How to Lose Money with Google Ads: The Perils of Auto-Recommendations

Running Google Ads can be a powerful tool for businesses looking to increase their online presence, drive traffic to their websites, and ultimately generate more sales. However, the effectiveness of your Google Ads campaign heavily relies on how well you manage and optimize your settings. One of the most common pitfalls for both novice and experienced advertisers is the use of Google’s Auto-Recommendations. This seemingly helpful feature can, in fact, lead to significant financial losses if not handled correctly.

After numerous sessions with “Google Ads experts” employed by Google, it has become evident to me that they lack a fundamental understanding of business strategy. Their default advice often revolves around “turning on recommendations” and “increasing your budget” as the primary solutions. This approach is so common that it has become a running joke among seasoned advertising professionals. In private Reddit forums and conversations with industry experts like Aaron Young, we often discuss how misguided these recommendations can be.

The cover image is a live example of a client I was helping, and when I looked into their account, found them spending nearly $80,000 month and an agency turned on auto-recommendations for them?.. I nearly choked! Imagine that… you have an $80,000 a month budget, use a 3rd party agency to handle Ads, and they turn on auto-recommendations in your account.

The Allure of Auto-Recommendations

Google Ads Auto-Recommendations are designed to simplify the management of advertising campaigns by automatically suggesting changes that could potentially improve performance. These recommendations range from bid adjustments and keyword additions to ad copy suggestions and budget increases. For advertisers who are new to the platform or those who don’t have the time to constantly monitor their campaigns, these automated suggestions can seem like a godsend.

However, after managing hundreds of Google Ads accounts, I have found that Auto-Recommendations often do more harm than good. In fact, turning off Auto-Recommendations is one of the first steps I take when optimizing a new account.

Why Auto-Recommendations Can Be Detrimental

1. Lack of Contextual Understanding

One of the main issues with Auto-Recommendations is that they lack the nuanced understanding of your business that a human advertiser possesses. Google’s algorithm might suggest adding keywords or increasing bids based on historical data, but it doesn’t understand the specific goals, target audience, or unique selling propositions of your business. This lack of context can lead to irrelevant traffic, wasted clicks, and ultimately, wasted money.

2. Overly Aggressive Bidding

Auto-Recommendations often suggest increasing bids to achieve better ad placements. While this might result in higher visibility, it also leads to higher costs without necessarily improving the quality of traffic. Over time, these increased bids can significantly inflate your advertising budget, reducing the overall return on investment (ROI).

3. Unnecessary Keyword Additions

Another common recommendation is the addition of new keywords. While expanding your keyword list can be beneficial, Auto-Recommendations often include broad match keywords that are not relevant to your business. These broad match keywords can trigger your ads for unrelated search queries, leading to a high number of irrelevant clicks and a low conversion rate.

4. Generic Ad Copy Suggestions

Effective ad copy is crucial for attracting the right audience and encouraging clicks. Auto-Recommendations often suggest generic ad copy changes that may not align with your brand’s voice or messaging. This can dilute the effectiveness of your ads and reduce their impact.

5. Budget Adjustments

Google may recommend increasing your daily budget to capture more traffic. While this might seem like a good idea, it can quickly lead to overspending, especially if the additional traffic is not converting into sales or leads. Without careful monitoring, these budget increases can drain your advertising funds without providing a corresponding increase in revenue.

A Red Flag: Indication of Inexperience

One of the clearest indicators that an account is being managed by someone with little to no basic skills in Google Ads is the presence of Auto-Recommendations. When I see an account where these recommendations are applied without discernment, it immediately raises a red flag. It tells me a story even before I begin my deep dive into the account’s performance metrics.

What This Signals

When Auto-Recommendations are left on by default, it suggests that the account manager might not fully understand the complexities of Google Ads. They might be relying on Google’s suggestions out of convenience or ignorance, rather than taking a proactive approach to campaign management. This often means:

1. Lack of Strategic Planning: The account manager may not have a clear strategy or understanding of the business goals. Instead of setting specific objectives and KPIs, they might be relying on generic recommendations that don’t align with the business’s unique needs.
2. Inadequate Keyword Research: Proper keyword research is essential for a successful campaign. Relying on Auto-Recommendations often means that this crucial step is being overlooked, leading to irrelevant traffic and wasted ad spend.
3. Poor Ad Copy: Generic ad copy recommendations indicate a lack of creativity and understanding of the target audience. Effective ad copy requires a deep understanding of what resonates with potential customers, something Auto-Recommendations cannot provide.
4. Uncontrolled Budget Management: Allowing Google to automatically adjust budgets can lead to overspending without a corresponding increase in conversions. A skilled account manager knows how to allocate budgets strategically, something that can’t be achieved through automated recommendations.

The Importance of Manual Optimization

Manual optimization is crucial for avoiding these pitfalls and ensuring that your Google Ads campaign is both effective and efficient. Here’s why:

1. Tailored Strategy: Manual optimization allows you to create a tailored strategy that aligns with your business goals. By understanding your target audience, competitive landscape, and unique selling points, you can make informed decisions that drive meaningful results.
2. Better Control Over Bidding: Manual bidding strategies enable you to allocate your budget more effectively. You can prioritize high-converting keywords and adjust bids based on performance, ensuring that you get the most value from your advertising spend.
3. Relevant Keyword Selection: By manually selecting keywords, you can ensure that your ads are shown to the right audience. Focusing on long-tail keywords and exact match terms can improve the relevance of your traffic and increase conversion rates.
4. Customized Ad Copy: Creating customized ad copy that resonates with your target audience can significantly improve the effectiveness of your ads. By emphasizing your unique selling propositions and aligning your messaging with your brand’s voice, you can attract more qualified leads.
5. Controlled Budget Management: Manually managing your budget allows you to allocate funds where they are most needed. You can test different budget levels, measure performance, and make adjustments based on actual results, ensuring that you don’t overspend on ineffective campaigns.

Overall…Shut off Auto-Recommendations

While Google Ads Auto-Recommendations may seem like a convenient way to optimize your campaigns, they can often lead to significant financial losses. The lack of contextual understanding, overly aggressive bidding, unnecessary keyword additions, generic ad copy suggestions, and uncontrolled budget adjustments can all contribute to wasted advertising spend.

After managing hundreds of Google Ads accounts, I have found that turning off Auto-Recommendations is a critical step in achieving better results. Manual optimization allows for a tailored strategy, better control over bidding, relevant keyword selection, customized ad copy, and controlled budget management. By taking the time to manually optimize your campaigns, you can ensure that your advertising dollars are spent effectively, driving meaningful results for your business.

In the world of Google Ads, sophistication and labor-intensive management are key to success. Relying on Auto-Recommendations can be a costly mistake, but with a strategic approach and careful monitoring, you can achieve a higher return on investment and avoid the pitfalls of automated suggestions.