Last week, Google held its first-quarter earnings call, touting its year-over-year growth in search.
The company posted $68 billion in revenue in the first quarter, with more than 50% attributed to search and ads.
Performance Max campaigns were one of the highlights of search performance, indicating strong projections and investments from Google.
Strong research growth in 2022
Ruth Porat, Chief Financial Officer of Google, said:
“So in terms of the advertising business, I would say, as I did in the opening comments, we were very pleased with the year-over-year growth in search revenue in the first quarter, up 24%.”
The adoption of Performance Max seems to be one of the main reasons for the growth in search.
Google Chief Commercial Officer Philip Schindler then explained how the new AI-powered campaign type can help optimize advertiser performance.
“Since its global launch in November, PMax has seen strong customer adoption, especially among small businesses. The simplicity of PMax shows how we are moving from a model where businesses had to understand a complex language of campaigns, keywords, CPC, etc. – to a model in which we understand a company’s goals and actively help them achieve their business goals.
Schindler also added “…we’re very, very committed to helping Performance Max deliver to our advertisers and we’ve been very open to feedback from advertisers on how we can do that.”
Peak Performance Figures and Projections
Google provided a brief Performance Max case study on the earnings call. They highlighted a leading travel assistance company, AssistCard, in LATAM.
AssistCard began testing Performance Max in November 2021 during its first rollout.
During beta testing, Performance Max campaigns had a 40% lower cost per acquisition and 15X higher conversion rate compared to other types of campaigns with the same objectives.
The case study ended with the mention that AssistCard “will significantly increase spending on the new advertising format in 2022”.
With Performance Max replacing campaign types such as Smart Shopping and local campaigns, it’s no surprise that Google is betting on investing in this new campaign type.
Source: Alphabet Q1 2022 Earnings Call (PDF link)
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