You just got an email from Google saying your Shopping campaigns will be upgraded to Performance Max. Or maybe your agency is recommending you make the switch. Either way, you're wondering: is this actually better for my business, or is Google just pushing another automated solution that gives me less control?
If you're running an e-commerce business and advertising on Google Shopping, this decision affects everything - your revenue, your return on ad spend, and how much control you have over where your advertising dollars go. Let me walk you through the real differences between these campaign types and help you figure out which one makes sense for your business.
What Are Google Shopping Campaigns?
Google Shopping campaigns have been the backbone of e-commerce advertising for over a decade. They're straightforward: you upload your product feed to Google Merchant Center, create a campaign in Google Ads, and your products appear in Shopping results when people search for what you sell.
How do Google Shopping campaigns work?
How Shopping campaigns work is relatively simple. You organize products into ad groups, set bids at the product or product group level, and Google shows your products when their algorithm determines there's a match between the search query and your product data. You're essentially bidding on product visibility rather than keywords, though the matching still happens based on your product titles, descriptions, and categories.
What kind of control do I have with Shopping ads?
The level of control you have is significant. You can see exactly which search terms triggered your ads. You can adjust bids for specific products or product categories. You can set negative keywords to prevent showing for irrelevant searches. You control the budget at the campaign level and can pause or adjust individual product groups whenever you want.
Where do Shopping ads appear?
Where Shopping ads appear is limited but focused - primarily in Google Shopping results, both on the Shopping tab and in the main search results page when someone searches for a product. You're not appearing on YouTube, Gmail, or Display Network with standard Shopping campaigns.
What Is Performance Max for Shopping?
Performance Max is Google's newer campaign type that takes a fundamentally different approach to advertising your products. Instead of the advertiser controlling bids and placements, Google's algorithm takes over most decision-making.
How is Performance Max different from Standard Shopping ads?
How it differs from traditional Shopping comes down to automation. With Performance Max, you provide Google with all your assets - product feed, images, videos, headlines, descriptions - and the algorithm decides where, when, and to whom to show your ads. You set a goal (maximize conversion value, target ROAS, etc.) and Google does the rest.
Google's automation-first approach means you're trusting the algorithm to figure out the best combination of placements, audiences, bids, and creative. The promise is that machine learning can optimize better than humans because it can process more signals and make real-time adjustments across millions of auctions.
Where do Performance Max ads appear?
Performance Max ads appear across Google's properties: Shopping results, Search (text ads), YouTube, Gmail, Display Network, Discover feed, and Maps. Your products can show up in all these places from a single campaign. This expanded reach is one of the main selling points - you're not limited to just Shopping placements.
Is managing a Performance Max Campaign different from Standard Shopping?
Absolutely. Let’s start with campaign structure. Asset groups (Performance Max) vs. ad groups (Standard Shopping) is a structural difference worth understanding. Instead of organizing products by ad group, you create asset groups that contain multiple creative assets (images, videos, headlines, descriptions) alongside your product groups. Google mixes and matches these assets across placements.
The "black box" problem is what frustrates many advertisers. You can't see which search terms triggered your ads like you can with a Standard Shopping campaign. You can't adjust bids for specific products or placements. You have much less visibility into what's actually driving your results. Google shows you performance data, but not the granular details you get with Standard Shopping campaigns.
Key Differences Between Shopping Campaigns and Performance Max
Let me break down the practical differences that actually matter for your business.
Control
Control differences are substantial. Shopping campaigns let you manually adjust bids at the product level, use bid adjustments for different times/locations/devices, and control exactly where your ads appear. Performance Max removes almost all of this control - you set a target (CPA or ROAS) and let Google optimize to that target across all placements.
Transparency
Transparency is where Shopping campaigns win clearly. You can see which search terms triggered impressions and clicks. You can identify which products drive results and which waste budget. With Performance Max, you get aggregated performance data but very limited insight into what's actually happening under the hood. Google shows you some search categories, but not actual search terms.
