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Budget Pacing
Hello So I’m new to the game of ppc and I’m trying to wrap my head around the concept of Budget Pacing. Specifically on Gads. If anyone could let me know where I’m thinking of this wrong it’d be appreciated.
So yea I know the general concept of budget pacing: just trying to make sure your daily spend at the end of each day will be on pace to meet your monthly retainer target spend.
So I understand that google will spend up to 2x more or less on certain days based on if they think the market is more or less lucrative. but another component of how google will pace the budget is that even though they may not follow your daily budget, they will ensure that by the end of every month they’ll make sure to match the total monthly spend by using the formula:
30.4 (days in month) multiplied by your daily budget.
So if google will eventually balance out the spend by the end of the month doesn’t that kind of ensure that the budget will be paced properly either way? Making budget pacing not that big of a concern?
That’s what I would assume though I’ve heard many contrasting opinions in the space that budget pacing is more important than what I just said so I thought to ask for your guys opinion.
Thanks in advance
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1 Reply
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So there is a few different aspects here.
1.) Ensuring you do not under pace, is just as important as ensuring you do not over pace. Especially if yourself or your company charge % of ad spend. Budget Pacing helps prevent this.
2.) Google’s official word and documentation is as you say, that they will never go above 2x your daily budget and it will balance itself out over the month. However, I personally don’t like relying on this and have been stung a few times, and also if a campaign is running for like 3.5 months or a short burst, relying on this may not be a wise idea.
3.) Budget pacing will also help you guide towards the most efficient tCPA or target ROAS for your campaign. if you are continuously going over your daily budget, your targets are too high, if you are constitently under your targets are too low (general rule of thumb not an exact science). so proper pacing can help you find that sweet spot.
In terms of it’s importance, it’s not something you need to check every hour of the day, but at least a few times a week certainly, set up an automated script into a Google Sheet and it will do all the hard work for you.
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Hi! So this formula is correct but it doesn’t balance out your campaign spend like you mentioned. think of it more as a spend cap.
It is more applicable IF your campaign at the end spent more than the amount calculated with (30.4 * daily budget) because Google spent more for you due to a better market on certain days. They’ll actually return some money to your account based on the calculation. (If you didn’t get it, you can actually ask from Google support)
If you don’t monitor your budget pacing and your campaign is able to spend, your campaign will indeed run out of money. The system also can’t do anything for you if your campaign simply can’t spend the daily budget set.
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Yes, you are correct for the most part, but you forget two key points as to why monitoring budget pacing is important:
1. Many accounts run daily budgets when multiplied by 30.4, equal to an amount greater than their monthly budget. This is because their campaign(s) need a higher budget to hit their desired budget pace.
2. People change budgets for campaigns part-way through a month. This causes the monthly spending target for Google to change, and can be hard to understand what the current target is.I did a [video](https://youtu.be/t2fvY_IkL64?si=cuhNeNbCSrzGgIr6) explaining Google budgets not too long ago if you are interested. If you want to see a quick snippet on what happens when budgets are changed midway through a month, then skip to [8:18](https://youtu.be/t2fvY_IkL64?si=Y_B322oO_kstDTKe&t=498).
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Track month to date spend, yesterday, and 7 day average. Use the 7 day average to predict rest of month.
Be wary of public holidays or mass shootings, that can tank search demand for products. Very annoying but happens and can cause underspending.
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