How to Build Local PPC Campaigns That Really Deliver New Customers

How to Build Local PPC Campaigns That Really Deliver New Customers
Key 'Takeaways' From This Post
  • We've looked at how local businesses can maximise their visibility through PPC
  • Separating AdWords campaigns with location targeting will help to strategically organise budget
  • Applying your PPC budget on a priority basis is crucial to getting the best return
  • A combination of geo-targeting and location keywords will generate potential customers with highest intent
  • If you service customers on-site, radius proximity targeting can be the best option for attracting the most relevant customers

The way we market our local businesses online is always evolving. One of the most notable changes recently, is the change to Google’s local “snack pack”, where the number of businesses which appear in local results has reduced from seven to three.

In light of this, many local businesses may focus more on pay-per-click advertising (PPC) if they want to regularly appear in search results.

However, when local businesses approach PPC advertising, they are often faced with the devastating combination of narrow target-audiences and highly competitive keywords. Many find their first experience with AdWords a negative one, with large amounts of wasted spend and a poor ROI.

Because of such experiences, many local businesses conclude that PPC is simply “not for them”.

However, once a more efficient targeting strategy is applied, the vast majority find PPC to be a profitable avenue to advertise their services/products, driving high quality leads/sales and generating a healthy ROI.

Whilst entire books could be written about PPC for local businesses, in this article I’ll be outlining the fundamental strategies to building an efficient local AdWords campaign.

Targeting your customers through local PPC

For any AdWords account, the key to a successful campaign is relevancy. Simply put, the more relevant your product/service is to the user’s search query, the better your ROI (for the AdWords geeks, I’ll leave out any discussion on quality score – for now!).

For local businesses, the immediate priority is to target the most relevant users – those that are looking for your service in your area.

In AdWords, there are two key ways of targeting locations in AdWords:

  1. Geo-Targeting (based on IP Addresses)

  1. Keyword Targeting (using a keyword modifier)





Many businesses will use one of these targeting methods in favour of the other. For example, targeting either US wide searches for “Plumbers in Oakland”, or rather Oakland searches for “Plumbers”.

Smart advertisers know that a combination of both targeting methods will help them to reach the most relevant users and provide the best ROI – after all, it does make sense. If a user is in your location, and searching for your service and location, then they are the most relevant user.

To continue the example, the advertiser’s primary target should be Oakland searches for “Oakland Plumbers”.

Budget application

Whilst this strategy will produce the best ROI, for many local businesses the result of such targeting means you’ll only be able to reach a small number of people – driving only minimal impressions and therefore very little revenue.

Local businesses may therefore be looking to expand their reach even further.

The 2 most common approaches local advertisers take in expanding their reach are:

  • Expanding the geo-targeting to include a broader area

  • Adding more generic keywords without location modifiers

However, taking either of these approaches dilutes the relevancy of the campaign as there is now a much wider target audience. Strategic application of the budget becomes impossible.

To combat this, the table below outlines a simplified account strategy (for a single product/service, in a single area) that will suit the vast majority of local businesses.

Google AdWords for local businesses

Budget can be applied methodically using this set up. This strategy will ensure that those searches with the highest ROI are targeted first, ensuring that your budget is applied effectively.

See below for a real-life comparison between the aforementioned campaigns over 1 month, where, for one of their services, this particular local-trade client enjoys a cost-per-lead that is approximately 80% cheaper using Geo/Keyword Targeting vs Geo Targeting alone.

Keyword tagging for local businesses

Impression share is able to be maximised for the first and second campaign, before applying any excess budget to the others. This delivers the best possible return for the local business’s budget – generating the highest number of leads at the lowest possible cost.

Advanced Location Targeting

The default location targeting option for any AdWords campaign is set to target those users who are not just in your location, but also searching for it. Whilst this works for some advertisers, particularly those in the travel industry, it will not be suitable for the majority of local businesses.

Navigating to Advanced Location Settings and changing it to “in my targeted location”, is the the better option. This will ensure you only show for the most relevant users in your geo-targeting campaigns.

Advanced Location Settings PPC

Once more, if you’re suffering from low impressions and/or want to expand your reach, then you can either create those “searching for” and “showing interest in” their own campaigns, or allow this targeting into one of the lower priority campaigns.