Placement Control
Placement control differs dramatically. Shopping campaigns show primarily in Shopping results. Performance Max spreads your budget across Search, Shopping, YouTube, Display, Gmail, Discover, and Maps. You can't say "only show my ads in Shopping results" with Performance Max - it's all or nothing.
Creative Requirements
Creative requirements expand with Performance Max. Shopping campaigns just need your product feed. Performance Max strongly encourages (and performs better with) additional assets: lifestyle images, videos, multiple headlines and descriptions. You can technically run it with just the feed, but you're leaving performance on the table.
Optimization
Optimization approach reflects different philosophies. Shopping campaigns optimize at the keyword and product level - you're constantly refining which products get more budget and which search terms to exclude. Performance Max optimizes toward your goal across all variables simultaneously - the algorithm adjusts everything behind the scenes.
Performance Comparison: Shopping Campaigns vs. Performance Max
So which one actually performs better? The honest answer: it depends.
Revenue Generation
Revenue generation tends to favor Performance Max in accounts with sufficient scale and good tracking. Google's data shows Performance Max typically drives 12-18% more conversions at similar or better ROAS compared to Shopping campaigns. However, this average masks significant variation - some accounts see huge improvements, others see declines.
Cost Per Conversion
Cost per conversion can be lower with Performance Max because the algorithm finds cheaper placements (Display, YouTube) that still convert. But this assumes the conversions are equally valuable. If Performance Max is driving lower-quality conversions on cheaper placements, the lower cost per conversion is misleading.
ROAS (Return on Ad Spend)
Return on ad spend expectations are generally similar between the two once Performance Max exits the learning phase and stabilizes. In our experience managing both, well-optimized Shopping campaigns and well-configured Performance Max campaigns tend to land within 10-15% of each other on ROAS. The difference is often less about which campaign type and more about the quality of setup and ongoing management.
Traffic Quality
Traffic quality and conversion rate sometimes differ. Shopping campaigns tend to drive higher-intent traffic because you're showing up when people are specifically shopping. Performance Max includes Display and YouTube placements where intent might be lower, though Google's targeting usually keeps quality reasonable. We've seen accounts where Performance Max drove more volume but Shopping campaigns maintained higher conversion rates.
Real-World Implications
Real-world performance from our client accounts: A home goods retailer saw a 22% increase in revenue after switching to Performance Max, primarily from YouTube placements they'd never successfully used before. A niche electronics seller saw their ROAS drop 30% with Performance Max because the broader placements attracted window shoppers rather than buyers. Both results are "normal" - your mileage will vary.
When Shopping Campaigns Are the Better Choice
Let me be clear about when you should stick with traditional Shopping campaigns.
Brand New eCommerce Businesses
New e-commerce businesses should start with Shopping campaigns. When you're just learning what works - which products sell, what pricing is competitive, which search terms convert - you need visibility into your performance. Shopping campaigns give you that visibility. Performance Max asks you to trust the algorithm before you even understand your own business metrics.
Limited Budgets (Under $1,000/month)
Limited budgets under $1,000/month don't give Performance Max enough volume to optimize effectively. The algorithm needs data to learn, and at low spend levels, you're better off with the control of Shopping campaigns where you can manually prioritize your best products and most profitable search terms.
Niche Products
Niche products requiring precise targeting often perform better in Shopping campaigns. If you sell specialized industrial equipment or highly technical products, the expanded reach of Performance Max might just waste budget on unqualified audiences. Shopping campaigns keep you focused on people actively shopping for what you sell.
Standard Shopping Works Best When Control is Key
When you need granular control and reporting, Shopping campaigns are non-negotiable. If you're optimizing profit margins by product line, if you need to report performance by manufacturer or category, if you want to adjust strategy based on specific search term performance - you need the visibility that only Shopping campaigns provide.
