Google has announced a significant update to its Smart Bidding system that’ll start rolling out from 17 August 2026. While the change will occur behind the scenes, it may affect how some Google Ads campaigns perform. The change will affect campaigns currently Limited By Budget that are using Target CPA (Cost Per Acquisition) or Target ROAS (Return on Ad Spend) bidding strategies. Google says the update has been designed to make campaign performance more predictable and to align more closely with the bidding targets that advertisers set. Google is also introducing a Bid Target Adjustment Tool to help advertisers prepare for the rollout.
Google Ads Smart Bidding Update
At the moment, campaigns using Target CPA or Target ROAS can behave differently when they’re budget-constrained. Historically, Google has often become very selective about which auctions it enters in these situations. That can sometimes produce better-than-expected results, such as achieving a £50 CPA against a target of £75. From 17 August, Google will optimise much more closely towards the target you set. Instead of consistently outperforming the target, campaigns may become less conservative with bidding and spend.
It’s important to note that Google will not automatically adjust your bidding targets or budgets – instead, the algorithm will optimise differently within your existing budget to get closer to the target CPA or ROAS. The campaign may use more of its available budget or pace spend differently. You could see higher CPA or lower ROAS, and it may appear like spend has increased, but the budget itself hasn’t changed – only how Google allocates it.
It’s also worth noting that this update doesn’t affect every campaign type. Video reach, App Campaigns, and Video view campaigns will continue to use the existing bidding system.
Should You Make Any Changes to Your Campaigns?
If you’re using Target CPA or Target ROAS bidding strategies, Google’s recommendation is to check any campaigns currently marked as “Limited by budget”. It won’t automatically change bidding targets or budgets, so it’s important to check that your settings still reflect your business objectives before the August rollout begins.
Large changes to Google’s bidding algorithms often come with a short adjustment period while Google’s algorithms learn the new optimisation behaviour, so we expect some temporary fluctuations as campaigns adapt. Our team will be looking at overall performance trends and making considered adjustments where needed. That may include:
- Refining bidding targets to better reflect current objectives
- Adjusting budgets if campaigns become unnecessarily constrained
- Monitoring conversion quality alongside volume to ensure lead quality remains strong.
Our advice? Start making incremental changes well in advance. Ideally, target CPA/ROAS adjustments should be made before 17 August, gradually moving towards the desired target rather than making a large change on the day to help minimise disruption as the new bidding behaviour takes effect.
The Final Word
Google is making Smart Bidding more predictable and closely aligned with business goals. While some campaigns may experience short-term changes, the long-term aim is to create more consistent performance. We’ll be monitoring this rollout carefully and reviewing any impacted campaigns as the changes take effect. If you’re unsure how this update might impact your Google Ads campaigns or you’d like to discuss whether your bidding strategy is the right one for your goals, chat to our team.