Google Ads vs Local Service Ads: What’s the Difference?
Local companies struggle to reach new levels of online lead generation. Your business may rock locally through word of mouth, but neighborhood referrals won’t stand a chance against bigger, tech-forward competitors who are stealing your phone calls online. After spending weeks researching paid advertising options, you find two entries consistently popping at the top of search engines. How do you know which one is best suited to fit your business goals? Let’s dive into how each platform functions, charges you money, and aligns with what you hope to accomplish.
- Google Ads: Sponsored Links You Create
- Local Service Ads: Google Guaranteed Listings You Cannot Edit
What Are Google Ads?
Google Ads is an advertising network system that allows businesses to pay for clickable ad space in SERPs. Marketers can bid on selected keywords to trigger contextual text ads at the top of Google search engine result pages. These paid placements can also show on websites within the Google Display Network, partner platforms, and even YouTube videos.
What Are Local Service Ads (LSAs)?
Local Service Ads are lead-driven ads curated specifically to service-based businesses and contractors. They operate on a separate pay per lead system and feature the iconic Google Guaranteed badge at the very top of search results on mobile and desktop.
Key Differences Between Google Ads and LSAs
Although both of these advertising solutions can funnel customers to your business, they differ wildly on important functional levels. Let’s break down how each platform contrasts to better define which strategy best suits your lead generation goals.
Pricing Model
Google Ads operates on a pay-per-click model. Every time a user clicks your ad, searches your website, you pay Google a small fee determined by the competitiveness of your selected keywords. Local Service Ads operate on LSAs pay per lead vs. pay per click system. With Local Service Ads, impressions and clicks are free of cost. You only get charged when a qualified lead takes action by sending you a text or calling your business phone number via the tracked phone number on your dashboard.
Placement In SERPs
Sponsorship on the search engine results page is prime real estate. Where your business is located on page impacts discoverability. Local Service Ads appear ABOVE all paid advertisements in a special row at the absolute top of the screen. Think above the fold. Regular ol’ Google Ads are displayed right below Local Service Ads in text form.
Targeting Options
When creating ad campaigns, Google Ads offers you full control over customization. You can select hyper-specific keyword matches, add negative keywords to prevent undesirable ad spend, set loose demographics, adjust bids by time of day or device used, and so much more. With Local Service Ads, your customization options are slim to none. You provide a service area where your team operates and select your business categories, and Google automatically inserts your business into active searches.
Lead Quality
The Leads you receive from Local Service Ads are typically caler happes that want to hire you right away. They see your business name, address, Google star rating, and Google vetted badge which builds credibility. Google Ads gives you much broader exposure. You will catch some buyers who are ready to buy but also those who are researching their options or seeking educational content.
Pros and Cons
Google Ads: Pros
- Full control over your audience through keywords and custom landing pages.
- A scalable advertising platform that lets you spend as much or as little as you’d like.
- Can be utilized by literally any industry, no matter how big or small your business is.
Google Ads: Cons
- Network requires monitoring and maintenance to remain profitable.
- Can get pricey if your keywords are left unchecked.
Local Service Ads: Pros
- You can rest easy knowing you won’t waste money on false leads.
- Instant credibility by placing the Google Guaranteed badge on your ads.
- A simplified funnel with one-click phone numbers makes it easy for potential customers to call you.
Local Service Ads: Cons
- Limited to only certain types of local industries.
- Limited ability to customize your ad.
Tips and Hints: If someone gives you a spam call, receives a robocall, or reaches out from outside of your service area from clicking your LSA ad, you can file a dispute through Google’s ads dashboard to recoup that money.
Which Works Better For Your Business?
Both have their place in a well-rounded digital marketing strategy. If you need calls NOW for your business, Local Service Ads are going to be your best bet. If you want to educate your market or provide clarity on a niche service, standard Google Ads are the way to go.
When Should You Use Both?
Implementing long-term marketing strategies that integrate both Google Ads and Local Service Ads will produce the best ROI. By using a full funnel approach, you can ensure your business dominates all of the above fold space on Google. When someone is searching for assistance, seeing your business show up in three separate areas of the SERP (Local Service Ads, text ads, and local map pack) truly puts your brand above the competition. Another useful trick is to use your Google Ads campaigns to target broad informational-based queries while your LSAs catch day-of service requests.
Google Ads vs LSAs | Cost Comparison
It’s important to understand how your advertising money is distributed. Keep these averages in mind when planning your upcoming digital budget.
- Average CPC: $2 – $50+, depending on competitiveness and locale.
- Average CPL: $20 – $150+ per lead.
Local Service Ads cost more per lead because you only get charged when someone completes an interaction. With Google Ads, you are charged whether or not that lead ultimately converts on your website.
Remember, your budget is only as good as your teams ability to convert new leads. If you do not have staff dedicated to picking up the phone on the first ring, pay per lead can start to cost you money. Every missed call still charges your account and can negatively impact your LSA rankings.
Growth Strategy Quiz
Let’s check the indicators for your strategy.
- Do you have someone on staff dedicated to taking live phone calls ASAP?
- Yes we answer all of our phones right away.
- No, we sometimes return calls or run an automated voicemail.
- What is your current digital marketing objective?
- I need to get my phone ringing with local customers TODAY!
- We want to build our brand, promote our locations, or publish long-form guides.
Answer Key: If you answered majority A, start Local Service Ads today. If you answered majority B, learn how to set up Google Ads.
Ready To Grow Your Business?
Let’s face it running online advertising campaigns can be daunting when you are running your own business. Here at Dallas SEO Dogs we simplify the process by creating customizable, ROI-driven campaigns that prioritize profits over popular metrics. Not only do we create the campaigns for you, but we also inspect your local competitive landscape, optimize your lead quality, and help you spend your advertising budget wisely. Contact our lead generation experts today for your free consultation and start converting searches into customers!
Frequently Asked Questions
Q: Will I pay for Google Local Service Ads if someone calls me but doesn’t end up booking?
A: Yes, you are charged when the lead connects to your phone or text number listed on your dashboard. Google charges your account for the inquiry regardless of if you convert that lead or not.
Q: Can my business run Google Ads and Local Service Ads at the same time?
A: Of course! This allows you to dominate your local market by covering top of page on SERPs. Think of it as a funnel. You catch large amounts of visitors with Google Ads and filter interested parties to your Local Services Ads.
Q: How does Google verify my business to use the Google Guaranteed badge?
A: In order to qualify, your business must pass an intensive Google screening process. This process includes a background check of you (the owner) as well as any field employees, confirms that your licenses are up to date, and ensures you have active GL insurance. Google Ads vs Local Service Ads: Important Differences Explained
