I have set a clear daily budget for my Google Ads campaign, but suddenly on one or several days the budget is consumed significantly beyond the budget limit. Why does this happen? What are the consequences? How can I avoid or solve it? This article aims to answer these questions.

Google Ads daily budget and how it works

The Google Ads daily budget is the average amount an advertiser is willing to spend on a specific campaign each day. You can set and modify your average daily budget at any time.

Here’s how daily budgets work in Google Ads:

Each campaign in Google Ads sets its own budget. Multiply your daily budget by 30.4 (the average number of days in a month) and that’s the monthly budget that the Ads system sets for your campaign.

Google optimizes campaign spend for the days when you’re most likely to get clicks and conversions. This means that on some days, your ads may not meet your average daily budget, and on other days, they may go over budget.

Why does Google Ads go over your set daily budget?

Google Ads uses a complex algorithm designed to maximize your ad performance. The algorithm considers a variety of factors, such as ad quality, keyword competitiveness, and the behavior of your target audience. Here are some reasons why your Google Ads daily budget may go over:

1. High-quality clicks

Google emphasizes achieving advertising goals rather than strictly adhering to budget limits. Its algorithms are designed to identify potential high-quality clicks. These clicks are likely to result in conversions. If your goal is to achieve 100 conversions, and Google can achieve these conversions by exceeding your daily budget on some days, then the system algorithm will go over the daily budget line.

2. Running on highly competitive keywords

If you bid on highly competitive keywords, you may find that your daily budget runs out quickly. This is because highly competitive keywords often have higher cost-per-click (CPC). If your daily budget is not enough to cover the high CPC, you may end up overspending.

3. Target audience behavior

The behavior of your target audience can also affect daily budgets. For example, if there is a sudden surge in search volume for your keyword, you may find that your daily budget runs out quickly. Similarly, if your ads are performing well and have a high click-through rate (CTR), this can also lead to overspending.

4. Mid-month budget changes If you adjust your daily budget mid-month, Google will reset your monthly spend and start the calculation from scratch for the rest of the month.

Google will set a new monthly budget and apply it to the rest of the month. Let’s say you set a budget of $50 for the first 10 days of the month. Then, you increase your budget to $100 for the next 10 days. Finally, you increase your budget to $150 for the last 10 days. In the first 10 days, Google calculates your monthly budget as $1,520, and the daily budget is consumed up to $100. So, you can spend up to $1,000 in the first 10 days. On the 10th day, if you increase your budget to $100, Google doesn’t take into account the amount you’ve already spent. It calculates a new average for the entire month, which is $3,040. Now, it can spend up to $200 per day in the next 10 days, for a total of $2,000. On the 20th day, if you change your budget to $150, Google starts the calculation again, with a monthly average of $4,560. For the rest of the month, the daily budget is consumed up to $300, for a total of $3,000.
So, by the end of the month, you’ve spent up to $6,000 on ads, even though your highest calculated average was only $4,560. But this is rare. Still, be careful. Set a low daily budget and, more importantly, try to avoid changing your budget too often mid-month.

How much can you overspend with Google Ads?

Google Ads can overspend up to 2 times your average daily budget in a single day, but your total monthly spend will not exceed 30.4 times your average daily budget. This is called the “overdelivery” feature. It’s useful because if your ads are showing so many times that your costs exceed your average daily budget for the billing cycle, Google will refund your account for these additional costs.

Consequences of overspending your Google Ads daily budget

While overspending your Google Ads daily budget may seem beneficial at first glance, as it can lead to more clicks and potential conversions, it’s important to understand its potential negative consequences, as it can hurt your ads in the long run.

Quickly exhausting your budget

One of the most immediate consequences of overspending your daily budget is exhausting your budget faster than expected. If Google spends more than your daily budget on certain days, you may find that your budget for the month is exhausted before the end of the month. This can cause your ads to not show for a period of time, and you may miss out on valuable clicks and conversions.

Inconsistent ad delivery
Because your budget is spent faster on some days, your ads may show more often on some days and less often on others. This inconsistency can lead to unpredictable performance and make it more difficult to measure and analyze campaign results.

Increased costs
Although Google guarantees that you will not be charged more than your monthly spending limit, overspending your daily budget will still result in increased costs. If your ads are performing well and generating conversions, overspending can be a good investment. However, if the extra clicks do not lead to conversions, overspending can result in increased costs without a corresponding increase in performance.

Ways to prevent overspending your Google Ads budget
Here are some things you can do to prevent overspending your Google Ads budget:
Adjust your daily budget
If your ads are performing well and generating conversions, it may be worth considering increasing your daily budget. This will allow Google to continue to get high-quality clicks without exceeding your budget. However, it is important to ensure that the increased spend is matched by the increased performance.

Implement a bid cap
A bid cap is a useful tool for controlling costs. By setting a bid cap, you limit the maximum amount you are willing to pay per click. This prevents Google from overspending your budget on expensive clicks that don’t necessarily lead to conversions.
Use negative keywords
Negative keywords are used to instruct Google not to show your ads for certain search queries. Using negative keywords can help prevent your ads from showing for irrelevant searches, which can save you from spending unnecessary money on ineffective campaigns.

Use scheduling
Ad scheduling allows you to control when your ads are shown. By running ads during certain hours or days of the week, you can ensure that your budget is spent when it is most likely to result in conversions. This helps prevent overspending during non-optimal times.

Monitor your campaigns daily
If you’re concerned that you’re overspending on Google ads every day, keep an eye on your ad reports to see how much you’re spending each day.
Monitoring your campaigns daily includes checking ad performance, tracking spend, and analyzing keyword performance. This can help you identify problems early and make informed decisions about your advertising strategy.
Contact Google Support
If you notice overdelivery charges that are more than twice your daily budget, you can contact Google Ads Support for help. They can review your account and request any eligible reimbursements.