← The Paid Search Podcast | A Weekly Podcast About Google Ads and Online Marketing
The Paid Search Podcast | A Weekly Podcast About Google Ads and Online Marketing
Should You Exclude by Age & Income Demographics? (Episode 512)
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Foreign. Hello, and welcome to the paid search podcast. My name is Chris and today I'm going to talk about audiences. I'm going to talk about using or more specifically, excluding audiences, age demographics, income level in Google Ads. Should you do it, should you not? We're going to talk about the upsides and downsides of it, the, the truth of how I use it and how I don't use it in today's podcast. So stick around. I'm going to devote today's entire podcast to this topic because I think it's something that is important. I think people misuse and misunderstand the purpose of how these metrics function. I'm going to describe what they are. If you're not familiar with what I'm even talking about, I'm going to explain it and then I'll talk about how you can best utilize it. So that's the topic for today's podcast. If you're new here, this is what I do every single week, new episode every Monday. I talk about Google lads, share my thoughts. And if, if this podcast was a book, it'd be a very long book because I share a lot of information on this podcast. So hopefully you subscribe, stick around. And if you'd like to speak with me, you can find information about my management services and my coaching services@chrisshafer.com and, and without further ado, let's jump in to some basics about today's topic. So today we're talking about audiences. And if you don't know, audiences in Google Ads really come in three flavors. They are referred to as demographic audiences. In particular, they're in the audiences tab. And there's, when we talk about audiences, there's, there's audiences that you can target, which has to do with affinity audiences and in market audiences. That's not the topic. Instead, we're talking about the flavor of demographic audiences. So those three are age, gender, and income. So every person that's searching on Google Ads has an age, a gender and an income. And Google does its best to guess, let's say guess at this information. We'll talk about how that happens in a little bit. And let me tell you what I have found. And you know why I think it's a good topic to discuss whether you should exclude or even worry about these audiences, These, these demographic audiences at all. What I find is most advertisers that I work with or that I do coaching or training with, most of the time, they tend to exclude. They, they don't consider certain audience types or certain demographics types to be worth showing ads to. In particular, I find that it happens mostly on income brackets. So maybe you are offering a specific service. Maybe you're offering, let's say a, you know, an exclusive service, a service that is going to require a certain level of income, disposable income. Maybe it's something that's typically, you know, something associated with a higher bracket income. And you might think that it's a good idea to just not show it to anyone that is below a certain percentage level of income. So what you're going to learn today is how those percentages, those income brackets, the age brackets, the gender are all determined and what it means when you exclude those. And whether I personally think that you should. And here's the, you know, I'll get to the, to the point now at the beginning, just so you don't have to stick around if you don't want to. But I'll tell you, I don't think you should. I don't think you should. I'll tell you the reason why. If you want to know the reason why I don't think you should be excluding demographic audiences, stick around because I'm going to explain it and tell you the real reason why I rarely do it and why the very few times that I do it, why I do that. But the short answer is I don't think you should. And I'm going to go into that in a moment. Before I do, I'm going to tell you about my sponsor that makes this podcast possible. They are a very generous company that has offered my listeners exclusively a 28 day free trial of their super powerful tool that has basically a special offer just for you to try this new tool that they have. They've built from the ground up and they've been quiet for a few months. I didn't hear from them for a while and now they've, they've come back with an amazing tool that has AI integration. It's become a power tool. It's no longer just a recommendation tool. This is now optio.com PSP a power tool for Google Ads, Meta, Microsoft, TikTok, LinkedIn, all of these different networks. So if you are across the Internet using different networks, this is now a tool that you can enter enter into all of your advertising segments. So what this tool does is it helps you get more out of your advertising dollars. If you don't even know what questions to ask or where the problems might be or the whole system seems a bit confusing, you don't know how to improve Your meta or how to improve your Google Ads. Well this system can help you do just that. You can try for free 28 days@optio.com PSP that's a 28 day free trial to get into this exclusive new offer they're giving to try this new tool@optio.com PSP all right, so let's go on. Let's talk about how Google determines your age, gender and income. Okay, so here's the short answer. Google does not actually know who you are. It