Geographical targeting, also known as geo-targeting, deals with displaying your AD’s and page contents to users on specific regions within your market. This would ensure maximum Return on Investment (ROI) on your internet marketing expenses.
There are various AD campaigns provided by search engines, web directories and portals that can be used to drive in local traffic that would convert better.
Every website that caters to nationwide or worldwide user population, but at the same time desires to market products that are region specific has implemented geo-targeting on their websites and AD campaigns. You can set up your website to display to prospective customers located in the specific regions that you select, as well as to prospective customers who include the name of that specific region in their search term.
In PPC Advertising campaigns, not splitting your campaigns based on geographies will be a waste of money as different geographies attracts different bidding costs and different competitors. Hence common bids for all geographies will attract traffic from cheaper countries which may not always convert to revenue.