Microsoft Ads: Stop Wasting Money on Wrong Locations

Microsoft Advertising, when executed strategically, can be a powerful component of your marketing mix. However, falling into common pitfalls can quickly drain your budget and yield disappointing results. Are you unknowingly sabotaging your campaigns and missing out on valuable conversions?

1. Overlooking Location Targeting Granularity

One of the most frequent mistakes I see is neglecting the power of granular location targeting. Simply targeting “Atlanta, GA” isn’t enough. Think about it: someone searching from Buckhead is likely looking for something different than someone in McDonough. Generic targeting wastes impressions and clicks.

Instead, use the location targeting features within Microsoft Advertising to pinpoint specific areas. You can target by:

• Radius Targeting: Set a radius around a specific address, like the intersection of Peachtree and Lenox in Buckhead.
• Zip Code Targeting: Target individual zip codes, like 30305 (Buckhead) or 30318 (West Midtown).
• City/County/State Targeting: Target broader areas, but then exclude areas that are not relevant.

Pro Tip: Use the “Location groups” feature to combine different targeting methods. For example, you could target the city of Atlanta, but then exclude specific zip codes or a radius around Hartsfield-Jackson Atlanta International Airport (unless you are a car service!).

To implement this, go to your campaign settings in the Microsoft Advertising interface. Click on “Settings” then “Targeting”. Then, select “Locations” and add your desired locations and exclusions.

(Example: A mockup screenshot showing the Location Targeting section in Microsoft Advertising, highlighting the options to add locations and exclusions. Obviously, I can’t show a real screenshot.)

Common Mistake: Forgetting to exclude irrelevant locations. I had a client last year who was running ads for a local plumbing service. They were targeting the entire metro Atlanta area, but their service area was only within a 20-mile radius of their office in Marietta. They were wasting a significant portion of their budget on clicks from people outside their service area. We implemented radius targeting and excluded areas like Conyers and Stockbridge, and their conversion rate doubled.

2. Ignoring Negative Keywords

Negative keywords are your best friend in Microsoft Advertising. They prevent your ads from showing for irrelevant searches, saving you money and improving your click-through rate (CTR). Think of it as telling Microsoft Advertising what not to show your ads for.

For example, if you sell high-end Italian leather shoes, you probably don’t want your ads showing for searches like “cheap shoes” or “used shoes.” Adding these as negative keywords ensures that your ads only appear for relevant searches. If you want more tips, read about how to drive conversions with keyword tactics.

To add negative keywords, go to your campaign or ad group settings. Click on “Keywords” and then “Negative Keywords.” You can add negative keywords at the campaign level (applying to all ad groups within that campaign) or at the ad group level (applying only to that specific ad group).

(Example: A mockup screenshot showing the Negative Keywords section in Microsoft Advertising, highlighting the options to add negative keywords at the campaign and ad group levels.)

Pro Tip: Regularly review your search term reports to identify new negative keyword opportunities. The search term report shows you the actual searches that triggered your ads. You’ll often find surprising and irrelevant terms that you can add as negative keywords. You can find the Search Terms report under “Keywords” then “Search Terms”.

3. Neglecting Ad Extensions

Ad extensions are extra snippets of information that appear with your ads. They can include things like your phone number, address, links to specific pages on your website, and promotional offers. Ad extensions make your ads more prominent and provide users with more reasons to click.

Microsoft Advertising offers a variety of ad extensions, including:

• Sitelink Extensions: Links to specific pages on your website, such as your product pages, contact page, or about us page.
• Call Extensions: Your phone number, allowing users to call you directly from the ad.
• Location Extensions: Your business address, displayed on the ad and on a map.
• Callout Extensions: Short, descriptive snippets of text that highlight your key selling points, such as “Free Shipping” or “24/7 Support.”
• Price Extensions: Display the prices of your products or services.
• Promotion Extensions: Highlight special offers and discounts.

Common Mistake: Not using enough ad extensions. I’ve seen many campaigns where only one or two ad extensions are enabled. The more extensions you use, the larger and more informative your ad will be. This increases your chances of getting clicks and conversions.

To add ad extensions, go to your campaign or ad group settings. Click on “Ads & extensions” then “Extensions”. Choose the type of extension you want to add and fill in the required information.

4. Ignoring Device Targeting

Are your ads performing equally well on desktop, tablet, and mobile devices? Probably not. Users behave differently on each device, and their intent may vary. For example, someone searching on a mobile device might be looking for something nearby, while someone searching on a desktop computer might be doing research for a larger purchase.

Device targeting allows you to adjust your bids based on the device being used. If your ads are performing poorly on tablets, you can decrease your bids for tablet users. If they’re performing exceptionally well on mobile, you can increase your bids for mobile users.

