Why Performance Max Doesn’t Work for Your Business

Performance Max — the perfect tool… for Google, not for you

Once upon a time, in the bright days of Google Ads, marketers decided where to show their ads. Want to pour budget into search? Go ahead. Targeting an audience on YouTube? Also an option. But something went wrong. The Google Display Network (GDN) performed so poorly that advertisers massively abandoned it.

Google noticed this, rubbed its hands, and decided: “What if we forced all advertisers to pay for GDN, even if they didn’t want to?” Thus was born Performance Max — a tool that took control away from marketers to protect Google’s profits.

Performance Max automatically allocates your budget among all available Google platforms:

• search;
• YouTube;
• Gmail;
• maps;
• GDN;
• Google Discover.

If you thought Google would honestly allocate your money to the most effective channels, think again. The algorithm works to flood precisely those platforms that previously didn’t generate enough money with traffic. You just give it money, and it does everything else for you…

The only problem is: in this equation, your profits don’t matter to anyone.

You’re getting more impressions, but not where they are beneficial. You see an increase in clicks, but they’re not from your clients, just random users. You’re spending more, but can’t figure out exactly where the money went.

It’s like you ordered food delivery, but the courier decided you needed cookies, a salad, and a sandwich instead of sushi rolls. Yes, they brought you food, but it’s not what you ordered.

As a result, Google reports the ‘success’ of Performance Max, while marketers and businesses are puzzled about where their budgets are disappearing.

The Failure of the Display Network and How Google ‘Saves’ the Situation at Your Expense

Imagine you’re a restaurant owner. You have a VIP room that brings in 80% of the income, and a general hall where random people drop by. You know the VIP room works better, so you develop it, raise prices, and attract influential guests.

Now imagine that the building owner (read: Google) comes and says:

— You know what, why don’t you pay the same for all visitors! It doesn’t matter that in the VIP room people are willing to spend $500, while in the general hall, they’re just there for the water. We’ll just distribute your costs automatically!

What would you do? Obviously, try to find a new owner or move to another restaurant. But when it comes to advertising on Google Ads, many marketers don’t have a choice.

Google noticed that advertisers are massively abandoning the display network.

Why Businesses Don’t Want to Use the Display Network

There are several reasons for this. Here are the most common ones:

• Low CTR — the average click-through rate in the GDN is less than 0.4%. For comparison, in Google Ads search campaigns it is 10 times higher!
• Opaque algorithms — ads appear on garbage sites where bots mimic views.
• Lack of control — you cannot precisely choose where and to whom your ad will be shown.

How Google Forces Payment for GDN

Performance Max automatically allocates the budget across all platforms: search, YouTube, Gmail, Google Maps… and of course, GDN! You cannot disable platforms you don’t need. All you are allowed to do is trust the algorithm.

Now honestly: do you trust a company that makes billions from advertisers but gives them no real control?

Let’s say you’re a company selling B2B services and decided to test Performance Max. But it turned out that you received a large number of clicks, a low cost of conversion, and… zero sales. Why?

• Most ads were run on Google partner sites (the same ones where bots create fake views).
• The algorithm drove traffic from random people who were just clicking on banners.
• The leads you received were unrelated to B2B — just spam inquiries.

The irony is that Google in its reports indicated that the campaign was super successful because it brought many ‘interactions’. But can you live on interactions? Can you pay rent, salaries, purchase goods with them? Obviously not.

Algorithms vs Logic: Why Performance Max Isn’t Working for Your Business

Imagine ordering a taxi to get to an important meeting. You enter your destination, expecting a usual sedan, but instead, a bus arrives, picking up five more passengers first, stopping by a warehouse to collect cargo, making several unpredictable stops, and only then — possibly — taking you to your destination.

You’re surprised, and the driver explains:

— This is our new system! We’ve optimized the route to include more trips in one, because everyone needs transport.

Sounds illogical? But that’s exactly how Performance Max works. You allocate advertising budgets, and the algorithm decides where, when, and to whom to show them: in search, on YouTube, Gmail, and the display network. The problem is, you can’t accurately control which channel really brings in conversions, and whether a significant portion of the budget is wasted on ‘unnecessary stops.’

Google decides for itself whom and where to show your ads

Do you think you’ve targeted your customers? In reality, the algorithm might decide that your ideal buyer is a random teenager watching Let’s Play on YouTube, or a pensioner reading political news.

You don’t know:

• Which platforms are consuming your budget.
• Whom Google shows your ads to (age, social, and behavioral data of the audience are unavailable).
• Why certain segments receive a larger budget than others.

And you know what? Google doesn’t know either. PMax operates on a principle of a “black box,” where no one has full access to the data.

Cheap conversions = Bad conversions

PMax is optimized not for lead quality, but for quantity. Its main task is to find the cheapest way to get a conversion. But here’s the question: if you’re selling premium B2B services, how will the system find you a cheap conversion?

Correct! It will go to the cheapest sources:

• Cheap sites with display networks, where clicks on banners are random.
• Low-competition zones that have nothing to do with your niche.
• Users who never buy but actively click on ads.

Let’s suppose we launched PMax for an e-commerce tech store. After a week, we received a bunch of inexpensive conversions. Happy? No. Because 80% of the leads were people who filled out forms for no reason or were looking for the cheapest products that didn’t bring profit.

But the most interesting thing is: in Google’s reports, everything looked perfect! A large number of leads, cheap clicks, lots of interactions… but zero profit.

When the algorithm is your enemy, not a helper

Google says: trust artificial intelligence, and it will do everything for you. But PMax works in such a way that:

• Optimization is not for your business, but for Google’s goals (spend more, get more clicks).
• You can’t adjust which audiences work better — Google just doesn’t provide this data.
• The algorithm automatically switches to cheaper conversions, even if they don’t bring profit.