does not know your age. It does not know how much you make. So whenever a click comes in, there is a statistical guess that happens with that click and this information, this guess, these statistics that are used in order to make an assumption about who this person is and how they fit into the demographical audiences of Google. You know, the different buckets. How that's determined comes from a variety of sources. Sources. It comes from third party data like experion and other data warehouses out there. They pay for this information to, to be able to track you and find out, you know, okay, this person is associated with this and this and this. And you know, there's also government census, census data based on your home value. So whatever zip code that you're in that determines how much your assumed income is and is also based on your behavior, the searches, the websites that you're going to, the device type that you're actually using in the moment, all of this is used to compile a statistical guess. Statistics are involved, but it's still a guess. Just where you're located determines this information. Third party information. Of course there's nothing private that's, that's being given to Google. But you know, there's a lot that can be sourced based on IP address and also just based on Google internal, internal data gathering. I mean so much of Google covers analytics and tracking and all this stuff. It's still, even though this is, you know, we're past a point of quote unquote privacy, you know, having privacy, you know, Google supposedly being all for personal privacy. But I'll tell you that is still not the case. You are still tracked. In fact, maybe someday I'll do a discussion about, you know, this, this kind of back door privacy access where Google stopped using these cookies that were shared and you know, would, would track you and all of that. And now essentially when you fill out a form, when you take action on a website, Google asks those websites, those advertisers to provide that private information to them. So there's actually like a bit of a back door that's happening on this. So I would say privacy is in no way any more secure than it was before. You know, so there's tons of information that Google has, but how accurate is this? And it doesn't just happen with the income, you know, so Google's going to make a guess about the income. And by the way, the income is based on a national scale. Whenever Google says, you know this, this person's in the top 10% bracket, that's based on a national scale, not just, you know, if you're, if you're targeting just Georgia, for example, Georgia is going to have some areas that are going to be well below the top 10% or high percent. And maybe you block everything that's not in the top 10 to 20%. And what you don't realize is you might be blocking entire zip codes, entire areas that are not within that 10 to 20%. Google's not going to tell you which ones are not included. But by excluding these, you're actually losing audience members. Not because those people actually make less than you want. It's because the entire zip code has been deemed by below income level of 10 to 20%. You know, top 10, 20%. So you don't know it, but there's no reported exclusion. You can't see how much you're excluding. By excluding these demographics, you know, these income demographics, I mean, I would say it makes more sense to instead just decide, I don't want to show up in this zip code or this zip code, but anything else, I'm not going to make an assumption about who they are. I'm just going to show them an ad. If they search the way I want them to search, that seems like a more logical way to go. And also, age is in the same situation. Age is inferred, not verified. There is no verification of age. There never has been. There never will be a verification of age because you don't have to show your license, you don't have to show your papers to be able to search on Google. Anyone can do it whether they're logged in or not. So, I mean, we won't even talk about gender, right? I mean, I don't find people typically block by gender. A lot of times they'll block by age and income bracket. They don't usually go so far as to block by male, female, and unknown. So, so there's, I think there's something to discuss here because if you are familiar with these demographics, you know, there's an unknown category. An unknown doesn't Mean, you know, this, this is not 20, 26 where it's male, female and then unknown. That's not that, that's not what they're referring to. There's only male and female in the Google demographics and then there's the unknown which refers to we don't know who they are. We have so little information about this searcher that we can't make any inference about their age, their income or their gender. Okay. And here's, here's the truth that you could verify in your own account. Look at the past 90 days, you know, 150 days, a couple years of data. Get, get a big sample and look at how much of your demographic audience data shows up as unknown. I would say from what I've seen, it can range from 25% of your traffic to 50% and sometimes even more. Sometimes some industries, if you're in the health or some kind of more restricted industry, a lot of times that information is, there's going to be policy exclusions and things like that. That's not even going to allow Google to make assumptions about the searchers. So oftentimes, regardless of how much you try and