There’s a Cost to Convenience: My (slightly uneducated) take on Performance Max.

This post isn’t for paid search people. It is for holistic marketers, c-levels, and others who hear the words “Performance Max” then see the quarterly goals are attained and ask...is Performance Max, that good? Yes it is, but it's going to cost you elsewhere. 

There’s a downside to hitting goals with PMax. I am going to get us out of “Match types, negatives, queries” and move us into a universal language. 

Grocery shopping.

Imagine you are in the grocery store and someone says to you, hey lines are long, wanna go home, I'll get everything in your cart and bring it to you. They even put everything away when you get home, take everything out of boxes and all. Nice right!?

The pitch:

"Why spend your time shopping for groceries, use our personal shopper, get time back with your family."

Now you are hooked, you give your grocery store a monthly budget to fill your cart.

Will they shop purely with my nutrition, family, and finances in mind, always just like the first time?

Or would they sneak in impulse buys and high-margin items from their in house brands to boost their profits, putting them away in your cabinet so you don't even know the brands?

Would they reach to the back of the milk to get the latest expiration date or dig through all the apples looking for the fresh ones? Or would they be incentivized to get you mushy apples and nearly expired milk? Without transparency into exactly what fills my basket each week and what decisions were made and how those decisions were made, how would I know if I'm still getting a good deal?

You don't.

Imagine you don’t need to go shopping ever again, the grocery store says…go enjoy the best parts of life. Managing lists and finding time isn’t the fun parts of life, eating and spending time with your family is, right?

Perhaps it’s naive to expect businesses to prioritize my best interest over their own bottom line. But how far are they willing to obscure things to serve their financial incentives over my needs? At what point does “personalization” become manipulation?

Performance Max promises relevant ads through black-box optimization. But when the store owns the products AND sets the prices, how can I evaluate value? Concealing core information about ad placements and conversions feels advantageous for them, not me.

I just saw Close Variant match basically match us to "www" [domain] ".com" for a client, with REAL money spent, it was people trying to go to a competitors website.  Our keyword was "CRM Software"  - Google matches us to "www saleforce com login" in our search query report.  WTF!! I'm supposed to trust that company with no data transparency?

Ok, now if you want to go deeper, let’s go…

The incentives: The shopper is employed by the grocery store

Who is the shoppers “customer” here? You. Nope. You don’t pay them. Just like Google's algorithms are optimized to benefit Google, this shopper's decisions will be optimized to serve the grocery store shareholders’ interests.

Your shopper isn’t bonused for giving you back $25 when they get all your wants for $475, instead of your budgeted $500. They throw in some other stuff, cause “maybe you want them”. You have no idea which items are the good and bad because you are on their Budget Max campaign, you just get a bunch of stuff for a price that is “market” driven.

You got convenience, but it comes at a price.

Without transparency, how do you know which brands are in house and which are not? How do you know if that shopper is getting you the best deals or not? How do you know that a savvy grocer, would get you what you wanted for $400 instead?

What if they purchased lots of budget items and skimped on your family’s favorites to pocket some profit for their “bonus program” which is paid by the grocery store? How would you know?

Welcome to Performance Max.

Lack of Transparency: Why did you put mayo in my cart, I told you I hate mayo!

Here's the catch - your personal shopper doesn't provide an itemized receipt, just like how Performance Max started not providing you with details on the words or sites your ads were placed on. (After a year Google finally gave you insights into placements you spent money on, but a whole year people were having ads placed on all kinds of sites without knowing). 

Imagine your shopper just threw in mayo. You are like…I hate mayo, they say…well it was such a cheap add on, and I didn’t go over your budget, so…you got mayo… oh you also got our branded mayo, that is almost expiring so we can sell it to you near full price so we don’t have to throw it out.

In this world you have no way to validate exactly what was purchased or how much was spent on each item, things get replaced because they are “close enough”, you can’t return any of it and you can’t go to the store yourself and look up the prices because when you sign up for this program you sign that right over. 

