Social Media Ad Targeting: How Local Businesses Can Pinpoint the Perfect Leads for Their Services

Digital Marketing » Social Media » Social Media Ad Targeting: How Local Businesses Can Pinpoint the Perfect Leads for Their Services

As social media continues to rapidly change the world in unprecedented ways, it’s also become an invaluable tool for businesses to reach their customers, discover new audiences, and promote their products or services. But with hundreds of millions of daily users on all different types of social media platforms, it can be overwhelming for some businesses trying to locate their target audience and generate higher-quality leads. That’s why effective targeting is essential for social media marketing efforts – it helps organizations reach the appropriate audience with an impactful message. 

For local service organizations, precise targeting is even more important. Local businesses oftentimes rely heavily on generating high-quality leads within a certain geographic area, and social media platforms have a number of tools and features that can help achieve this. By narrowing down the target audience to the most relevant individuals based on their geographic location, interests, behaviors, and other factors, local businesses can increase their chances of converting leads into loyal customers. 

In this article, we will cover the many targeting options available to local businesses on popular social media platforms like Facebook, Instagram, LinkedIn, and others. We will also talk about how to leverage location-based targeting, interest targeting, lookalike audiences, and other helpful techniques to ensure businesses cultivate greater leads and drive revenue growth. 

Understanding the Basics of Targeting Options

Targeting via social media advertising involves using a set of criteria to narrow down audiences for a particular ad or campaign. By assessing factors like geographic location, interests, demographics, and online behavior, businesses can ensure that their marketing materials are shown to the most relevant audience possible. 

Targeting options are practically essential for local service-based organizations, as they can help businesses focus their ad campaigns on the people who are most likely to be interested or in need of their services. This works to generate high-quality leads in a relevant geographic area. 

Understanding the basics of targeting options can help local businesses create effective social media marketing campaigns that increase website traffic, enhance the quality of new leads, and generally drive growth and revenue. 

Demographic Targeting

In social media advertising, demographic marketing involves categorizing users based on their age, gender, education, income, and other commonly utilized demographic attributes. Businesses can then use this demographic information to identify better-quality leads. For example, lawn care businesses may seek out people who are homeowners, aged 30-60, with above-average household incomes, within a specific zip code or multiple zip codes. 

By marketing with demographics, local businesses can greatly improve ad performance, reduce ad spend, and increase the likelihood of gaining more customers. Demographic targeting can also help businesses by ensuring that marketing materials spend less time in front of irrelevant or uninterested audiences and more time in front of people who are likely to take a desired action. 

Geographic Targeting

Another vital aspect of effective social media marketing is geographic targeting. As the name implies, geographic targeting involves identifying an audience based on their location – whether it’s a broader categorization (by state or region) or more specific (by zipcode or neighborhood).

To find their ideal service area, businesses can analyze their existing customers and identify neighborhoods or zip codes with higher demand for their services. Geographic targeting strategies may include radius targeting, which allows businesses to target people within a certain distance from a location, or zip code targeting, which allows businesses to target people by their zip code.  

Interest and Behavior Targeting

On one hand, interest targeting allows marketing teams to target users who have previously expressed interest in specific topics or have engaged with related content on social media websites. Behavior targeting, on the other hand, involves reaching users based on their past online behaviors. 

Social media platforms have a number of tools and features that can help businesses analyze and make decisions based on audience interests and behaviors. Facebook’s Audience Insights tool, for instance, can be leveraged to identify relevant interests and behaviors to help businesses target their marketing strategies more effectively and potentially broaden revenue streams. 

Custom Audiences and Lookalike Audiences

Custom audiences and lookalike audiences are powerful targeting strategies in social media advertising. Custom audiences can help business target users who have previously interacted with the brand; this may include existing customers, website visitors, or email subscribers.

Lookalike audiences enable businesses to target users who are similar to their very best customers. To leverage lookalike audiences, businesses can analyze customer data and social media tools to identify users with similar interests, demographics, and behaviors. By working with custom and lookalike audiences, businesses can create highly targeted, effective ad campaigns that reach the appropriate audiences and drive conversions. 

Retargeting Strategies

Targeting users who have previously engaged with a business’s digital content is known as a retargeting strategy. It’s effective because it allows businesses to stay top-of-mind for users who have already expressed interest in their products and/or services. 

