Geotargeting Adwords For Local Business: Buyer Beware

I recently read a well-written article by Search Engine Guide, which outlined the ways one can use the geo-targeting features of Google Adwords. My problem with this article and the other ones on the subject that I have read lately, is that they are now written without the caveats that typically accompanied them a year ago. Most articles written on the subject a year ago… warned: the system is not perfect. I would go further and say… the narrower the region being targeted the more flawed the geo-targeting. Consider this search for Newark NJ in Google Trends:

Newark Search In Google Trends

These results would not give me the warm & fuzzies if I were running a campaign that was geo-targeting Newark.

This is important because the purpose of Geo-targeting is to put your ad in front of a person who is using a generic search query that has local intent. For Example, “Dentist” as opposed to “Dentist Newark NJ.” Studies have shown that half of local queries are entered without the geographic indicator. And Geo-targeting should give you a leg up in trying to capture these sales. The above Google Trends report argues otherwise.

If the IP addresses of searchers shopping online in Newark are in Oakland, NJ and Clifton, NJ; advertisers’ results are going to be adversely effected. Such campaigns would be plagued by low CTRs and/or wasted spend.

Take-Aways for when you’re targeting a small geographic region with adwords (City, County, a few towns etc.):

  • Don’t rely on Geo-targeting. Use keywords that include the geography you’re targeting as well.
  • Put Geo-targeted ads in a separate ad group, so that there lower CTRs don’t effect your higher performing ads.
  • KNOW the addresses of the local Cable/DSL provider in the area where you are going to Geo-target. Many of the cities listed above in the Google Trends report are those where Cablevision is located; or in the case of Madison, NJ… where the IP originates for Verizon DSL customers. My IP is located in Madison, despite me being some 30-40 miles away from there. And Oakland is a small town about 50 miles to the north of Newark; but the IPs of many Cablevision customers originate from that town. The results of a local campaign could change dramatically by just adding or subtracting one of these important but sometimes very small towns.
  • TEST!

Some Assumptions I Made Interpreting This Data:

1)People who most frequently use ‘Newark NJ’ as a search term, do so because
they live in or around Newark. 2) And that group would be representative of those who are shopping locally but use the generic search term.
Because we are studying this from the “reverse angle.” Google trends is showing us the location of the IP address for those who type Newark. Geo-targeting in Adwords would return results based on the IP address of a shopper who did not type in Newark. 3) Google uses the same IP tracking in Google Trends as it does in its Adwords system.

I believe those assumptions are true based on the results I’ve seen personally in the geo-targeted advertising that I’ve done, though admittedly a small sample. But the more relevant cities I saw in Google trends for the applicable geography, the higher the CTR of the advertising…. again very very small sample.

For those who are running “tight local campaigns” could you do me a favor? Please use Google Trends and search for a town or 2 in your area
and let us know if you find anything that would make you agree or disagree with what I’ve asserted in this article. Thanks!

Good Additional Reading on Geotargeting:

Geotargeting Adwords by The Merjis Blog

Geotargeting: Core To Local by Chris Silver Smith

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3 Responses to Geotargeting Adwords For Local Business: Buyer Beware

  1. Tony Hilton says:

    Hi this is an interesting post geo targeting in Adwords is definitely unreliable at best. I thought you might be interest to know though that a was talking to our relationship manager at Google the other day and he said that the system has now been improved so that geo targeting will automatically match to local words as well. So if you set an Adwords campaign around the word “dentist” and target it to Newark if someone types in “dentist in Newark” it will bring up your advert.

  2. That’s great insight Tony! Thanks… Wow, there are tremendous implications to that… maybe a whole other post.

    If you do post about it, please let me know, I’d be happy to link to it.

    And thanks for stopping by Tony it gave me the chance to find another good blog in the niche.

  3. Tony Hilton says:

    No Problem. You have some great content. Have you seen about the demographic search Google is trailing? I have posted about it and there is a few bogs talking about it at the moment.