What Are Google Local Services Ads and Why Should You Care?

What Are Google Local Services Ads and Why Should You Care?
106

If you’re working with Service Area Businesses (SABs), you’ve no doubt been asked about Google’s Local Services Ads (LSAs). In this ultimate guide to LSAs, contributor Tom Waddington breaks down where these new ads came from, where they’re headed next, and how to get the most from them.

Google Local Services is a pay-per-lead advertising platform that Google began expanding to several new verticals and markets outside of California in mid-2017.

A Brief History of Local Services Ads

The product was initially called “Home Services ads” and began as a beta test in the San Francisco area in 2015. Businesses that appeared in these Home Services ads were required to complete a screening process to make sure relevant insurance and licensing requirements were met. Criminal background checks for employees were also required as part of Google’s screening process.

When looking for a contractor through Home Service ads, consumers could either call a business directly or select up to three businesses from the list to request individual quotes for comparison. The look and process has changed since then: a consumer no longer has options to request an online quote from a single business or select multiple businesses to request simultaneous quotes. Currently, the only way to contact businesses to compare service quotes is to call them.

Google expanded the program to markets outside of California in 2017, and rebranded: “Home Service ads” became “Local Services ads” (LSA). The look and process has continued to evolve during the expansion, but one constant has remained. In order for a business to be “Google Guaranteed” they must pass Google’s screening process. This process continues the practices of license and insurance verification, as well as employee background checks performed by Pinkerton Consulting and Investigations. All employees that serve customers at their homes must complete background checks for the business to earn the “Google Guaranteed” badge.

In addition to knowing these businesses have passed Google’s screening process, consumers that hire a “Google Guaranteed” business through a Local Services ad receive a satisfaction guarantee backed by Google. If they are not satisfied with work quality, Google will cover claims up to the job invoice amount (with a lifetime cap of $2,000).

When and where in the search results do Local Services ads appear?

Keywords relevant to Local Services ads categories will typically trigger the ads, which appear at the top of the search results (above AdWords and the map 3-pack) on both desktop and mobile. The main ad format allows companies to display only their company name, review rating, city, phone number, and hours of operation.

Companies that benefit the most from this ad format will most likely be those that are able to maintain a high relative review rating combined with strong brand awareness in their local markets.

Local Services Ads Appearance on Desktop

lsa-desktop

Local Services Ads Appearance on Mobile

lsa-mobile

On the initial search result, you will see three Local Services ads on desktop and two Local Service ads on mobile. Clicking on the “More plumbers” link will take you to a separate page showing a full list of both paid and free business listings in the Local Services ad unit.

How much do Local Services Ads leads cost?

Businesses set a weekly budget and are charged on a per lead basis. The lead cost is a set rate that varies depending on the category and market (from $5-$139 per lead). On the low end, locksmith leads in a few markets are $5, but at the high end water damage restoration leads in Tampa are $139. The average cost overall is around $24 per lead.

Leads obtained by listings that aren’t “Google Guaranteed”, either because they’re advertisers that have their ad paused, or they’re free listings, will not be charged for leads.

The number of paid listings in a market and within specific categories can vary greatly. Some searches may result in only one or two listings, while others may have more than twenty. There are no limitations to the number of advertisers that may be included in a particular market or category. Obviously, the fewer of advertisers there are, the more leads those businesses are going to get. Some participating businesses may be receiving a large volume of leads while others may only be getting a few.

Can a business choose which keywords to target with Local Services ads?

No. Businesses are not able to designate which keywords to target. Instead, they select categories or “job types” that indicate of the type of services and products they offer. Google decides which keywords are relevant for those job types and a business’s ad will appear based upon the service areas and job types the company selected. Google does not provide any keyword data to show which keywords are triggering ads, or which keywords are generating leads.

What happens when a company pauses their Local Services ad?

When a participating business has their ad paused, it doesn’t remove their ad from the search results, but the business’s “Google Guaranteed” badge and label will not be present and the paused listing will be placed below any paid listings.

It is easy for a business to pause and reactivate their ad via the Google Local Services dashboard or app, and businesses are not charged for leads while their ad is paused.

Is setting up Local Services ads worth it?

Absolutely. There’s no cost to sign up or obligation to participate. The on-boarding process can be cumbersome, but once enrolled, a company will be able to objectively determine whether it’s a good fit for their business. Considering the priority placement of the ads, the relatively low cost of the leads, and the absence of additional costs or obligations to join should make enrollment an easy decision for any business.

If a company determines that the program is not a good fit among their advertising strategies, they can pause the ad and no longer incur costs. Their listing will simply be placed in among the free listings in a section below the paid listings and its placement will likely remain more visible than non-participating companies in the area.

Which cities and categories currently have Local Services ads running?

Most lists you will find online are outdated, including Google’s. I try to keep the Data Studio report below up to date, but it may have some holes in it as Google doesn’t announce when new ones are launching.

If you’re having trouble viewing this tool, try it in Fullscreen mode (click the ‘fullscreen’ icon in the bottom-right corner of the report) on desktop.

How can I join Local Services ads?

The official Local Services website offers phone support and a sign-up form to help businesses get started.

Business owners also need to be aware that a member of the Google Local Services team may try to reach out to them directly via a phone call or email, even if the business did not fill out the form and may already working with an agency (including one that is a Google Partner).

