Local Service Ads are pay-per-lead ads from Google designed for local service businesses. They appear at the top of search results and connect customers with verified providers through phone calls and messages, often displaying trust badges such as Google Guaranteed or Google Screened.
This guide explains how Local Service Ads work, who they are best for, how costs are determined, and when they make sense compared to other local marketing channels.
What Google Means by Local Service Ads
When Google refers to Local Service Ads, it is describing a lead-generation platform built specifically for local, service-based businesses. Unlike traditional Google Ads, which rely on keyword bidding and ad copy, Local Service Ads prioritize trust, proximity, and availability.
These ads are part of Google Local Services Ads, a system that operates separately from standard Google Ads accounts. Businesses do not bid on keywords or write ads. Instead, Google evaluates factors such as location, reviews, responsiveness, and service eligibility to determine which providers appear.
The goal is to reduce friction for users looking for a reliable local provider while simplifying lead generation for businesses that depend on phone calls and appointment requests.
Local Service Ads Are Not the Same as Google Local Search Ads
Local Service Ads are often confused with Google’s local search ads that run through standard Google Ads campaigns. While both appear in local search results, they are fundamentally different products.
Local search ads within Google Ads use keyword targeting, bidding strategies, ad copy, and landing pages. Businesses pay per click and control how and when ads appear based on campaign settings.
Local Service Ads, on the other hand, do not use keywords or traditional ad campaigns. They operate on a pay-per-lead model and rely on Google’s verification process, proximity, reviews, and responsiveness to determine visibility.
Confusing these two can lead businesses to choose the wrong advertising approach. Local Service Ads are designed for immediate lead generation from service-based searches, while local search campaigns offer more control and are better suited for businesses looking to scale, test messaging, or target broader intent.
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Where Local Service Ads Appear
Local Service Ads appear above both paid search ads and organic listings. On mobile devices, they often take up most of the screen before users scroll.
Each listing shows key trust indicators, including review ratings, business hours, response time, and verification status. This placement alone makes LSAs one of the most visible ways to capture high-intent local searches.
How Businesses Are Ranked
Unlike traditional paid search, Local Service Ads are not ranked by keyword bids. Google evaluates several signals, including:
- Distance between the searcher and the business
- Review quality and volume
- Responsiveness to calls and messages
- Business hours and real-time availability
- Past lead quality and dispute behavior
Many of these signals overlap with broader local ranking factors that also influence map visibility and organic local results, which is why Local Service Ads often perform best when combined with strong local SEO fundamentals.
How You Pay for Leads
Local Service Ads use a pay-per-lead pricing model. Leads typically come in as phone calls or messages initiated directly from the ad.
Businesses are only charged for leads Google considers valid. If a call is unrelated, spam, or outside the services offered, it can be disputed inside the platform. Understanding how lead disputes work and how Google defines a billable lead is critical for controlling costs over time.
Who Local Service Ads Are For
Businesses That Benefit Most
Local Service Ads tend to work best for:
- Service-area businesses serving a defined geographic region
- Industries where customers are ready to contact a provider immediately
- Companies that answer calls consistently during business hours
- Businesses focused on lead volume rather than brand storytelling
If your growth depends on inbound calls and booked appointments, LSAs can act as a reliable demand channel.
Businesses That Should Avoid Them
Local Service Ads are often a poor fit for:
- Ecommerce or online-only businesses
- Companies outside Google’s supported service categories
- New businesses with limited reviews or weak local presence
- Teams that struggle with call handling or slow response times
Because responsiveness directly affects visibility, missed calls can reduce performance just as quickly as poor keyword targeting in traditional Google Ads.
Supported Industries for Local Service Ads
Local Service Ads originally focused on home services but now support a much broader range of industries. Common eligible categories include:
- Home services such as plumbing, HVAC, electrical, roofing, and cleaning
- Legal services in approved practice areas
- Healthcare and wellness providers, including dental and therapy services
- Education, care, and personal services in select markets
Eligibility varies by location, category, and licensing requirements. Google regularly updates which business types are allowed to advertise.
Because these categories change, businesses should always verify eligibility directly through Google’s Local Services Ads Help Center or during the account setup process to confirm the most current list of supported services.
Local Service Ads vs Google Ads
Cost Structure
Local Service Ads charge per lead, while Google Ads charge per click. This difference can make LSAs feel more predictable, but cost-per-lead still fluctuates based on competition, location, and lead quality.
In competitive markets, managing paid search campaigns alongside Local Service Ads can help stabilize acquisition costs by diversifying how demand is captured.
Control and Optimization
Google Ads allow full control over keywords, ad copy, landing pages, and bidding strategies. Local Service Ads provide far less customization, with Google controlling most optimization decisions.
Businesses that want more control over messaging, audience targeting, and conversion paths often rely on Google Ads management to complement the limited flexibility of LSAs.
When to Use Each
Local Service Ads are ideal for capturing immediate, high-intent local demand. Google Ads are better suited for scalability, testing messaging, and expanding beyond tightly defined service categories.
Using both together allows businesses to dominate more real estate on the search results page while reducing dependence on a single platform.
How Much Do Local Service Ads Cost?
There is no fixed pricing for Local Service Ads. Costs depend on several variables, including:
- Industry competitiveness
- Geographic location
- Lead type, such as calls versus messages
- Business responsiveness and historical performance
Google allows weekly budget controls, but actual spend can vary depending on lead volume and quality. Over time, businesses that maintain strong reviews and fast response times tend to receive more consistent leads at lower effective costs.
Tracking lead quality and conversion outcomes is essential. Without proper conversion tracking and call attribution, it becomes difficult to determine whether Local Service Ads are truly profitable.
Pros and Cons of Local Service Ads
Pros
- Top-of-page visibility for local searches
- Trust signals such as Google Guaranteed
- High-intent leads from users ready to contact a provider
- Lower setup complexity compared to traditional paid search
Cons
- Limited control over targeting and messaging
- Lead quality can vary by market
- Heavy reliance on Google’s platform and policies
- Not ideal as a standalone long-term growth strategy
Local Service Ads work best when treated as one channel within a broader marketing system.
Common Local Service Ads Mistakes
Many businesses run into issues by:
- Activating LSAs without optimizing profiles and service areas
- Ignoring call handling and response time requirements
- Failing to dispute invalid or low-quality leads
- Treating LSAs as a set-and-forget solution
- Running ads without visibility into lead tracking and performance measurement
These mistakes often lead to higher costs and inconsistent results, even in strong markets.
How to Get Started With Local Service Ads
To run Local Service Ads, businesses must complete Google’s screening and verification process, which may include background checks, license verification, and insurance validation.
After verification, businesses configure service areas, job types, availability, and budgets. While setup is relatively straightforward, ongoing monitoring is required to maintain performance, manage disputes, and adapt to changes in competition.
Many businesses underestimate the operational side of LSAs, especially the importance of call handling, follow-up processes, and lead qualification.
Is Local Service Ads Right for Your Business?
Local Service Ads can be a powerful lead source, but they are not universally effective. Category eligibility, market competition, internal operations, and follow-up systems all play a role in success.
Evaluating whether LSAs make sense requires more than checking if your industry is supported. It involves understanding expected lead costs, how those leads convert, and how Local Service Ads fit alongside SEO, paid search, and other acquisition channels.
Approaching LSAs with a clear strategy reduces wasted spend and helps ensure they contribute meaningfully to long-term growth rather than short-term spikes.
