Let's say you sell those good old Widgets and you only ship to the US. Naturally your AdWords Campaigns are targeting the US but because you're a good manager you understand that performance varies from state to state so you want to control what you spend by state. Before Enhanced Campaigns were introduced you would have had to have had a Campaign for every state - or at least for every set of states that were different - and one for the US in total, excluding all the states to which you've applied specific budgets. It could be quite messy. Enhanced Campaigns make it a lot easier to control spending on CPC from state to state, all within one Campaign.
If you've got enough conversion data in your AdWords Account you might like to use that alone for deciding how to split your spend but I prefer to use Analytics bringing in all traffic sources, not just AdWords, partly because you're dealing with a larger data set so theoretically more accurate modelling, but also because the pretty map is much easier to work out. Here's a location map from an Account showing Transactions.
The palest green here is 0 Transactions so that's the colour of New Mexico bottom middle, to the left of the big dark green Texas. There are some pretty obvious trends here. California, Texas and New York State are running away with the business while Florida and Pennsylvania are not far behind. But there's a lot of states here with no transactions at all (New Mexico, Idaho, North Dakota, etc.).
Let's say I'm only really bothered about the biggest sellers and the worst and I'll leave all those in the middle to fight it out amongst themselves. So I make a list, I'm going to make CA, TX & NY + 10%, FL & PA + 5%, NM, ID & ND - 10%. Now I log into my AdWords Account, select my Campaign and choose "Settings", then Locations from the button above the graph (at the moment all I can see is "United States"), then "Edit Locations", beneath the graph. In the page that appears I add all 8 States (making sure I choose the State entries) - nothing more to do in this page, then Save these new locations. My list will now show "United States" and the new 8 specific states I've chosen.
Alongside each entry is a column for "Bid adj." and I'll click into each position (at the moment just showing a hyphen) for each of the new states. When you click in the column a dialogue box will appear and you'll be able to choose whether to "Increase by" or "Decrease by" a percentage, the Max. CPC for that particular state. I go through my list increasing California and Texas by 10%, decreasing New Mexico by 10% and so on until they're all done.
That's it! From this point on, bid values from these specific states will be adjusted according to the percentages entered so I can pay less for my clicks from poorly converting states (while still showing Ads, just in case) and make sure my Ads are #1 for states that convert well.
You can analyse this stuff until the cows come home but here's a few things to remember:
1) Make sure you use a decent time period and number of data points to make these important decisions. Don't change your entire account spending pattern on the basis of 3 sales in a 24 hour period. I'd suggest you use data from at least a month, better yet a quarter, better still a whole year to allow for seasonal variations.
2) Get down in the detail. While in my example above I've boosted all of New York state, a closer look at the data might show that almost all of the transactions were actually from the City. It might make more sense to + 5% the state and another + 5% the City itself.
3) Watch those numbers. You can make bid adjustments all over the place in Enhanced Campaigns and they're all cumulative. If you boost for time, location and device you could end up with some quite high CPC figures from very modest beginnings - just be aware.
Of course, you may still want to split your Campaigns up to split the actual budget, but this new Location bid adjustment gives you another level of granularity to control exactly where your money is spent, and that has to be a good thing.
