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Daily Budget with Ad Scheduling

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# 1
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Hoping someone can shed some light on this. I've seen this issue raised in previous discussions, but I've seen conflicting answers as to how this really works.

 

I understand that Google defines one's monthly budget cap as 30.4*daily budget, and overdelivery can lead to up to 20% in incremental cost on any given day (and that overdelivery gets evened out on slow days to keep you close to your daily budget). When ad scheduling is introduced into the equation, though, things get a tad murky.

 

Example:

A client says she wants to spend $500 per month and run ads on weekdays only (M-F), and there are 20 weekdays in our example month.

 

Simple math would dictate a budget of $25 per day ($500/20 days = $25 per day). BUT, does Google actually interpret this as a monthly budget of $760 ($25*30.4=$760) and therefore go ahead and feel free to spend up to 20% more each day, thus potentially leaving my client with a $600 bill ($25*1.2*20=$600)? Or, does Google "see" the ad scheduling and realize I'm actually only showing ads on 20 days, not 30.4, and my budget is $500?

 

If Google goes by the "daily budget*30.4" rule, I should assume I'll incur 20% higher daily costs than what I have as my daily budget. So I should reduce daily budget to $20 to allow for 20% overspend (which would be $24) and finish the month just under budget at $480 ($24*20=$480). If I were running all 30.4 days instead of weekdays-only then this would be a non-issue because Google would look at my maximum monthly spend and adjust my daily spend accordingly.

 

Any insight/confirmation on this is greatly appreciated.

 

Brad

 

 

 

 

 

 

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Marked as Best Answer.
Solution
Accepted by RaggyRat (Google Employee)
September 2015

Re: Daily Budget with Ad Scheduling

Google Employee
# 4
Google Employee

Hi Brad,

The technical specialists have also confirmed this. Here's what you can do to work around this and avoid overspending:

 

Let's say you have 20 days on which your ads serve in a month and a daily budget B (take it as $10 if that makes it simpler). On normal serving, you can accrue costs of upto 30.4B or $304.

 

However, with scheduling, you only want to spend 20B or $200. If you set your budget to B or $10 here, you could accrue 20% extra traffic every day upto 30.4B or $304. But, with only the 20% increment that is allowed, there'y no way for the system to reach $304 in 20 days. The maximum it can reach is $240 or 24B as, if the system exceeds your budget by more than 20% on any given day - you won't have to bear those costs.

 

Hence, the simplest solution is to set your budget to 0.8B or $8 in this case. For your $25/day target budget, you should set your daily budget to $20 if you're scheduled to run only for 20 days.

 

Formula for calculating budget for any number of days scheduled.

Note: This is an empirical calculation

 

Let's say the number of days scheduled is A. Therefore, B x A = Total spend if budget is not overdelivered.

(1.2) x B x A = Max Overdelivered Spend. Now 1.2 BxA < 30.4 x B as long as A <24.32.

Therefore, if you're scheduling your ads for less than 24.32 days i.e. 24 days, 7 hours and 41 minutes, set your budget to 0.8 B or $20. If you're scheduling ads for any longer, set your daily budget to Monthly Budget/30.4 i.e $16.44.

 

Hope this helps.

 

Sincerely,

 

RR

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Re: Daily Budget with Ad Scheduling

Google Employee
# 2
Google Employee
Hi Brad,

Thanks for reaching out. I've checked with our specialists who've indicated that the system looks at 30.4*daily budget even when the ads are scheduled. To be doubly sure, I'm reaching out to the technical team for confirmation. I'll update you on this shortly.

Sincerely,

RR

Re: Daily Budget with Ad Scheduling

Follower ✭ ☆ ☆
# 3
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Thanks for talking to your specialists. Confirmation from your technical team would also be appreciated.
Marked as Best Answer.
Solution
Accepted by RaggyRat (Google Employee)
September 2015

Re: Daily Budget with Ad Scheduling

Google Employee
# 4
Google Employee

Hi Brad,

The technical specialists have also confirmed this. Here's what you can do to work around this and avoid overspending:

 

Let's say you have 20 days on which your ads serve in a month and a daily budget B (take it as $10 if that makes it simpler). On normal serving, you can accrue costs of upto 30.4B or $304.

 

However, with scheduling, you only want to spend 20B or $200. If you set your budget to B or $10 here, you could accrue 20% extra traffic every day upto 30.4B or $304. But, with only the 20% increment that is allowed, there'y no way for the system to reach $304 in 20 days. The maximum it can reach is $240 or 24B as, if the system exceeds your budget by more than 20% on any given day - you won't have to bear those costs.

 

Hence, the simplest solution is to set your budget to 0.8B or $8 in this case. For your $25/day target budget, you should set your daily budget to $20 if you're scheduled to run only for 20 days.

 

Formula for calculating budget for any number of days scheduled.

Note: This is an empirical calculation

 

Let's say the number of days scheduled is A. Therefore, B x A = Total spend if budget is not overdelivered.

(1.2) x B x A = Max Overdelivered Spend. Now 1.2 BxA < 30.4 x B as long as A <24.32.

Therefore, if you're scheduling your ads for less than 24.32 days i.e. 24 days, 7 hours and 41 minutes, set your budget to 0.8 B or $20. If you're scheduling ads for any longer, set your daily budget to Monthly Budget/30.4 i.e $16.44.

 

Hope this helps.

 

Sincerely,

 

RR

Re: Daily Budget with Ad Scheduling

Visitor ✭ ✭ ✭
# 5
Visitor ✭ ✭ ✭
Thanks so much for the confirmation and the thorough explanation. This helps clear things up for me and likely for some other AdWords users.

Greatly appreciate the help, RR!

Brad

Daily Budget with Ad Scheduling

[ Edited ]
Visitor ✭ ✭ ✭
# 6
Visitor ✭ ✭ ✭

Hi there! Just checking if this 2013 answer is still applicable? I was wondering if there was also a slightly more simple or clearer answer available? What with this being 'Basics for New Advertisers' forum Smiley Very Happy

 

Thanks!

Re: Daily Budget with Ad Scheduling

Google Employee
# 7
Google Employee
Hello,

Thanks for checking. This 2013 reply is not exactly relevant anymore since
our system can now overdeliver your ads by upto 2x on any given day as
opposed to 20%. I'll have to dig into this and get back to you on a more
comprehensive solution. This may take me some time, so feel free to call in
to support with this question if you can't wait. Smiley Happy

Sincerely,

--
Raghav Rao | Account Manager | raghavrao@google.com |
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