Products with complex variations or sizing can be easier to manage in Shopping campaigns where you can see performance by specific variants and adjust accordingly. Performance Max handles variations, but when you can't see which sizes or colors drive results, optimization becomes guesswork.
When Performance Max Is the Better Choice
There are absolutely scenarios where Performance Max outperforms Shopping campaigns.
Established Accounts with Conversion History
Established accounts with conversion history are the sweet spot for Performance Max. If you've been running Shopping campaigns for 6+ months and have consistent conversion data, Performance Max can build on that foundation. The algorithm can analyze what worked in your Shopping campaigns and find similar opportunities across other Google properties.
Budgets Over $2,000/month+
Larger budgets over $2,000/month give Performance Max the volume it needs to optimize effectively. At this spend level, you're generating enough conversions for the algorithm to identify patterns and make smart decisions about where to allocate budget.
Stores with Large Product Catalogs
Broad product catalogs with hundreds or thousands of SKUs benefit from Performance Max's automation. If you're spending hours each week managing Shopping campaign structure and bids across a huge catalog, Performance Max handles that complexity automatically. The algorithm can identify your best sellers and high-margin products and shift budget accordingly.
You Have Top Notch Lifestyle/Brand Photos & Videos
When you have quality creative assets - lifestyle photography, product videos, brand imagery - Performance Max can leverage these across YouTube, Display, and Discover placements. If you're already creating this content for your website or social media, Performance Max lets you extract additional value from it.
Scaling successful campaigns is where Performance Max shines. Once you know your products, your customers, and your unit economics, Performance Max can find more of the same customers in places you weren't actively advertising. It's particularly good at discovery - finding people who match your customer profile but weren't actively searching for your products yet.
Can You Run Both Shopping Campaigns and Performance Max?
This is the question everyone asks, and Google's answer has evolved over time.
Google's official stance is that you can technically run both, but they don't recommend it for the same products in the same geographic areas. The concern is that your campaigns will compete against each other in auctions, driving up your costs.
Potential conflict and cannibalization is real. If both campaign types are targeting the same search queries with the same products, you could end up bidding against yourself. Performance Max typically gets priority in auctions, which means your Shopping campaign might get fewer impressions even if you want it to.
Strategic use cases for running both do exist. Some advertisers run Shopping campaigns for their core best-selling products where they want full control, and Performance Max for everything else to capture incremental volume. Others use Shopping campaigns during high-stakes periods (Black Friday, product launches) when they need predictable performance, and Performance Max during slower periods for discovery.
Budget allocation between the two matters if you're running both. Make sure you're tracking performance separately and can clearly see the incremental value from each campaign type. If Performance Max is just cannibalizing Shopping campaign conversions without adding new volume, you're paying twice for the same results.
How to Transition from Shopping Campaigns to Performance Max
If you decide Performance Max is right for your business, don't just flip a switch.
Step-by-step migration process:
- Create your Performance Max campaign as a draft without launching it
- Build out complete asset groups with quality creative
- Set the same or slightly lower budget as your Shopping campaigns initially
- Launch Performance Max while keeping Shopping campaigns running for 1-2 weeks
- Monitor for cannibalization and total account performance
- Gradually shift budget from Shopping to Performance Max over 3-4 weeks
- Pause Shopping campaigns once Performance Max demonstrates consistent performance
Set Your Baseline Before Switching
Look at your Shopping campaign performance over the last 90 days. Identify your top products, best-performing search terms, conversion rates by product category, and overall ROAS. This baseline helps you evaluate whether Performance Max is actually improving results or just shuffling conversions around.
Common Mistakes To Avoid:
Don’t make these mistakes, if switching to Performance Max:
- Switching too quickly (the learning phase causes volatility)
- Not building complete asset groups (limited creative hurts Performance Max performance)
- Setting target ROAS too aggressively (the algorithm can't find profitable volume)
- Not accounting for the learning phase when evaluating results.
