What are Local Services Ads?
Local Services Ads are a separate Google ad product for service businesses in eligible categories and regions, including the United States. They appear at the top of some local searches with your business name, rating, review count and a badge, and the customer can call, message or, in some categories, book directly from the ad.
Before your ads run with the badge, Google screens your business. Google's current US help page describes this as the Google Verified badge, which signals that the business passed Google's screening process. Many contractors still use the older names, Google Guaranteed and Google Screened, when they talk about the same product. The checks vary by category and state and can include business registration, licensing, insurance and background checks.
You do not write ads or choose keywords. You choose the services you offer and the area you cover, set a budget, and Google builds the ad from your profile.
Local Services Ads vs Google Ads: how is Google Ads different?
Google Ads Search campaigns are the classic pay-per-click ads that show above and below the organic results. You choose the keywords you want to show for, write the ads, pick the landing page each ad sends people to, and set bids and budgets. You pay when someone clicks the ad or taps the call button.
That control is the main advantage. You can build a campaign for one service in one city, send clicks to a page built for that exact job, exclude searches you cannot serve and track every form and call. The tradeoff is that you need to manage it: search terms, negatives, ads, bids and pages all need regular attention.
LSA vs PPC: how does each one charge?
This is the core of the LSA vs PPC question.
Local Services Ads: pay per lead
Google says you pay only for leads related to your business and the services you offer. A lead is a call, message or booking that comes through the ad. You set a budget and a bid; Google describes the bid as the most you are willing to pay for a lead and notes you may pay less. In the US and Canada, Google now handles lead credits automatically: leads it judges invalid or low quality are not charged, or are credited later. Google no longer credits leads for job types or areas you do not serve, so your settings have to be exact.
Google Ads: pay per click
You pay when someone clicks. Not every click becomes a lead, so your real cost per lead is your spend divided by the calls and forms you received. That number depends heavily on your landing page and your tracking. A good page turns more of the same clicks into leads; a weak one wastes them.
What decides who ranks in Local Services Ads?
Google's help page on Local Services ad rankings lists three groups of factors:
- Your bid: the maximum you are willing to pay for a lead.
- Likelihood of a lead: your responsiveness, the context of the search, how relevant your business is, and whether you accept message or booking leads. Google notes missed calls may hurt your responsiveness.
- Profile quality: your rating, number of reviews, response time, images and verification checks. Google says higher-quality profiles may rank higher and may pay lower costs per lead.
What this means in practice
Reviews and answering the phone are not side issues in Local Services Ads; they are the ranking system. A company that misses calls on weekends, or lets messages sit, works against its own ads. If you cannot answer fast, set up call forwarding, a dedicated line or an automated first reply before you scale the budget.
Google Guaranteed vs Google Ads: which one should you start with?
There is no universal answer, but the decision usually comes down to a few questions.
Start with Local Services Ads when
- Your trade and service area are eligible.
- You can pass screening (license, insurance, background checks where required).
- Someone reliably answers calls and messages during business hours.
- You already have, or can build, a steady flow of genuine reviews.
- You do not have a strong landing page or the time to manage keywords.
Start with Google Ads when
- Your category is not available in Local Services Ads, or you are still in screening.
- You want to target specific services, such as only remodels or only commercial jobs.
- You have a fast landing page for each main service.
- You want full control of keywords, ads, schedules and tracking.
When does it make sense to run both?
Local Services Ads and Search ads can both appear on the same results page, along with the map pack and organic results. Running both can cover more of that page and lets you compare cost per booked job between them. It also protects you if one channel has a bad month, a suspended profile or a screening delay.
The condition is clean measurement. Use separate call tracking for each channel so a call from your Search ads is not counted as a Local Services lead, and the other way around. Compare the two on booked jobs and revenue, not on leads alone, because the lead mix is often different.
Common mistakes we see
- Selecting services you do not want in Local Services Ads, then paying for leads you turn away.
- Ignoring the lead inbox and missing calls, which hurts responsiveness and ranking.
- Never rating leads in the account, which leaves Google without feedback on which leads were good.
- Sending Google Ads clicks to the home page instead of a service page.
- Counting the same customer twice when they see both ads and call from one.