Today, we are going to show you how to set up a shared budget and start benefiting from this practice.

First, click on Budgets and then add new Budget.

Next step is to create a budget name, so that you can identify the name of your campaign (by themes, products or pricing). Apply it to how many campaigns you want. Then, just pick an amount that’s large enough to cover the campaigns you’ll apply it to.

If you are using a shared budget, you need to make sure that it’s large enough to cover all of the campaigns to which it will be applied. So, if you have 4 campaigns and they are limited by budget, it’s important to determine firsthand if this feature best matches your campaign’s needs.

Let’s say you have a top performing campaign that normally converts 10-12 times per day and you decide to share budget with other 4 campaigns.

By adding 4 campaigns to the”top performing campaign”, you can risk that your low performing campaigns steal budget away from the campaign with high conversions. Believe me, you don’t want this to happen. If you used to get 100 clicks and converted at 5% and you change what campaigns/keywords you’re getting clicks from, you could end up with a campaign with 100 clicks, but converting at 2%.

For example, I have a Rent to Own campaign with $140 budget. My client decided to add four new services: Foreclosure, Short Sales, Hud Repossession and Bank Owned Homes.  After I’ve created this new campaign, I decided to create a shared budget along with the top performing campaign (rent to own)

Yep, don’t do this at home! Anyhow, if you look at the screenshot below, you will notice the day conversions dropped significantly (which made my client upset). Immediately the next day, I decided to set a single budget for my top performing campaign and create a shared budget for the new campaigns i created.

Now, as you see these campaigns are limited by budget, so we had to increase budget for the new campaigns. The Rent to Own campaign spends $140 daily, so by creating a shared budget between the five campaigns I wasn’t letting the campaign perform as it usually does. By sharing your budget between multiple campaigns, you are spreading your budget too thin. At the end hurts your campaigns more that it benefits them.

Most of the people I know in the industry use this shared budget feature simply because they have a small budget and they do not want to have a separate one for each campaign. Let’s say you have a $25 budget and you have two campaigns. Then it’s convenient that to create a shared budget because with this feature, AdWords can automatically adjust how your budget is allocated across different campaigns.

If you have two campaigns sharing one single budget and on any given day Campaign A benefits a little more than campaign B, AdWords will recognize this and distribute it accordingly.

So technically, Shared Budget takes care of all your budget reallocation.

If in any case both of your accounts become limited by budget, you do not want to bid higher. If you have a small budget, you can’t bid high, otherwise your ads will not be able to show throughout the day.

Most likely your ads will show in the morning and stop showing at noon.

If you ever decide you no longer need to use the shared budget, you can always go back to your Shared Library, click on the budget name and delete it.

This won’t affect in any way your campaigns. You’re simply telling AdWords that you no longer want to use this feature. This way you’ll be able to control over how much you spend per campaign.