before achieving the desired result. 

Tip: Be patient during the learning phase. 

Your main goal is not clear 

Unrealistic expectations usually lead to disappointments - not only in life but also in Google Ads. If marketing goals are vague, clear results will not follow either. If the goals are clear, but you don’t know which campaign types are suitable for them, the figures will also disappoint. 

For example, if you work with display or video ads, you should not automatically expect to receive many high-quality leads. Not because your setup is wrong, but because these campaign types pursue different goals. They are meant to increase the awareness of your product and cover the early phase of the customer journey. Moreover, the ad formats are tailored to this goal - think of skippable ads on YouTube. They are there to promote your brand and convey a message. However, it is not realistic to expect good leads from them, as they are likely to be skipped, with the customer taking no further action. If your shopping campaigns don’t deliver results for weeks, this is at least alarming. 

Tip: Define clear objectives for each phase of the funnel and choose the appropriate campaign types. Only then can you effectively optimize your Google Ads campaigns. 

There is a Budget-Killer in the House 

But let's go back to the three clear signs that a budget-killer is present in your account: 

• Campaigns with traffic but no conversions 

• Rising CPAs 

• Decreasing ROAS 

If your goal is conversions and you see none or increasingly fewer, there’s a problem. Especially if your tracking is functioning and the learning phase is complete. If the campaign still does not deliver the desired conversions, this impacts not only your KPIs but also the performance of your automated bidding strategies. For instance, if you optimize for tCPA or tROAS, declining conversions will lead to a higher CPA, a lower ROAS, and overall restrictions on bidding strategies. 

Here is a list of factors that could explain the decline in conversions you are observing. These include: 

• Landing page – Any change that worsens the user experience can negatively influence the conversion rate as well as the bounce rate. 

• Competition - Especially in e-commerce, competition through lower prices can affect the number of conversions as well as the conversion rate. 

• Seasonality - If your business experiences significant declines during certain periods, you should adjust your marketing strategy accordingly. 

• Irrelevant Traffic - Ensure that your ads don’t appear for irrelevant search queries to reduce Google Ads costs for poor traffic. This often helps to lower Google Ads CPC. 

• Faulty Targeting – A reasonable campaign setup is vital in Google Ads. However, despite optimal campaign setups, certain target groups or keywords may perform less well than expected. For this reason, you should quickly optimize the targeting of your Google Ads campaigns if the desired results are not there. 

Google Ads campaigns are not static. What works well today can perform poorly tomorrow. As a marketing manager, you should thoroughly understand the business model and goals, select the appropriate campaign types, set KPIs, and set realistic expectations. The rest lies in flexible and smart Google Ads optimization. Additionally, your task extends beyond Google Ads as overall performance is influenced by many other factors described above. For example, dramatic political or economic developments can have the same negative impact as a poorly optimized campaign. Your Google Ads expertise should go hand in hand with thorough market analysis so that you can see the bigger picture and take the right actions. 

If you need assistance with this or if you want to scale your existing campaigns, our SEA team is happy to advise you. Contact us now!