As a remodeling contractor for over 15 years and a marketer for nearly 7, I’ve seen all kinds of new marketing strategies come and go. The latest offering from Google – Local Service Ads – is proving to be a game changer for lead generation. In this article, I’ll explain what Google Local Service Ads are, how they work, and tips for getting set up to take advantage
of this powerful new advertising option.
What Are Local Service Ads?
Local Service Ads, also referred to as Google Guaranteed Ads, are a new form of pay-per-call advertising offered by Google. When someone searches for a relevant local service, these ads appear prominently at the top of the search results, before the regular paid ads and organic listings.
The key difference is that unlike regular Google Ads where businesses pay per click, with Local Service Ads you only pay when a potential customer calls your business directly from the ad. The ads stand out with a phone icon and a prominent “Call Now” button.
When a customer clicks on a Local Service Ad, they are taken directly to your Google My Business listing. This provides immediate access to call or message the business. They pull information from your Google My Business listing and those glorious yellow review stars sit right there in plain site. We all know how everyone loves those stars and uses them to make buying decisions online.
After helping many clients with this type of ads, I’ve seen call prices range from $25 to $250 per call. While that might sound expensive to you, if you’ve ever done regular PPC advertising, you know that this is right on par with how you pay per lead on just about any platform. I’m talking about actual leads here, not random contact information of people you never actually speak to.
How Local Service Ads Work
Google wants to ensure a quality experience for customers clicking on Local Service Ads. So there is an approval process required before a business can start running these ads.
First, you need an optimized Google My Business listing with all the key details like hours, photos, services, etc. Having lots of positive reviews is also important since these are one of your main differentiators with this kind of advertising… If you’re showing up next to other companies and they have 50x more reviews than you, you’re automatically at a disadvantage.
Google will verify your business meets requirements like proper licensing, insurance, staffing capacity, and more. You’ll also need to provide call recording consent since Google reviews recordings to resolve any disputes about lead quality. This is a good thing because you will get refunded for leads that prove to be bad or not relevant to your business.
Once approved, you set a monthly budget as well as choose your service areas and your ads will start appearing for relevant local searches. You can pause and adjust spend at any time without long-term commitments.
The backend dashboard provides helpful metrics like call history, the ability to mark appointments as booked, dispute bad leads, and listen to call recordings. While I recommend doing this yourself, we do offer this as a service if it’s worth it to you to have someone else monitor these calls daily, mark booked leads, and refute bad ones. If this isn’t done daily, th
e cost of your ads will rise dramatically, and fast. Google requires your constant feedback and will reward companies that do this over others that don’t.
Word on the street is that maintaining a booking rate over 80% is crucial to keep your costs down. The platform optimizes performance automatically, but small ongoing tweaks will improve results. It’s all about testing and seeing how your company is sizing up to the competition. Every city is going to be different.
Tips for Getting Started
In my experience, Local Service Ads work best as a secondary strategy once you have strong organic rankings and reviews. They provide a more immediate lead generation boost for new contractors trying to gain momentum.
While not as cost-effective long-term as ranking organically, the predictable lead costs can make budgeting simpler. Again, it’s just important to monitor these leads daily because some weeks can be busier than others and constant adjustment is sometimes needed to get the leads you want while maintaining your budget. Below are my top tips for getting started:
- Optimize Google My Business profile first – don’t pay for ads without reviews.
- Stack positive reviews before launching ads. These lend credibility alongside ads.
- Have proper licenses, insurance, and staffing to pass verification.
- Closely monitor performance data to maximize bookings.
- Focus on high-value service areas where $100-$150 calls make sense.
I’ve seen contractors generate 20-30 solid leads per month through Local Service Ads on a $2,000 monthly budget. I’ve also seen others in high competition areas and niches get just a few leads per month for the same budget. They both make money, just in different ways. I think it’s important to have reasonable expectations – this is a supplemental lead generation strategy, not a complete marketing solution. Feel free to reach out with any other questions!
