Targeting by household income (HHI) is a staple when working with programmatic & display companies. Wouldn’t it be great to be able to add in similar HHI targeting in Google AdWords? Oh wait, you can! Although a somewhat hidden option within the interface, it only takes a few additional steps to set up. By doing so, you can get some incredible insight into how wealthy the users interacting with your ads are. Taking it a step further, you can use that data to optimize your campaigns (both search and display).
According to Google, household income targeting is “based on publicly available data from the US Internal Revenue Service (IRS), advertisers are able to target ads to certain areas according to their average household income. This feature is currently available for U.S. locations only.”
Currently, the HHI targeting available is by tier within a selected geo-location. Example below.
Top 10% within New York
11 – 20% within New York
21 – 30% within New York
31 – 40% within New York
41 – 50% within New York
Lower 50% within New York
When you apply the household income targeting tiers to your location targeting, data begins to populate within each line item. This not only gives unbelievable insight into who is interacting with your ads, but you can add bid modifiers to be more or less competitive for a select income tier. For example, if you are promoting something with a high price tag, you may find it beneficial to add a positive bid modifier on the top 10% income tier within the market you are promoting it in. Alternatively, you may consider excluding the lower 50% using a -100% bid modifier.
As a best practice, we recommend adding all tiers of HHI targeting (per your geo target) in addition to your actual target. Once added, let the data accumulate prior to make any bid adjustment modifications. As we all know, what we assume to be true is not always the case. You can assume that the top 10% would be most interested in a luxury item, but it’s always best to let the data do the talking.