Google Local Services Ads: A guide for contractors
For many trades, Local Services Ads are the first thing a searcher sees. They are simple to run and easy to get wrong in small ways that cost you leads.
Keyword tools estimate around 27,000 US searches a month for "google local services ads", which says a lot about how many businesses are trying to work them out. For plumbers, HVAC companies, electricians, roofers, cleaners and many other trades, they are often the first thing a searcher sees.
How Local Services Ads work
When someone searches for a service near them, Google may show a small set of Local Services Ads at the top of the page. Each shows your business name, rating, review count, hours and verification badge. The searcher can call, message or request a booking directly.
You are charged when a customer contacts you through the ad and the lead is related to your services and area. You are not charged for clicks or impressions.
Getting verified
To run Local Services Ads, your business must complete Google's screening and verification process. Depending on your trade and location, that can include background checks, license verification and proof of insurance.
In October 2025, Google replaced its older badges, including Google Guaranteed, Google Screened and License Verified by Google, with a single Google Verified badge. The money-back guarantee tied to Google Guaranteed was also discontinued. If you have older copy on your website or ads that mentions the Google Guarantee, update it.
What affects your ranking
Google says ranking in Local Services Ads is based on factors including:
- Proximity to the customer's location.
- Your review score and number of reviews.
- Responsiveness to customer enquiries.
- Business hours.
- Complaints about your business.
- Your budget and bidding.
You cannot buy the top spot outright. Answering calls and messages quickly, keeping hours accurate and collecting reviews steadily all help.
Budget and bidding
You set a weekly budget and choose how to bid. With "maximize leads", Google sets bids to get as many leads as possible within your budget. You can also set a maximum amount per lead. Cost per lead varies by trade, job type and area.
Choose your job types carefully. If you do not want certain work, turn off those job types so you are not charged for those leads.
Disputing leads
Not every lead is valid. Common examples are wrong numbers, spam, job seekers and requests for services you do not offer. Review leads regularly and mark them. Google may automatically credit some invalid leads, and you can request credit for others within the allowed time window. Keep notes on why each lead was invalid.
Handling leads well
- Answer calls. Missed calls hurt both your results and your ranking.
- Reply to messages quickly.
- Mark leads as booked when they become jobs. This helps you see what the channel produces.
- Ask customers from Local Services Ads for reviews.
Illustrative example
These numbers are invented to show the effect of responsiveness.
A plumber receives 50 Local Services Ads leads a month but misses 15 calls. After adding an answering service and faster message replies, they answer nearly all of them. Leads rise over the following weeks as responsiveness improves, and booked jobs increase from 18 to 27.
When Local Services Ads make sense
They suit most local trades that serve homeowners in covered categories. They work less well when your ideal jobs are large and planned, since Local Services Ads tend to bring more urgent, smaller jobs. Many businesses run them alongside Search ads. See Local Services Ads vs Google Search Ads.
Where to start
Complete verification, set job types and service areas carefully, and put a process in place for answering and disputing leads.
Our Google Ads management service covers Local Services Ads setup and management. If you already run them and want an outside view, request a free audit.
Questions owners ask
How much do Local Services Ads cost?
You pay per lead. The price depends on your trade, job type and location, and Google shows estimated lead costs when you set up your account.
What happened to the Google Guaranteed badge?
In October 2025, Google replaced Google Guaranteed, Google Screened and License Verified by Google with a single Google Verified badge. The money-back guarantee was discontinued.
Can I get refunded for bad leads?
You can dispute leads that are not valid, such as spam or requests for services you do not offer. Google reviews disputes and may credit your account.
Sources
Want us to look at your own numbers?
Get a free lead generation audit. We will review your ads, landing pages and tracking, and show you where enquiries are slipping away. If nothing is broken, we will tell you that too.
LeadWise MarketingAn owner-operated lead generation agency based in Cape Town, South Africa, working with service businesses across the United States and Europe. More about LeadWise.
