Raise the budget or fix the campaign? How to tell if more spend will bring more leads

Google Ads is very good at telling you to spend more. "Limited by budget" appears next to campaigns, and the Recommendations tab suggests higher budgets almost every week. Sometimes that's right. Often it isn't.

Before raising a budget, answer these four questions.

1. Is the campaign on target as a whole?

Look at the campaign's cost per lead, not its best ad group's. A campaign with one excellent ad group and three expensive ones will spread extra budget across all four.

And remember that extra clicks usually cost more than your average ones. When budget runs out, you lose the searches Google ranks lowest for you, often at higher prices or with lower intent. A reasonable assumption is that extra leads cost around 20 percent more than today's average. If the campaign is at your target now, the extra leads will be above it.

Rule of thumb: raise the budget only if the campaign stays on target even at about 20 percent dearer leads.

2. Does it really spend its budget?

"Limited by budget" can show on a campaign that doesn't spend its full daily budget on average. If it spends well under its budget most days, a higher budget won't change much. Check average daily spend against the budget first.

3. Is the campaign still wasting money?

If a campaign has ad groups with no leads, junk searches or dead hours, extra budget flows to those too. Fix the waste first. In a campaign that runs out of budget, cutting waste doesn't lower the bill; Google spends the freed money on the searches you were missing. That's often the best "budget increase" you can get, and it costs nothing.

4. Are the conversions real?

If conversion tracking counts page views, very short calls or the same lead twice, the campaign looks cheaper per lead than it is. Raising the budget on inflated numbers is the most common way to burn money in Google Ads. Check tracking before spending more. (We covered how to check.)

What about raising bids instead?

In a campaign that runs out of budget, higher bids usually make things worse: you pay more per click from the same budget, so you get fewer clicks. Bid raises make sense when a campaign has budget to spare and loses auctions to ad rank, not to budget.

Shared budgets

If several campaigns share one budget, raising it raises spend in all of them. Check that each one is on target first.

A simple decision

• On target, spends its budget, no obvious waste, tracking checks out: raise the budget, in steps of about 20 percent, and give each step two weeks before judging.
• Over target: fix the campaign first.
• Waste in the campaign: cut the waste first; in a capped campaign that alone buys more leads.
• Tracking in doubt: fix tracking first.

PPC Master works through these questions for each campaign. It only suggests a budget raise when all of them check out, caps the raise at what the missed searches could absorb, and reviews Google's own budget recommendations against the same rules. See its verdicts on your account.