Dec 92015

Four Things You Should Know About AdWords Location Targeting for Search

The geographic area that a user searches from or for can be a large determinant of what types of actions that user is looking to take and what their value to an advertiser’s business stands to be.

As such, advertisers stand to benefit by targeting their ads as best as possible to the users who are most likely to buy or engage with the advertiser’s brand. Further, paid search managers can make smart bid adjustments using geographic bid modifiers to better match the price paid for traffic to the value of each click.

However, there’s a lot to understand about how geographic targets work in Google which can impact how advertisers go about optimizing for differences in value by geography. Here are a few things to know and look out for.

1) Your Settings Naturally Impact Who You’re Targeting

Google’s advanced location options provide advertisers with three different possibilities for how they would like AdWords to respect their location targeting.

These are:

  • Reach people searching for, or who show interest in my targeted location – Rather than targeting the user’s physical location, this option allows advertisers to target only those who are searching for the location in question. For example, someone searching for ‘Charlottesville ice cream’ from any location would be targeted if a campaign with a relevant keyword were to target Charlottesville, VA with this setting. A user who is in Charlottesville would not be targeted unless their query mentioned Charlottesville.
  • Reach people in my targeted location – Only target users who have been tracked to the location in question. If you’re an ice cream seller running a one day promotion for a single location in downtown Charlottesville, Virginia, you may only want to be attracting searchers who are currently physically near your brick and mortar location. This is for you.
  • Reach people in, searching for, or who have shown interest in my targeted location – This option allows you to target both of the above groups of searchers.

How effective your targeting and bid adjustments are at delivering the best performing traffic can be impacted by the setting you choose, and it’s thus important to take time in thinking through exactly what types of searchers you would like to target and the best way to do that given these three options.

At Merkle|RKG, the vast majority of advertisers choose the third targeting option, which is also the default, for most of their campaigns.

2) Google’s Location Tracking Abilities Impact Who You’re Targeting

Regardless of the setting you choose from the options above for your campaigns, your ability to target all of the users in a given area with a location target hinges on Google’s ability to locate the individual to the level of granularity of the location target. Depending on the circumstances of the search, Google uses different methods of tracking to determine user location and location of interest.

I wrote about Google’s growing ability to track users at more granular levels here, but they’re still not able to assign all users to the most specific locations possible. For example, from the blog post linked to above, Google is now able to assign roughly 97% of all desktop traffic to a city, but only 71% of all desktop traffic to a zip code.

Thus, advertisers must understand that setting up a location target does not mean that the campaign will then target all of the users that meet the location requirement, but rather only those users who Google is able to track to that location.

This means that it may be beneficial to set up broader ‘catch-all’ targets if your campaigns are targeting granular location types such as zip codes or radiuses around stores, as Google mentions in their documentation.

3) Google Respects the Most Granular Location Target It Can Identify

In Enhanced Campaigns, location targets aren’t just for telling Google which users to show ads to - they’re also used to adjust bids for users which meet the location requirements.

In the event that a user meets the criteria for two different location targets within a campaign, such as a city and the state which that city is located in, Google will respect the more granular target in adjusting bids. It will also assign all data associated with each search to the more granular location.

Thus, if a campaign had New York City and New York state as the only geographic targets, the data assigned to the state target would exclude the traffic which Google is able to assign to New York City. However, traffic from users in New York City which Google can’t assign to New York City but can assign to New York state would be rolled up to the state target.

4) Average Household Income Targets Act as Location Targets

AdWords demographic targets, currently limited to Average Household Income (HHI) targets for use in search, are based on demographics tied to the zip code of the searcher. As such, HHI targets are themselves viewed by Google’s system as location targets, and are launched ‘within’ traditional locations.

So for example, an advertiser could target all of the possible HHI brackets within the United States. However, because Google can’t track all users to a zip code, advertisers would have to add in a United States location target in order to target all U.S. users, with Google respecting the HHI brackets within the location for any traffic it can identify at the zip code level targets.

If HHI targets exist in a campaign alongside other location targets, they will be ignored for more granular targets for use in bid modification and data attribution. While HHI targets are derived from zip code level data, tests have shown Google will for the most part respect state, city and zip code level targets that are launched alongside national level HHI targets.

Conclusion

The geographic region a user is searching from or for often has a huge impact on the expected performance of that user. As such, advertisers should be looking to take advantage of the different geographic targeting methods Google provides.

Hopefully the points mentioned in this article will help you to better understand how geographic targets work as you optimize your campaigns.

Comments

One Response to "Four Things You Should Know About AdWords Location Targeting for Search"
Nice round-up Andy, but I would say with regards to point #4, $150K HHI in downtown Manhattan is much different than $150K HHI in Boise Idaho. This simple HHI bucketing completely ignores the local context (eg. disposable ≠ HHI, access to local stores etc). Advertisers *should* be bidding locations differently (using the 10K location targets Google gives to you) but don't rely on just Google's HHI tool to do so — it is too blunt of an instrument.

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