Geo-targeting PPC Ads

Geo-targeting is nothing new. It's no secret that Google, Yahoo! and MSN/Bing allow PPC accounts to geo-target their ads. What's interesting is how some campaigns use this option and how the use of it – or even lack thereof – could be affecting their bottom line.

First, a brief overview of how to geo-target PPC campaigns. In Adwords, there are a few options for geo-targeting:

1. Bundles (Country) – this option allows you to 'bundle' countries or territories. You can select all of North America, for example, or merely show ads in Canada & the U.S. (excluding México).
   
   
   
2. Browse (Country/State/Metro) – this option allows you the option of choosing between countries, drilling down into states/regions and further into metros.
   
   
   
3. Search (any location) – here you can input your own location on the map, whether it's a country, state, metro or zip code*.
   
   
   
   *If the zip code is small, the setting defaults to a 20-mile radius of the zip code.
   
   
4. Custom (Zip Code/Address) – the 'custom' option lets you plug in a specific zip code or even address, and tell Adwords the size of the radius around that specific location you'd like to target.
   
   
   
   Notice there's an option for an address to show in your PPC ads. This is part of the Adwords new feature, Local Extensions.
   

In all but the 'custom' locations setting, there's a possibility the country, state, or metro you're targeting can show up underneath your PPC ads in the SERPs. While it could make the ad even more relevant to the searcher, does it always work?

Here's an example of a search performed for "dog trainer" in Google, where our PPC client (Linda Brodzik) shows up via 'custom' placement whilst a competitor is using the selected DMA of St. Paul:

Both of these ads are relevant...but which one stands out more? To me, it seems the title of "St. Paul Dog Trainer" does, since it's bolded (obviously because of the keywords used in the search), bigger and at the top of the ad. That being said, the other ad saved precious copy characters by not including their geographic focus.

Yet here's the same search performed in Yahoo!:

Are these geo-targeting tactics as relevant? Not really. Anyone who lives in the Twin Cities metro knows somewhere in St. Paul can be quite a haul from somewhere in Minneapolis (especially in rush hour). In this instance, both of these ads could probably benefit more from geographically-focused keywords versus merely geo-targeting the metro area (Yahoo! doesn't have 'custom' settings...yet?).

Of course, the best way to know exactly how this affects any campaign is to track everything with analytics. What've you found?