Google Ads Observation Audiences

The difference between Google Ads’ “Targeting” and “Observation” settings.
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Worldwide Google controls around 92% of the search engine market share.

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Targeting vs observation within Google Ads

Google search advertising can be expensive and frustrating. In particular, if you’re getting a low conversion rate. Fortunately, Google has been working on ways to leverage the increasingly detailed data they hold on user behavior. This data can be used to help advertisers convert searches to sales using a Google Ads Observation Audience.

Google Ads has been hiding two of its secret weapons in beta testing for some time – Observation and Targeting modes. Finally, these options have been deemed viable to fully roll out. They are now available for use by all advertisers. These new modes allow you to target your ads more intelligently. This should reduce your costs whilst raising your conversion rate – a double win!

 Let’s look at what they are and how to use them.

Google Ads Observation Mode

A conventional Google Search involves looking for specific keywords and targeting users searching on Google for those terms. This is how traditional Search Targeting works and historically it has proven extremely hit and miss. Now, you can probe your potential audience more deeply, using Google’s improved algorithms.

As well as searching based on specific keywords, you can now look at the users’ underlying interests (those interests that made them use the keywords). Let’s look at an example.

Imagine you want to focus on users searching for [women’s shoes] to make a purchase (i.e. not fashion students merely researching an essay). You can now use Google’s In-Market algorithms to select for users actually buying shoes. This is done by adding from Audiences: In-Market > Apparel & Accessories > Shoes. Once this option is selected, click Start Observation.

Observation means your ads will be shown to everyone but will observe how audiences outside your target audience respond to your ads. You can then use this data to make intelligent decisions. It’ll help determine when to increase bids for more valuable traffic, depending on whether the well-performing audience is within or outside of your target audience. You can also segment your ad groups and create new ad groups with the data from your observations.

For this example, let’s say that, from your 100 keyword users, 40 belong to the In-Market “shoes” category. With a potential 40% conversion rate, you may now choose to increase your bids to that specified audience, whilst still bidding for other users outside the category. However, if you notice only the above sub-set converts to a sale, you may instead switch over to Targeting mode.

In this mode, Google will only show your ad to the selected In-Market audience (in this case, shoes). Google will not display your ad if the user is not within the In-Market category. As a result, you won’t be able to observe how audiences outside of your In-Market category of “shoes” might respond to your ads.

The same can be achieved with Remarketing Audiences. Simply select Remarketing and add “All Visitors” under Audiences.

You’ll now see statistics from your existing site visitors, for specified search terms (Observation mode) allowing you to bid higher for them. When Google recognizes one of your site visitors using the specified term, it will automatically raise bids according to your pre-set amounts, just for that cross-selected audience.

If you set the bid adjustment to 100% and pay $0.50 for a new visitor, it will raise the bid automatically to $1 for those repeat visitors.

Within the Targeting mode, you can choose to shift focus onto specified keywords. For example, if you’ve been targeting both [women’s shoes] and [kids’ shoes] but your conversions are weak only for the latter keyword. You would open a Search Campaign, add [kid’s shoes] and, under Audience, select Remarketing – All Visitors, then click onto Targeting mode.

Google will now push your ad only to your website visitors searching for [kid’s shoes]. The rationale is that you trust the conversion chances of your regular visitors. You can then direct these more reliable users to your children’s shoes.

In summary of observation vs targeting

With these two new options, Google Ads now allows you to target audiences in a more sophisticated manner. In Targeting Mode, your advertisement will only show for people who are within the audience you’ve specified. As a result, you’ll waste less money on loosely specified search campaigns. On the other hand, with Observation Mode, you can compare your target audience’s engagement against prospects outside of it. After observing audience engagement, you can then make an informed decision about which audiences to target.

Why not try some small-scale tests in both modes. You’ll soon see how these new options can help you spend your ad budget more intelligently and efficiently.

Is the concept of using a Google Ads Observation Audience still confusing after reading this blog post? Let’s connect on how to implement them into your Google Ads campaigns.

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  • Did you know?
In Google, more than 60,000 search queries are entered every second. Hence, daily 5.6 billion searches are entered.
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