Google Ads Location Targeting: Get the Settings Right

Google Ads location targeting is the campaign-level rule set that decides which geographies can see your ads, and it comes down to three decisions: which areas you target, whether you match on physical presence or on presence plus interest, and which areas you exclude. The critical detail is that Google defaults to 'presence or interest', so if you change nothing, users who merely searched for your city from another country are still eligible to see your ads. This guide walks through those three decisions in order, with a way to measure each one.

What does Google Ads location targeting actually do?

Location targeting is a geographic filter defined at campaign level. For every search, Google evaluates location signals such as IP address, device location, place names inside the query and recent browsing, then checks them against your target list before entering the auction. So targeting does not draw a fence, it sets a matching rule. How loose or strict that rule is determines the size of your impression pool.

• Country, region, city: administrative boundaries; the most common and most stable method.
• Postal code: the sharpest way to narrow a service area inside a city.
• Radius: a circle around an address or coordinate; suited to stores and field services.
• Places of interest: point targets such as airports, universities and shopping centres.
• Excluded locations: removes areas that sit inside your target list but that you do not want.

One detail slips past most accounts: location targeting is defined at campaign level, not at ad group level. If you want different budgets, different messaging or different landing pages for two cities, you split campaigns rather than ad groups. The second detail is precedence: the narrowest definition in the list wins. Target a province and exclude a district inside it, and the exclusion takes priority, never the other way around. In complex lists this rule creates unexpected gaps, so with a target list of dozens of rows it is safer to sketch the coverage map on paper before touching the interface.

Should you pick presence, or presence or interest?

'Presence' shows ads only to people who are in or regularly in your targeted locations. 'Presence or interest' adds people who signal interest: their query contains the place name, they were recently there, or they browse content about the area. For a business serving physical customers the second option is usually wider than needed; industry benchmarks suggest the default setting can push roughly 20 to 35 percent of budget toward non-target geographies.

When does radius targeting work better?

Radius works better when your service area does not match administrative boundaries. The zone a field team reaches in twenty minutes rarely follows a district line, and a store usually draws customers from a few kilometres rather than a whole city. In practice the classic mistake is launching with a wide circle and never tightening it. Starting narrow and expanding on evidence is a cheaper way to learn than starting wide and cutting back.

1. Start narrow with a conservative radius around the store or depot.
2. Collect 2 to 4 weeks of data and split conversions and cost per conversion by distance.
3. Find the band where conversions cluster; if most land within 3 km, a 15 km radius is reach you are paying for.
4. Do not overlap radii; overlapping circles blur reporting and create internal competition.
5. Review the decision seasonally rather than treating it as a one-off setup.

Use the distance report to judge a radius; Google shows which distance band your conversions fall into relative to your business. When two circles overlap, the same user enters two campaign pools, bid and quality decide which one serves, and your reporting splits in half. For multi-branch businesses, postal code groups usually produce a cleaner structure than circles: instead of drawing one circle per branch, group the postal codes your branches actually sell to and collect them in a single campaign, which protects both budget and learning. Radius targeting is available in Performance Max as well, but reporting granularity is thinner, so distance tests teach you faster in a search campaign.

Why are excluded locations the most skipped setting?

Exclusions are the second layer that closes off sub-areas inside your target list, and most accounts never use them. The reason is structural: the targeting screen invites positive selection while negative selection sits on a separate tab. Yet this is exactly where budget leaks. Districts you cannot serve, competitor-heavy areas and 'magnet' locations that pull traffic without purchase intent all keep collecting clicks quietly.

• Outside the service boundary: districts and postal codes you cannot deliver to.
• Magnet locations: airports, university campuses and major transit hubs.
• Nearby metros: if you advertise in a small city, the neighbouring metro edge inflates bids.
• Legally or logistically blocked areas: places your carrier agreement does not cover.
• The non-converting tail: city rows with 90 days of clicks and no conversions.

Build the exclusion list from data, not intuition. Open a 90 day window at city and postal code level, flag rows that took clicks but produced no conversions, and shortlist those that crossed a spend threshold. In practice a reasonable threshold is an area that spent about twice your average cost per conversion and returned nothing; rows below that line are usually statistical noise and closing them buys little. Expand the list in stages rather than all at once. Each round, record how many areas you closed, their share of total spend and the effect on conversion volume; if volume drops after two rounds, you cut too deep.

Where are the advanced location options hidden?

Advanced location options sit behind a collapsed link under the 'Locations' section of campaign settings and are closed by default. Once opened you can set targeting and exclusion behaviour separately. The most common mistake in practice is switching targeting to 'presence' while leaving the exclusion side on its default, which makes your exclusions work more narrowly than you expect.

1. Open campaign settings and expand the 'Locations' section.
2. Click the 'Location options' link for advanced settings.
3. Choose 'Presence' or 'Presence or interest' for targeting based on your business model.
4. Apply the same logic to the exclusion side and verify both independently.
5. After saving, review the geographic breakdown weekly for the next fourteen days.

Do not skip the verification step after saving. If targeting is set to 'presence' while the exclusion side stays on its default, your ads narrow inside the target area but interest-driven traffic from unwanted areas is not fully closed off. Once both sides follow the same logic, open the user location report during the first week. If the share of off-area clicks has not visibly dropped, the possibilities are limited: the change was applied to the wrong campaign, the campaign sits on a shared budget, or a broad country row is still sitting in your target list. All three can be checked on the same screen in a few minutes.

How should you read the location reports?

Google Ads offers two location views and they do not answer the same question. 'Matched locations' shows which targeting criterion the ad matched. 'User locations' tells you where the person physically was at click time. Only the second one exposes waste. In report editor, open user location at city and postal code level and place click-through rate next to conversion rate; rows that diverge are candidates either for exclusion or for a bid adjustment.

Order matters when you turn a report signal into action. Exclude areas you cannot serve at all first, then apply negative bid adjustments to areas with weak but genuine demand, and only then add positive adjustments to strong areas. Bid adjustments run from plus 900 percent down to minus 90 percent, but under smart bidding they act as a signal to the system rather than a direct multiplier. In illustrative scenarios, retail accounts that separated performance at postal code level reported conversion rate gains in the 10 to 20 percent range; read that as a hypothesis worth testing, not a guarantee.

Location targeting is not a setup step, it is an ongoing cost control. A map nobody reviews each month is an invoice you keep paying each month.The Ads Sensor Team

Location settings should not be confused with local business advertising; visibility on the map itself is a separate topic covered in our Google Maps ads guide. If you would rather automate this audit loop than run it by hand every month, Ads Sensor reads your account data and turns geographic waste and opportunity into reasoned actions; you can use the sign-up form for the early beta.