For a local business, location targeting is one of the most important settings in the account. You can target or exclude regions, cities, postal codes, or a radius around your business, and adjust bids by location. Google also offers a key choice: showing ads only to people in or regularly in your area, or also to people who have merely shown interest in it.
That broader 'presence or interest' option — Google's default — is a common source of waste, because it can show ads to people far outside your service area who simply searched about it. Most service-area businesses should choose 'presence,' then use location reports to shift budget toward the areas that produce the best customers.
Example
A Huntsville plumber targets a 25-mile radius around its shop with 'presence' selected, so its ads don't show to someone in another state researching Huntsville.
How Sloss Digital uses it
We set location targeting to match each client's real service area, default to 'presence' for local businesses, and reallocate budget toward the ZIP codes that produce the most valuable jobs.