Every ad platform lets you target specific geographies. Most accounts use the default "presence or interest" setting and never realize that means showing ads to people thinking about your area, not just in it. For service businesses, that's most of your wasted spend.
The setting nobody changes (but should)
Google Ads → Campaign settings → Locations → Location options. The default is "Presence or interest". This shows your ad to:
- People physically in your target area, AND
- People showing "interest" — meaning they've searched for, looked at maps of, or recently visited your area.
Sounds reasonable. In practice it means showing your San Antonio plumbing ad to someone in New York reading about Texas BBQ. Change it to "Presence" for local businesses. 90% of accounts get an immediate CPA improvement from this single setting.
Radius vs. city vs. ZIP
- Radius targeting — best for service businesses. "10 miles around my shop." Includes everyone in that radius regardless of which city Google calls them.
- City / metro — best for businesses serving a specific named market. Includes the suburbs Google lumps under that metro.
- ZIP code list — for businesses with a hard service-area boundary. Granular but tedious; you'll miss neighbors just outside.
- State / country — for online businesses. Use sparingly — you usually want sub-targeting on top.
Location bid modifiers
You can bid more or less in specific places. After 30 days of data, look at the location report:
- Cities with low CPA → bid up 20-50%.
- Cities with high CPA but real conversions → leave alone.
- Cities with high spend and zero conversions → exclude entirely.
A common pattern: one suburb converts 3× better than the rest of your radius. Bid up there; budget shifts toward the winning area automatically.
The exclusion list every account should have
Block these regardless of business type:
- Countries you don't sell to (especially relevant if you target English broadly).
- Specific high-fraud regions if you've seen abuse — common ones include certain South Asian and Eastern European geographies for free trials.
- Your own office (don't pay for yourself testing).
Hyperlocal businesses
If you serve one neighborhood (a coffee shop, a dentist), don't run nationwide search ads. Use:
- Radius of 3-10 miles around your location.
- Nextdoor — it's literally hyperlocal by design.
- Google Local Services — the green checkmark "Google Guaranteed" listings.
- Map listings via Google Business Profile (free).
Common mistakes
- Targeting "United States" for a local business. You'll spend $5,000 to discover that 95% of your clicks weren't local. Restart with a 25-mile radius.
- Forgetting to update geo when you expand. You opened a second location in Austin but the campaign is still San Antonio-only. New leads lost.
- Excluding people in offices/airports. Some campaigns try to filter out commuters, then realize their best customers are commuters.
- Not setting language. If you only speak English, set language = English. Otherwise Google can serve to Spanish-search users with a translated mismatched ad.