What to do When Limited by Budget in Google AdWords
By Nathan Pabich
If your AdWords campaign is limited by budget, it means you’re likely not getting as many meaningful clicks as you possibly could. When you’re limited by budget, it’s like trying to draw money out of an ATM when your account has “no balance.” You’re just going to have to wait until more money is available. In this post I’m going to explore what limited by budget really means and a few strategies you can employ to get the most out of your campaigns after seeing this status.
What Does Limited By Budget Really Mean?
The AdWords help guide states that your campaign status will be updated with “Limited by Budget” when your “daily budget is lower than the recommended amount.” So put very simply – if the keywords and bids you have in your campaign could spend more than your daily budget limit, you are going to see this message.
By clicking into the bar graph icon next to the status message, you will come to a graph like the one below which can help you understand how much you’re limited by and what a budget increase might mean for your account.
Being limited by budget carries a few consequences:
Your ads will not be eligible for as many impressions as they could be. Depending on which setting you have at your campaign level, this will either limit you throughout the day, or if you have selected to serve your ads at an accelerated pace, then Google will show your ad in every auction you are eligible for. The consequence here is that you may run out of budget early in a day and have some lopsided metrics.
Your ads will not receive as many clicks as are available. This is not necessarily bad news, but with every bad click you miss you also risk not being visible to high quality searchers as well.
You will not have a chance to convert as many visitors. If you miss 100% of the shots you don’t take, then you’re missing chances to convert with each click you’re missing.
What factors play into Limited by Budget?
Keyword selection. If you have done an excellent job with your keyword research, then every keyword in your account should give you a chance to convert. But if people are search for your keywords, and people are clicking on your ads, then your budget could dwindle quickly.
Ad Copy. If your ad is broad, it might have a lot of appeal.
Bids. Every keyword clicked is going to cost you money. If your bids are higher, then you’ll tap out your budget sooner.
Settings. There are many setting that can affect how far your budget goes – mobile device bidding, day parting, geographic focus and opting into display partners or even the display network can all affect who and when you’re targeting your audience.
Google AdWords Budget, duh.
What can you do about a campaign being Limited by Budget?
Increase budgets. The simplest way to get rid of the Adwords Limited by Budget warning is increase your budget. This might not be the wisest first approach, but hey, it’s always there as a lever to pull if it makes sense with your marketing budget.
Decrease bids. Since your Adwords budget only goes so far and each click gets your closer to hitting that limit, you can decrease your bids. If you’re maxing out at a position and blowing through your budget, reducing your budget can get you many more clicks and perhaps a better CPA. The consequence of lowering your bids will be a decreased average position. Monitor this change closely as a change in position can also signal a change in conversion rates or CPA.
Use Ad Scheduling. When you have a limited budget, it’s recommended to go with even daily ad distributions. Why? Because you might find pockets of time where your budget goes a bit further than others. If you convert better in the afternoon, it is best to ensure your ads are always showing then. You’re not going to uncover this information if your ads stop showing at noon. Fortunately, even distribution is the default setting in AdWords. But make sure you go back and review this information.
Be Specific in your Ad Text. If your ads have broad appeal, they may garner more clicks. If you over promise in your ads, you might get more clicks while delivering a poor user experience. The better you can qualify your customer in the ad text, the higher your conversion rate should be. Ward off poor quality clicks by telling potential customers exactly what to expect and deliver them to a page offering exactly that.
Use Geographic Reports. Not every state or region will convert equally. If you know that your business rarely sells anything in Pennsylvania, then exclude it. Or just start with targeting those regions you know have the best conversion rates – that way more of your budget will have an opportunity to convert visitors.
Use Bid Adjustments. If you don’t want to completely exclude a time of day, day of week, or geographical region, then bid adjustments may be your new best friend. You can apply bid adjustments on all the aforementioned targeting layers and on mobile clicks as well.
Negative Keywords. Not all keywords are created equally. Find the bad ones for your account and make sure you’re not accidentally bidding on keywords that are too broad or unrelated to your service or product.
Re-evaluate your account. Everyone who manages a PPC account should always be questioning whether their current keywords, ads, campaign settings, etc. are all doing their best to promote their goal online. If not, avoid sunk costs – a beautiful thing about PPC is that you can always restructure your account and you can always improve your results.
The best thing you can do, though, is make sure your campaigns are organized in a way that promotes your goals. If you have a handful of keywords that are hogging most of the clicks in your account, it might be time to re-evaluate your approach. Some things to ask:
Are you getting enough conversions to justify the cost on these keywords?
What are the actual search queries that are converting? Is it possible to focus on variations that are moving the dial?
For example, if I bid on PPC, but the actual keywords that convert are “PPC marketing firm,” I can save some money by being more precise with my keyword targeting. Being limited by budget is just part of life. It’s one of the reasons I’m not driving a Bentley. We’re not always going to have deep enough pockets to reach for the stars with every account or advertising objective. But you can still make the most of your situation by knowing what causes the “limited by budget” warning and adjusting your strategy to better fit your account’s reality.