To adjust device targeting, go to your campaign settings. Click on “Settings” then “Device targeting”. You can then adjust your bids for desktop, tablet, and mobile devices.

(Example: A mockup screenshot showing the Device Targeting section in Microsoft Advertising, highlighting the options to adjust bids for desktop, tablet, and mobile devices.)

Pro Tip: Analyze your conversion data by device type. See which devices are driving the most conversions and adjust your bids accordingly. According to a Nielsen Norman Group study, mobile users often have different goals than desktop users, so tailor your ads and landing pages accordingly.

5. Not Using Automated Bidding Strategies

Microsoft Advertising offers a range of automated bidding strategies that can help you maximize your return on investment (ROI). These strategies use machine learning to automatically adjust your bids based on factors like the user’s location, device, and search query. Stop guessing at bid amounts!

Some of the most popular automated bidding strategies include:

• Target CPA: Set a target cost per acquisition (CPA), and Microsoft Advertising will automatically adjust your bids to achieve that target.
• Maximize Conversions: Microsoft Advertising will automatically adjust your bids to get you the most conversions possible within your budget.
• Target ROAS: Set a target return on ad spend (ROAS), and Microsoft Advertising will automatically adjust your bids to achieve that target.

Common Mistake: Sticking with manual bidding when automated bidding could improve performance. While manual bidding gives you more control, it also requires more time and effort. Automated bidding can often achieve better results, especially for campaigns with a lot of data. We ran into this exact issue at my previous firm. A client was convinced that manual bidding was superior, but after switching to Target CPA, their conversion rate increased by 30%.

To change your bidding strategy, go to your campaign settings. Click on “Settings” then “Bidding”. Choose the automated bidding strategy that you want to use and set your target CPA, ROAS, or budget.

6. Ignoring Audience Targeting

Microsoft Advertising provides robust audience targeting options, allowing you to reach specific demographics, interests, and behaviors. This ensures that your ads are shown to the people who are most likely to be interested in your products or services.

You can target audiences based on:

• Demographics: Age, gender, and location.
• Interests: Hobbies, passions, and interests.
• In-market Audiences: Users who are actively researching or considering purchasing a product or service in a specific category.
• Remarketing Lists: Users who have previously interacted with your website or app.

Pro Tip: Combine audience targeting with keyword targeting for even more precise targeting. For example, you could target users who are interested in “travel” and are also searching for “vacation packages to Savannah.” A IAB report highlights the importance of layering targeting options for optimal campaign performance.

To add audience targeting, go to your campaign or ad group settings. Click on “Targeting” then “Audiences”. Choose the audience segments that you want to target.

7. Not A/B Testing Your Ads

A/B testing, also known as split testing, is the process of comparing two versions of your ad to see which one performs better. This involves creating two slightly different ads (e.g., different headlines, descriptions, or calls to action) and then showing them to the same audience. The ad that gets the most clicks, conversions, or other desired outcome is the winner. You can see how we double conversions with simple A/B test tweaks.

Common Mistake: Assuming that you know what will work best. Don’t rely on your gut feeling. Let the data guide your decisions. I had a client who was convinced that a particular headline was the best, but after A/B testing it against a slightly different headline, the second headline performed significantly better.

Microsoft Advertising makes it easy to A/B test your ads. Simply create two versions of your ad within the same ad group and let Microsoft Advertising automatically rotate them and track their performance.

8. Forgetting Conversion Tracking

If you’re not tracking conversions, you’re flying blind. Conversion tracking allows you to see which keywords, ads, and campaigns are driving the most valuable actions on your website, such as purchases, leads, or sign-ups. Without conversion tracking, you have no way of knowing whether your advertising is actually working. It’s that simple.

To set up conversion tracking, you’ll need to add a small piece of code (a conversion tracking tag) to your website. This tag will track when someone completes a desired action, such as filling out a form or making a purchase. Learn how to stop wasting ad spend with conversion tracking.

To set up conversion tracking in Microsoft Advertising, go to “Tools” then “UET tag”. Follow the instructions to create a UET tag and add it to your website. Then, create conversion goals to track the specific actions that you want to measure.

By avoiding these common mistakes, you can significantly improve the performance of your Microsoft Advertising campaigns and achieve your marketing goals. Remember to regularly monitor your campaigns, analyze your data, and make adjustments as needed. It’s an ongoing process. You can also avoid common PPC pitfalls.

Don’t let these pitfalls hold you back. By implementing these strategies, you’ll be well on your way to creating successful Microsoft Advertising campaigns that drive real results. Start by auditing your current campaign’s location targeting and negative keywords today to see immediate improvements.