By Amara Osei

Google will retire the existing Display spending allocation setup for Search campaigns in February 2027, and every channel in its new prioritization system will default to "High priority" — two details that advertisers who change nothing could pay for. Google Ads is introducing Channel Prioritization and Budget Allocation controls globally across Search, Shopping, Performance Max, and Demand Gen campaigns over the coming months, following an early demonstration to Search Engine Journal during a virtual roundtable with Google's product team.

What does Channel Prioritization change?

Advertisers can label channels "High priority" or "Low priority." Google will fund high-priority channels first, then move remaining budget to lower-priority inventory, while still accounting for Target CPA or Target ROAS goals (bidding strategies that optimize toward a cost-per-acquisition or return-on-ad-spend target).

A Search advertiser could prioritize Google Search and place Search Partners or the Display Network in a lower tier. The options vary by campaign type. For Performance Max and Demand Gen, Google will group its owned channels — Search, YouTube, Discover, Gmail, and Maps — together, so advertisers cannot prioritize those placements individually.

Every channel will default to "High priority." Advertisers must change the settings themselves if they want certain channels deprioritized.

The default matters more than it sounds: inaction, not action, is what shifts spending here.

How do the budget caps work?

The Budget Allocation feature lets advertisers set a percentage limit on how much daily budget goes to lower-priority channels. An advertiser testing Search Partners could mark it "Low priority" and cap it at 20% of daily budget.

One caveat follows the promise. Google says it will try to stay within the limits on a best-effort basis, so advertisers should not treat the percentages as hard caps.

Google confirmed that 0% is also an option, letting advertisers block spending on a channel or channel grouping entirely, including within Performance Max. The controls also work when campaigns are not budget-constrained — channel prioritization alone, Google explained, generally won't change much for Target CPA or Target ROAS campaigns with sufficient budget.

Advertisers can set priorities at the account level with separate defaults per campaign type, and override them at the individual campaign level. Shared budgets are supported. Google confirmed API support will be available at launch. It discussed campaign experiments but gave no date. Limited feature testing for Demand Gen is expected to begin in November.

What happens to Display settings in February 2027?

Google's product team said Search campaigns already prioritize Search inventory over Display behind the scenes — but not over Search Partners. Starting February 2027, Google will retire that existing Display spending allocation setup.

Because the new controls default everything to "High priority," advertisers who make no changes could see spending shift between networks. Google recommends setting the Display Network to "Low priority" with a 50% budget allocation to preserve the current configuration. A one-click migration option will be available when the controls launch.

Anyone running Search campaigns with Display enabled should review those settings before February 2027.

How does this fit with automated bidding?

The obvious question from the roundtable: if conversion tracking is accurate and campaigns hit their targets, shouldn't Google's bidding system already decide where to spend?

Google's product team acknowledged that AI-driven campaigns have simplified campaign management. The goal, they said, is to give advertisers more control over spending while still allowing automation to optimize toward campaign goals.

The controls stop short of what some advertisers want. Performance Max keeps YouTube, Discover, Gmail, Search, and Maps grouped, with no individual prioritization. Google is separately testing more advanced Performance Max channel controls in a small alpha experiment (an early closed test), and confirmed both approaches will run alongside each other for now.

On reporting: Performance Max already has channel-level reporting, and Google expects expanded channel reporting for Search in the first quarter of 2027. Existing network segmentation in Search remains available until then. Google also plans account-level budget allocation insights.

What should advertisers do now?

For advertisers who avoided Search Partners or the Display Network over traffic quality concerns, percentage caps make testing those networks viable without handing over the full budget.

There is also a reason not to rush channels into lower tiers. If a campaign already meets its CPA or ROAS targets, restricting inventory could shrink the opportunities Google's bidding system has to work with.

Advertisers should review network-level performance before applying the controls: campaigns already hitting targets may need no change at all, while long-avoided networks may deserve a capped second look.