Solved: Adjust Budget & tROAS Simultaneously in Google Ads?

Hi there,

Thanks for reaching out! Happy to give you some initial thoughts on your questions about budget and tROAS adjustments. It's a really common point of confusion, and tbh, a lot of the 'best practice' advice you read online is either outdated or just too generic to be useful. The short answer is yes, you can do both at once, but whether you *should* is a completely different question. It all depends on your campaign's current performance and your ultimate goal.

Let's unpack this properly.

That 20% Budget Rule is Mostly a Myth...

Alright, let's tackle this one head-on. The old wisdom of only increasing your budget by 10-20% at a time, maybe once a week, comes from a time when the ad platform algorithms were a lot more fragile. The idea was to avoid giving the system a massive shock, which could throw it back into the 'learning phase' and cause wild performance swings. It was about slowly spoon-feeding the system more cash so it didn't panic.

In today's world, especially with smart bidding strategies like Target ROAS (tROAS), this is far less of a concern. The machine learning is significantly more robust and sophisticated. It's designed to handle fluctuations. You can, in reality, double your budget overnight if you wanted to. I've done it on many campaigns.

But—and this is a big but—it doesn't mean it's without consequences. When you dramatically increase the budget, you're telling Google, "Go find me a lot more customers, right now." The system will immediatly start spending that money to explore new auctions and user segments it previously couldn't afford to enter. Naturally, some of these new pockets of traffic will be less efficient. They might be more expensive clicks or users who are less likely to convert. So, you should fully expect your ROAS to take a temporary hit for a few days, maybe even a week, while the algorithm figures out the new landscape and optimises for the higher spend level.

It's not that you've 'broken' the campaign or reset the learning phase in a catastrophic way. You've just given it a much bigger playground and it needs a bit of time to map out where the best spots are. The risk isn't breaking the system; the risk is a temporary drop in profitability. If your margins are tight, that temporary drop can hurt. If you have a healthy margin and are focused on aggressive growth, it's often a risk worth taking. This is why just blindly following a rule without understanding the 'why' behind it is dangerous.

To help you visualise this, I've put together a little interactive tool. It's not a perfect science, of course, but it can give you a gut-check on how much risk you're introducing with a budget change.

So, what about changing the tROAS at the same time?

Now we get to the tricky part. Adjusting your tROAS is a very different lever to pull. You're not just giving the system more money; you're changing its instructions on *how* to spend that money. Increasing your tROAS from, say, 300% to 350% tells the algorithm, "Stop bidding on those less valuable conversions and focus only on the ones you're confident will help you hit this higher target."

This is a powerful tool for improving profitability, but it's also the easiest way to strangle a campaign. If you set the target too high, beyond what's realistically achievable based on your recent performance, the algorithm will simply stop spending. It won't be able to find any auctions where it feels confident it can meet your demand, so it just sits on its hands. Your impression volume will plummet, your spend will dry up, and the campaign will grind to a halt.

The key to adjusting tROAS is to do it incrementally and base it on real, recent data. Look at your actual ROAS over the last 7 or 14 days. If your actual ROAS is 400% and your target is 300%, you have room to push the target up a bit, maybe to 350%. If your actual ROAS is 250% and your target is 300%, increasing the target further will only make things worse. In that scenario, you might even need to *lower* the target to 250% to give the algorithm more breathing room to find conversions and stabilise performance.

Now, when you combine a budget increase with a tROAS change, you're sending two distinct signals. Let's say you increase the budget by 50% and also increase the tROAS. You're effectively telling Google: "I want you to spend 50% more money, but I also want you to be more selective and efficient than you were before."

Can you see how these could be conflicting messages? You're asking it to expand its reach and narrow its focus at the exact same time. The system can get confused, and it often leads to unpredictable results. This is why you must have a very clear reason for doing both at once. There are basically two scenarios where this comes into play, and you need to be brutally honest about which one you're in.

You'll need to decide: are you scaling or fixing?

This is the most important question you need to answer. Your strategy should be completely different depending on your campaign's current health. Pretending you're in one situation when you're actually in the other is how you waste a lot of money, very quickly.

Scenario 1: You're Scaling a Winner

This is the dream scenario. Your campaign has been consistently *beating* its tROAS for the last couple of weeks. For example, your target is 400% but you've been averaging 500%. The campaign is profitable, stable, and clearly has more room to run.

In this case, yes, you can and should increase both the budget and the tROAS at the same time. You have proof that there are highly profitable conversions available. You'd make a confident budget increase—maybe 50%, maybe even 100%—to capture more volume. At the same time, you'd make a smaller, conservative increase to your tROAS, perhaps from 400% to 420% or 430%. The goal here is to scale the spend aggressively while gently pushing the algorithm to maintain its excellent efficiency, capturing a bit more profit as you grow.

