With demographic targeting in Google Ads, you can strategically narrow down your target audience to reach a more refined niche of potential customers. From age range to parental status, you can select from a set of targeting options for your campaigns. Today, we will zoom in on Household Income in Google Ads, and we will see what exciting things we can do with it.
What is Household income in Google Ads?
Currently, Google Ads offers four categories of demographic targeting:
- Parental status;
- Household income;
The last one, also known as income targeting, allows you to filter out your audience based on the estimated average family income within your selected location. Depending on the product or service that you are offering, this can be a valuable segmentation attribute.
For example, if you are selling high-ticket products, you can use this criteria to reach an audience with higher income than average. Think of a private Business school offering Executive Education programs for Managers and Directors.
At the other end of the spectrum, maybe you are selling a low-cost version of a particular product. In this case, you could use the income targeting to exclude people with higher income than average, as they are more likely to purchase the more expensive version.
Or you can directly target people with the specific income that are more likely to purchase your product. Without doing so through the exclusion filters.
Income targeting is a great way to maximize the value of your ad spend. Sometimes, segmenting by location just isn’t enough. Especially if keywords within your industry are expensive, and you only want to focus on the ones that bring actual results.
Targeting by income in Google Ads
In Google Ads, you can find Household income in the Demographics section. Just select the campaign that you want to refine, go to the Demographics tab on the left, and you fill find it right under the Parental status:
As you can see, there are multiple ranges that you can select from:
- Top 10%
- 11 – 20%
- 21 – 30%
- 31 – 40%
- 41 – 50%
- Lower 50%
These ranges represent anonymous clusters of public data collected by an authoritative source, such as the IRS (Internal Revenue Service) in the United States. Having said this, there are couple of things to keep in mind:
- Google doesn’t offer targeting by income in all countries yet. This filter is only available in some countries, including Australia, Brazil, Hong Kong, United States, Spain, Japan, Mexico, and so on. You can check the full list here.
- The Unknown group will always be the largest. This means that the information about household income that Google has is very limited. So, a huge cluster of people will be marked as Unknown because Google doesn’t know their status.
- Not all websites on the Display network allow for demographic targeting. Some of them will opt out of it, meaning that Google will not be able to identify their visitors’ gender, parental status, age, and of course, income.
For this reason, I highly recommend that you don’t exclude Unknown. But of course, we will see this point in detail in our Tips section, which comes in a couple of minutes.
Using income targeting
Using this demographic filter is very simple. We already saw that you can find it under the Demographics tab, in the left column of your selected campaign/s.
Now, all you need to do is select the range that you want to include or exclude. Then, click on the blue Edit button that shows up above:
If you want to include the selected ranges within your segmentation, click on Enable. On the contrary, if you want to exclude them, click on Exclude from ad group.
However, including and excluding ranges isn’t the only thing that you can do with household income. Sometimes, you want to include all possible ranges, but simply focus a bit more on those that are more likely to purchase.
You can do this with the bid adjustment option in Google Ads. This means that you will tell Google to increase your bid by a certain percentage for those groups that you are more interested in. Or, you can guide the systems into decreasing your bid for groups less likely to convert.
Again, click on the ranges that you want to make changes to. From the Edit button, click on Change bid adjustments:
As you can see, I decided to increase my bid by 20% for the income ranges of 21-30% and 31-40%. This means that, if Google detects that a person belongs to one of these ranges, the system is “allowed” to spend 20% more than my regular bid for that person.
On the contrary, if I decrease my bid by 20%, the system will decrease my maximum cost per click by 20% for people who fall within these ranges.
You can decrease your bid adjustment if you don’t want to exclude a specific household income range completely. However, you still want to receive less traffic from it because it is not the most appropriate one for your business.
Household Income tips
At this point, we are already familiar with the peculiarities of targeting by income. And of course, of the way it works. So, now is time for some tips to ensure that we are making the best of it:
1. Don’t exclude Unknown.
As we already mentioned briefly in one of the previous paragraphs, Google doesn’t have enough data on household income. Yes, it extracts this information from public authoritative sources, but it is far from being complete. It is also anonymous.
All this means that the Unknown group will always be the largest one from all income ranges. Especially if you are targeting countries that have less data than others, which is often the case.
For this reason, I highly recommend that you don’t exclude this group from your demographics segmentation. Otherwise, you risk shrinking your audience to such a small volume that your ad might not be receiving enough information to bring results.
2. Play with Bid Adjustments
My next tip is to “play” with bid adjustment as opposed to directly excluding certain groups. Of course, if you are absolutely sure that a specific household income is far from your ideal target audience, this might be the right option.
However, Google Ads’ data is far from perfect, and we don’t know for sure how precise it is. With this in mind, excluding a group might not always be as efficient as one might think. Sometimes, we might miss some good opportunities by doing so.
For this reason, unless you are completely sure that a certain income range will never purchase your product, try bid adjustment instead of direct exclusion.
3. Don’t select only one range
Many advertisers might feel tempated to only select one household income range. With the idea that their target audience is more refined, and there will be enough data to drive tangible results.
However, this is not necessarily the case. Selecting only one range also means that you might be restricting your audience to such a level that you will barely have imperssions.
Considering that income ranges have very limited data by default, you don’t want to restrict your audience even further by limiting your ranges. Instead, select at least 2 or 3 at a time:
4. Don’t target income exclusively
Household income is one of the various targeting options available in Google Ads to refine your audience. However, I don’t recommend that it is the only attribute that you use for your campaigns.
Make sure to combine it wisely with relevant keywords or in-market audiences. Of course, among with other targeting variables, including locations, age, parental status, and others. The point is to create a controlled and refined audience, and using only household income will probably not be enough.
5. Combine demographics
You can combine multiple demographic options to create a hyper segmented audience. In fact, you can go to your Google Ads campaign, and check what are the current combinations that are driving you the best results.
In the Demographic section, click on the Combinations tab for more information:
In this section, you can see 4 columns with the possible demographic combinations:
- Parental Status;
- Household income;
By checking this information, you can see your ideal combinations, and adjust your bids for them. You can also create two campaigns for A/B testing:
- Version A – excluding the demographics that you don’t need for your audience;
- Version B – excluding only the demographics that are currently active in Version A;
This will allow you to capture less qualified traffic at a lower cost. While simultaneously adapt your ad copy and landing to speak to the corresponding demographics level with the right message.
Did you like this article? If you want to learn more about Google Ads, you can also read:
- Google Ads Bidding Strategies: The Beginner’s Guide
- 13 tips to Improve your Quality Score in Google Ads
- Your Guide to Search Engine Marketing for Beginners
And that was all from me, folks! As always, thank you for taking the time to read my blog post, and I hope to see you in the next one!