DEFINITION of 'Geo-Targeting'

Geo-targeting refers to the ability for advertisers to place their marketing materials in a specific region or locale. In digital advertising specifically, geo-targeting is just one of many tweaks that an advertiser can make to ensure that messaging reaches a particular customer in a particular market. In addition to geo-targeting, online ads can be targeted by additional demographic information like age, gender, hobbies and so on.

BREAKING DOWN 'Geo-Targeting'

Like most advertising techniques, geo-targeting predates the internet. Local papers, radio and television programs have long been used to target customers in a particular region with ads. These advertisement were customized for the local audiences where possible - a process that we now call optimization. Digital technology has simply made this practice more widespread. The major innovation that has increased the effectiveness of geo-targeting is the addition of other data points beyond simple location.

The Power of Geo-Targeting

The power and ease of geo-targeting makes it a necessity for businesses advertising online. For example, a small business like a pizza shop with a finite servicing range can purchase online ads that only appear in the browsers of people with an IP address within the neighborhood. Geo-targeting also increases the opportunities for A/B testing. For example, a Japanese speaking immigration lawyer may choose to run two separately geo-targeted campaigns - one locally for people looking to bring family over or maintain status in the country and another one in Japan targeting people looking to emigrate.

Even national marketing campaigns can benefit from geo-targeting as regional differences create opportunities to test multiple messages and refine them as a campaign continues. This geo-targeted experimentation has been used successfully by businesses, charities and even political campaigns. Factoring out cultural and ethnic variation, there are still subtle regional differences in something as universal as language. A campaign for donations might be better served by using a “donate” button in one area and a “support” button in another. Similarly, customers might respond differently to “book your trip” as opposed to “buy your ticket” or “schedule your trip”. The same goes for the look and feel of the advertising content/copy.

Simply put,where your customer is in the world is an incredibly important data point in created targeted ads. That said, it is just one data point on an ever growing list that can be used for ad targeting techniques.