While some marketers are content to simply identify their target audience and then produce ad content that appeals to that group, PPC and social media experts know that this is only the first part of the battle. To generate real, quality results, all ad content needs to be tightly targeted so that it is displayed to the right audience as well.
Targeting is a word tossed around a lot in the world of PPC, and for good reason. After all, while the right level of ad targeting can help you drastically increase your leads and conversions, targeting groups that are too broadly defined (or targeting the wrong group or keywords altogether) will completely waste your ad budget.
Because of this, it’s little surprise that audience targeting has taken off on Facebook, Google, and other platforms. Targeted advertising has been found to be highly effective, even influencing the way people think about themselves—and of course, there’s the fact that targeted ads make audiences more likely to buy in the first place.
But when it comes to selecting the parameters for your targeted social ads, which criteria is the most important? Age? Gender? Geographic location?
While the answer may vary depending on your product/service or the scope of your business, there’s one frequently overlooked demographic item that can have a big impact on your marketing success: income.
Why Income Targeting?
The reasons behind using income targeting are simple. Your product or service may not be affordable for everyone. Or you know that what you have to sell wouldn’t necessarily appeal to a high-end consumer. When you target your ad content based on consumer income, you place yourself in a much better position to reach “qualified traffic”—a fancy industry term to describe those who would actually be interested in buying your product.
Let’s use engagement rings as an example. Those nervous people getting ready to pop the question are all in a similar situation, but their budgets can be radically different—the average payout is supposedly $4,000, but looking online, you can find rings ranging in price from just under $200 to well over $40,000.
If you’re in the business of selling less expensive engagement rings, you probably wouldn’t want your ads getting dished out to someone looking for the fanciest ring money can buy. Likewise, the makers of those high-end rings aren’t going to get many sales from low-income searchers.
Because of this, it’s essential that you consider how your price point and average order value affect your audience’s ability (or interest) in buying your product. Delivering your ad content to someone in the appropriate income bracket for your product or service could ultimately make all the difference in whether or not they click on your content.
Implementing income targeting has been reported to decrease a campaign’s cost per lead “by nearly 41% in a single month,” while also leading to a significant improvement in conversion rates—and all because income targeting finds that essential “qualified traffic.”
How Does Income Targeting Work?
After discovering that income targeting is a thing, you might be asking yourself: how do Facebook and Google determine someone’s net income in the first place? Is there some sort of creepy Big Brother thing going on?
Not entirely. In fact, income targeting isn’t an exact science—rather, it generally relies on a mix of purchased third-party data, as well as user interests and demographic information housed on-site to provide a rough estimate as to someone’s income level. According to Google, AdWords uses data from the IRS to determine the “average household income” for areas within the United States.
So no, Facebook and Google aren’t keeping exact tabs on how much money you make (you can take off your tinfoil hats now)—and yes, this does mean that even when you select income targeting, your ads might still be served to a few people who don’t quite fit your preferred buyer persona.
However, it’s worth noting that Facebook and Google are continually fine-tuning their ad targeting options. Pulling information from multiple data sources does paint a fairly reliable picture as to what a user’s expected income or net worth would be—and as more data is collected based on user interactions with targeted content, this ensures even greater accuracy for the future.
Using Income Targeting
If income targeting seems like an appropriate choice for your product or service, the next logical step is figuring out how to implement it. Finding the appropriate boxes to check for this type of targeting requires a little digging, but it’s well worth the effort.
For Facebook, you’ll have to open up the Detailed Targeting menu when selecting audience settings. Click on the Demographics tab, and then open up the Financial submenu. You’ll find two options for targeting your ads: Income and Net Worth.
Because net worth can sometimes be tricky to figure out (and a lot of people don’t really know their net worth anyway), you’ll have a simpler time sticking with income targeting, which on Facebook is bracketed in low-to-high ranges that get broader as income levels increase.
Google’s income targeting is a little different. Rather than targeting income based on a specific number (like $70,000/year), Google targets users based on where their income level falls in relation to the rest of the population of a given area. You can target ads based on the top 10% of earners, the lowest 50%, or somewhere in between. These settings are found under the Location Groups header of your ad settings.
With these tools in hand, it’s easy to press forward and add income targeting to your next social ad campaign. While it might require a bit of trial and error to find the income demographic that is best suited for your product or service, this additional step can ultimately yield big benefits.
The potential ROI boost of targeting your social ads based on audience income doesn’t mean that you can let other targeting features go by the wayside. After all, targeting based on age, interests, education level, and other factors will also play an important role in making sure your advertisements reach the right people.
But as you implement income targeting into your campaigns, you’ll be better able to find those who are ready to buy—and as a result, you’ll soon be rolling in the dough yourself.