Performance Marketing
Local Services Ads vs Google Search Ads for Home Services
Steve Burk Co-Founder 7 min read
Local Services Ads are Google's pay-per-lead ads for home service companies. They usually show at the top of the results page with a verification badge, and you pay per lead, not per click. Google Search Ads charge per click on keywords you choose. Most home service companies should run both and compare them by cost per booked job.
If you own a roofing, HVAC, plumbing or remodeling company, you have probably been pitched both. They are really two ways to buy the same customer on the same page. This guide compares them and judges both by cost per booked job. It is the same approach behind our Google Ads management.
How Local Services Ads Are Bought vs Google Search Ads
Most owners notice the difference on the invoice first. One bills you for leads. The other bills you for clicks, whether or not anyone calls.
Local Services Ads start with screening. Google runs background, license and insurance checks before your ad can run, with details that vary by trade and state. Pass, and you get a badge. You may know it as Google Guaranteed or Google Screened, since Google has changed the name and rules more than once. Then you set a weekly budget. You are charged when a customer calls, messages or requests a booking through the ad.
Search Ads work the other way. You bid on keywords like "furnace repair near me" or "roof replacement cost," and you pay each time someone clicks. That click might become a call, a form or nothing. In our experience, local service clicks commonly run $5 to $50, so a landing page that does not convert gets expensive fast. We go deeper on this in our post on how much Google Ads cost.
Where Local Services Ads Show on the Google Results Page
Search "AC repair" on your phone in any New Jersey town and look at the first screen.
When Local Services Ads run for that search, they usually come first: a short list of a few providers, each with a badge, a star rating, a review count and a button to call or message. Text Search Ads usually come next, then the map results, then the regular listings.
Local Services Ads do not show on every search. In our experience, they appear mostly when someone clearly wants a local provider, like a trade plus "near me" or a trade plus a town. More specific searches, like "cost to replace a flat roof," often show text ads only.
Google also decides who gets those few spots. Its help pages point to how close you are to the customer, your reviews, how quickly you respond and whether you are open. A company that misses calls can pay the same and show up less.
Who Controls Targeting and Ad Copy
Owners who come from Search Ads are often surprised by how little they can change in Local Services Ads.
In Local Services Ads, you pick your job types from Google's list for your trade, your service area by town or ZIP code, your hours and your budget. Google builds the ad from your profile and reviews. There are no keywords to block, no headline to write and no landing page.
In Search Ads, you control nearly all of it:
- You choose the keywords and block the ones you do not want, like "jobs," "DIY" or a service you do not offer.
- You write the ads, so you can lead with financing, same-day service or a warranty.
- You pick the landing page, so a replacement search lands on a replacement page.
- You set the towns, the schedule and the bidding strategy.
More control means more room for mistakes. A Search account with loose keywords can spend a month's budget on people who were never going to hire you. Local Services Ads protect you from that and limit what you can fix.
Local Services Ads Lead Quality and Disputes
Every Local Services Ads account eventually pays for a wrong number, a job outside the service area or a vendor pitch.
Because you pay per lead, Google has rules for leads that should not count. It credits some invalid leads on its own, and depending on the current policy you can flag or dispute others, like spam or a service you do not offer. The process has changed over the years, so check your account's current rules.
Search Ads work differently. Google filters invalid clicks from bots and repeat accidents, but a real person who clicks and never calls is a cost you keep. In Search, lead quality comes from your keywords, negatives and landing page.
The habit that works for both: listen to the calls. Review your Local Services Ads leads weekly, mark each one in the lead inbox, flag the ones that qualify for credit and tighten the settings that let bad ones in.
If you are not sure which ad channel is booking your jobs, start with a free Growth Score. Take the free Growth Score →
Why Most Home Service Companies Should Run Both
When one channel works, it is tempting to move the whole budget there.
Local Services Ads have a ceiling. They only spend when people nearby search for your job types and pick you from a short list, so a bigger budget does not always buy more leads. Search Ads reach far more searches, but each lead takes more work to earn. Running both holds the top spot for "near me" searches and still reaches the specific, high-value searches Local Services Ads miss.
Both come out of the same marketing budget, which for most service businesses runs 5 to 10 percent of revenue. A simple way to split it:
- Fund Local Services Ads first, up to the point where they stop spending the full weekly budget.
- Put the rest into Search, starting with the services that earn you the most per job.
- Review the split every month by cost per booked job, and move money toward whichever channel books jobs for less.
Roofing shows why. In our experience, a roofer's Local Services Ads bring in a lot of repair and leak calls. That is steady work. A full replacement is worth far more, and those buyers often compare options first. Search Ads let the roofer bid on replacement searches, write an ad about warranties and financing and send the click to a page built for that job. For industry-specific detail, see our page on paid advertising built for construction companies.
How to Judge Local Services Ads by Cost per Booked Job
Both dashboards lead with cost per lead. It is the wrong place to stop.
A cheap lead that never books costs more than an expensive one that does. Say Local Services Ads bring in 40 leads at $70 each ($2,800) and 10 book. That is $280 per booked job. Search brings in 20 leads at $150 each ($3,000) and 12 book. That is $250 per booked job. Search looks twice as expensive per lead and is cheaper per job.
To get that number, every lead needs a source and an outcome. Mark Local Services Ads leads as booked or not in the lead inbox, track Search calls and forms in Google Ads, and record each booked job in your CRM. Then divide each channel's spend by the jobs it booked.
For a NJ HVAC company we keep anonymous, we grew its Local Services Ads categories from 4 to 11, so it could show for more of the jobs it does. Its absolute-top impression share, meaning the share of eligible searches where its ad showed in the very first spot, rose from 12.56% to 30.37%.
On the Search side, a NJ roofer's Google Ads rebuild took cost per lead from $912 to $197 and conversions from 21 to 196 in 90 days, at a 15.62% click-through rate. For proof, look at 9X more conversions in 90 days for a roofing company.
Neither channel wins alone. Local Services Ads hold the top of the page for people ready to call. Search Ads reach everyone else and let you choose the message. Run both, and let booked jobs decide the split. We have seen this play out firsthand, as our post on contractor marketing that books jobs explains.
Spending more on ads and getting less back? Request a paid ads account review and see where your budget is leaking.
Frequently Asked Questions
Are Local Services Ads worth it for home service companies?
For most home service companies, yes, as long as someone answers the phone. Local Services Ads put you at the top of the page for people ready to hire, and you pay per lead instead of per click. They work best with strong reviews, accurate job types and fast responses. Judge them by cost per booked job, not cost per lead, and compare that number against your Search Ads.
How much do Local Services Ads cost per lead?
It depends on your trade, your town and the season. Lead prices are set by an auction, so high-value trades like roofing and HVAC usually pay more than lower-ticket services. You set a weekly budget and either let Google get as many leads as it can or set the most you will pay per lead. Watch cost per booked job, since a cheap lead that never books is not cheap.
Can you run Local Services Ads and Google Search Ads at the same time?
Yes. They have separate budgets and separate spots on the page, and one business can appear in both on the same search. Running both is common for home service companies because Local Services Ads cover the top of the page for "near me" searches, while Search Ads reach specific services, towns and questions. Track each one on its own so you know which books jobs for less.
