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Optimize Budgets Across Platforms - Methodology and FAQ for Budget Reallocation Suggestions (Beta)
Optimize Budgets Across Platforms - Methodology and FAQ for Budget Reallocation Suggestions (Beta)
Frequently asked questions and the methodology behind Optimize Budgets Across Platforms
Geetanjali Tyagi avatar
Written by Geetanjali Tyagi
Updated over a week ago

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Methodology

Frequently asked questions:

Get Optimization Suggestions

​​You'll see suggestions for budget optimization on each tab depending on the target you want to achieve: Optimize clicks, Optimize Conversions, or Optimize Conversion Value.

Each row in the table represents a different reallocation scenario and carries a different aggressiveness level. Next to every number, you'll see the % of increase/decrease it would undergo with that particular change.

To generate suggestions, impression share lost due to budget is analyzed. If there are campaigns that are losing impression share (due to budget constraints), the tool tries different daily budgets and, based on the historical spending; it calculates a potential daily spend. Only if it detects that there is impression share lost due to budget, the system recommends increasing the daily budget.

Based on historical performance patterns, the system identifies those budgets that have a good chance of getting more clicks, conversions, or conversion value (depending on the selected target). It doesn’t only look for cheaper clicks and conversions or higher conversion value but also takes into account patterns, e.g. if the campaign(s) associated with the budget tends to perform well at the beginning or at the end of the selected period.

After you select a row, the system will reallocate budgets based on the selected goal.

At the moment, reallocation suggestions are made between Google Ads, Microsoft Advertising, and Yahoo Ads campaigns. If you've included Facebook campaigns and ad set budgets in the budget group, you can manually edit the daily budgets, but intelligent suggestions are not available at the moment.

The system considers the maximum limit for each budget’s saturation point. The saturation point is the maximum budget amount that will get more impressions.

  • Daily Budget - Current daily budget for the entity.

  • Edit Daily Budget - Option to set a new daily budget.

  • Projected Spend - The amount that a budget will end up spending by the end of the selected date range.

  • Recent IS Lost (Budget) - Impression share lost due to budget restrictions.

  • Avg. daily spend - Average daily spend so far during the selected date range.

  • Potential daily spend - A projection for the potential for daily spend if the reallocation suggestion is accepted.

If the potential daily budget is larger than your daily budget, then it'll highlight in yellow. Budget reallocation suggestions are made within the selected budget group.

Frequently Asked Questions

Are Performance Max and Facebook included in the reallocation suggestions?

Performance Max and Facebook campaigns are currently excluded from the reallocation suggestions. The reason is, one of the data points the budget reallocation features use is the Impression Share Lost (budget). However, impression share metrics are not available for these campaign types at the moment. To make sure the reallocation suggestions are relevant and accurate, ad spend from Performance Max and Facebook campaigns is not considered in the total reallocation amount, and the system won’t suggest reallocation from or to Performance Max or Facebook campaigns.

You can still manually change the daily budget amount by editing the Edit Daily Budget field and applying the changes.

Our team is working on a workaround to help you reallocate budgets across Facebook and Performance Max campaigns as well. If you’d like to submit a feature request, please feel free to contact support@optmyzr.com.

Which Optimization Suggestion goal is the default?

If the system detects conversion value being used in the account, the Optimize Conversion Value strategy is selected by default. If no conversion value is detected, then the tool will try to optimize conversions and, finally, clicks

Why is the system projecting a decrease in conversions when giving optimization suggestions to increase clicks?

When generating optimization suggestions, the system reallocates the budget across campaigns to help achieve the selected goal. If we specify that our goal is to increase clicks, the system will allocate more budget to campaigns that have a higher click-through rate to capture the opportunity to increase clicks. This may lead to a decrease in the budget of campaigns that have a lower CTR but a higher conversion rate, which could cause a drop in conversions in these campaigns.

If the campaigns with the best CTR have a low conversion rate, even the increase in clicks may not generate a significant improvement in the conversion rate; hence the number of conversions projected for these campaigns may not compensate for the loss of conversions the system is projecting on campaigns for which the budget was reduced.

Does the tool recommend increasing ad spend?

No, the tool doesn’t recommend increasing or decreasing the budget: it simply shows different reallocation scenarios and predicts how selecting one would affect the performance of each displayed metric.

Therefore, if the projected spend is significantly below your target budget and there is room to spend more, you can use the tool to find a reallocation scenario that will help you avoid underspending. On the other hand, if it looks like the selected budgets will overspend, you can see if one of the reallocation scenarios would help you reduce cost in the most sustainable way possible.

Why is budget reduced for a campaign with a relatively low CPA?

This can happen if:

  1. There’s a significant gap between the Avg. Daily Spend and Budget amount. This means the associated campaign is not spending the full budget amount in the first place.

  2. The associated campaign doesn’t have the potential to keep getting more conversion value, conversions or /clicks (depending on which goal you’ve selected)/conv.value based on historical performance.

  3. Some of the campaigns associated with the budget are not active.

  4. You’ve selected a reallocation scenario that will reduce the projected spend significantly

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