Audience Targeting

Optimized Targeting vs In-Market Audiences: Pick or Delegate

In short: Both decide who sees your Display, Demand Gen, or Video ads, and in most accounts they are running at the same time whether the advertiser knows it or not. In-market is a fixed boundary - spend stays inside the category you picked - while optimized targeting treats your picks as a starting suggestion and expands to anyone it predicts will convert. That makes conversion tracking the real dividing line: automation aiming at bad data expands badly. Delegate to optimized targeting when your conversion signal is trustworthy; hold a fixed segment when it is not, or when you need to know exactly who you bought.

By the AdFlint research team · Fact-checked against current Google and Meta platform behavior · Last reviewed July 2026

In-Market Audiences

Targets people Google has identified as actively researching or comparing products in a defined category, based on their recent search and browsing behavior.

You attach an in-market segment to a Display, Video, Demand Gen, or Search ad group and Google matches users whose recent activity signals active purchase research. Reach for it when you want intent-led reach beyond your own keyword footprint. The common mistake is applying it to Search as targeting rather than observation, which narrows an already intent-qualified audience for no gain.

Full definition

Optimized Targeting

Lets Google find additional converting users beyond the audiences you selected in a Display, Demand Gen, or Video campaign, treating your segments as a starting signal.

Enabled at the ad group level, it uses your chosen audiences and live conversion data as seeds, then bids on people outside those lists who look likely to convert. It is the intended successor to similar segments. It only behaves well when conversion tracking is reliable, and advertisers routinely confuse it with audience expansion, which widens reach without optimizing toward a conversion goal.

Full definition

Side by side.

The differences that actually change what happens in your account.

	In-Market Audiences	Optimized Targeting
Who chooses the person	Google, but only inside the category you named.	Google, anywhere it predicts a conversion - your picks are a suggestion, not a wall.
Role of your audience picks	The boundary of delivery.	A seed signal the system may quickly grow beyond.
Dependence on conversion tracking	None - the segment serves identically with or without conversions.	Heavy - without reliable conversion data the expansion has nothing sound to aim at.
Where spend can go	Stays inside the segment by construction.	Can shift mostly outside your chosen segments, which reporting shows as expansion traffic.
Default state	Off until you attach a segment.	Commonly enabled by default on eligible ad groups, so accounts run it without deciding to.
How to rein it in	Swap the category or add exclusions.	Toggle it off at the ad group level, tighten bid strategy targets, and rely on exclusions, which it still honors.
What a clean test looks like	Segment A versus segment B in separate ad groups.	Same seeds with the toggle on versus off, judged on conversion volume and cost, not audience purity.

What actually separates them.

Optimized targeting can put most of the budget outside your chosen segments, while in-market spend never leaves the category, so only one of them can surprise you about where the money went.

Because it is often on by default, many accounts believe they are buying a fixed in-market audience while actually funding expansion they never reviewed.

Optimized targeting aims at your conversion goal while an in-market segment is goal-blind, so tracking quality changes the behavior of one and not the other.

Exclusions are the only hard boundary optimized targeting respects - your segment picks are soft signals, but excluded audiences and content stay excluded.

Audience expansion on Video is a different feature that widens reach without conversion prediction, so which switch you flip changes what you are actually buying.

Which one should you use?

Use In-Market Audiences when

Your conversion tracking is sparse, delayed, or partly offline, giving automation a weak target to optimize toward.
You need to know and document exactly which audience your spend reached.
You are testing a category hypothesis and expansion traffic would contaminate the read.
Your goal is awareness or reach inside a defined market, where conversion prediction is the wrong steering wheel.

Use Optimized Targeting when

You have steady conversion volume flowing through tracking you trust.
Your fixed segments have hit their volume ceiling and you need growth without new campaign builds.
You have strong seeds - Customer Match, remarketing, converters - for the system to expand from.
You care about cost per conversion far more than about which named audience delivered it.
You can monitor the expansion share in reporting and are prepared to toggle it off if quality slides.

Common questions.

How do I know if optimized targeting is on in my campaign?

Check the ad group's targeting settings, where it appears as a toggle for eligible campaign types. The audience reporting also gives it away: traffic attributed to expansion beyond your selected segments means it is active. It is commonly on by default for new eligible ad groups, so audit rather than assume.

Does optimized targeting just ignore the in-market segment I chose?

It does not ignore it - your segment works as a starting signal and early delivery leans on it. But the system is free to serve well beyond it wherever conversions look likely, and over time the expansion share can dominate. If the segment must be a hard boundary rather than a hint, turn the toggle off.

Is optimized targeting the same as audience expansion?

No, and confusing them changes what you are buying. Optimized targeting predicts conversions and expands toward your campaign goal, while audience expansion simply widens reach to users similar to your audience without conversion prediction. Direct-response campaigns generally want the former; reach campaigns tolerate the latter.

Why did performance drop when I turned optimized targeting off?

Most likely the expansion was quietly carrying a large share of conversions, and your fixed segments alone are a much smaller pool. Before judging, give the change enough time to settle and compare cost per conversion, not just volume. If efficiency held but volume fell, that is the real trade you were making, and you can now decide it consciously.

Or stop choosing between them.

AdFlint picks the setting, writes the ads, and keeps optimizing inside the Google and Meta accounts you already own.

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