I know many people have the mindset that Google will never call them, so any call from someone claiming to be from Google must be a scam. I am sure that numerous businesses have missed out on the opportunity to be one of the first participants in their market because they’ve refused to take a call or respond to an email from a legitimate Google Local Services representative. In such instances, business owners may want to reconsider these suspicions and feel encouraged to request additional verification before dismissing the representative.

Local Services is its own product

There are some correlations with Google AdWords and Google My Business but it’s important to note that Local Services operates independent of both. A Local Services ad and an AdWords campaign can be run at the same time but do not have to be. Their budgets are independent of one another and one can be running while the other is paused.

Local Services has its own dashboard and app, so you do not do any management of it from within AdWords. An AdWords account is required for Local Services but it’s essentially just for billing purposes and to be able to utilize Google Manager Accounts (MCC) features.

A Local Services ad is typically associated with a Google My Business listing but it doesn’t have to be. When it is, the Local Services ad will show reviews sourced from its corresponding Google My Business listing. Reviews can also be obtained through the Local Services ad platform, where Google is making an effort to improve the authenticity of reviews.

Since Google is directly capturing and directing the lead with LSA, they have more data and are better able to connect the dots on a converted lead that leaves a review. In situations where the dots do connect, a review will display an enhanced status as a “Google verified job”:

Reviews on a Local Services ad can be a mix of Google My Business and LSA sourced reviews. However, reviews sourced from the LSA platform do not currently appear on Google My Business listings.

“I am not a contractor, or my agency doesn’t have clients that are contractors, so Local Services ads won’t impact me.”

Don’t be so sure. Google has already expanded LSA to verticals outside the realm of home services (such as auto repair, event planning, pet boarding, pet grooming, and photography).

Local Services is no longer a beta test impacting just a handful of businesses in a few markets. It has caused a significant shift in the local search landscape that businesses and search marketing agencies need to be thinking about.

Maybe most importantly, the integration of Local Services with Google Assistant and Google Home products may offer a glimpse of the future, showing how Google might utilize voice search to connect consumers with local businesses.

Tom Waddington is a co-owner of Wachae, a search marketing and analytics business. He has been involved in local search for over 10 years and has worked with numerous home service-related businesses. Tom is also a Google My Business Top Contributor and has been closely monitoring the evolution of Google’s Local Services ads over the past year.

Share this article

12 thoughts on “What Are Google Local Services Ads and Why Should You Care?”

  1. I understand the frustrations and I have some myself. The point of this article, however, was to try to help give people a basic understanding of Local Services ads and to point out they may be dealing with them soon. I have my concerns with some aspects of LSA but didn’t want to go down that path in this article. LSA may be new to your market/vertical (I didn’t even have it on my list) but it is been around for quite a while now.

    It is intrusive, particularly for locksmiths, garage door companies, and moving companies because they must pass Advanced Verification to even be eligible to participate.

    I think most people that believe it will be a race to the bottom are under the impression that a consumer enters their info and then receives quotes from multiple businesses. That is not how it works (at least currently). A consumer calls the phone number on the listing and may call several if they’d like, just as they might do while looking at map listings, organic results, paid results, etc.

  2. This is a disgusting intrusion by Google into our businesses. I spent 10 years building up SEO Ranking and reputation for my moving business in the Twin Cities. I have seen a large drop in the number of new clients who call us. Google will effectively be big brother looking over your shoulder and telling you what to do and how to run your business. You will be the one paying off the crooked client who just refused to pay you, citing some obscure reason. (Something that happens to me at least 3 times a year). It will be a race to the bottom with pricing, as other articles have pointed out. Your article missed all of the really important negative aspects of Googles new ploy to use their monopoly to gain almost complete control of our businesses..

  3. Exciting. Whne will it be available in Nordics..? Any idea? Closest to this would they google business, right? Business is just indexing on maps, no ads?

    1. Hi Josefine, I would guess that it would be quite a while until these are found outside the USA. They’ve been live for a while now and there’s not been any hint of them moving outside the States, but if they’re a success over there I’m sure they will eventually.

      The nearest equivalent to LSAs is actually PPC, as it’s a form of paid advertising, whereas Google My Business is free and more directly tied to Maps.

      Thanks

      Jamie

  4. Yes big “G” is using their top of page real estate to cut into the lead generation market with fixed lead prices for these categories… I’m sure this will last especially if it generates enough revenue. I only see this expanding for all types of niches!
    Thanks for the great article Tom.

  5. I have a locksmith client who is using LSAs in Nashville and is EXTREMELY happy with it. Lots of business coming his way, and they review aspect that’s tied in with it is increasing his review count quickly and CLEANLY – which in the locksmith category is super important.

    1. Hi Carrie, thanks for your comment. Great to hear there’s a positive knock-on effect on reviews, too!

      Jamie

  6. It seems to run behind the scenes in AdWords Express, as when the Local Ads go online suddenly my MCC keeps telling me I have ads running (in AdWords Express) but don’t really.
    You can (and should) keep your standard Adwords running, but you will see huge drop in impressions.
    As an agency you should be careful clients don’t see this as the only tool and drop regular Adwords. This won’t last long and will be another HomeAdvisor where the lead is sold multiple times.

    1. Hi Jason, thanks for your comment.

      Yes, I agree that it’s important to continue to look at other opportunities aside from just Local Services Ads, and contrast and compare their performance.

      Jamie

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.