Suppose we have a shopping portal and offering shopping services in all over world. Everyone can purchase anything to everything but we need visitor first to sell our products and products choices vary form country to country. This is the main reason behind geographical targeting if we want visitor from US we need to start email campaign, PPC campaign, News Letter only for US region visitor.
Geotargeting happens on the server, before the page is sent to the browser. When a user requests a page from the server, the server queries the user's IP address against a database of worldwide IP addresses. The database identifies the country of the user's IP address and then the server decides what to do.
Chances of conversion rate are high in geographical target based campaign that’s why everyone starts providing geographical targeting facility in their paid campaign facility like Google.