Google Ads campaigns that are limited by budget beat their ROAS targets by a median 20% in June and by roughly zero by Aug. 31, according to data from Smarter Ecommerce (smec).
If you run Shopping or Performance Max on a Target ROAS and your daily budget runs dry before the day ends, a cushion that quietly padded your reported return is gone, and your target now sets your real efficiency. Ecommerce Paradise readers feel it most. In high-ticket dropshipping, a few points of ROAS decide whether an ad dollar earns or burns on a big-ticket order.
Below: what smec measured, where Google and its critics disagree, what it does to high-ticket math, and seven changes to make before Black Friday. I covered the rollout the day it went live. This is the first hard data on what it did, and it comes with caveats.
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smec Data: Budget-Limited Campaigns Went From +20% to 0% on ROAS
Google announced the change June 15 and began applying it Aug. 17, according to Google’s own help page, which says the global rollout finished Aug. 27. It covers Target CPA and Target ROAS campaigns that are limited by budget across Search, Shopping, Performance Max, Demand Gen and Travel. Campaigns that are not limited by budget keep their current behavior, per Google.
Smarter Ecommerce published the numbers on a podcast episode titled “Google’s August 17 Bidding Update: Good or Bad? The Data,” posted to YouTube Oct. 20, according to PPC Land reporter Luís Rijo on Oct. 22. The hosts were Mike Ryan, head of ecommerce insights at smec, and Christian Scharmüller, its chief client officer and managing director.
Before the change, 55% of budget-limited campaigns beat their ROAS target, versus about a third of all campaigns, per smec’s data from June 1. The median overachiever beat its target by about 20%. Non-limited campaigns that overachieved did so by a median of about 5%.
After Aug. 17 the cushion shrank fast. Median overachievement fell to about 11% in the week of Aug. 17, about 6% the week of Aug. 24 and roughly zero by Aug. 31, per the same data. Early post-change results split about half on target, a quarter above and a quarter below, which the hosts called preliminary.
Costs moved the other way. In figures Ryan shared Sept. 14 and TechWyse reported Sept. 18, median CPC for budget-limited Target ROAS campaigns rose 15.8% after Aug. 17, while campaigns never limited by budget saw CPCs fall 13%. Median impression share for the budget-limited group dropped from 40% to 31%. Impression share lost to budget rose from about 4% to about 33%, and the share lost to ad rank fell from about 45% to about 30%.
One unnamed UK kitchen and homeware retailer showed the pattern in a single account. Its weekly CPC rose from about 17p to about 27p in the change week, according to PPC Land’s summary of the episode. The retailer then raised its ROAS target to about 13, meaning $13 of revenue per $1 of spend, and its actual ROAS tracked that target closely.
Treat the sample with care. PPC Land flagged that smec did not disclose the sample size, the markets or how campaigns were selected, that the CPC increases for each group were not given as percentages in the episode, and that the case study is one account. No Google response was included. smec also sells budget and target recommendation software, per its own site, which gives it a stake in this topic.
Google’s August 17 Bidding Change: Timeline and the Pushback
Google sent notification emails July 2 and updated its Help Center the same day. A Bid Target Adjustment Tool appeared in accounts July 6 for campaigns that had been limited by budget in the prior 12 months, according to PPC Land’s Aug. 5 report. Google says it will not adjust your budgets or targets automatically.
Google’s help page also tells advertisers to provide budget buffer where possible and to consider Portfolio Bidding or Shared Budgets so limited budgets work harder. Campaigns with fewer than 7 conversions get no recommended target, though Google still advises reviewing them manually.
Ginny Marvin, Google’s Ads Product Liaison, said budget-limited campaigns that over-achieve their targets will adjust toward the target, and that after a brief recalibration they should keep conversion value near their recent average. She also said the system “may mean entering different auctions than you previously competed in,” per PPC Land.
The mechanism is the part that matters. The removed behavior was Google lowering bids on budget-limited campaigns to keep them inside budget, according to TechWyse. Lower bids meant skipping pricier auctions and picking up cheap conversions, and that, in my read, is where the cushion came from.