Proximity targeting

For many local businesses, the closer a user is to your service, the more likely they are to convert. For others, proximity has almost no effect within the target area. Local businesses should reflect the nuances of their particular sector in their targeting.

The chart below compares the conversion rates of two local businesses. Client A represents a local private dentist, whereas Client B is a double-glazing firm.

PPC conversion rate

For Client A, there is a direct link between distance and conversion rate. As the account is limited by budget, they can use gradient location bidding in order to bid higher for those users that are closer.

radius targeting ppc

This can be set up by radius targeting around your business address at the incremental distance you choose (note: Google does not sum these bid increases together, it will choose the highest locational bid adjustment to apply).

Granular targeting

If your business operates more like Client B, there is still room for granular location targeting that will improve your ROI. Even within small towns, different areas can convert differently to others.

For businesses that wish to target customers across their region, be sure to follow these steps to optimise your account:

  1. Review user location data in Analytics and find your best performing areas (for example, this might be a high average-income area)

  1. Similarly, review your customer database or offline records. What zip codes are driving the majority of your customers? Where should your ads be targeting as a priority?

  1. Use these insights and add bid adjustments where necessary. Ensure you’re targeting those crucial areas as a priority.

Additionally, if your business actively markets their products/services offline, it can pay dividends to synchronise your online activity with your offline. Sending out mailshots to a neighbouring town next week? Ensure you’re visible online in that area when they search for you by using bid adjustments.

(Note: In many cases, Google’s knowledge of IP locations is patchy at best. For some areas, broader location targets are better used to ensure capture of target traffic. Test the waters through trial and error; starting small and gradually expanding).

Review and improve

I’m sure that I don’t need to say that conversion tracking is essential for all online advertisers, especially local businesses. This means both the forms on your website, and call tracking too.

The advice in this article highlights the importance of a strategy that takes into account the intent of the audience you’re targeting. This likelihood of intent varies depending on the search terms they are using  and the location that they are in.

Larger local businesses that cover a wider area should target different areas in different campaigns, which will further allow a strategic application of budget, and make bid management much more efficient.

It is important to remember that the aforementioned advice applies to the vast majority of local business, though some will benefit from an alternative strategy.  Remember, you know your business best, and your strategy should reflect that.

Above all, pay-per-click advertising is unique in the vast quantity of data it accumulates very quickly. Consistently reviewing account performance, and the use of actionable data is the only route to AdWords success for a local business.

Liam Wade is the Paid Marketing Manager at digital agency Impression. He is knowledgeable about paid marketing methods across a variety of platforms & prides himself on taking an innovative, data-driven approach to PPC. Liam is one of 15 team members at Impression, which delivers digital marketing campaigns to a wide range of clients covering SEO, PPC, digital PR, content marketing and website design and development. Follow Impression on Twitter or here on LinkedIn.

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7 thoughts on “How to Build Local PPC Campaigns That Really Deliver New Customers”

  1. I have one suggestion to any small business owners or anyone thinking about AWE… Use Adwords and start with a campaign that is ‘simple”. You don’t have to have everything perfect. Start with a small budget and learn the options in detail as you go. Optimize where you can and don’t be afraid to experiment. Small changes can translate to really big increases in leads and conversions! And lastly, if you aren’t having success with AWE… that doesn’t mean you won’t be successful with regular adwords! Great article. Great read! Thanks.

  2. Thank all 3 of you for your comments, great to hear these strategies resonate with you.

    Dave, absolutely – if you have offline data, it’s always a good place to start. All too many advertisers negate to connect online and offline effectively, but by doing so you can solidify your overall strategy and make data-driven decisions (the best kind of decisions).

    I think your point about ROI actually echoes mine. Whilst yes, the example you’ve demonstrated is not a fantastic ratio, it is still a healthy ROI. The techniques I’ve demonstrated are to give businesses the best possible chance of a positive ROI – without the need for ‘experiment’ budget.

    Geo targeting is definitely better in some areas than others – I’ve noticed similar differences in rural areas too. Whilst Google heavily relies on IP addresses, for mobile users they’ll also use GPS (many users have this feature enabled on their phone without realising). As I said, it’s important to test and see for yourself.

    Mike, as someone working agency-side, I’ve seen the horrors of AdWords express from viewing inherited client accounts… ouch! Would always recommend a local business gets to grips with regular AdWords.