What To Expect In the First 30 Days
The learning phase takes is typically 2-4 weeks, depending on your conversion volume. During this time, performance will fluctuate significantly. Don't panic or make changes during learning - let it run unless something is clearly broken (like spending way over budget with zero conversions).
Make sure you also monitor daily spend and pacing, conversion volume compared to Shopping campaigns, ROAS trends, which asset groups drive results, and whether Performance Max is finding new customers or just serving the same audiences as your Shopping campaigns did.
Performance Max Setup Requirements for E-commerce Success
If you're going with Performance Max, set it up properly from day one. Focus on the areas below to ensure your campaign maximizes its chances for success.
Product Feed Quality
Product feed optimization is still foundational. Even though Performance Max automates a lot, your product titles, descriptions, images, and categorization directly affect performance. Everything you'd optimize for Shopping campaigns still matters for Performance Max - maybe even more so since you have less direct control.
Asset Group Structure
Asset group structure should align with how customers shop your store. Create asset groups by product category (men's vs. women's clothing), by price point (budget vs. premium), by use case (workout gear vs. casual wear), or by margin if you're focused on profitability. Don't create 47 asset groups for 47 products - group strategically.
Quality Audience Signals
Audience signals that actually work include your customer list (if you have one), website visitors, YouTube engagers, and custom audiences built around customer characteristics or interests. These signals guide the algorithm early on but don't restrict who sees your ads. Better signals lead to faster learning and better performance.
Server-side / Quality Conversion Tracking
Conversion tracking requirements are non-negotiable. You need clean, accurate conversion tracking with proper values assigned. Performance Max optimizes toward your conversion goal, so if your tracking is broken or missing significant conversions (like phone orders), the algorithm will optimize toward incomplete data and performance suffers.
Budget
Budget minimums for effective performance: Google says Performance Max works at any budget, but realistically, you need enough spend to generate 30-50 conversions during the learning phase. For most businesses, that means $50-100/day minimum. Below that, learning takes forever and performance stays volatile.
Making the Decision: A Framework for Your Business
Here's how to actually decide what to do.
Questions to ask yourself:
- Do I have at least 3 months of consistent conversion data?
- Is my monthly Google Ads budget over $1,500?
- Do I have quality images and videos to use as assets?
- Can I handle 2-4 weeks of uncertain performance during learning?
- Do I need detailed search term visibility for my business?
- Is my conversion tracking accurate and complete?
Budget considerations: If you're spending under $1,000/month, stick with Shopping campaigns. Between $1,000-2,000/month, you could test either depending on your conversion volume. Over $2,000/month, Performance Max becomes more attractive.
Technical capabilities assessment: Do you have the creative assets Performance Max needs to succeed? Can you build out comprehensive asset groups? Is your Merchant Center feed optimized? If any of these are "no," address them before migrating.
Risk tolerance evaluation: Performance Max requires trusting the algorithm with less visibility into what's happening. If that makes you uncomfortable, or if you're in a high-stakes period (Q4, major product launch), stick with the control of Shopping campaigns.
Timeline and testing approach: Don't feel pressured to choose one permanently. You can test Performance Max for 90 days while maintaining Shopping campaigns as a backup. Evaluate after the learning phase completes and you have real data.
There's No Universal "Right" Answer
Most e-commerce businesses will eventually need to use Performance Max - Google is clearly moving in that direction. But "eventually" doesn't mean "right now."
If you're a new business, start with Shopping campaigns to learn your business. If you're established with good tracking and sufficient budget, Performance Max likely offers incremental value. If you're somewhere in between, test carefully and make decisions based on your actual results, not Google's promises or your agency's preferences.
The goal isn't to pick the "right" campaign type - it's to pick the right campaign type for your business at this specific moment. That answer might change as your business grows, your budget scales, or Google's products evolve.
If you're trying to figure out the right campaign structure for your e-commerce business, schedule a consultation with our team. We'll review your current performance and recommend a strategy based on your specific situation, not a one-size-fits-all answer.
