The Smart Bidding system of Google Ads will see a significant update aimed at changing the optimization logic of budget-limited campaigns towards the goals of advertisers. Starting from August 17, 2026, Target CPA and Target ROAS bidding campaigns with limited budgets will optimize better to the targets set by the advertisers.
Before that date, some campaigns that were limited in budget had been showing performance metrics better than the configured Target CPA/Target ROAS because of the Google bidding strategy of participating in the most efficient auctions. While the results have become unexpectedly good, they remained unpredictable because of the variability of budgets.
With the introduction of the new feature, Google tries to make the performance of campaigns predictable. Rather than delivering significantly better performance than the configured target, eligible campaigns will now try to reach the Target CPA/Target ROAS. Thus, advertisers can expect that campaign results will become more predictable when raising/lowering budgets.
To help advertisers to get ready for the new features, Google provides a Bid Target Adjustment Tool. The tool shows the list of the campaigns that can be impacted by the new feature as well as those cases in which
It gives advertisers an opportunity to evaluate and make necessary adjustments to their Target CPA or Target ROAS before implementing the changes. Google will also inform eligible accounts when action is recommended.
The change will affect budget-limited campaigns that run on Target CPA and Target ROAS. Campaign types that can be impacted by the update include Search, Shopping, Performance Max, Demand Gen, and Travel campaigns. Campaigns that are not budget-limited or use some other form of bidding will not be affected by the update.
Campaigns that are currently marked “Limited by budget” need to be evaluated based on how well they are performing compared to their bidding targets. If a campaign historically provided high conversion rates with CPA significantly lower than the set target or generated ROAS higher than the target, it will be beneficial to update the target to maintain the performance. Also, businesses should evaluate whether it would be more efficient to increase the budgets of their campaigns for future optimization of conversions and revenue.
This update confirms the ongoing effort of Google to make its bidding strategy more transparent and predictable.
