New Google Ads Rollout: Optimized Targeting and the “Signal” Icon

KLIK Staff

July 22, 2021

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This month, Google Ads advertisers started seeing a new icon pop up in their accounts. The icon is a small label with the text “Signal” and might be found next to demographic targeting parameters like age and gender targets.

The new icon is part of Optimized Targeting – a new feature rolling out this summer that widens the reach of Display, Discovery, and Video ads.

Quick Facts

We’ll dive in deeper in a moment but, since you’re probably busy with daily optimizations, reporting, and planning for next month, here are a few quick answers for you:

  • Optimized Targeting will expand your audience reach.
  • It impacts Display, Discovery, and Video ads.
  • You can disable it if you want to.
  • However, the default for this feature is Enabled. It’s an “opt-out” situation rather than “opt-in.”
  • Optimized Targeting is an ad group level setting.
  • Like most Google Ads updates, it is gradually rolled out to accounts. That means you may see it in some accounts that you manage right now but might not see it in others yet.
  • For best results, Google recommends that you use conversions-focused bid strategies with Optimized Targeting – that means Target CPA or Maximize Conversions.

What Does Optimized Targeting Do In Your Account?

With Optimized Targeting (OT) enabled, users who are not specified in your targeted audiences may be served your ad. Ostensibly, Google is doing advertisers a favor by helping them identify the right users when they may not be sure which audiences to choose.

Let’s say, you think a Pet-Lovers audience is your best bet for conversions so you choose that as your target audience. However, after your account runs with this target for some time, the OT algorithm might find that high-earning, 35-44 year-old Females make up the majority of converters and start serving your ads to users with this demographic profile even if they are not strictly part of your chosen target of Pet-Lovers.

So is This a Good Thing?

As with most automated features, the answer is “it depends.” If you don’t feel confident in your ability to choose the perfect audience targets, then Optimized Targeting provides a data-driven strategy for reaching that user group that you can’t quite put your finger on.

Alternatively, if you feel pretty good about the results you’re seeing from your chosen targets but wish to expand further, Optimized Targeting is also likely to help. It will try to find users with similar personal characteristics who (hopefully) have similarly high conversion rates.

For some advertisers, Optimized Targeting may be more frustrating than it is helpful. If you have carefully curated audience targets and feel confident that you are capturing just the right amount of traffic from the right sources, you would not want to use Optimized Targeting.

Essentially, the trade-off for using any automated feature is Help vs. Control. Optimized Targeting could be a useful way to expand your reach when you’re not quite sure how, but you’ll need to accept that you can’t fully control the expansion.

Optimized Targeting and Spend

For most advertisers, the biggest worry that comes with expanded reach is that their budgets will be surpassed or used on low-quality leads. However, Google has assured the public that, with Optimized Targeting enabled, budgets and target CPAs that you set will be maintained. This ties back to their recommendation of using conversion-focused bid strategies with Optimized Targeting. These bid strategies will allow OT to use conversion data to expand to users with a high likelihood to convert with the aim of maintaining or improving your CPA.

What Does the “Signal” Icon Mean?

Optimized Targeting looks for patterns in your converting users to find more users with similar characteristics. The characteristics that OT identifies as promising are labeled as Signals. If the majority of converters for your account are in the 25-34 age range, this age range would likely become a Signal. Google Ads now labels these with the “Signal” icon that you may have seen in your account.

Advertisers can also add their own Signals manually. However, since OT is an automation feature, it may discard manually added Signals if conversion data does not support them.

How to Disable Optimized Targeting in Your Account

Optimized Targeting is an ad group level setting so you will change it from the Ad Group Settings page. You will need to make the change individually for each ad group. Alternatively, you can leave this setting enabled for some ad groups and disable it for others.

  1. Click into the ad group you want to update and choose Settings from the left-side menu.
  2. Click “Edit Ad Group Targeting” – this button has a pencil icon.
  3. Find the “Optimized Targeting” section under the “Settings” header.
  4. You may need to click to expand this section.
  5. Here you will see a checkbox option to turn Optimized Targeting off.

In Conclusion…

This is not the first time that Google has rolled out a data-driven automation feature. And while it may be frustrating, the “opt out” (rather than “opt in”) approach is pretty standard for Google. This update is also consistent with Google’s efforts over the last several years to lead advertisers towards automation over manual optimization.

Now that we know about Optimized Targeting, we can watch out for that “Signal” icon in our accounts, monitor performance, and make informed decisions about whether or not to disable the feature. In the meantime, we’ll be keeping watch in the SEM community for success stories, complaints, and new information from Google about this update.

You can read more about OT on Search Engine Land and Google’s Optimized Targeting Support Page.

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