In a Think with Google article posted last week Google says “fixed marketing budgets are holding you back.”
Let me translate: “Give us unlimited spend on Search ads.”
Their argument sounds compelling initially, 20% more conversions if you’re “budget agile”. But here’s what they conveniently leave out:
The Circular Logic Problem:
Google recommends Performance Max and AI-powered tools to “prove ROI”… which feeds more budget back into Google’s ecosystem. I have written before that without data AI is nothing, the more data the more accurate. For the past couple of years Google reps have been pushing AI hard! Automate this, automate that, Google will find your right customers – yet every test when you give google the power to find the “right audience” ends in more wastage than return. Performance Max especially can be a burning money pit ready to gobble up the unsuspecting advertisers spend in quick time!
So, spending more money on Google automation, gives Google more data, to refine their AI learnings and hopefully improve their systems at your expense.
The Measurement Illusion:
They push their own attribution tools (Meridian, Google Analytics) to “prove” incrementality. But who’s auditing the auditor? When the platform selling ads also provides the measurement framework, conflicts of interest aren’t bugs, they’re features. We know there are always challenges with true attribution. If a user clicks from an ad today and converts 5 days later from an organic social post would they have converted on the social post anyway? Who knows.
The point being – attribution is so complex as the buyer journey has erupted over the years. Complex buying committees, some of who click, some just quietly observe your brand and never click anything. Privacy settings, cookies, tracking scripts, page load limitations, all contributing to a more complex world of tracking. Add to this chaos, the point that Google Ads always seems to gain first, middle and last attribution, so often tends to be overinflated, this adds to my slight skepticism of their claims of 20% uplift. You may think “If you can prove $5 revenue for every $1 spent, it’s a no-brainer”, sure, except most brands can’t isolate Google’s contribution from brand equity built over decades, organic demand, competitor missteps, and macroeconomic factors. Clean attribution is a fantasy.
The Missing Context:
Only 17% of companies have flexible budgets. Maybe that’s not because 83% of finance teams are naive, maybe it’s because they understand portfolio theory, opportunity cost, and the diminishing returns that Google’s article completely ignores.
Dynamic budgeting can work, and should be considered to ensure peak times are not limited, or productive campaigns are not throttle, but there are few businesses with endless budgets to spread across multiple channels and cover all bases. There are intelligent ways of managing budgets across days, months, seasons, even weekends for B2B. However, in a world where the political climate is throttling many businesses via taxes, tariffs, regulations and limitations, not to mention energy costs, salaries, tech and office space – having a “fluid budget” on your Google ads is a far off fantasy – which, lets face it probably wont deliver on a 20% increase in sales – even if questionable “conversions” do increase.
Can we afford to let Google write our budget strategy? Let me know your thoughts 👇Original Article : Think with Google
