Google Ads Bidding Changes (August 2026) and What You Need to Do Before 17 August

Google has announced that it is changing how budget limited campaigns handle their bidding targets. From 17 August 2026, campaigns that are limited by budget will optimise consistently toward the target you have set (Target ROAS, Target CPA or Target CPC on Demand Gen) instead of overdelivering the way many do today.

If your campaigns currently beat their target (and many budget limited ones do significantly outperform their configured target), leaving the target as is could pull your performance down to that lower number. Google has stated that it will not adjust your targets for you. The fix is straightforward – before the changeover, review each affected campaign and adjust each target toward its recent actual performance where appropriate. Here at Calibrate, for ROAS campaigns, we tend to set the target at about 90% of the trailing figure so that you lock in the efficiency you already have while keeping room to spend.

What is actually changing?

At present, a campaign that is capped by its budget will often spend that budget on the best return it can find – which frequently lands well above the target you set. For example, across the Google Ads accounts we manage, it is fairly common to see a campaign sitting on a 3x target but delivering 8x, simply because the budget runs out before Google needs to chase lower return conversion opportunities to hit the target.

Once the change occurs, however, Google will – put simply – treat the stated target as the goal to optimise toward instead of a floor to beat. For a campaign that has been overdelivering, that means the system has the ability to bid more aggressively and therefore could spend the same budget on lower return conversions because you specified that 3x was the goal.

Why does it matter for your business?

The risk is not that you spend more because your budget cap does not change – it’s now that you get less back for the same dollar spent. The new behaviour can drift you down to your target, which can be a large step down in efficiency that is easy to miss unless you are watching for it.

The change applies to budget limited campaigns using target based bidding across Search, Shopping, Performance Max and Demand Gen. Target CPA campaigns are affected the same way – if yours has been beating its target CPA, you’ll need to consider resetting the target nearer to your recent actual CPA if maintaining current efficiency is your objective, otherwise the system now has permission to spend up to the figure you gave it.

What to do before the change?

Google has introduced a tool called the Bid Target Adjustment Tool that works to help you identify campaigns and suggests updated bidding targets based on historical performance. We asked Andrew McLeod, Calibrate’s Head of Media & Analytics, how he’d approach this change:

The goal is to reset your targets so they reflect what your campaigns are actually achieving, for example:

• Pull the ROAS for the “Last 28 days” for each target based campaign.
• Set the new target to roughly 90% of that trailing figure to keep most of your current efficiency locked in while continuing to leave a little headroom for volume.
• Make the change gradually. As a rule of thumb, we don’t raise a target ROAS by more than about 20% in a single week – because Smart Bidding needs time to adjust (and big jumps can stall delivery).
• Monitor return (& amount spent) for a couple of weeks after each change. Keep tweaking it to find the right balance of efficiency and volume.

Not every campaign needs adjusting. If a campaign isn’t budget limited, or if its current target already closely reflects actual performance, you may not need to make any changes. Focus first on campaigns showing a “Limited by budget” status and consistently outperforming their configured target.

Setting targets properly

A target ROAS is only useful if it reflects reality. Targets that were once set and forget tend to either choke volume or leave performance exposed when the platform changes how it reads them. It is worth revisiting your targets against recent actual performance on a regular basis and ensuring you move them in small steps.

This is the kind of change we handle for our clients as part of managing their paid media – so if you’d rather not work through all of your campaigns before this switch over, get in touch.