Performance Max (PMax) campaigns promise scale, automation, and impressive reach across Google’s network. 

But if left unchecked, the omniscient, ever-wise PMax ‘black box’ can quietly siphon off ad spend into unqualified clicks. 

So, how do you stop that from happening?

With one of the most powerful (yet wildly underutilized) tools in modern advertising: Negative keywords.

In a recent episode of the Paid Media Lab, we sat down with Guillaume Devinat, CEO of PPC optimization platform Opteo, to unpack the findings of a revealing research study - and dig into exactly how advertisers should be using negative keywords (and more) to reduce waste and improve PMax performance.

Watch the full session below, or keep reading for the written takeaways - with key insights from our session with Guillaume sprinkled throughout:

Timestamps: 

0:00 - Intro

1:36 - Guillaume’s key focuses at Opteo

2:07 - How marketers are using negative keywords

4:02 - Why are negative keywords so underutilized?

7:16 - Which search terms waste the most ad spend?

10:18 - Finding the best negative keywords

14:55 - Competitor keywords as negative keywords

16:06 - Biggest sources of waste in PMax campaigns

21:48 - Managing ad placements

23:58 - Key metrics to track after making changes

28:14 - Final thoughts / outro

What are negative keywords - and why are they important?

Negative keywords are search terms that you explicitly tell Google not to target in your campaigns. When a negative keyword is added, it prevents your ads from showing for queries that include that word or phrase. 

This gives advertisers a layer of control to exclude irrelevant traffic and ensure their budget is spent only on users with a higher likelihood of converting.

In the context of Performance Max campaigns, where visibility and control are often limited, negative keywords become even more valuable. They act as one of the few remaining guardrails to shape how and where your ads appear, helping you avoid wasted spend on unqualified clicks and irrelevant audiences.

The big problem: 68% of PMax campaigns use zero negative keywords

One of the most eye-opening takeaways from Opteo’s research is the sheer number of Performance Max campaigns running without any negative keyword coverage at all.

“68% don’t use a single negative keyword against Performance Max. And over 80% used 10 or less. That’s across account-level negatives and shared lists - before campaign-level negatives were even available.”

This is a worrying statistic.

Opteo’s study looked at nearly 25,000 Performance Max campaigns spanning over $26 million in monthly ad spend. This wasn’t a fringe analysis or a small sample size - it reflects a broad cross-section of real-world accounts, both large and small, running live across the Google Ads platform.

So what does this stat really tell us?

A lack of control in an automated environment

It’s become common knowledge in the PPC world that Google has stripped back a lot of the granular control advertisers used to rely on - keyword match types, device targeting, bid adjustments, and search term visibility have all taken a hit in recent years.

But what’s often overlooked is that there are still control levers available - they just aren’t always front and center.

Negative keywords are a prime example. They’re a known feature, clearly effective, and provide an essential line of defense against irrelevant or poor-quality traffic. Yet most advertisers aren’t using them at all in PMax. Why?

Why so many ad accounts still skip negatives

There are several reasons behind this widespread underutilization:

1. Early friction in implementation

When PMax first launched, adding negative keywords required navigating obscure workaround paths - typically via Google reps or the Campaign Modification Request Form. That friction left a lasting impression.

“They don’t make it easy, for sure. And even when account-level negatives were available, 68% still didn’t use a single one.”

2. New marketers missing historical context

Many newer advertisers - or in-house marketers focused solely on one or two campaigns - may not have grown up with the core discipline of negative keyword sculpting. They may trust the system too implicitly.

“I saw smartphones come into my life. But my kids just assume they’ve always existed. If you started in Google Ads two years ago, you might assume this is just how it works.”

3. Automation bias

PMax’s branding and UI encourage a “set and forget” mindset. Who wouldn’t want a campaign that promises to automatically optimize across all networks and touchpoints?

But that ease comes at the expense of precision. Without negative keywords, you’re essentially giving Google an open wallet.

4. A misplaced assumption that PMax is ‘smart enough’

Advertisers may believe that Google will naturally figure out where to avoid spending - but the reality is that PMax doesn’t stop unless you tell it where not to go.

“You might not feel the pain right away. But that doesn’t mean inefficiencies aren’t happening.”

Why negative keywords matter more than ever

As Google continues to move towards broader automation and reduced transparency (despite some recent improvements), the remaining tools we do have - like negative keywords - become all the more vital.

Think of it like this: PMax doesn’t provide full search term reports, granular placement control, or fine-tuned bid strategies. But it still respects exclusions. That makes them one of the most critical levers for driving efficiency.

If 68% of advertisers aren’t using even the most basic exclusions, it means the majority of PMax campaigns are likely wasting budget - often without the advertiser realizing it.

The most common offenders: what you should be excluding

So, what kind of queries are typically responsible for waste in PMax?

Guillaume highlighted four major categories:

1. Competitor terms

PMax often picks up competitor brand names, which might seem relevant but usually underperform.

“It’s typically low quality score, high CPC, and low conversion. You probably want to manage this class of traffic separately.”

2. Overly generic terms

Think broad phrases like “best tools” or “how to advertise.” These may match your niche, but they’re often too top-of-funnel to convert effectively.

