So much is written about how local lead gen is HOT, but so precious little on how to actually do it.  Not surprising, since for every Brandon Hoffman, Dr. David Klein, and David Kyle, there are 100 pretenders.  So let's talk about local PPC geo-targeting.

First off, geo-targeting is critical for professional service firms-- dentists, doctors, attorneys, and the like. Some folks are more local than others-- for example, the local dry cleaner is not going to attract people from 3 states away (much less, across town) while a Charlotte realtor may attract folks who are searching from California for real estate.  A Las Vegas hotel may attract booking nationwide, as would a world-famous restaurant.

Thus, a locally-based business performs their service locally, but may attract folks from across the globe, depending on how special their service is.

Consider Dr. David Verebelyi, a Denver plastic surgeon.  His office does liposuction, scar removal, botox, laser hair removal, and so forth. Most of his clients come from the Denver metro, although his reputation in the industry (he runs the curriculum for the American Society of Laser Medicine, which trains the 4,000 laser surgeons in the US) brings in clients from around the world.  Last week, he booked a client from the UK.

In setting up PPC campaigns, you should expect that 90% of your traffic will come from your geo-targeted campaign, while  10% should come from geo-modified terms.  You should have at least a geo-targeted campaign with generic keywords (searching for "laser hair removal" from a Denver ip address) and a nationally-targeted campaign with geo-multiplied terms (searching anywhere in the US for "Denver laser hair removal").  Be careful about cities that have the same name-- Louisville, CO versus Louisville, KY.  And consider whether your clients have to travel to see you (real estate) or are in-town (family dentistry and pizza).

If you have a mix of services that attract only locals and some specialized offerings that draw nationwide clientele/patients, then you CANNOT just duplicate your geo-targeted campaigns.  Separate out the ad groups based on how far people will travel to see you.For example, Botox injections are a common service provided not just by high end offices such as Dr. Verebelyi's, but by medical spas, clinics, and even folks who run "botox parties".  At only $10 an injection, it's not something you'd fly across the country to get.  And we're not willing to pay $12 a click for that user, like we would for a $6,000 liposuction procedure covering multiple areas.Not sure how to tell how far folks will travel for each of your services?   Maybe you are the agency and the client isn't sure.  Then look at the bounce rates by campaign and keyword.  In the screenshot below, we have the following campaign structure:

• Denver geo-targeted campaign: Targeting Denver, driving 548 of the 1,029 paid search visits we saw in the last 30 days. This metro campaign will be the bulk of your traffic, so make sure you have the targeting option correct-- whether a certain number of miles from the client's zip or the whole metro area.  If you're a local veterinarian, you might only take a 10 mile radius and not the whole city.  If you're a roofing contractor, you might drive 150 miles for a new job.  If you live in the Twin Cities (which is two overlapping metros), be careful about targeting folks too far outside your area.  If you're in Manhattan, don't target NYC unless you really do service all the boroughs and can afford to compete for that amount of traffic.  You'll be competing against all the other folks who aren't so careful with geo-targeting.
• Extended geo targeting: We've taken the primary metro and extended it for a 3 hour drive in any direction.  Some folks have no problem driving 2 hours east from Vail into Denver for better care.  They'll not drive that far for botox, but they will for a complex procedure.  This campaign targeting has fewer ad groups and also fewer clicks.  Note the bounce rate is 59% versus 66%, reflecting poorer quality traffic.  Not everyone will drive 3 hours for scar removal, so we bid less.  Even if you mention your city name in your ad to try to prevent erroneous clicks, assume most people don't read your ad carefully.  Local ads also get the benefit of the 5th line, which shows their geo-targeting (whether Denver or perhaps all Colorado).

• Denver nationwide search: This is a nationally targeted search with keywords that are multiplied against "Denver" and a couple other major cities.  We find that multiplying against zip codes and small towns typically result in almost no traffic.  From a SEO standpoint, they are perhaps worthwhile, but not PPC.  The bounce rate is 78% and the bids are adjusted accordingly.  Note that the PPC bounce rates are not apples-to-apples comparable to the site-wide bounce rates.  PPC is sending people to a landing page designed to drive a phone call (resulting in a bounce), while traffic to the homepage will usually result in a click to an interior page.
• Nationwide search: Here we market our most expensive services to folks across the country. Someone who lives in Hollywood is probably going to find a plastic surgeon in LA County, not Colorado-- but you can't be sure, as reputation is worth a lot.  This campaign has 1/10th the traffic of the primary Denver geo campaign, which means that we're not getting as many clicks. The bounce rate is 87%, which means that folks who did click are not as interested once they do get to the landing page.  While the traffic is worse, it doesn't mean you shouldn't play nationally necessarily.  Just calculate the ROI and spend such that the leads still make sense.
• Content campaigns: You can follow the same logic with content network campaigns.  Just bid appropriately based on cost per lead (generated call or inquiry).  The traffic will be almost as good as search if you day-part (campaigns on only during office hours) and do heavy site targeting (filter out the sites that are garbage through heavy negatives).   Don't just copy your search ads into content and leave it.  With content, you're interrupting people, so the ads will be different.  Plus, you can do banners (try some images) and use demographic targeting (in this case, go for middle aged women that need a little beauty enhancement).