Google has announced they will be tightening the integration between their Local Service Ads and Google Ads.

As it stands, Local Services Ads is a completely stand alone service with it’s own login and interface. However, it’s not quite as alone as it looks. Indeed, when you pull reports out of Google Ads using their API, a hidden LSA campaign becomes visible.

Local Service Ads

This is a headache for agencies because we have to filter this out of reports, assuming it’s not being managed by said agency.

But outside of that, there is no other integration between the two platforms. That is about to change.

What are Local Service Ads (LSAs)?

For the uninitiated, LSAs, called “Google Guaranteed” on the consumer-facing side, are a pay-per-lead service from Google for local businesses. These ad units appear at the top of Google results above Google Ads and organic results as well as on Google Maps. Unlike Google Ads, LSAs require infrequent management. Once configured the service is largely set it and forget it, other than occasional tweaks to offered services, bids, and budgets. Google handles targeting automatically. And, importantly, they don’t require any landing pages.

Also, unlike Google Ads, you only pay when you receive a lead.

What are the Limitations of LSAs?

LSAs are not available for every type of business. In fact, they are broadly only available for companies that offer home services, professional services, and health services. That can cover a lot of different businesses, but it’s still a small fraction of what you can advertise with Google Ads.

Leads generally only come in through phone calls, although texts and bookings are also supported. You’ll receive an email notification for every new lead that comes in. This isn’t ideal if you can’t respond to inquiries after hours or on weekends. And unlike Google Ads, you cannot set a schedule for when your ads run.

Lead quality from LSAs tend to be lower and the cost per lead tends to be higher compared to professionally run Google Ads campaigns.

Also, unlike Google Ads, you don’t have very much control over creative elements or keywords for your business.

Instead, here are the exact elements that drive competitiveness for Local Service Ads:

  • How often you answer phone call leads – critical to have a 95% or higher answer rate
  • How fast you respond to messaging/booking leads – critical to respond within 30 minutes
  • Your overall review score and recency of reviews – you’ll need a 4.8+ rating and 5 fresh monthly reviews to remain competitive
  • How well you match service range & keyword searches – will affect placement
  • How close your business is to the searcher – will affect placement
  • Business hours and real-time availability – whether you are open or closed during the search
  • Bidding mode and budget ceiling – higher bids, selecting “maximize leads” and offering more budget mean showing up for more searches
  • Having a complete profile and including trust signals – getting the verification badge, having a good closing rate, and high quality visual assets all help

Should you run LSAs or Google Ads?

The answer is, it depends. If you want an easy hands off way to drive leads from Google’s search engine and have a small budget, Local Service Ads are an attractive option.

If you have a larger budget or want more control over creative, ad schedules, or the way you generate leads, Google Ads is probably a better bet. And, of course, you can run both simultaneously.

What’s Changing with LSAs?

Google is incorporating LSAs directly inside of Google Ads. If you currently have LSAs you do also already have a Google Ads account; even if you’ve never actually logged into it.

In the future, Local Service Ads will be run as a special kind of Performance-Max Google Ads campaign. Thus, instead of managing your bid, budget, and targeting from a dedicated interface, you’ll now do so from within that campaign. There will be some other minor changes, as well. You will no longer be able to set specific bids by service and budgets will be switch from weekly to daily in keeping with Google Ads standards.

Another change that’s been glossed over by Google, is that they will start charging you for missed calls. Hopefully advertisers will be able to set ad schedules in the new P-Max campaign to avoid calls when they are unable to answer them. Otherwise LSAs will no longer be viable for many smaller advertisers.

Why is Google doing this?

My guess is speculative but by integrating LSAs with Google Ads it’ll make it easier for Google to market LSAs to Google Ads users and Google Ads to LSA users. I also feel like more PPC management service agencies will adopt LSAs as part of their regular service offering. And they, will in turn, promote LSAs as an add on to Google Ads.

This means more advertisers will double down on the two services. It’s unclear whether this means that current Google budgets will just be split or more will be spent with Google overall. But I suppose the latter will be true in enough cases to boost Google’s ad revenue.

When are the Local Service Ads Changes Happening?

Google will be gradually migrating businesses over time; the change already started in August for US based plumbers, HVAC, and roofing companies. By the end of 2026 all US businesses should be moved over to the Google Ads configuration.

In 2027 Google will migrate advertisers located outside of the USA.

As for missed calls charges, that’s going into effect on October 1st. It won’t matter if you’re on the old or new system.

How to Prepare for the Change?

For most advertisers you’ll simply need to wait in the queue. Google will send you an email notification 14-days before the migration and then will automatically set up the new P-Max campaign for you.

You should review the newly created campaign and tweak any settings as appropriate. Some new features like ad scheduling may be available or not. Also, you will not have access to old reports in Google Ads and you cannot set a target for specific services; it’s all in one pricing.

If this all sounds a bit challenging, you might want to outsource LSA management moving forward. Quite a few freelancers and agencies offer this; although often that’s only if you’re also running Google Ads.

Historically TTFV never managed LSAs because it doesn’t really fit with our retainer-based service model. However, since this is now going to be part of the Google Ads eco-system, we will be offering extended LSA management to our Google Ads clients. This will involve campaign review and optimization after integration. On an ongoing basis bid & budget optimization between traditional search and LSA campaigns will be provided along with LSA campaign optimization, regular performance reporting and lead quality analysis.

Summary

Like it or not, Local Service Ads are changing. If you already run LSAs you should prepare for the upcoming changes and also decide whether this service still suits your needs. With the Google Ads integration I expect more PPC agencies will provide both services as a package. This may offer you a little more flexibility and support than you can currently get with LSAs.