Local Services Ads are Google's pay-per-lead ads for service businesses. Your ad appears at the top of Google Search results for services you offer in the areas you choose, and customers reach you by phone call, message or booking request. You pay for the lead, not for a click.
How Local Services Ads work
Google describes them as a way to advertise your business on Google and receive leads from customers as calls and messages through your ad. You can reply to leads, track bookings and manage the account online.
- You choose services and areas. The ad shows for the services you offer in the places you pick.
- Customers contact you through the ad. That can be a call, a message, or a booking request. Booking leads are only available in the United States and Canada.
- You pay when a lead comes in. The price depends on your location, the job type, the type of lead and your bidding mode.
- You set a budget. Google asks for an average weekly budget. Once you hit the monthly maximum, your ad stops showing for the rest of that month unless you raise the budget.
Only certain service categories qualify, and availability depends on location. Google's rollout notice names plumbing, HVAC and roofing as examples. Check your trade and city on Google's sign-up page before you plan around them.
What counts as a lead you pay for
This is where most surprises happen. Google's page on how leads work sets these rules.
| Lead type | When it's charged |
|---|---|
| Phone call | You answer, or reach the customer on a callback. A missed call during your business hours also counts if the caller stays on the line past 20 seconds, including calls that reach voicemail or a greeting. |
| Message | You receive a text or email from the customer through the ad. |
| Booking | A customer sends a booking request. US and Canada only. |
| Repeat contact | Not charged again if the same number or email interacts with you again within 15 days. After 15 days of inactivity, a new contact is a new lead. |
"Business hours" are the hours set in your Google Business Profile, so wrong hours there cost real money. If nobody answers at 5:30 and your profile says you close at 6, those missed calls can still be billed. Keep the hours honest and answer the phone during them.
Google also says that regularly missing leads may affect your ad ranking, so a slow response costs you twice.
How much do Local Services Ads cost?
Google doesn't publish a price list. Its help page says lead prices "may vary depending on your location, the job type, the type of lead, or your bidding mode." Message leads are typically priced lower than the matching phone lead, though not always. Google bases the price on how likely the customer is to book, using things like the service requested and whether they contacted other advertisers.
That means the only price that counts is yours. Take last month's spend and divide it by jobs booked, not leads. Our lead cost calculator does that math, and shows how a source with a low price per lead can still cost more per booked job.
What if the leads are bad?
You have some protection. Google assesses a lead at first contact and doesn't charge for leads it judges invalid or low quality at that point. Charged leads are checked again over time and may get credits automatically if Google decides they were low quality. You can also report a poor lead through the feedback survey on that lead, and Google may credit it.
Each lead shows a charge status: Charged, Not charged, In review or Credited. Report quickly and keep notes on wrong numbers, out-of-area callers and job types you don't do. Credits are not available for some verticals, such as health care and tax specialists.
The Google Verified badge
Local Services Ads carry a badge that signals a business has passed Google's screening process. Google's help page calls it the Google Verified badge, and it isn't available for auto, beauty or dining. Older articles still talk about "Google Guaranteed" and "Google Screened." We cover what happened to the older badge in SEO vs Google Ads vs Local Services Ads.
For pre-badge ads, which let you get leads while you finish onboarding, Google lists a license or business registration, an acknowledgment that you hold all appropriate business licenses, reviews where the category requires them, and finished billing with a set budget. Professional categories also need headshots. The full screening steps are on a separate Google page.
Local Services Ads are moving into Google Ads
Google has announced that Local Services Ads are becoming Performance Max campaigns with pay-per-lead goals inside Google Ads. The pay-per-lead model and the placements stay the same, and ads will keep showing only on Google Search and Google Maps. What changes for you:
- Budgets, locations, service types and lead inboxes move to Google Ads.
- Your Local Services Ads performance reports don't carry over, so download or screenshot them before you migrate.
- Manual bidding and vertical-level Target CPA are being removed, and weekly budgets become daily averages (weekly budget divided by 7).
- Business name, address and hours sync from your Business Profile and must be edited there.
Google's schedule starts in August 2026 with select US home and storefront service advertisers, such as plumbing, HVAC and roofing. It expands in late 2026 to service-area businesses without storefronts, and in 2027 to non-US accounts and remaining categories. The account administrator gets an email 14 days before migration and a reminder 7 days before, and Google says to allow up to two weeks for the migration to complete. New pay-per-lead campaigns can't yet be created inside Google Ads, so new accounts still start at Google's Local Services sign-up page.
Are Local Services Ads worth it for a contractor?
They can be, in two situations. You need calls this month and don't want to wait for SEO to build. Or your crew has open slots, and a good answered call is worth far more than the lead fee. They fit worst when your phone is often unanswered, when your average job is small, or when you haven't tracked what a booked job costs you.
The ads also stop the day you stop paying. A Business Profile and website that rank on their own keep bringing calls at no per-lead charge. Contractors often run both: ads for speed, SEO for the base. The comparison is in SEO vs Google Ads vs Local Services Ads, and how to rank higher on Google Maps covers the free side.
Before you start
- Confirm your trade and city qualify on Google's sign-up page.
- Fix your Business Profile hours, name and address first, because the ads read from it.
- Set up a way to answer or return every call during business hours.
- Start with a budget you can lose, and track jobs booked, not just leads.
- Check each lead's status in the first two weeks and report the bad ones.
Common questions
What are Local Services Ads?
Local Services Ads are Google's pay-per-lead ads for service businesses. They appear at the top of Google Search for the services and areas you choose, and customers contact you by phone, message or booking request. You pay per lead, not per click.
How much do Local Services Ads cost?
Google doesn't publish fixed prices. Lead prices vary with your location, job type, lead type and bidding mode. Divide your monthly spend by jobs booked to find your real cost per booked job.
What counts as a lead in Local Services Ads?
A phone call you answer or return, a message from a customer, or a booking request in the US and Canada. A missed call during business hours also counts if the caller stays on the line more than 20 seconds. Repeat contact from the same person within 15 days isn't charged again.
Can I get a refund for a bad Local Services Ads lead?
Sometimes. Google doesn't charge for leads it judges invalid or low quality at first contact, may credit charged leads it later decides were low quality, and lets you report a poor lead through the survey on that lead. Credits aren't available in every category.
Are Local Services Ads becoming Performance Max?
Yes. Google says Local Services Ads are moving into Google Ads as Performance Max campaigns with pay-per-lead goals. The pay-per-lead model and placements stay the same, but performance reports don't transfer, so download them before you migrate.
Are Local Services Ads better than SEO?
They're faster but stop when you stop paying. SEO takes months but keeps bringing calls without a per-lead fee. Contractors often run both, using ads for speed and SEO for the long term.
Sources
- Google Local Services Help, Getting started with Local Services Ads (checked November 2, 2026)
- Google Local Services Help, How leads work (checked November 2, 2026)
- Google Ads Help, Local Services Ads transition to Performance Max campaigns with pay-per-lead goals (checked November 2, 2026)
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