Why Demand Gen works best alongside Performance Max for ecommerce - Adil Raseed

Google Ads has changed rapidly over the past few years, and ecommerce advertisers now have more campaign types than ever to choose from. Among them, Demand Gen and Performance Max (PMax) stand out — not as competitors, but as complementary tools when used correctly.

While Performance Max is designed to capture existing demand at scale, Demand Gen excels at creating interest earlier in the customer journey. When combined strategically, the two can drive sustainable ecommerce growth while preserving brand control and creative integrity.

From experiment to essential: the evolution of Demand Gen

When Demand Gen launched in 2023, it felt like a hybrid experiment — sitting somewhere between awareness and performance. It promised reach across YouTube, Discover, and Gmail, but early versions lacked the depth and control many advertisers wanted.

Since then, Demand Gen has matured significantly.

Today, it offers stronger creative flexibility, clearer audience controls, and improved integration with ecommerce data. For brands that care about storytelling, testing, and consistency — without sacrificing conversions — Demand Gen has become a reliable part of the media mix.

In practice, its strongest results appear when it runs alongside Performance Max and Search, not in isolation.

Control vs automation: why Demand Gen fills a critical gap

One of the most common frustrations with Performance Max is its opacity. While PMax can deliver impressive results, it often operates as a black box — with limited insight into placements, creative combinations, or targeting decisions.

Demand Gen takes a different approach.

Instead of relying entirely on automation, it gives advertisers the ability to:

Preview and approve creative combinations before launch
Customize assets for specific placements
Control audience selection more directly

For ecommerce brands with strong visual identities, this control is essential. Messaging, styling, and product positioning matter — and Demand Gen allows brands to maintain those standards across video and discovery environments.

Performance Max, by contrast, automatically assembles ads from uploaded assets. This works well for scale, but it means creative quality becomes non-negotiable, and precision is limited.

How Demand Gen and PMax complement each other in the funnel

The real power comes from understanding where each campaign type fits in the customer journey.

Demand Gen operates higher in the funnel. It introduces products, builds familiarity, and sparks interest before users actively search or shop.

Performance Max operates lower in the funnel. It captures users who are already showing intent and pushes them toward conversion through Shopping, Search, Display, YouTube, and Discover.

For example:

Demand Gen might show lifestyle-focused video ads for a new fitness collection
As users engage, search, or revisit products, PMax delivers Shopping and Search placements to close the sale

To reduce overlap, many advertisers use feed-only Performance Max campaigns, limiting PMax to Shopping placements while Demand Gen handles upper- and mid-funnel discovery.

This structure ensures each campaign type does its job — without competing for the same user at the same moment.

Google’s shift toward visual-first performance

Google’s consolidation of video and discovery formats under Demand Gen marked a major shift.

With Video Action Campaigns phased out, Demand Gen now covers:

YouTube in-stream
YouTube Shorts
In-feed placements
Gmail
Discover

For ecommerce advertisers, this brings clarity. Instead of managing multiple overlapping campaign types, Demand Gen centralizes visual storytelling into one system — with better testing and optimization controls than before.

If legacy video campaigns were migrated automatically, advertisers should review asset performance and audience settings to ensure nothing was lost in translation.

Where Demand Gen gives ecommerce advertisers an edge

Audience precision

Unlike Performance Max, Demand Gen allows advertisers to build and manage audiences directly. This includes:

Combining audience types
Selecting where budget is allocated
Using lookalike audiences to find new customers

For acquisition-focused ecommerce brands, lookalikes alone make Demand Gen a valuable addition. PMax uses audience signals instead — useful for scale, but less precise for testing and segmentation.

Placement and channel control

Recent updates now allow advertisers to opt out of specific Demand Gen channels. This means brands can exclude placements that don’t align with their goals or creative formats.

While subtle, this added flexibility is significant — especially for advertisers used to Google’s increasingly automated ecosystem.

Product feed integration

The introduction of product feeds into Demand Gen campaigns has closed the gap between branding and performance.

Advertisers can now combine:

Lifestyle-led video or image creative
Live product data from Merchant Center

This allows brands to inspire users visually while still presenting shoppable products — blending awareness and conversion in a single experience.

For ecommerce, this turns Demand Gen into a true hybrid between Shopping and Display.

Budget considerations for Demand Gen

Demand Gen is not designed for micro-budgets.

Google typically recommends starting at a meaningful daily spend to allow learning and optimization. Campaigns with very low budgets often struggle to exit the learning phase, limiting performance insights.

Rather than replacing Search or Performance Max, Demand Gen should be treated as a supporting pillar — especially once conversion tracking, feeds, and audiences are already performing well.

Demand Gen vs Performance Max: A Strategic Comparison

In simple terms:

Demand Gen excels in creative control, audience precision, and transparency
Performance Max excels in scale, automation, and conversion capture

Neither replaces the other.

Demand Gen creates demand.
Performance Max captures it.

The bigger takeaway for ecommerce advertisers

Performance Max is powerful, but it isn’t built for brands that want full control. Demand Gen gives advertisers what they’ve been asking for: visibility, testing, and precision — without abandoning performance goals.

For ecommerce brands focused on long-term growth, running both campaigns together creates a full-funnel system that balances automation with intent.

Used correctly, Demand Gen doesn’t compete with Performance Max.
It makes Performance Max work better.