CPC difference between locally and nationally geotargeted ads

What is the difference?

[FranticFish]

Although I've been able to find reference to the fact that the CPC would be lower if I bid on 'trade' and geotarget to a particular city rather than an entire country, does anyone know exactly what the difference is likely to be?

If it was £5.00 to be found for 'trade' throughout the UK, what would the likely cost of 'trade' be in London?

Is there a broad percentage that could be put on it, or does it vary from niche to niche and city to city?

Would London cost more than a small town?

Anyone know what Google's system of calculation is? Perceived affluence of area? Demand in the area? Average CPC from advertisers in that area?

Despite an hour's searching here and on the web I can find hardly any information about this. Any pointers welcome. PM me with specific links please if you have any.

[RhinoFish]

Regarding your reference... maybe someone was predicting that a geo targeted campaign would perform better than a national one (via higher CTR and higher relevance) would conclude that your CPC would be lower, but I believe the proof's in the pudding (the campaign's actual performance), and nothing else like the affluence / demand questions you posed.

[FranticFish]

So the CPC is the same whether you want to be found within a 10 mile radius or across an entire country?

The thread I read mentioned that a better Q-score was obtained for a geotargeted ad therefore the CPC went down.

[netmeg]

You're not going to find any specific information, because there are too many variables. All you can do is test it.

[FranticFish]

OK, but can anyone give me a 'yes' or 'no':

Is CPC same no matter the size of the area targeted?

[Acrill]

No, it is not the same, it can vary.

Nobody can tell you why or by how much, it all depends on the keywords and market involved.

[Acrill]

I should note that this is largely a relevance issue.

CPC of locally-targeted ads should be lower than nationally-targeted ads as long as your keywords and website content are more relevant to users in that local area than they are to nation-wide users.

A general keyword such as 'trade' probably wont be any more relevant to users in Sheffield than it would be to users in London, meaning you will probably get a similar CPC for both locations.

If you were bidding on 'trade sheffield' you would be more likely to have a higher click-through-rate which leads to higher Quality Score which means a lower CPC in the long run.

Simply targeting your ads to a local area will not give you a CPC advantage over other AdWords advertise who target their ads to the whole nation. You still have to deal with the same competition, and I dont think that factors such as the affluence of an area will affect this at all.

[FranticFish]

Thanks, understood.