In August, Ryan argued Aug. 17 was not a cliff and urged a 30 to 60 day evaluation window. On the new episode, PPC Land reports, he concedes the data showed one. Scharmüller said the rollout was not smooth and was not communicated correctly.
Not everyone reads the change as a loss. Adthena’s Joss Froggatt argued that loose targets were deliberate strategy that gave Smart Bidding room to find cheap conversions, according to an analysis on greghal.no. Google’s side is that the target should be the efficiency lever, so spend behaves the same whether a budget is capped or not.
The anecdotes cut both ways. An advertiser posting as NorskBavian on r/PPC said a Shopping campaign with a 300% target ROAS delivered 3,000% to 4,000% before Aug. 17 and sold less after it, per PPC Land’s Oct. 5 report. The post named no vertical, spend level or margin and included no screenshots, and a Google representative suggested raising the target toward the delivered level, which the poster did not test.
I flagged the budget angle earlier this month in my write-up on budget as the new quality score. smec’s numbers are the first I have seen that put a size on it.
What Zero ROAS Surplus Does to a High-Ticket Shopping Budget
My read is that the cushion was a side effect of how Google capped spend, and plenty of stores built their targets on top of it without knowing. When the budget ran short, bids dropped, you skipped the expensive auctions and the conversions you did get came cheap. Reported ROAS looked great, so you assumed the campaign was simply efficient.
Now the same campaign chases the number you typed in. Reported ROAS drifts toward the target, CPCs rise to buy that volume, and the profit that used to sit in the gap shrinks with it.
Here is hypothetical math, not a reported result. Say a store sells a $3,000 product at 30% gross margin after product cost and freight, so $900 per order. Break-even ROAS is 1 divided by 0.30, about 3.33x.
A Target ROAS of 300% delivering 400% costs $750 in ads per order and keeps $150. If delivery slides to the 300% target, ads cost $1,000 per order and you lose $100. Across 10 orders a month, $1,500 of profit becomes a $1,000 loss, and the Google Ads dashboard still reports a return that looks like the target you chose.
Low volume makes the problem harder to see. Many high-ticket stores close a handful of orders per campaign per month, and Google’s own guidance says campaigns with fewer than 7 conversions get no recommended target. In my read, those are the campaigns most likely to be mispriced, because nothing in the account flags them and the sample is too thin to trust a short window.
Your account falls into one of four buckets. My thresholds:
Target well above break-even, say 400% against 3.33x. The change costs you volume at worst. Hold your target and judge it after one or two conversion cycles.
Target near break-even. The cushion was your profit. Raise the target to break-even plus a safety margin before spend scales, or accept less volume.
Target below break-even. You were underwater on paper and positive in practice only because of bid suppression. Fix this one first.
Campaign not limited by budget. Nothing changed, per Google. Leave it alone.
The backend gap makes this worse. Advertisers who set targets from margins or server-side attribution can fall below break-even while Google Ads still reports strong performance, according to the same greghal.no analysis. High-ticket stores are the most exposed, because quotes, calls and financing approvals happen off-platform, so Google sees only part of the revenue story.
That is why the conversion system around the ad matters as much as the bid. I wrote about turning Shopping clicks into high-ticket sales, and the logic holds here. Higher CPCs only work if more of those clicks close, which is the argument in my piece on the complete conversion system.
Switching channels is not a free exit right now. Meta ad prices are up 23% in the US and Canada before Q4, per my earlier coverage. Cutting your sale price to compensate is the wrong lever, and I laid out how to scale without cutting prices.
Google also just let retailers multiply new customer value up to 5x, per PPC Land, which I covered here. More levers means more ways to misprice a target, and every one needs the same break-even number underneath it.
If you would rather not re-audit every campaign each time Google rewrites a bidding rule, my team handles that inside the turnkey done-for-you high-ticket store build.
Your budget-capped campaigns just got repriced, so want my team to scale the store you already have, with targets built on real margin? See the scaling service →
Reset Your Budget-Limited tROAS Targets Before Black Friday
Seven moves, in order:
- Pull every Target ROAS and Target CPA campaign that carried a Limited by budget status in the last 12 months, across Shopping, Performance Max and Search. The Bid Target Adjustment Tool, in accounts since July 6 per PPC Land, lists them and offers four paths: keep the target, lower it to recent performance, set a custom target, or switch to Maximize conversion value.