“It’s on-topic, but too far up the funnel. And if it’s only tangentially related, you could be wasting budget fast.”

3. Informational queries

These “how to” or “what is” type searches are rarely commercial in intent. Yet PMax loves them.

“It might be technically relevant, but it’s not buying behavior,” Guillaume warned.

4. Flat-out irrelevant matches

AI doesn’t always hit the bullseye.

“Sometimes it just misses. You look at the queries and go, ‘I get why the model triggered this - but it’s not right for my product.’”

A step-by-step strategy to proactively add negative keywords

If you’re launching a new PMax campaign - or getting serious about reducing waste - here’s how to approach negative keywords methodically:

Use N-Gram analysis

Group search terms by recurring word fragments (unigrams, bigrams, trigrams) to identify common wasteful themes. This gives you more data-driven insights than reviewing queries one by one.

Learn more about how powerful N-Gram analysis can be - and how to use it effectively - here.

Evaluate with early indicators

Before you have robust conversion data:

• Use low CTR as a proxy for low relevance
• Use high bounce rate or low interaction rate from GA4 to identify poor user experiences

“If something’s getting lots of impressions and not many clicks - or if users bounce quickly - that’s a red flag.”

Use ChatGPT to cluster non-converting terms

Input your low-performing queries and prompt ChatGPT to group them into themes. It’s a useful way to surface modifiers like “how to,” “free,” “near me,” or “jobs” that may not be obvious at first glance.

Exclude known competitors

If you run a dedicated competitor campaign, exclude those terms from PMax to prevent budget overlap and ensure clean campaign segmentation.

Going beyond keywords: other major sources of PMax waste

Negative keywords are just the beginning. Guillaume also highlighted several other overlooked areas where advertisers can cut waste.

Poor PMax-to-business fit

“If your homepage is hard to understand, or you’re a complex B2B SaaS product, you’re probably not a great match for PMax.”

PMax thrives on structured data, clean messaging, and clearly defined conversion paths. If your funnel is opaque or hard to parse, automation may work against you.

Overly broad geographic targeting

“You don’t need to target the entire US. That’s like targeting an entire continent.”

Start with specific states or metro areas. If you must target broadly, exclude underperforming regions over time. And always use “Presence” targeting - not “Presence or interest.”

Junk placements

PMax includes Display and Video placements, which are often the source of invalid or low-quality traffic.

“It’s not just one or two bad sites. The inefficiencies live in the long tail - and they add up.”

Use exclusion lists (here’s one we made earlier) to filter out known junk placements, and monitor for:

• Placements on kids’ apps or YouTube
• Gambling, adult, or sensationalist sites
• Questionable TLDs like .xyz, .ru, .biz

Bonus tip: We spoke to Guillaume (alongside Google Ads Experts Thomas Eccel and Lucy Smith) about plugging the PMax drain - watch the full session here for additional tips & insights.  

Evaluating your impact: how to prove changes are working

Tracking the success of exclusions isn’t always straightforward, but there are ways to make the impact visible:

Estimate reclaimed budget

1. Take your excluded n-gram or placement.
2. Multiply its monthly clicks by average CPC.
3. Subtract any conversions lost.
4. Assume the budget is reinvested more effectively.

“You’re not just cutting spend - you’re reallocating it to better opportunities.” 

Monitor post-change search terms

After exclusions go live, verify that those terms or placements no longer show in your reports. This confirms that your guardrails are working as intended.

Pro tips to enhance PMax optimization

• Use GA4 bounce rates to preemptively flag unqualified traffic
• Ask ChatGPT to cluster and interpret high-volume, non-converting queries
• Build shared exclusion lists to apply learnings across multiple campaigns
• Review placement performance by TLD to catch junk sites early
• Check all default PMax settings, including final URL expansion, location of interest, and automated assets

“When all those default settings stack up, it’s easy to find yourself with dodgy placements, dodgy ads, and irrelevant traffic - all in one campaign.” 

Final thoughts: focus on what you can control

While Performance Max continues to remove transparency and manual control, there are still key levers within your grasp - and negative keywords are among the most impactful.

“We spend a lot of time complaining about what Google took away. But it’s odd that the controls we do have are still underutilized.”

PPC success in the age of automation won’t come from doing more - it’ll come from doing less, but better. Targeted exclusions. Smarter structure. Better alignment.

If you’re running PMax without exclusions, you’re not just leaving money on the table - you’re handing it over to Google without a fight.

Want to cut more waste from PMax?

Lunio’s free Placement Exclusion List is an excellent starting point to immediately cut a significant number of 0-value placements out of your campaigns. Then, get a free 14-day traffic audit to see exactly how much of your ad spend is being wasted.

And if you haven’t already, follow Guillaume on LinkedIn for more practical PPC tactics and upcoming research drops. And if you’re serious about cutting ad spend, check out Opteo - which is now built directly into the Lunio platform. 

Want more practical advice from the top voices in the PPC industry? Subscribe to Lunio’s YouTube channel to ensure you don’t miss an episode - or find the Paid Media Lab wherever you get your podcasts.

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