Performance Max Custom Acquisition: Prioritizing New Customer Growth

The Low-Hanging Fruit Problem

Performance Max campaigns are designed to deliver results quickly. To accomplish this, Google's algorithm takes the path of least resistance:

• Targets warm audiences first—people who've visited your website or engaged with your brand
• Prioritizes remarketing spend—pushing already-interested prospects over the conversion line
• Delivers impressive initial metrics—making the campaign appear highly successful

The Predictable Pattern

Timeframe	What Happens	Performance
Week 1-2	Warm audiences convert	Exceptional
Week 3-4	Warm audience pool depletes	Sharp decline
Week 5+	Struggles to find new customers	Stagnant or poor

Why Small Businesses Get Hit Harder

• Limited warm audience pools that exhaust quickly
• Smaller customer bases that can't sustain remarketing-heavy campaigns
• Greater need for consistent new customer acquisition

Understanding the Core Problem

Performance Max doesn't distinguish between customer types by default. A conversion from someone who visited your site yesterday is weighted the same as a brand-new prospect—even though new customers are typically far more valuable.

The Solution: Customer Acquisition Settings

Setting	What It Does
Bid higher for new customers	Adds value premium when targeting prospects
New customers only	Only bids on acquisition (excludes remarketing)
Off	Treats all customers equally (default)

Recommended: Bid Higher for New Customers

• Maintains remarketing capability
• Increases competitiveness for new prospects
• Balances acquisition and retention
• Best for most businesses

Step 1: Enable Customer Acquisition

1. Go to PMax campaign settings
2. Find "Customer acquisition" section
3. Select "Bid higher for new customers"

Step 2: Set New Customer Value Premium

How much extra are you willing to pay for a new customer?

Business Type	Recommended Premium
High repeat purchase rate	50-100% premium
Moderate repeat purchase	30-50% premium
One-time purchase business	10-30% premium

Step 3: Upload Customer Lists

Google needs to know who your existing customers are:

• Go to Tools → Audience Manager
• Upload customer email list
• Wait 24-48 hours for processing
• Apply to PMax campaign's audience signals

Step 4: Verify Configuration

• ☐ Customer acquisition enabled
• ☐ Value premium set appropriately
• ☐ Customer lists uploaded and matched
• ☐ Audience signals applied to campaign

The LTV Method

Formula: Customer Lifetime Value - First Purchase Value = Maximum Premium

Example:

Metric	Value
Average customer LTV	$500
First purchase value	$100
Maximum new customer premium	$400
Conservative setting (50%)	$200

The Repeat Purchase Method

Formula: First Purchase × Average Repeat Rate = Additional Value

Example:

• First purchase: $100
• 40% of customers repeat purchase
• Average repeat value: $80
• Additional value per new customer: $32
• Premium: $32 (32% of first purchase)

Key Metrics to Track

Metric	What to Look For
New vs. existing customer ratio	Should improve after configuration
New customer CPA	May be higher but within premium range
Overall blended CPA	Should remain stable or improve
Backend new customer revenue	Ultimate success metric

When to Adjust Premium

• Increase premium if: Still mostly targeting existing customers
• Decrease premium if: CPA too high for profitability
• Maintain if: Good balance of new and existing

Warning Signs

• New customer ratio not improving after 2-3 weeks
• Overall CPA increasing without volume gains
• Backend revenue not matching Google Ads conversions