Scenario 2: You're Fixing a Loser (or a Breakeven Campaign)

This is the more common situation. Your campaign is struggling to hit its tROAS. Your target is 400%, but you're averaging 320%. The campaign is either unprofitable or just barely breaking even. It feels stuck.

In this scenario, increasing the budget is the absolute worst thing you can do. You'd just be throwing more money at an inefficient system, amplifying your losses. Your only focus here should be on stabilising performance. You must *first* fix the ROAS problem before you even think about scaling. This means you should NOT touch the budget. Instead, you should consider *lowering* your tROAS to match your recent performance (e.g., from 400% down to 320%) to give the algorithm a realistic target it can actually hit. This might feel counterintuitive, but it allows the system to get back in the game, gather more conversion data, and find its footing. Once performance has been stable at the new, lower target for a week or two, you can then start to incrementally increase it again towards your profitability goal.

To make this clearer, here’s a simple flowchart that walks through the decision process. It’s a mental model we use for managing client accounts all the time.

I'd say you probably need more than just budget tweaks...

Here’s the thing. While fiddling with budgets and bids is important, it's often not the thing that unlocks massive growth. It's tactical optimisation. If you want to truly scale, you have to think bigger and look at the whole system, not just the campaign settings. I've worked on dozens of accounts, from B2B SaaS to eCommerce, and the ones that scale successfully all understand this. We had one software client where we took their Cost Per Acquisition from £100 down to just £7. That wasn't just by tweaking bids; it was by overhauling their entire approach.

So, if you're feeling stuck, here are a few other areas to look at:

1. Your Offer is Everything. The number one reason campaigns fail is a weak offer. Are you selling a "nice-to-have" or a "must-have"? I remember a client with an accounting system whose main value proposition was "privacy." The campaigns really struggled to gain traction. We realised that businesses don't buy accounting software for privacy; they buy it to solve urgent problems like compliance, payroll, and cash flow management. Your offer must solve a specific, urgent, and expensive problem for a well-defined audience. If it doesn't, no amount of ad spend will make it work. You should be able to complete this sentence: "We help [specific audience] solve [urgent problem] by providing [your clear solution]." If you can't, start there.

2. Your Landing Page is Leaking Money. You can have the best ads in the world, but if they send traffic to a slow, confusing, or untrustworthy landing page, you're just setting your money on fire. We often see clients get loads of clicks but no conversions, and 9 times out of 10 the culprit is the landing page. Is your value proposition crystal clear within three seconds? Is there a single, obvious call to action? Have you removed all distractions? Are you building trust with reviews, testimonials, or case studies? A 1% increase in your landing page conversion rate can have a bigger impact on your profitability than any budget tweak.

3. You Need to Understand Your Real Numbers. To scale confidently, you need to stop obsessing over daily ROAS and start thinking about Lifetime Value (LTV). How much is a new customer actually worth to your business over their entire relationship with you? When you know that number, you know how much you can afford to spend to acquire them (your Customer Acquisition Cost, or CAC).

Let's do some quick maths. Say your average customer pays you £200 a month, your gross margin is 70%, and you lose 5% of your customers each month (churn).

LTV = (Average Revenue Per Customer * Gross Margin %) / Monthly Churn Rate
LTV = (£200 * 0.70) / 0.05
LTV = £140 / 0.05 = £2,800

Each customer is worth £2,800 to you. A healthy business model often aims for a 3:1 LTV to CAC ratio. This means you can afford to spend up to £933 (£2,800 / 3) to acquire a single customer. Suddenly, paying £50 or even £100 for a qualified lead doesn't seem so expensive, does it? This is the maths that allows you to outbid competitors and scale agressively while they're stuck trying to get cheap clicks. Here's a calculator to play with your own numbers.

I've detailed my main recommendations for you below:

To bring it all together, here is a simple table outlining the core strategy. Find your situation in the left column and follow the advice. This should cover most scenarios you'll encounter with your campaign.

As you can see, managing a paid ad campaign effectively is less about following rigid rules and more about understanding the system you're working with, having a clear strategy, and making decisions based on data. The technical side of adjusting bids and budgets is only one piece of a much larger puzzle that involves your offer, your funnel, and your business economics.

Navigating all of this can be complex, and getting it wrong can be an expensive learning experience. Having an expert who has seen these patterns across hundreds of accounts can often be the difference between a campaign that limps along and one that becomes a predictable engine for growth.

If you'd like to go over your specific campaign and business goals in more detail, we offer a free, no-obligation initial consultation. We can review your account together and give you some more tailored advice on what your next steps should be.

Hope this helps!

Regards,

Team @ Lukas Holschuh