How to expand audience reach using Optimized Targeting in Google Ads

Replacing Google Ads targeting expansion, a new feature called optimized targeting is at your disposal for new Display campaigns from June 2021. In Google’s words:

“Like targeting expansion, optimized targeting looks at any audience segments you’ve added to your targeting and uses that as a starting point to find new and relevant audiences for the campaign. As an additional benefit, optimized targeting may look for audience segments that fall outside your selected audience segments if there’s an opportunity for better performance.”

A large number of advertisers argue in favor of targeted audience segmentation. And rightfully so since it is focused, cost-effective, and helps in tailoring your messaging strategy. Optimized targeting is still a form of audience segmentation, with the difference being that now you can reach people outside your pre-determined demographics. Since many Google Ads users fear that this practice may prove counterproductive, experienced PPC professionals from our Chicago PPC agency explore how optimized targeting works and how to expand your audience reach using this feature.

What is Optimized Targeting?

Optimized targeting allows advertisers to reach potential customers beyond their targeted audience. Google highlighted the following as the main benefits of this type of audience segmentation:

• It simplifies your Google Ads audience targeting and optimization.
• It helps advertisers work across different networks and audience types.
• It provides additional opportunities to expand your campaign reach.

Optimized targeting is an automatically applied feature that looks for signals such as keywords on your media assets or landing pages and uses that data to find an additional audience in order to help increase conversions and meet the goals of your campaign. You also have the option to add additional signals such as demographics or content keywords manually.

It is important to highlight that optimized targeting is not an option that is exclusive to a specific campaign. Instead, it looks at your account as a whole.

Compatible campaign types

The targeting signals available for you to include in your campaigns may vary depending on the campaign type. Here are the types of campaigns compatible with optimized targeting, as well as the signals available for each type:

Display campaigns

• You can add audience segments, custom segments, customer data segments, keywords, and topics
• Your ads may be displayed to users outside your selected signals

Discovery campaigns

• You can add audience segments, custom segments, and customer data segments as signals
• Your ads may be displayed to users outside your selected signals
• Your ads will not be displayed to users that you have excluded through customer data segments

Video campaigns that use the Sales, Leads, or Website traffic goals

• You can add audience segments, custom segments, and customer data segments as signals
• Your ads may be displayed to users outside your selected signals
• Optimized targeting doesn’t use placements as signals, and your ads will be displayed only on the placements that you provide
• Your ads will not be displayed to users that you have excluded through customer data segments

How does it work?

Performance metrics are displayed under your Totals at the bottom of your Audiences or Keywords view on your Display, Discovery, and video campaigns. With optimized targeting, you are no longer attracting clicks, impressions, and conversions from your targeted audience alone but also from people outside your set parameters.

The algorithm searches for additional conversion chances by targeting people that it considers most likely to become customers based on the signals that your setup sends. The feature behaves according to real-time conversion data, and for example, it discovers what users who recently converted are now searching for.

Optimized targeting needs some time to learn and adjust in order to effectively discover new segments of the audience that are most likely to convert. People from Google suggest that:

• For your new campaigns, it is advisable to wait at least until the campaign collects 50 conversions or has been active for at least two weeks before you evaluate results.
• For your existing campaigns, it is best to wait at least two weeks before evaluating performance.

Since optimized targeting uses targeting signals to find similar criteria to serve your ads on, in case it finds better performing traffic, it can reduce or altogether stop serving traffic on your signals. It also respects your existing brand safety settings, so there is no need for you to make any additional changes to it when using this feature.

How is Optimized Targeting different from Targeting Expansion?

We can agree that optimized targeting does sound very similar to targeting expansion since both of these options look for additional opportunities for conversion beyond your targeted audience. However, they do it in a different way:

• Targeting expansion searches for lookalikes of your current audience that behave similarly to your selected audience segments.
• Optimized targeting uses real-time data to look for people outside your targeted audience who behave similarly to those members of your audience that have already converted.

So, we can conclude that optimized targeting is a more precise way of targeting audiences in Google Ads campaigns but lacks the reach that targeting expansion had.

When should you use this type of audience targeting in Google Ads?

Optimized targeting can prove to be just the thing you need if you feel that your current audience targeting methods are providing mixed results. Here are some of the scenarios in which leaving this feature on may be beneficial for your campaign.

• Targeting expansion didn’t provide positive results to your campaign.
• Your current targeting setup provides sluggish results and has failed to increase your audience.
• You aim to scale your Display, Discovery, or video campaigns.
• You are looking to increase your conversion rates without raising your bids or allocating a larger budget.
• You wish to acquire new customers or reach new people who are relevant to your campaign goals.

How to use Optimized Targeting to expand your audience reach?

Deciding whether to use or not to use optimized targeting mainly depends on the goals of your campaign.

If you are focused on attracting more traffic to your website through your Google Ads campaign, you should consider using optimized targeting along with Maximize conversions option as your bidding strategy as well as website visits as your conversion type.

On the other hand, if you wish to focus on increasing your conversion rate, pair optimized targeting with Maximize conversions or Target CPA as a bidding strategy. These two bidding strategies are highly recommended to be combined with optimized targeting since they use your conversion data in order to provide the most value for your Google Ads campaign.

In case your campaign goal is to reach your existing customers in order for them to use your services or repurchase your products, you should turn off optimized targeting and use manual targeting only.

How to turn off Optimized Targeting?

There are a few simple steps to follow if you wish to exclude optimized targeting as Google Ads targeting audience option from your campaign. These steps are also a great chance for you to familiarize yourself with the lesser-known ad group setting section of your Google Ads account. Here is how to do that:

• Select the campaign for which you wish to change your settings.
• Select the ad group for which you want to adjust the optimized targeting. You’ll have to repeat these steps for each of your ad groups.
• Once you are in your selected ad group, click on Settings in the left light gray column.
• Click on the Edit ad group targeting. From there, you will be taken to a separate screen.
• Scroll down below Settings to the Optimized targeting section.
• Check the box to turn optimized targeting on or off.
• Click the Save button.

How to review performance for campaigns that use Optimized Targeting?

Optimized targeting extends the reach of your campaign to people who otherwise wouldn’t have come across your ads, so the conversions you get this way are additional conversions that you otherwise had no chance of getting. Initially, your CPA may vary, but optimized targeting will eventually figure out which targeting brings the most benefits to your campaign. Using this data will, over time, optimize your reach at a more consistent average CPA in order to drive the most possible conversions.

Here is how to check optimized targeting performance:

• Select a campaign in your Google Ads account. You can also select an ad group within a campaign if you wish to check data at a more granular level.
• Select Audiences or Keywords from the page menu on the left.
• Scroll down to the bottom of the statistics table. There you’ll notice a row labeled Total: Expansion and optimized targeting.

Final thoughts

During their lifecycle, many companies experience a plateau in growth. During that time, most breathe a new life to their business by stepping outside their comfort zone and trying new growth strategies such as optimized targeting. This feature can be an excellent option for those looking to find new customers to target or have a specific audience segment in mind. 

Optimized targeting can also help businesses that are just starting their marketing campaigns and are not yet sure who their audience is as they can use it without setting specific targets. However, this can potentially turn out to be expensive, especially for lower-budget campaigns since your initial conversion quality is likely to vary until optimized targeting collects enough data and puts all the pieces together. How big of a benefit this option brings to your Google Ads Quality Score remains to be seen.