Discover the Google Ads Targeting vs Observation settings AKA Google AdWords Target And Bid vs Bid Only. We cover Google Ads Targeting and Google Ads Observation for Search Network, Shopping Network and Display Network campaigns. These only apply to the Google Search Network and Display Network, so these settings do not apply to Video Network Campaigns.

You have a lot of options when it comes to campaign and ad group targeting settings. One of the options is choosing to use Targeting and one of the other options is to use Observation. Targeting was referred to as Target and Bid in the old Google AdWords experience. Observation was referred to as Bid Only in the old Google AdWords experience.

You may want to see how your ads perform with certain targeting settings before you actually target it. That is where the Observation feature comes in. You can observe how certain audiences perform so you can decide whether or not you can set custom bids and bid modifiers. If you find a certain audience performs well, you can bid higher after using the Observation setting. If you find a certain audience performs poorly, you can bid lower. If something is performing great, you can insert it as Targeting and improve your cost per conversion altogether.

Targeting and Observation availability

In Display Network campaigns
Recommended usage: “Targeting”
You can use “Targeting” for:

Audiences
Placements
Topics

Demographics and Display Keywords use the standard “Targeting” setting only. Note that by default, all demographic groups are targeted, unless you make changes.

In Search Network and Shopping campaigns
Recommended usage: “Observation”
You can use “Observation” for Audiences (this includes RLSA).

In Video campaigns
Recommended usage: “Targeting”
"Observation" is not available. All methods use standard targeting by default.

Learn more here: https://support.google.com/google-ads/answer/7365594?hl=en

Select targeting and observation settings: https://support.google.com/google-ads/answer/7374253?hl=en&ref_topic=6346221

Targeting settings on the Display Network: https://support.google.com/google-ads/answer/1209882