Google has announced that your AdWords campaigns will be able to spend up to twice the average daily budget to help you reach your advertising goals, like clicks and conversions.

On the face of it, Google looks like it is going to take twice as much from your campaigns now. But read on – this is quite a smart move.

On days with lots of high-quality traffic, your costs could be up to two times your daily budget. This spending is balanced by days when your spend is below your daily budget.

Google, however, won’t charge you more than your monthly charging limit which is the average number of days in a month (30.4) multiplied by your average daily budget.

Google likens internet traffic to an ocean. Some days, there will be small waves. Other days, there will be great big ones. So, if your ads don’t show up much because of low traffic, then Google will make up for that by showing your ads more when traffic’s higher.

That’s why Google will now allow up to two times the clicks in a day than your daily budget allows. Google calls this is called Over Delivery.  And it’s a good thing: if Google ends up showing your ad too much — to the point where you accrue more costs than your daily budget allows for over a billing cycle — then they’ll give you credit for those extra costs.

Over delivery and your daily budget

You might see that your advertising costs each day are a little higher or lower than what you set for your daily budget. If you do, don’t worry — over a month-long billing cycle, Google won’t charge you more than your daily budget would have allowed for over 30.4 days.

30.4 is the average number of days in a month (365 days in a year / 12 months = 30.417). Google multiplies your daily budget by this number so they know what your budget should be over the course of a month.

Let’s say you set your budget at £5 a day, and your billing cycle is 30 days. Over the course of the month, you notice that your charges vary. Some days you’re charged £2, on others you’re charged £10. But at the end of the month, your charges won’t exceed £152 (that’s 30.4 multiplied by your £5 budget). So even though your campaign costs tipped above and fell below your £5 budget from day to day, at the end of the month, you’re still charged no more than what you budgeted.

The waves of Internet traffic might make your daily costs go up and down. But at the end of the month, despite those unpredictable waves, you’ll find your costs at right where you expected them to be.

Google recognises that it may deliver over your monthly budget. In those cases, Google will credit the over delivery cost back. You’ll be able to check for over delivery credits by using a predefined report.

The waves of Internet traffic might make your daily costs go up and down. But at the end of the month, despite those unpredictable waves, you’ll find your costs at right where you expected them to be.

Google recognises that it may deliver over your monthly budget. In those cases, Google will credit the over delivery cost back. You’ll be able to check for over delivery credits by using a predefined report.

David Browne

Author: David Browne

David Browne’s Google AdWords campaigns have been described by the big cheeses at Google HQ as an “art form” – which would make David an artist. David honed his skills at the helm of the very successful Scottish Shutter Company, but having handed over the reins to his daughter and son-in-law he now runs his own digital marketing consultancy and is a co-founder of Barefoot Digital.