Performance Max for Microsoft Advertising is an omnichannel campaign type designed to enhance conversions across the Microsoft Advertising Network. Using AI and automation, it lets advertisers showcase ads across multiple formats—including search, native, and product ads—without the need to manually create each ad variation.
Instead, Performance Max dynamically generates ads from the assets you provide and delivers them to your target audiences in the most effective way possible. Simply give your assets (like images, videos, and copy) and set your campaign goals, and it takes care of the rest—optimising for the best results across channels. This level of automation lets businesses focus on strategy rather than manual ad creation.
When integrated into your broader advertising strategy, Performance Max has the potential to drive incremental conversions and significantly boost overall ROI.
Advertisers who combine it with traditional search campaigns, for example, have seen impressive results: a 32% decrease in CPA and a 3x increase in ROAS on average, compared to running search campaigns alone. Small and medium-sized businesses also see substantial benefits, with many experiencing 3-4X higher conversion rates.
How To Optimise Your Performance Max Campaign
Performance Max campaigns are an essential tool for advertisers across various industries, from retail to services. However, it’s important to optimise your campaigns so the AI can deliver the best possible results based on your unique business needs.
Here are some key optimisation strategies to maximise your campaign’s performance:
1. Set Up Conversion Tracking
Before you can begin optimising for conversions, it’s crucial to enable conversion tracking. This allows Performance Max to track customer actions beyond the initial click, providing data that AI needs to learn and optimise effectively. There are two main components to conversion tracking:
- Universal Event Tracking (UET): This is the first step to enabling conversion tracking. UET is a unique piece of code that tracks user actions on your website. You’ll need to generate this code within your Microsoft Advertising account and add it to your website using either manual installation or Google Tag Manager.some text
- Conversion Goals: These are the actions you want to track and optimise for, such as a purchase, form submission, or app install. You can set multiple conversion goals depending on your business objectives.some text
By setting up conversion tracking properly, you empower Performance Max to use data to enhance your campaign and deliver optimal results.
2. Create Campaigns with Unique Goals
Many businesses have diverse objectives—some focus on generating leads, others on driving sales, and still others on booking appointments or demos. The beauty of Performance Max is that it allows you to create campaigns for different goals, in addition to your ongoing campaigns.
For example, let’s say you're a furniture retailer:
- Campaign 1: Targeting furniture purchases.
- Campaign 2: Generating leads for interior design consultations.
For each campaign, define your primary and secondary goals. Secondary goals, like “Add to Cart” or “Begin Checkout,” provide additional data to help Performance Max optimise for conversions, though they’re not mandatory.
By segmenting your campaigns based on specific goals, you ensure that each Performance Max campaign is laser-focused on achieving your most important business outcomes.
3. Include a Wide Variety of Assets
The success of any Performance Max campaign depends on the quality and variety of assets you provide. Performance Max dynamically assembles ads from your assets—text, images, and videos—to create personalised ad experiences for your audience.
To get started:
- Import Assets from Google Ads: If you’ve already run campaigns in Google Ads, you can import your Performance Max assets easily.
- Leverage Microsoft’s AI-powered Copilot: Copilot in the Microsoft Advertising platform can help generate creative ideas for your campaign assets, saving you time and ensuring you never run out of ideas.
Performance Max campaigns also work with asset groups, which are collections of assets that resonate with different audience profiles, demographics, or promotions. For instance, if you run a hotel, you might organise your asset groups into:
- Audience profiles: For couples, families, or solo travelers.
- Promotions: Evergreen, seasonal, or limited-time offers.
- Markets: Local, out-of-state, or international.
The more variety you provide, the more likely your ads will connect with different audience segments. Enable features like auto-generated assets and Final URL expansion to let AI experiment with different combinations for maximum relevance.
4. Tell Us More About Your Target Audience
The more you tell Performance Max about your target audience, the better the AI can fine-tune its targeting and reach your most valuable customers. This involves providing data on your audience’s interests, demographics, search behaviours, and more.
Key tactics for refining audience targeting:
- Add Audience Signals: These signals allow you to describe the type of customers you want to target (e.g., in-market audiences, remarketing lists, or custom audiences). The more signals you provide, the more precise Performance Max can be in finding the right people.
- Use Search Themes: Search themes help refine targeting by specifying the kinds of words and phrases your customers use to find products or services like yours. You can input up to 25 search themes per asset group.
- Optimise Location Targeting: Location targeting is critical to ensure your ads are shown in the right geographic areas. You might start by targeting a specific city or region, but then expand to surrounding areas if you’re looking to increase volume.
The AI-powered Predictive Targeting capabilities will work to find not just your ideal customers, but also new potential audiences that you might not have considered.
5. Choose the Appropriate Bid Strategy
Performance Max offers various bidding strategies depending on your goals:
- Max Clicks: Best if you're focused on driving traffic but haven’t set up conversion tracking.
- Max Conversions: Prioritises the total number of conversions.
- Max Conversion Value: Focuses on generating the most valuable conversions based on the assigned conversion value.
If you’ve set up conversion tracking, Max Conversions or Max Conversion Value will allow you to optimise your campaign for conversions.
- Max Conversions is ideal when your conversions are of equal value.
- Max Conversion Value works best if you have different products or services with varying profit margins.
Review your bid strategies regularly and adjust them based on your business goals and campaign performance.
6. Calibrate Your CPA or ROAS Targets
To fine-tune your campaigns, you can also set Target CPA or Target ROAS. These targets help you set expectations for cost-efficiency and performance.
- Target CPA: Sets a cap on the amount you’re willing to pay for a conversion. This is useful for maintaining cost efficiency.
- Target ROAS: Helps you optimise for a specific return on investment (e.g., aiming to earn $5 for every $1 spent).
Start with achievable targets and adjust them gradually as Performance Max gathers more data. Setting overly restrictive targets can hurt your campaign’s performance.
7. Adjust Your Budgeting Approach
Effective budgeting is key to achieving long-term success with Performance Max. If your campaigns consistently reach their budget limits, they won’t be able to perform at their full potential, and you might miss out on valuable conversions.
- Increase Budget for Growth: If you’re consistently maxing out your budget, consider raising your daily or monthly limits to allow for more conversions and data collection.
- Account-Level Budget Adjustments: If you’re frequently hitting budget limits across all campaigns, it might be time to increase your overall account-level budget to accommodate higher-volume campaigns.
Performance Max thrives when given enough budget to test various ad creatives, refine targeting, and generate conversions. By increasing your budget appropriately, you ensure that the AI has the resources it needs to achieve optimal performance.
Performance Max is a powerful tool for advertisers looking to reach customers across multiple touchpoints with minimal manual effort. By leveraging AI and automation, Performance Max can drive meaningful conversions, boost your ROI, and uncover new growth opportunities. To optimise your campaigns, it’s essential to set up conversion tracking, provide a variety of assets, define clear audience signals, and choose the right bidding strategies.
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