Australian e-commerce brands face a familiar problem: you manage keyword lists meticulously, yet customers still find you through search queries you never anticipated. That gap between your keywords and reality costs money. Every unmatched search represents a potential customer you’ll never see. Exact match keywords, once the gold standard for search control, have become a liability in 2026, leaving performance on the table whilst competitors capture the searches you missed.
Google still sees roughly 15% of daily searches it has never seen before, searches no keyword list could have anticipated. For e-commerce brands, that gap translates directly to lost revenue. But there’s a solution that bridges this gap, fills the holes in your campaign structure, and reduces wasted spend in the process: combining Dynamic Search Ads with strategic audience expansion.
This article walks you through how to use both tactics together to reach untapped shoppers and stop leaving money on the table.
How Dynamic Search Ads Fill the Gaps Exact Match Cannot
Dynamic Search Ads (DSAs) have been a quiet workhorse of Google Ads since 2011, automating keyword discovery so you stop missing relevant searches your keyword lists never anticipated. The principle is straightforward: instead of you building and maintaining keyword lists, Google crawls your website content, matches customer searches against that content, and generates headlines automatically.
DSAs are ideal for advertisers with a well-developed website or a large inventory, using your website content to target your ads and helping fill in the gaps of your keyword-based campaigns. For Australian e-commerce brands with large product catalogues or frequently changing inventory, this automation saves hours of keyword research and ad copy writing. More importantly, it captures customer intent you didn’t know existed.
Why Exact Match is No Longer Your Default
In 2026, broad match combined with smart bidding has become the dominant Search strategy for most e-commerce accounts. Exact and phrase match still have a role in brand campaigns and high-value terms, but broad match with Target ROAS or Target CPA bidding now reaches qualified intent signals that exact match misses.
The shift reflects how Google’s AI-driven platform works today. Exact match gives you control, but that control is expensive. You’re bidding on known queries only. Broad match paired with Smart Bidding lets Google’s systems find related queries with purchase intent, expanding your reach whilst maintaining conversion efficiency. DSAs take this further by not relying on keyword matching at all, instead matching search queries directly to your website content.
The DSA Setup: Four Critical Steps
Audit and prepare your website first. Since Google uses your site to create ads, your website must be well-structured, with clear, keyword-rich page titles, headers, and product descriptions. Ensure your site is properly indexed by Google and that you have a clear site hierarchy. This preparation directly influences the relevance and quality of your automated ads.
Next, in 2026 the right answer is almost always Smart Bidding (Maximize Conversions or Target CPA). Manual bidding defeats the purpose of automation. Smart Bidding algorithms need conversion volume to learn effectively.
Third, write strong description copy. Dynamic Search Ad headlines and landing pages are generated using content from your website, which keeps your ads relevant and saves you time. All you need to do is add a creative description. This is where your brand voice and value proposition live. Make descriptions count, because Google controls the headlines and landing pages.
Finally, manage negative keywords and negative ad targets ruthlessly. Utilise negative keywords to refine your traffic and filter out irrelevant queries. Adding these keywords prevents your ads from appearing in searches that don’t align with your offerings. This helps you avoid wasted ad spend and improves overall campaign efficiency.
DSA Transition: Important 2026 Timeline Update
Google is extending the timeline for Dynamic Search Ads sunset and auto-upgrade, which will begin in February 2027. If you’re running DSAs now, you have time to optimise before the upgrade to AI Max for Search. If you’re starting from scratch in 2026, build the campaign as a DSA and treat the September upgrade as a milestone to optimise toward. Understanding DSAs is more useful than ever, because what you set up today is the foundation Google’s AI-driven search ads will inherit.
Audience Expansion: Teaching Google Who Your Ideal Customers Really Are
Audience expansion in Google Ads allows your campaigns to reach new users who closely resemble your existing audience segments. Using machine learning, Google identifies people with similar interests, behaviours, or intent as those already engaging with your ads. This helps you broaden reach and find new potential customers while maintaining relevance and conversion efficiency.
For e-commerce brands, this is where first-party data becomes your competitive advantage. Audience signals in 2026 are not targeting restrictions. They are hints to Google’s AI about who your ideal customer looks like. The best practice is to layer audience signals generously but let Smart Bidding decide how much weight to give them. Use first-party data (customer lists, converters, high-value segments) as your strongest signals.
