If you are running Target CPA or Target ROAS on a campaign that is limited by budget, sit down for this one. From 17 August 2026, Google is updating its bidding systems so that campaigns perform closer to the number you actually typed in, rather than the better, more efficient number the algorithm has been quietly finding for you behind the scenes.
Yes, you read that right. Google is changing Smart Bidding so that certain over-performing campaigns will become less efficient on purpose.
What is actually changing
Imagine this scenario: You set a Target CPA of £10. Your daily budget is tight, so the campaign gets marked as “Limited by budget”. Up until now, Smart Bidding handled budget limits by cherry-picking only the absolute cheapest, highest-converting auctions. Over a few months, your actual CPA settled at £5 that was half your target. You probably never complained, because converting at half price is a great outcome.
From 17 August, that quiet win goes away. According to Google Ads Help documentation on target-based bid strategies, a budget-constrained campaign with a £10 target that currently delivers a £5 CPA will begin delivering much closer to the £10 target you originally set.
The update impacts Target CPA, Target ROAS, and Target CPC (for Demand Gen campaigns). Google’s FAQ guidance says the change applies to Search, Shopping, Performance Max, Demand Gen, and Travel campaigns. It does not affect Manual CPC, Target Impression Share, App, or Video campaigns, nor does it impact campaigns with healthy, unconstrained budgets.
Google’s stated reasoning is that budget changes currently cause unpredictable efficiency swings, and locking delivery to your explicit target provides more consistent results when scaling. That makes engineering sense, but whether it is a welcome discovery on a campaign you haven’t reviewed in eighteen months is a different story.
Who is in scope?
The trigger for receiving account notifications is a 12-month lookback. If a campaign was flagged as limited by budget at any point over the last year, Google flagged the account.
To help advertisers adjust before the deadline, Google rolled out the Bid Target Adjustment Tool directly inside Google Ads on 6 July 2026. This tool scans your account, flags affected campaigns, and displays your historical performance alongside your set target so you can adjust your figures in a single click.
If you manage your own account, it is worth logging into Google Ads to check your alerts or review the tool before August 17.
What to actually do about it
- Open the Bid Target Adjustment Tool in Google Ads and review any flagged campaigns.
- Compare set targets against actual performance. If your Target CPA is set to £20 but your actual recent CPA is £11, that campaign will see costs drift upward after August 17 unless you intervene.
- Decide deliberately. You have four main options:
- Match your actual performance: Update your target down to match recent performance (£11) to lock in your current efficiency.
- Increase your daily budget: Remove the budget constraint entirely so the campaign can scale cleanly at your current target.
- Switch your bid strategy: Change to Maximize Conversions or Maximize Conversion Value. These strategies focus on getting the highest volume within your set budget without an explicit CPA or ROAS ceiling.
- Leave it as is: Accept that performance will drift closer to your original target in exchange for potential volume gains.
- Leave unaffected campaigns alone. This update is not a reason to re-tune or disrupt campaigns that are not budget-limited.
The bigger takeaway
I expect brand campaigns and mature accounts with legacy bidding targets to be hit hardest by this change. Brand search naturally converts cheaply, making it a prime candidate for quietly beating targets under budget caps without anyone noticing.
More than anything, this update is a reminder that “set and forget” automated bidding strategies still require regular human oversight. The account wasn’t set up wrong—the platform simply changed the underlying rules.
If you’re not sure whether any of your campaigns are affected or you’d rather have someone else run the audit before the 17th, drop me a line at will@sharpstonesmedia.co.uk.