block and you know, get information, there's another 50, 60, 70% maybe at times that this isn't even applying to. Google doesn't even know who they are. So here, here, here's the bottom line. Here's why I think this information is largely inaccurate or irrelevant or something you just really shouldn't worry about. Number one, as I said, a large percentage of the traffic is unknown. It's not even enough for Google to make a statistical guess about who they are based on factors of third party data, zip code, government census data and previous searches from that particular user or device. Okay, so unknown. Right? They don't even make a guess. No. Number two, and this is something I know from experience can't share specifics about this but I've talked to a lot of smart people, people that have a lot more technical know how about analytical data tracking and you know, backend server tracking and they have told me and shown me just how in excellent accurate Google's location accuracy actually is. Google will say that oh, this person is located around this general area and their more accurate tracking where the person actually shares information about who they are. You know, they're comparing this side by side and it's really not right, it's really not at some points miles and miles away from where the person actually is. So if you're making a guess, if you're targeting by zip code and making exclusions by zip code or income. And Google doesn't even get their location right by, you know, I wouldn't say hundreds of miles, but maybe 20, 30 miles, maybe 50 miles. Maybe they're off by that much. Not only are they in the wrong zip code, they might be in the wrong state. That's not really true here in Texas. You can be hundreds of miles away and still be in the same state. But the point is, they are nowhere near the demographic income area that Google assumes that they are. So location data, user location data is a guess. And just as an aside, I mean, how many times do you do searches that are not at your house? Right? I mean, you're in a certain zip code, you're searching when you're at work, you're searching when you're in your car, you're searching at a restaurant. I mean, how many times are you not in the actual zip code that represents your income bracket? You're not actually searching from home? You know, so there's a lot of complexities that, that really lead me to this point. And this is, this is where I end up. This is my final just, okay, I'm, I'm done with it. And as I said, I don't recommend that you do this. I don't care who the person is that clicks my ad. I don't care. And you say, well, Chris, you should care, because some people are more likely to purchase, right? You've heard of these, you know, personal, these, these customer profiles, right? My customer profile is someone is of this age, they have this kind of business, and they're looking for this kind of work or something like that, or it's a homeowner that's of this age. They have, you know, 1.5 kids, and that's who my customer profile represents. And if they're not within that profile, it's very unlikely that I'm going to sell them anything or they're going to buy anything from me. But I'll tell you what, when it comes to Google Ads, you can't make those assumptions. I do not block demographics. I don't care who they are. I only care in the moment of their search, in the moment of their search. If they are looking for something really specific and I see that search and I am blind to who they are, how much they make, what gender they are. I don't care. But I can see that they're doing that search. I'm interested in showing them an ad. So here's, here's an example. Let's Say that someone does a search for interior designer near me. Okay, that is a higher tier kind of thing. You know, this is someone who is going to need to spend thousands of dollars. They're going to have to be willing to buy some custom furniture that's sourced from the interior designer. You know, this is a person who needs to be at a point where they have a high level of disposable income. And you know, this person, you know, an interior designer does not want to work with someone who's going to be penny pinching the, the art and the design decor that this interior designer is going to be recommending and setting up and kind of shaping their home into. I cannot make that decision because I don't know who this person is. Instead, I judge based on the value of that traffic, based on the intent of their search. If they're looking for interior designer near me, I assume that's what they're looking for because they typed it. They took the time to go to Google and type that search. Now, I don't make a judgment based on their demographic. I make a judgment based on the intent of their search. Here's where I do make my judgment and this is the final point here. Here's where I do draw the line and say, okay, now I'm willing to cut it. Now I'm willing to make not a statistical guess, but an analytical judgment. That's where I draw the line. Let me remind you real quick, My sponsor is optio.com PSP for a 28 day free trial. I do appreciate those of you who have tried it. There are many, many listeners that have used the software, continue to use the software and I highly appreciate it. You can at least reach out to them and say thank you for supporting Chris, thank you for supporting Chris's podcast. So I'd appreciate that to let them know that their investment is worth it