    For anyone just beginning with PPC, AdWords may seem daunting, but the interface is actually very intuitive and the right way of thinking will help enormously. Hopefully, the tips in this article will help – I’m always happy to answer any other questions.

  3. if you just run a local business you don’t need to target a specific area of your business coverage for cost effective campaign. This article explain a lot for geographic targeting. Great post my friend

  4. Great article I just have to add my own experience with Google Adword Express. It is a Joke! for example if you select a keyword such as plumber, it automatically add plum mer and then you get charged for that keyword instead of plumber! I never got a single click or traffic from word plumber.

  5. ….and here is one other really fascinating article about creating geo campaigns, and possible cost per click charges between a geo campaign with a relatively small territory vs a much larger territory. The article is from 2013:

    One point it suggests is that if you run a campaign with a relatively small geo territory cpc could be significantly higher. The second point is that running a campaign on a relatively smaller area eliminated a lot of clicks. Increase the size of the geo area and all of a sudden clicks start happening.

    With regard to the directly above paragraph, our own observations about ppc, and about google’s awareness of location is a long term process. We have tracked data and clearly Google believes it has better granular data about locations.

    In the comments above we referenced some anomalies we have found on geo data. On the other hand this article is from 2013….and possibly one has to adjust geo territories several times to ensure capturing enough relevant leads from adwords…and additionally google has gotten better at identifying locations…so the finds from 2013 might not be as relevant today.

    It all requires quite a bit of testing.

  6. Good article. We’ve been doing this and things like it for years, with variations on the suggestions. Let me add a few comments:

    1. For customers new to this they may have data relative to the graph showing the dentist and the double glazing firm, wherein you can look at addresses for leads, addresses for sales and determine where the most optimal areas and what level of proximity to use. So get a hold of their data first, if you can. Does the client market into a 5 mile radius, a 20 mile radius and does the client convert 50% of leads at within a 5 mile radius and 10% of leads at 20 miles away. That gives you insights before you start the campaign.

    2. One thing about ppc….its sometimes like arbitrage….and while there is a lot of conversation about studying ROI etc….sometimes its not about that.

    For instance; if a client sells a service at $1,000/sale….and ppc click costs are coming in at $2/click. Frankly I wouldn’t worry much about tight ROI if I had the money to spend on advertising. If I had 8 sales from 1,000 clicks on my ppc running at the high end of $2/click….I have $8,000 in revenues for $2,000 in advertising costs. Not bad. Not great…but not bad.

    And those 8 sales represent 0.8 of only 1% of the clicks. Miserable conversion into sales but a healthy ROI of 4 times the cost of advertising.

    So understand the relationship between sales price, cost of clicks, and what a business can or be willing to spend or to experiment on. Understand if you are “arbitraging” between low costs of clicks and high costs of a sale, or if you are at a tighter differential and need to create tight ROI standards.

    3. Geo targeting is good but its not perfect by any means. This study turned up some surprisingly “spotty” or less than great results:

    We participated in the study, and we know geo targeted results are “often” or “sometimes” spotty at best. Here are some anomalies wherein geo targeting can be significantly off:

    Rural areas; desk tops can have their locations assigned to IP’s in the nearest large cities. We’ve seen a good bit of that, especially in deep farming and rural areas.

    Searches from corporate offices or the local office of a business or organization which is headquartered thousands of miles away. We have received a healthy number of these visits, clicks, etc. One way to check is to go to Google Analytics to the audience section, then go to technology and click and then click on networks.

    Networks will tell you what providers are sending traffic plus what corporate or organizations are sending traffic from pc’s wired into the network. Incredibly revealing data in some cases.

    4. There are clicks from ppc and there is information: One shouldn’t overlook the value of information. We love it. We use ppc to place appropriate high ranked ads to get clicks on search phrases that count. We also use it to study trends and demand and supply for keyword terms. If you want to know where the most impressions are coming….bid low, but high enough to show up in ppc. You won’t get a lot of clicks, but you will get incredible information as to the real volume of impressions for lead terms and long tail terms.

    With more info you can build a more effective ppc campaign, plus you can build pages to try and grab appropriate organic traffic.

    5. PPC campaigns require study and adjustment. Don’t expect to get it right the first time around and be prepared to adjust adjust adjust.


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