Three Layers of Audience Signals
Start with Customer Match. Upload your existing customer email list, phone numbers, or physical addresses to create a first-party audience. Google matches these to logged-in Google accounts and uses them to find similar users through audience expansion. A well-maintained CRM export with 500+ customers dramatically accelerates the learning period by giving the algorithm concrete data on who has already converted for your business.
Layer in remarketing audiences next. Add your Google Ads remarketing tag or Google Analytics audiences to signal that users who have visited your site, especially product pages, pricing pages, or checkout, represent the profile the algorithm should target. Segment remarketing audiences by stage (all visitors, cart abandoners, past purchasers) and add each as a separate audience signal for maximum specificity.
Finally, supplement with in-market and custom segments. Supplement with in-market and custom segments. These provide directional signals without the precision of first-party data, but they expand reach to users actively researching in your category.
The Audience Expansion / Exact Match Tension
One or two AI Max campaigns covering generic non-branded queries with the brand campaign’s terms excluded via campaign-level brand exclusions should set Final URL expansion on, text customization on, and search-term matching on. Layer Customer Match audiences as audience signals, not targets. Run at target ROAS aligned to your blended e-commerce target, typically 350 to 400 percent.
The key insight: in 2026, audience signals don’t restrict who sees your ads. They guide where Google’s AI focuses its bidding. If your audience expansion is too narrow, you starve campaigns of volume. If it’s too broad, you risk untargeted spend. The balance is found through testing and monitoring search term reports weekly.
Practical Action Steps: Implement This Today
- Audit your website for DSA readiness. Check that product page titles, category pages, and descriptions are clear, detailed, and keyword-rich. If pages are thin or missing metadata, Google’s crawler won’t generate relevant ads. Spend 1-2 days here. This step directly improves DSA ad quality.
- Extract your customer list and upload to Customer Match. Export your email database from your CRM or e-commerce platform (minimum 500 customers for reliable lookalike modelling). Upload to Google Ads as a Customer Match audience. Refresh this list monthly. This single action powers most of your audience expansion.
- Create or audit your negative keyword list. Review your search term reports from the past 30 days. Identify queries that triggered clicks but no conversions. Add these as negatives. Common culprits for e-commerce: informational queries, competitor brand names, and low-intent variations. A tight negative list reduces wasted spend by 15-25%.
- Set up a DSA campaign as a test if you don’t have one running. Create a single DSA ad group targeting your entire website domain or a specific product category. Use one strong description across all ads. Let it run for 2-4 weeks with Smart Bidding enabled before evaluating results. Monitor the search term report carefully.
- Establish a weekly search term review cadence. Every Monday, export your search terms report from the last 7 days. Identify new keywords that are converting (add to your keyword-based campaigns for more control), and spot wasted spend patterns (add to negatives). This 30-minute routine prevents budget leakage.
- Segment your audience signals by conversion value. Don’t treat all website visitors equally. Create separate audience signals for high-value customers, recent purchasers, and site visitors. This gives Smart Bidding granular data on who your best customers look like. It directly improves lookalike quality and reduces CAC.
So, What Now?
The Australian e-commerce market is competitive. Many Australian e-commerce brands are experiencing rising Google Ads CPAs and declining efficiency from purely paid-led acquisition strategies. That doesn’t mean Google Ads doesn’t work. It means the tactics that worked in 2024 no longer work in 2026. Exact match plus manual bidding leaves money on the table. DSAs and audience expansion, paired with Smart Bidding and weekly optimisation, capture the customers your competitors miss.
The setup isn’t complicated, but it requires focus. Start with your website audit and Customer Match upload this week. Get a DSA campaign live next week. Monitor search terms weekly. The brands that win in 2026 aren’t the ones spending the most. They’re the ones letting Google’s AI reach the right customers, whilst staying focused on the ones that matter.
If you’re ready to refine your Google Ads strategy and ensure your e-commerce budget reaches high-intent customers, explore how Bleo’s digital marketing team can optimise your search campaigns for Australian shoppers.
