For years, Google AdWords has been one of the most powerful forms of marketing for those looking for a cost-effective, totally self-controlled marketing platform. Like so many other forms of marketing, recent changes introduced to the Google AdWords platform may have a rather negative effect on budgets.

How so? Because, AdWords can now actively spend DOUBLE your daily budget without you doing anything about it. Naturally, for those without the cash flow to be able to afford just doubling your marketing output, this might be a cause for some concern in the near future. Should you stop using AdWords, then?

Probably not. Take note that Google AdWords will not charge you more than your monthly budget. They explained that on days with quality traffic, your expense could be up to twice your daily budget. The costs will be balanced on days (weekend, perhaps) when your ad spend is below your daily budget.

The idea behind this update makes a lot of sense. Advertisers will be able to account for the fluctuations in daily activity. Just remember that the overall costs will not exceed your calculated monthly budget.

Also, there are overdelivery credits that would probably make advertisers feel a little better. According to Google:

Sometimes we deliver over your monthly budget. In those cases, we’ll credit the overdelivery cost back.

You can check the Overdelivery on Reports > Pre-Defined Reports > Basic > Overdelivery.

However, the budget caps are not always instantly applicable to your own needs most of the time. For example, you can usually just manage the budget on your own – just spend by setting up bids instead of making an automated budget campaign just keep spending until the budget is gone.

If you run it by yourself then you are naturally much more likely to get a more direct correlation between what you are spending your money on and what the spending is actually giving you back each time.

Thankfully, Google sends out an automated message to let you know when said overspend is kicking in so that you can go and do something about it. If you are serious about making a genuine statement and making sure that you are on the right path to putting together affordable Google AdWords campaigns, then you should absolutely look to start using this simple little system.

It is a good thing to have a monthly budget with dynamic daily budget adjustments. For small businesses, however, they might not be aware of the recent update. Just remember that you will not be charged over your monthly budget. The latest change points towards at improving pacing of your AdWords campaigns.

Source: Search Engine Land