What does it mean? Well, it means that your ads could show more often, if there was enough budget to do so. For example, if you have a budget of £10 a day and each click costs £1, but there is enough demand for 20 clicks a day, your account would be limited by budget as it is not able to show for all 20 clicks.
Some inexperienced PPC consultant would simply tell you to increase your daily budget, if the ‘Limited By Budget’ label was showing. Sometimes, this is the best answer, but there is usually a bunch of other things you can do before handing more money over.
If the campaign is performing really well and you are happy with the cost per conversion that you are currently paying, there is no reason why you wouldn’t just increase the budget. The problem we have is that it’s usually poor performing accounts that need more budget, so business owners are more reluctant to increase the budget for something that is not working well.
There are many different things that could cause your account to be limited by budget, which I will go into more detail below:
Badly setup campaigns is a common cause of being limited by budget. There are simply too many settings for me to run you through them all, but the common ones are budget delivery and keyword match types.
Going back to my example from earlier, if you have £10 a day budget and each click costs £1. But your badly setup campaign is wasting £3 a day, you are only getting £7 worth of decent clicks. So sometimes there are a few simple tweaks that you could do to help your account.
Why I mean by this is that you are biting off more than you can chew. By trying to target too much with a small budget, you might be leaving yourself short. For example, if you are a local company, you may have your geo targeting too big.
Or if you are promoting two or more services on AdWords, try pausing one so that you are not spreading your budget too thin. Focus on getting that one service working before you try and branch out.
This one is pretty much the same as above. Your campaign might be set up correctly and performing well as it is, so you may just need to add more budget. As I said previously, if you are happy with the cost per conversion and there are no other improvements to be made, steadily increase the budget.