Retargeted can be implemented via website pixels, which track user behavior and allow businesses to show ads to users who have visited specific pages or filled out forms. Retargeting can also be accomplished with email marketing campaigns, and businesses can show ads to users who have opened or clicked on previous emails. By leveraging these strategies, businesses can greatly increase the effectiveness of their digital marketing campaigns and may see a greater return on investment. 

Exclusions and Negative Targeting

It can also be helpful for businesses to minimize interactions with individuals who have already interacted with their brand or have expressed disinterest in a business’s goods and/or services. Exclusions and negative targeting are marketing techniques that essentially prevent uninterested persons from being included in marketing efforts.

Negative targeting involves excluding users who meet certain criteria that are not relevant to the ad campaign – usually things like location or age. When utilized thoughtfully, these techniques can help businesses avoid wasting valuable ad spend on uninterested parties and broadly improve the targeting of their marketing campaigns. This is just another step in the process to ensure that businesses position their ads and content in front of the right audience at the right time. 

Testing and Refining Your Targeting Options

Another important part of any social media advertising strategy is testing and refining targeting options. Ongoing testing allows businesses to understand the most effective targeting strategies for their campaigns and refine techniques and approaches to help improve results. 

A/B testing is a common technique for testing targeting options, wherein a business creates two different versions of an ad with different targeting options and compares how the two perform. To optimize targeting over time, businesses must regularly analyze performance data, and adjust targeting accordingly. Assessing performance data and other social media metrics can help companies optimize targeting strategies and improve conversion rates. By testing and refining targeting options, businesses can improve the overall ROI of a marketing campaign and experience better results over time.

Targeting Options on Major Social Media Platforms

Major social media platforms like Facebook, Instagram, LinkedIn, Twitter, Pinterest, and others, all offer various targeting options for social media advertising initiatives. Facebook and Instagram are popular choices because they allow businesses to target users based on demographics, interests, and other behavioral factors. LinkedIn is a great choice for B2B organizations since there are targeting options based on things like job titles, company, or industry. Twitter’s targeting options include interests, keywords, and followers of certain accounts. And Pinterest allows businesses to target users based on keywords, interests, demographics, and more. 

Effective social media marketing also requires marketers to have a firm understanding of how audiences engage and interact with the platform itself. For instance, the visual nature of Instagram’s platform makes it an ideal option for showcasing local services, whereas LinkedIn’s targeting options are generally more useful in B2B applications. Best practices for cross-platform targeting strategies typically involve analyzing audience insights, testing, and refining targeting options, and applying retargeting techniques when necessary to stay top-of-mind with interested users across multiple platforms. 

Ultimately, business leaders must carefully consider each platform’s targeting options when trying to improve social media marketing techniques. 

Cost Considerations

As a basic rule of thumb in social media advertising, general targeting is usually more affordable than hyper-targeting. Because hyper-targeting requires more data and effort to reach a smaller audience, the average cost per impression (CPM) will likely increase. However, hyper-targeting can be exceptionally useful at driving more clicks and conversions, which can sometimes lead to a lower CPM. 

In order to identify the best targeting option for your business without overpaying, many modern businesses will test a range of hyper-targeting and general targeting options. This testing process can help marketing teams identify which targeting options will likely be the most effective at reaching the ideal audience and driving conversions. By finding a good balance between hyper-targeting and general targeting, businesses can optimize their social media advertising campaigns and improve their ROI.


Social media marketing is a difficult field to master, especially since platforms are continually being updated, and their algorithms and features are subject to change at any time with little or no notice. But by utilizing the various targeting options available on most major social media platforms, businesses can engage better with their ideal audience and cultivate more conversions.

And by continually testing and assessing various targeting options, businesses can optimize performance and quickly adapt to changes in the digital landscapes of social media. Business owners must take steps to implement effective targeting strategies, including demographic targeting, geographic targeting, interest, and behavior targeting, custom and lookalike audiences, retargeting, and exclusions/negative targeting as well. When businesses improve targeting initiatives, they are also more likely to see improvements in engagement and conversions.

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About The Author

Masha Mahdavi

Masha Mahdavi

Masha Mahdavi has over ten years of experience in digital marketing. She has worked with clients across a variety of industries including legal, medical, retail, and local businesses. Her focus is on working with clients in highly competitive niches and generating ROI through data-driven strategies, search engine optimization, paid search advertising, and paid social media.