Are Google Ads Smart campaigns an intelligent investment?

When it comes to advertising online, Google Ads has been the go-to platform for businesses seeking to expand their digital presence since the early 2000s. Kook has been managing Google Ads / AdWords campaigns since the very beginning. Among its many campaign options, "Smart” campaigns (formerly known as AdWords Express campaigns) promise an easy setup process and a simple interface for busy business owners looking for do-it-yourself advertising results. The campaigns are quick and easy to set up, offering just a few steps before you enter your credit card info and link to your Google business listing.

But a closer examination reveals that Google Smart campaigns are not as intelligent as they appear, with lack of transparency hiding poor return on investment.

One glaring issue with a Google Ads Smart campaign is its inability to track the success of a campaign. Designed to attract DIY advertisers, these campaigns lack any meaningful website conversion tracking (code that lets us know when someone clicks an ad and performs a valuable action on a website). Without this tracking, you’re “flying blind”, with no idea of whether an expensive click is actually valuable to your business or not. This limitation leads to a campaign that can tell you how much money your business is paying Google, but not what business is being returned.

The focus of Smart campaigns on driving website traffic rather than optimising for conversions can result in a wildly optimistic boost in Click-Through Rates (CTR). This initial success, however, can quickly unravel upon closer inspection. The real test of a campaign's effectiveness lies not in high CTRs, but in its ability to generate meaningful conversions and revenue for the business.

Perhaps one of the most significant pitfalls of Smart campaigns is the poor reporting they offer. Businesses are left grappling with inadequate reporting features that fail to provide a comprehensive overview of campaign performance. Poor reporting leads to poor decisions which leads to poor results, a vicious marketing cycle. Using a "Smart" campaign in Google Ads is like playing golf but you never get to see where the ball lands. You know you hit it, it felt good, but you don’t know where it went.

In the past 12 months Kook has transformed the ROI for more than a dozen clients who used Smart campaigns before coming on board for professionally-managed Google Ads campaigns. The numbers speak for themselves!

• A Sunshine Coast electrician spent more than $1500 on a “Smart” campaign that delivered 1200 clicks of the ad in a short period of time, but only 2 phone calls… a cost per phone call of over $750! After only a month, Kook’s customised search campaigns have delivered a conversion rate more than 40 times higher, at a fraction of the cost.
• A dentist in Queensland spent more than $3200 on a “Smart” campaign that delivered 790 clicks but at a very high cost per enquiry and phone call compared to the benchmarks for that kind of business. Their Kook search and display campaigns have improved their cost per conversion by 74%, delivering 2.5 times more leads with the same spend.
• A Sunshine Coast residential cleaning company had a cost per conversion of more than $118 using a Google “Smart” campaign. Their Kook search and display campaigns generate a cost per conversion less than $37 with a conversion rate that is 24 times greater.
• An Australian manufacturer of adjustable beds and chairs spent more than $8800 on a Google “Smart” campaign and received a cost per conversion that was 27% higher than their professionally-designed Kook search and display campaigns. They now receive more than 4 times as many enquiries and phone calls per month.
• A mortgage company in Victoria spent over $3800 on a “Smart” campaign and received 1 phone call and 2 enquiries from the resulting 4929 clicks, a cost per conversion of over $1200 (OUCH!). Their Kook search campaign costs $32 per conversion, over 36 times better.
• Another “recurring service” business spent over $1500 on a “Smart” campaign and received a grand total of 5 customers, at a cost per customer of over $300 for a service that generates about $20 a month in revenue for the business. This means that each of those 5 customers would have to stay a customer for over a year just to break even on the cost to advertise! Since ditching “Smart” campaigns, the business’s Kook campaigns have a lifetime cost per conversion under $11, just 4% of the previous cost, and an infinitely better lifetime return on investment.

In conclusion, while Google Ads "Smart" campaigns promise simplicity and automation, they often fall short in delivering meaningful results for businesses. The inadequate conversion tracking, the focus on traffic over conversions, and the lack of comprehensive reporting features are substantial concerns that can lead to wasted advertising budgets and missed opportunities. Businesses seeking genuine success in their digital advertising endeavours would be wise to carefully consider the limitations of "Smart" campaigns and explore alternative strategies that prioritise accurate measurement and tangible outcomes.