Google Ads adds channel priority tiers and budget caps

Google Ads has launched two optional controls, channel prioritisation and budget allocation, that let advertisers rank the channels in a campaign as High or Low priority and cap how much of the daily budget a Low priority channel can spend. Google announced the controls on 14 October 2026 and says they are rolling out globally across Search, Shopping, Performance Max and Demand Gen over the coming months.

The announcement carries a deadline. From February 2027, Search campaigns that have the Google Display Network switched on lose their current spend allocation setup, and Google says advertisers "may see a shift in channel spending". Anyone running Search with Display enabled has until then to set the Display Network to Low priority with a 50% budget allocation if they want to keep things as they are.

What the two controls do

Channel prioritisation lets you sort the inventory in a campaign into two tiers. Google says campaigns will spend on High priority channels first, up to the Target CPA or Target ROAS where one is set, and only then pass leftover budget to Low priority channels.

In a Search campaign, that means Google Search, Search partners and the Google Display Network can each be set to High or Low priority. In Performance Max and Demand Gen, Google's own surfaces (Search, YouTube, Maps, Gmail and Discover) are bundled together as "Google channels", so you can rank the bundle against partner inventory but you cannot rank YouTube against Search.

Budget allocation is the second lever and only applies to channels set to Low priority. For those, you can enter a maximum percentage of the campaign's daily budget. Google is explicit that the limit is best effort and that spend can exceed it. Demand Gen gets channel prioritisation only; budget allocation is not supported there.

Google's help page spells out the maths. The percentage is calculated against the campaign's average daily budget rather than actual spend, so a 5% allocation on a $1,000 daily budget means Google will aim to keep that channel at or below $50 a day. Each day starts fresh: money a channel does not spend is not saved for tomorrow, and an overspend is not clawed back the next day. Google also cautions that a channel can sometimes go past its percentage on a given day.

Setting the allocation to 0% stops spend on that channel entirely. Google's product team has confirmed this applies within Performance Max as well, which gives advertisers a way to shut off partner inventory in a campaign type that has offered few channel-level switches.

Where the settings live

Both controls are available at the account level and the campaign level, and they work with shared budgets. Account-level settings act as defaults for each campaign type (Search, Shopping, Performance Max and Demand Gen each get their own), and a campaign-level setting overrides the account default. On a shared budget, the percentage is measured against the pooled budget, so it covers all the campaigns drawing on it combined.

Google's help page lists the steps: open Account settings, find the Channel Prioritization card, pick the campaign type, assign High or Low priority to each available channel, optionally enter a budget allocation percentage for the Low priority ones, then save.

At launch the controls can be managed in Google Ads and Search Ads 360. Google says Google Ads API and Editor support is coming soon. The settings cannot be applied from a manager account, so agencies need to set them in each client account. The controls can already be used in custom experiments, except on multi-campaign shared budgets. Demand Gen is expected to follow, with limited testing reported to start in November.

Every channel starts as High priority

This is the detail that matters most. Google's product team has confirmed that every channel defaults to High priority. Nothing is deprioritised unless you change it, and a Low priority channel has no spending cap unless you enter one.

There is a second catch for campaigns using Target CPA or Target ROAS that are not limited by budget. Google says channel prioritisation on its own will generally not change anything in that situation, because there is no shortage of budget to ration. The percentage cap is the control that bites there.

The February 2027 change to Search and Display

Today, when a Search campaign has the Display Network enabled, Google prioritises Search inventory over Display behind the scenes. That built-in preference does not extend to Search partners. Google says this existing Display spend allocation setup will be retired in February 2027.

Google's help page adds two details. The Display Network will stop serving on Search campaigns that use Target Impression Share. And setting channel priorities on a Search campaign before February 2027 applies immediately and replaces the old Display Expansion behaviour, so an account-level Search default would do that for every Search campaign in the account at once.

Because the new controls default everything to High priority, a Search campaign with Display on and no changes made could see spend move between networks once the old setup disappears. Google's recommendation for keeping the current configuration is the Display Network set to Low priority with a 50% budget allocation, and Google has indicated a one-click migration option will be offered.

For Australian advertisers, this is worth a calendar entry now. February sits just after the summer trading period, and a quiet shift of Search budget into Display is the kind of change that shows up as a worse cost per lead before anyone finds the cause.

Testing partner networks without the all-or-nothing switch

Google pitches the controls as an alternative to the on/off decision. Advertisers who historically opted out of Search partners and the Display Network can now opt back in with a Low priority tier and, say, a 10% or 20% cap, and judge the results against the rest of the campaign.

That framing also cuts the other way. If a campaign is already hitting its CPA or ROAS target, capping inventory could reduce the room Google's bidding has to work with, and there may be no reason to touch it. The sensible order is to check network performance first, then decide which campaigns need a cap. Our comparison of Performance Max versus Search across nine years of spend is a reminder that the channel people distrust is not always the one performing worst.

Google was asked why manual prioritisation is needed at all when Target CPA and Target ROAS are supposed to allocate spend on performance. Google's answer was that advertisers want more say over where the money goes, and the controls provide that while Smart Bidding still works toward the campaign's target. A manual guardrail is a reasonable response to that. We saw the same gap in our look at Target CPA and ad scheduling, where spend stayed flat from 1pm to 7pm while cost per lead swung from $286 to $1,003 by hour.

What is still coming

Performance Max users should not expect per-channel control over Google's own surfaces. YouTube, Discover, Gmail, Search and Maps stay grouped. Google is separately running a small alpha of more advanced Performance Max channel controls and says both will run alongside each other for now.

Reporting lags the controls. Performance Max already reports by channel, and Google expects expanded channel reporting for Search in the first quarter of 2027. Until then, the existing network segmentation in Search is the place to check how Search partners and Display are performing. Google also plans account-level budget allocation insights to help advertisers judge their settings.

The controls can be used in custom experiments, except on multi-campaign shared budgets. If you test a cap with a custom experiment, remember that Google Ads experiments stuck in INITIATED can fail without any notification, so confirm the experiment is actually serving before you draw conclusions.

What to do this week

• List every Search campaign with the Display Network enabled. Those are the ones affected in February 2027.
• Flag any Search campaign using Target Impression Share with the Display Network on. Google's help page says Display will stop serving on those campaigns.
• Segment by network and record current Search partners and Display spend and cost per conversion, so you have a baseline before anything changes.
• When the controls appear in your account, decide per campaign: keep the current setup (Display to Low priority, 50% allocation), cap it lower, or set 0%.
• Check account-level defaults before campaign settings. An account default applies to every eligible campaign of that type, and Google warns spend may shift if a campaign currently exceeds the percentage.
• Treat the percentages as best-effort targets and watch daily spend by network for the first few weeks.

The controls are optional, and untouched campaigns stay as they are until February, but setting priorities on a Search campaign earlier replaces the old Display behaviour straight away. The one task that cannot wait is knowing which of your campaigns have Display turned on.