- Work out break-even ROAS for each product line: 1 divided by gross margin after product cost, freight and refunds. Pull landed costs from Shopify and your books. For profit by SKU, I’d point an ecommerce owner to Finaloop.
- Compare each campaign’s target to its last 30 days of delivered ROAS, then set the target at or above break-even. Raise a budget only where the math supports it, and read how Google’s new budget caps and channel priority work before you do.
- Stop touching it. Google says to wait one to two conversion cycles and to avoid data exclusions or new bid limits only because of this update. For quote-driven sales, log calls and quotes in HubSpot so you can see closed revenue Google never saw. Then use my high-ticket follow-up guide to tighten the close.
- Offset higher CPCs with conversion rate. A Tidio live chat on product pages catches buyers who would otherwise bounce. Session recordings in Lucky Orange show where high-ticket visitors stall.
- Bring back the visitors who left. Quote and abandoned-cart follow-up through Omnisend turns a click you already paid for into a second chance at the sale.
- Fund ad spend from a dedicated business account so a rising CPC never starves payroll or inventory. Mercury is the account I’d start with. My application walkthrough covers the setup.
Then run my Black Friday Google Ads setup against the new targets. Test the store itself with the high-ticket Black Friday stress test.
If you want a second set of eyes on your targets before the holiday rush, book a discovery call and bring your last 30 days of campaign data.
Frequently Asked Questions
Does this change hit every Google Ads campaign?
No. Per Google’s help page it applies to Target CPA and Target ROAS campaigns that are limited by budget, plus Target CPC on Demand Gen. Manual CPC and Target Impression Share are not affected.
Did Google reset my targets or budgets?
No. Google says it will not automatically adjust your daily budgets or bid targets, so any gap between your target and your results is yours to fix.
How do I find the affected campaigns?
Filter for campaigns that were limited by budget in the last 12 months. PPC Land reports the Bid Target Adjustment Tool has surfaced those campaigns since July 6.
How long should I wait before judging results?
Google says one to two conversion cycles. Ryan’s earlier guidance was 30 to 60 days, and high-ticket buying cycles run longer than most, so I’d lean toward the longer window.
Should I just switch to Maximize conversion value?
It is one of the options Google offers. It removes the target, which also removes your guardrail, so I’d only use it where margin is wide and your conversion tracking is clean. The complete conversion system post covers what clean tracking looks like.
Is the smec data reliable?
It is a useful signal with open questions. smec did not disclose its sample, markets or campaign selection, the retailer example is one account, and Google gave no response in the coverage I found.
Does this change which niches are worth advertising?
It raises the bar on margin. Products with thin margins have almost no room if ROAS settles at target, while wide-margin niches absorb higher CPCs, and my free high-ticket niches list shows where the margins sit.
Want 1-on-1 coaching to set bid targets that survive the next Google change? Get the coaching details →
That is the briefing for now. Subscribe to the YouTube channel for daily breakdowns. More breaking news coming through the day.
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Trevor Fenner is an ecommerce entrepreneur and world traveler from Seattle, Washington, and the founder of Ecommerce Paradise, a platform focused on helping entrepreneurs build and scale profitable high-ticket ecommerce and dropshipping businesses. With over a decade of hands-on experience, Trevor specializes in high-ticket dropshipping strategy, niche and product selection, supplier recruiting and onboarding, Google & Bing Shopping ads, ecommerce SEO, and systems-driven automation and scaling. Through Ecommerce Paradise, he provides free education via in-depth guides like How to Start High-Ticket Dropshipping, advanced training through the High-Ticket Dropshipping Masterclass, and fully done-for-you turnkey ecommerce services for entrepreneurs who want a faster, more hands-off path to growth. Trevor is known for emphasizing sustainable, real-world ecommerce models over hype-driven tactics, helping store owners build scalable, sellable, and location-independent brands.
He maintains homes in Seattle and Bali, spends most of the year overseas, and usually returns to Seattle for about a month each summer.