As a result: you’re spending money, getting many clicks, but true sales go… somewhere.

Real case: how Performance Max did not meet the expectations of Ecosoft

Company: Ecosoft — Ukrainian manufacturer of water purification equipment.

Goal: to expand presence in the UK and EU markets by attracting new B2B clients through PPC advertising tools.

The problem was that during attempts to use Performance Max campaigns, the company encountered a number of difficulties:

• Irrelevant traffic: the ads attracted end consumers instead of business clients, resulting in non-targeted leads.
• Lack of control: limited customization options for audiences in Performance Max made it difficult to accurately target the right clients.
• Adaptation complexity: the necessity to consider linguistic and cultural peculiarities of different European markets required a more flexible approach than the tool offered.

Outcome: using Performance Max did not yield the expected results in attracting quality B2B leads. The company decided to switch to a combined strategy, integrating search campaigns and other tools to achieve better metrics.

Why your business won’t get quality leads from Performance Max

There’s a great saying: “All that glitters is not gold.” In the case of Performance Max, it’s worth adding: “Not all conversions that are cheap are valuable.”

Imagine you’re selling expensive IT services or a B2B product. Your client is a business owner, manager, or technical director making decisions. You launch ads via PMax, and Google starts generating conversions for you. At first, you’re delighted — leads are pouring in, and the cost per lead is minimal.

And then you open the CRM…

• Lead #1: a student looking for a free VPN.
• Lead #2: a person who wanted to download a free PDF file.
• Lead #3: a retiree who was simply curious about what the button does.

What happened? PMax did its job: it found the cheapest conversions. But are they suitable for you? The answer is obvious.

How PMax Allocates Budget and Why It’s Important for Google

To understand why you’re getting unwanted leads, let’s break down how Google manages your budget:

1. The algorithm analyzes where conversions can be obtained as cheaply as possible.
2. Allocates the budget to maximize the number of applications rather than their quality.
3. Considers all interactions — even those without commercial value.

Now the question is: who does the algorithm consider the ideal client? Someone ready to buy? Or someone just ready to click a button?

Spoiler: the latter.

PMax operates on the principle of quantity over quality. And there’s a reason for this: Google is interested in spending your budget faster and making reports look better.

Why Everything Seems Successful at Google Even When It’s Not

The thing is, Performance Max counts any interaction as a success. Did you get a lot of clicks? Okay, then the campaign is effective. Someone submitted a form? Great, regardless of who it is.

But what will happen to your business? You’ll spend the budget, process a mountain of applications, and realize that these are just numbers, not actual clients.

Remember: Google is not responsible for the quality of your leads. It just channels your budget where it’s most convenient for them.

Can Performance Max Be Made Effective

Imagine you bought an expensive sports car, but instead of letting you drive, the manufacturer puts you in the passenger seat and says:

— Relax, we know how to drive faster.

Sounds, to say the least, risky, right? But that’s exactly how Performance Max works. You provide budgets, and Google decides where to spend them.

However, let’s be honest: are there situations when PMax can actually work? Yes, but only if you understand its limitations and build the strategy correctly.

When PMax Can Work

Performance Max can be effective in the following cases:

• Brands with high recognition — if your company is already known, Google algorithms can better optimize the ads. For example, Apple or Nike can get good results since their ads will work on a familiar audience.
• Mass-market products — if you sell something that a large number of people buy (for example, cosmetics, accessories, gadgets), the algorithm quickly finds an audience.
• Large budgets — PMax prefers when you give it a lot of money and time to learn. If you’re testing it with $500 — don’t expect miracles.
• Well-configured conversions — if you have clear tracking of all funnel stages, PMax can learn to find better customers (but not always).

And now the main question: if your business doesn’t meet these conditions, what should you do?

How to Avoid Budget Drain on PMax

If you still want to try Performance Max, here are some tips to help you not lose all your money in the first week:

1. Don’t give a large budget right away. PMax works like a voracious robot: the more money you give, the faster it ‘eats’ it. Start with a small budget and test the results.
2. Track lead quality. Google will report that the campaign is successful, but check who these people are. Monitor the quality of the applications and turn off the campaign if it generates only junk leads.
3. Combine PMax with other formats. If your search ads or retargeting work well, don’t replace them with PMax. It’s better to use it as an addition rather than the main channel.
4. Don’t trust all of Google’s recommendations. The PMax algorithm will insist on increasing the budget, expanding audiences, and other things that… are not beneficial to you. Trust real data, not automated suggestions.

PMax — The Future of Advertising or Just Another Marketing Trap

Performance Max looks like the technology of the future, but in reality, it’s just an attempt by Google to sell you more ads without guaranteed results.

Many marketers have already found that PMax is a quick way to spend the budget, but not always effective for generating profit. So before you launch this campaign, ask yourself: are you ready for experiments, or do you want real results?

If quality sales are important to you, not just pretty reports in Google Ads, it might be worth choosing more controlled advertising methods.

However, if you have extra budgets and want to conduct an experiment — PMax can be an exciting adventure for you. But if you’re managing advertisements with the goal of achieving real profit, not just pretty numbers in reports, think twice.

Performance Max is not a magic pill. It’s a tool that Google controls, not you. You don’t know where the ad will be running, who it is shown to, and how your budget is spent.

What is truly important to remember:

• Google created PMax to save its failing products, not to help businesses.
• You get more ‘interactions’, but that doesn’t mean more sales.
• The less control you have, the more money you give away for nothing.
• If you don’t check the quality of leads – be prepared to receive a bunch of useless applications.

So before launching Performance Max, ask yourself: do you want results, or just to give Google another chance to experiment at your expense?

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