In the ever-evolving digital landscape, businesses often find themselves in a race to capture the attention of potential customers. In the realm of online advertising, Google’s Local Services Ads (LSAs) have emerged as a powerful tool for local service providers, offering a unique way to connect with customers in their immediate vicinity. This article explores the purpose and benefits of LSAs, shedding light on why they have become an essential component of the digital marketing strategy for many service-oriented businesses.
Understanding Local Services Ads
Formerly known as Google Home Service Ads, Local Services Ads are a specialized form of online advertising designed to cater to local service businesses. These businesses include a wide range of services such as plumbing, HVAC, electrical work, and cleaning services. What sets LSAs apart is their ability to place local service providers at the forefront of potential customers’ search results.
1. The Primacy of Local Services Ads
Imagine you’re in urgent need of a plumber to fix a leak in your home. You turn to Google, type in “plumber for hire in New York,” and hit the search button. What you see next are the Local Services Ads. These ads, distinguished by their prominent placement above the organic search results and traditional Google Ads, are the very first thing you encounter. They provide essential information such as contact details, operating hours, average review scores, and a “Google Guaranteed” badge.
2. Industries Covered by Local Services Ads
As of now, Local Services Ads are available for specific industries in the United States. These industries primarily revolve around home services and include:
- Appliance repair
- Carpenter
- Carpet cleaning
- Cleaning service
- Countertop professionals
- Electricians
- Fencing professionals
- Flooring professionals
- Foundation professionals
- Garage door professionals
- HVAC (heating, ventilation, and air conditioning)
- Landscaping
- Lawn care
- Locksmith
- Painter
- Pest control
- Plumber
- Roofer
- Tree services
- Water damage
- Window cleaner
- Window repair
Google’s support for these services may vary by location, and the availability of LSAs is continually expanding. If your industry or region isn’t listed, it’s advisable to check back regularly, as LSAs may become available in your area in the future.
3. Geographic Availability of Local Services Ads
Local Services Ads are not universally available and are restricted to certain regions. To determine if your area is eligible for LSAs, you can visit Google’s Local Services Ads signup page or perform a quick check by searching for your profession and city on Google. For instance, searching “window cleaning Chicago” can reveal the availability of LSAs in Chicago.
How Local Services Ads Differ from Google Ads
Local Services Ads and Google Ads are distinct advertising services managed through separate platforms and budgets. Here are three key differences between the two:
1. Payment Model
In Local Services Ads, you pay per lead, while Google Ads operate on a pay-per-click (PPC) model. With LSAs, payment only occurs when you receive a legitimate booking request from a qualified lead, whereas Google Ads charge you for each click, even accidental ones.
2. Scope
Local Services Ads are designed specifically for local service providers targeting customers in their vicinity. In contrast, Google Ads are suitable for promoting a wide range of products or services on a regional, national, or international scale.
3. Visibility
Local Services Ads enjoy prime placement in search results, appearing above traditional Google Ads. This premium positioning increases their visibility and click-through rates.
Making the Right Choice
Choosing between Local Services Ads and Google Ads depends on your business goals and marketing strategy. LSAs are ideal if you primarily serve local customers and are just beginning to explore online advertising. On the other hand, Google Ads are more suitable for businesses with advanced marketing strategies targeting regional, national, or international audiences.
The Significance of Google’s Guarantee
A distinctive feature of Local Services Ads is the Google Guarantee, represented by a white checkmark within a green circle on specific ad listings. This emblem signifies that Google has verified the business and deems it trustworthy. The Google Guarantee holds significant benefits for both service providers and customers.
Once a service provider has earned the Google Guarantee, customers gain confidence in booking their services. This trust is reinforced by the understanding that if a customer is dissatisfied with the quality of the work provided, they can file a claim with Google to seek a refund. In the United States, Google typically covers claims up to approximately $2,000.
To attain the Google Guarantee, service providers must undergo Google’s rigorous screening and qualification process. This process ensures that businesses maintain the highest standards of quality and customer satisfaction. Acquiring the Google Guarantee can go a long way in building trust and credibility, making prospects more likely to choose your business over competitors.
