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Post by Casey Howard, Media Director-Local

When setting up geo-targeting for campaigns within AdWords, it’s important to be realistic about consumer behavior to avoid wasting media spend. Setting targeting to a large radius around a store may generate a large volume of impressions and clicks, but the reality of this activity turning into a true lead for a business decimates with over-targeting.

Local businesses can easily be distracted by high amounts of activity generated by a campaign with a large geo-targeting radius. This influx in activity can blind businesses from the value of micro-targeting, which is where their customer is most likely to come from.

Separate Approaches to Geo-targeting: Illustrated

Using a local client based in Westchester County NY, just North of Manhattan, a study was conducted by Performics to evaluate KPIs with two separate targeting approaches: The first utilized targeting that reached well west of the Hudson River, into New Jersey and all the way to the southern tip of Manhattan. The second target, a revised target, was scaled down to the PMA of Yonkers, NY and a 10 mile radius covering the main market for the store, keeping out of New Jersey and north of the Bronx/Manhattan.

geomaps post

Utilizing the tighter target which focused on the store’s primary location, KPIs showed immediate and consistent improvement.

  • Click-through rate (CTR) more than doubled, (proving targeting was more relevant to the consumer)
  • Cost-per-click (CPC) declined 30%, due to less competition in the target
  • Leads (phone calls + online form submissions) improved by 21%, despite overall click volume dropping (clicks from geo-relevant consumers result in higher propensity to contact the store)
  • Media costs dropped 57%, and cost-per-lead (CPL) dropped by 63%.

Summary

For local businesses selling in-store purchase products (no online orders, etc), utilizing micro-targeting within a logical radius around the store can lead to stronger KPIs. With multiple options in nearby geographies, consumers are less likely to convert into actual leads for a store that is further away.

With tighter targeting near the store, clicks convert to leads more often, as the consumer recognizes geographic proximity and contacts the store after reaching their site.

For more information of geo-targeting, please contact your performance account team

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