and it is heard. So thank you. Optio.com PSP so here's the bottom line. Analytical, analytical analysis, analytical judgment based on conversion data, actual purchases, actual leads, actual phone calls over a extended period of time. That's where I make my judgment. Now let me, let me explain the situations where this would and would not apply. So let's say, let's go with the interior designer spin again. And I notice that in the age groups there's a 3%, a 4%, a 5%, a 2% and another 3% conversion for all these different audience income, let's say income level, and nothing really sticks out at that point. It ranges from 3 to let's say 3, you know, 3 to 6% conversion rates and the cost per conversion is about the same. There's nothing there that really stands out to me that I think it would be worth blocking the traffic entirely in that instance because there's no massively different conversion metric that stands out so strongly that it's absolutely worth to stop advertising there. Now in another instance, let's say that I've never gotten a conversion, ever, ever tracked a single conversion from the age bracket of 18 to 24. And I know an interior designer is very likely to not work with someone 18 to 24 because it's going to be something of a middle age, later age kind of service. So if my conversion data matches with my assumption of the customer profiles, now I'm willing to make that leap and cut it. Now I'm willing to decide, okay, what I have assumed about my customers and what I see is also true in my Google analytical data. My Google conversions shows me that there's essentially none or very, very little. Right. If I see my conversions of 10%, 8%, 7% and then on the 18 to 24 range, it's 0.2% or 0% conversion rates in that situation I can call it that is drastically different because it matches my assumptions, it matches my profiles of who I say and assume my customers are, great. I'm willing to do it. And let me tell you another situation. I'm very much willing to do it if the account is struggling due to budget. If you're limited due to budget by a significant amount, you know, 30, 40, 50, 60% loss due to budget. Yeah. Okay, maybe we can make these judgments and this will help us devote the budget to the areas that do matter. But here's, here's where I find people making this mistake. And this mistake is, it comes in many flavors. When they start a Google Ads campaign, they think they know. They don't realize that they're guessing. They think they know exactly the searches that, that are going to be valuable to them. So they start with exact match. This same kind of assumptive, overbearing, over powerful type of management style also blocks certain age groups, they block certain demographics based on income. They block entire segments of the market based on assumptions based on a guess because they have a feeling, because there's no way I'm going to sell to anyone that's in this area. These people are, these people never buy from me. Okay? I mean what you're asking for is a smaller and smaller bullseye. And do you know what happens when you get smaller and smaller bullseyes. Typically, your costs accelerate in order to make sure you hit that bullseye and get the right market. You often find that your cost per click, your ability to show for those becomes more and more difficult. You're using exact match keywords. You're only showing on, let's say, desktop devices to people that are 40 and up. You won't show to anyone that is of an unknown age or an unknown demographic income. You're not going to show to anyone who's searching past 3:00pm I mean, all of these assumptions narrow your target so small. And then you dare to ask, why am I not getting any traffic? And I say the reason for that. The reason for that is because you have taken something that should have been a much more humble approach. You walk into Google saying, listen, I don't know exactly what's going to work. I'm going to try a couple different strategies and see what works. I'm going to try, you know, I'm not going to go into it. I mean, that's the entire devotion of this podcast, is to describe how to walk into a Google Ads campaign with a educated guess. But those that walk into Google Ads with an assumption that I don't want this, I don't want this, I don't want this, I don't want this. It reminds me of my picky eating children where they sit down at the dinner table and complain, why are we eating chicken nuggets and butter noodles again? And my wife and I have to tell them, children, you have said you don't want any of those other things. So instead you're left with the bare minimum of what we can scrap together that you will approve. And that seems silly. They're missing out on so much more because they won't try lasagna, they, they won't try steak, they won't try baked chicken. Why? Because they made an assumption. And those of you that eat steak, that. Those of you that eat lasagna, you know that's a silly assumption to make. You know that eating chicken nuggets is not really eating. It's not. That's not the right way to do it. So don't be a picky Google Ads manager, don't be a picky business owner who assumes they know exactly the traffic that's gonna work for them and then is surprised when they're served the chicken nuggets of Google Ads and they're frustrated. So there we go. I hope that's useful to you. Again, my name is Chris Schaefer. You can find me@chris schaefer.com. otherwise, I'll see you guys next week.