The shopper reassures you: "Don’t worry, your total bill was under $500. I used my expert judgment to pick the highest quality items for your budget and healthy lifestyles." When you realize that the shopper works for the grocery store and NOT you, you start to realize where the incentives lie.  

Welcome to Performance Max.

Slowly rising prices: How Epipen’s went from $124 to $609 in 7 years

We can argue if Google is a monopoly. I don’t know, not here to discuss that. I am here to talk about drug dealers.  When they give you great highs early for free, you know there’s a cost later. They get you hooked and then they can charge whatever they want, letting them raise all kinds of prices on you. You're hooked.

Look at Epipens 2009-2016 run. When you are optimizing for shareholders, you will do this kind of behavior.

Grocery Monopoly

Imagine over time, your weekly bill starts quietly rising, $500 used to get you everything, now your shopper is coming up short because it had to make “decisions” for you it didn’t get you enough groceries to feed the family. 

Now the same groceries cost $550 - The shopper says food costs are increasing. You have no way to validate that, but you don’t want to skip meals, so you suck it up and pay the tax. How does that feel?

Without an itemized breakdown, you have to take their word for it - you can’t go validate that costs are up because in the “budget max” program, you can never see the true market price, the cost of goods, or the other “shoppers” who are “bidding up” your costs. 

“Trust us, prices went up” once you are hooked sounds like typical drug dealer behavior.

So are you getting the first bites for free now? With goals being hit in the short term? Probably, and when they go to raise prices, which they will, you will no longer have the data to police them, you’ll just have to “trust” that prices went up.

Having seen insane amounts of waste in paid accounts at the search term level (Google black therapist and click on all the ads), I would be like “from my cold dead hands”  but I get it, quarters gotta get hit, teams are getting hit with layoffs. 

Just for Giggles, if you have made it this far and trust me with your data, I would love to see if I can create efficiencies similar to PMAX on a CPA level by just running tools, Ill do it for free...just need access to search terms.

Know what you are optimizing for, it's OK to use PMax!

It all depends on what you are optimizing for…If you are thinking, I don’t want to shop and I’ll deal with the disincentives, cool. If you don’t mind being taken advantage of from time to time with no way to police things. Cool ease is worth it.

Performance Max positions itself as that convenient, highly effective personal shopper for your marketing budget. It uses automation to buy advertising optimized toward your goals.

But Performance Max doesn’t show the itemized receipt. It obfuscates the underlying search terms, ad placements, and granular performance data that savvy digital marketers can use on to inform strategy.

Much like the grocery example, this lack of transparency gives Google latitude to act in their own interests over yours. And as a dependent customer, you lose visibility into whether campaigns truly deliver value.

ChatGPT Helped me come up with counterpoints tot his post. Here is what it came back with.

ChatGPT: However, consider this counterpoint: Could the simplification provided by PMax be beneficial for certain businesses or marketers who lack the time or expertise for detailed campaign management? While transparency and control are crucial, there's also value in automation and simplified processes for some users. It's a balance between convenience and control.

Me: I agree 100% this is why up above I said, it’s all about what you are optimizing for.  It might be a “net” win for you to lose a little bit of transparency and maybe performance for the ability to have one less thing to spend so much time on.

ChatGPT: Moreover, while the analogy is strong, ensure it doesn't oversimplify PMax's complexities or Google's intentions. It's important to acknowledge that while there are conflicts of interest, Google also has incentives to maintain advertiser satisfaction and campaign effectiveness, as their business model relies heavily on advertising revenue.

Great point my ChatGPT “friend” - Google does have to keep advertisers satisfied by having effective campaigns or $$ will move to FB and other platforms. As we’ve seen, in an oligopoly if both parties collude, we can end up with a “Performance Max” on Bing /  Facebook and then everybody has marketed and promoted a way of obfuscating data, leaving the customer with higher prices and lack of transparency on all platforms. Which is a net negative for advertisers. Who will also now have low transparency into their data.