The Benefits of Google’s Local Services Ads
The adoption of Google’s Local Services Ads offers several compelling advantages for service-oriented businesses:
1. Reach New Customers
Local Services Ads position your business prominently at the top of Google search results when local users search for the services you offer. This prime placement increases your visibility and helps you reach a broader audience of potential customers actively seeking your services.
2. Establish Trust
The presence of the Google Guaranteed badge next to your business name instills trust in potential customers. They are more likely to book your services when they see this emblem, knowing that Google has verified your business as reliable and trustworthy.
3. Control Your Availability
With Local Services Ads, you have the flexibility to control your booking schedule.
You have the flexibility to control your booking schedule. You can determine how many booking requests to accept and set your preferred times and availability during the week. This control ensures that you never overextend your resources and can efficiently manage your appointments.
4. Convert Leads Efficiently
Local Services Ads enable potential customers to learn about your services and book appointments at any time of day or night. This accessibility streamlines the lead conversion process and helps you secure bookings more efficiently.
5. Cost Management
Local Services Ads offer a unique advantage in cost control. You have the freedom to decide how much you want to spend on advertising, whether it’s $500 per month or $50. The amount you invest depends on your desired lead volume, budget, and the average cost per lead in your industry.
While Google does not disclose the exact cost per lead, it’s known to vary based on factors such as the type of job, industry, location, and lead category. According to Google Local Search Expert Tom Waddington, the cost per lead typically ranges from $5 to $130, with an average cost around $23.
Here’s a breakdown of lead costs for specific industries:
- HVAC: $26
- Plumber: $24
- Electrician: $17
- Garage door: $19
- Locksmith: $11
- Carpet cleaning: $21
- House cleaning: $19
The advantage of Local Services Ads lies in the degree of control you have over your spending. When creating your ads, you establish a weekly budget and a monthly maximum. While you may occasionally exceed your weekly budget to accommodate more leads, Google ensures you do not surpass your monthly maximum. This flexibility allows you to maintain a steady flow of leads while managing costs effectively.
ROI and Local Services Ads
Return on investment (ROI) is a critical metric for any advertising campaign. While boosting impressions and brand awareness with advertising is valuable, most small businesses care more about results than building brand awareness.
The fact that 1,000 people viewed your ad is irrelevant if they didn’t take the next step (call, email, subscribe, etc.). Therefore, to calculate ROI, you have to focus on conversion numbers.
With Google Local Services ads, conversion should be calculated by the number of qualified leads and not the number of phone calls. For example, if you spent $1,000 on Google Services Ads and received 50 phone calls as a result, then your cost per call is $20. While this is an important metric to understand, it should not be used to calculate your ROI.
To calculate your ROI, you need to subtract qualified leads from phone calls and finally, clients/customers from qualified leads. In the example above, we received 50 phone calls – let’s assume that 10 phone calls can be classified as qualified leads and people genuinely interested in our business/product/service. At this point, our cost per qualified lead is $100.
Obviously, to a business owner or a marketing person, this number is a lot more valuable because we established (in this example) that for every $100 we spend on Google Local Services Ads, we attract 1 qualified lead. Furthermore, if we convert 50% of those qualified leads into a customer, our cost per customer is $500.
How much you are willing to pay per qualified lead or per customer will depend on your business type and profit margin. Naturally, the higher your profit margin per customer is, the more you can spend to attract them. This emphasizes the significance of not just generating leads but ensuring they are of high quality and likely to convert into paying customers.
Conclusion
Google’s Local Services Ads represent a game-changing opportunity for local service providers to thrive in the digital age. They offer prime visibility, enhanced trust through the Google Guarantee, and precise control over budgets and scheduling. For businesses looking to connect with local customers efficiently, LSAs are a powerful addition to the marketing toolkit. However, understanding your conversion metrics and return on investment is key to maximizing the benefits of Local Services Ads. As the digital advertising landscape continues to evolve, LSAs are poised to remain a vital strategy for local service businesses seeking to grow and succeed in their communities.
