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Budget-limited campaigns no longer beat their target - now it's up to you to fix it

Since August 17, Smart Bidding in budget-limited Target CPA or Target ROAS campaigns aims for the target instead of beating it. Heading into peak season, the winners will be advertisers who reset their targets, not those who raise them on reflex.

Bartosz Bielawski

Bartosz Bielawski

· 3 min read
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Budget-limited campaigns no longer beat their target - now it's up to you to fix it

Signal in the data

Independent sources on this topic: 3 in the last week, 4 in 30 days, 5 in 90 days. We have tracked it since 2026-07-21; 35 claims in our database in total.

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Number of independent sources per week (last 12 weeks).

What is happening

Since August 17, Google has changed how bidding works in Target CPA and Target ROAS campaigns that are limited by budget. Previously, these campaigns often delivered better results than their target.

Now the system aims to land as close to your target as possible instead of beating it. The change covers Search, Shopping, Performance Max and Demand Gen campaigns (Google Ads).

At the end of September, the topic is back in the news because peak shopping season is approaching. Sources are no longer writing about the change itself, but about how advertisers have reacted to it.

Where sources agree

You only feel the change when three conditions are met at once: the campaign is limited by budget, it uses a target-based strategy, and the target is looser than the actual results.

Google advises reviewing exactly these campaigns: budget-limited ones that outperform their target. It also recommends not capping the budget on target-based strategies and controlling spend through the target alone.

Data from a major sales event shows that target-based strategies held steady. Clicks got the most expensive in campaigns set to maximise conversions (Optmyzr).

Where they differ

After the change, many advertisers raised their ROAS targets, even in campaigns the new rules did not affect at all. One analysis suggests this panic may have created an opening for those who lowered their targets and took market share (Search Engine Land).

Sources also disagree on how much data Smart Bidding needs. Some say at least 30 conversions a month, ideally more than 60. Others point out that Target CPA has no threshold at all.

Some B2B advertisers stick entirely with manual bidding. In their view, automated bidding eats up the budget (Optmyzr).

What to do about it

Find campaigns that use a target-based strategy and have a "Limited by budget" status. If they were beating their target, tighten the target to a realistic level or increase the budget.

Before peak season, calculate your ROAS target from your own margin, not from gut feeling. Breakeven ROAS is 1 divided by your gross margin (Optmyzr).

Don't raise targets on reflex in campaigns that aren't limited by budget. The new rules changed nothing there, and a higher target will only cut your reach.

Our take

The August 17 change doesn't break campaigns - it removes the buffer a limited budget used to give you. If your target was loose, your cost per acquisition will rise all the way to the target. Set your target as if the system will hit it to the cent, because that is now exactly how it works.

Confidence: medium - Google itself describes the mechanism and several independent sources describe its effects, but data from a wide range of accounts since the change is still lacking. We will change our view if: data from a large number of accounts shows that budget-limited campaigns still regularly beat their target, or that cost per acquisition has not risen since the change.

Sources

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