Google Local Services Ads vs Google Ads (which fits your business?)
Local Services Ads charge per lead, Google Ads per click. How each works, who qualifies, what happened to Google Guaranteed, and when to run both.
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Short answer
Local Services Ads charge you per lead (a call, message or booking) and often show at the top of Google for eligible local service businesses that pass Google's screening. Google Ads search campaigns charge per click and send people to your website. If you're in an eligible category and can answer the phone fast, local service ads are usually the easier start; Google Ads gives you more control and works for almost any business.
If you run a home service or professional service business, you've probably seen local service ads: the listings with a checkmark badge and star rating that often sit at the top of the page when someone searches "plumber near me." You've also seen the regular text ads below them. Both are Google products, both are paid, and they work very differently.
Here's how each one works, what changed with the Google Guaranteed badge, and how to decide which fits your business.
How local service ads work
Google's official name is Local Services Ads (LSA). The core idea is simple: you pay only for leads related to your business and the services you offer, not for clicks or views.
What counts as a lead
According to Google's explanation of how leads work, you're charged when a customer contacts you through the ad, for example:
- You answer a phone call and speak with the customer
- The customer sends a message or leaves a voicemail
- You return a missed call by text, email or phone
- The customer sends a booking request (US and Canada)
How you pay
LSA works on a weekly budget. Google offers three bidding options: Maximize leads, where Google sets your bid; Target cost per lead, where you set a target; and Max per lead, a manual bid cap. Your bid is the most you'd pay for a lead, and what you actually pay depends on how many similar businesses are competing for it.
Leads Google judges invalid or low quality aren't charged, and charged leads can be credited automatically after review. One detail worth knowing: Google no longer credits leads for job types or areas you don't serve. Set your services and service area carefully, because a call about a job you don't do can still cost you.
How LSA decides who shows first
Google's ranking factors for LSA are your bid, how likely you are to get a lead (including how responsive you are and how relevant your business is to the search), and profile quality: your rating, number of reviews, response time, photos and the verification checks you've passed. Google is explicit that missed calls can hurt your responsiveness.
That makes LSA unusual. A business that answers every call and has strong reviews can outrank a bigger competitor bidding more.
What happened to Google Guaranteed?
For years, home service businesses that passed screening got a "Google Guaranteed" badge, and many professional services got "Google Screened." Those names are still what most people search for.
In August 2025, Google announced it was unifying all LSA badges into a single Google Verified badge, replacing Google Guaranteed, Google Screened, License Verified by Google and the Money Back Guarantee. The rollout began in October 2025. Customers can tap or hover over the badge to see which checks a business passed.
Google's help center confirms that the Money Back Guarantee was discontinued; customers could still request reimbursement for services booked before December 7, 2025, within 30 days of the service being completed. Google also says LSA ranking isn't affected by the badge change, and existing verified advertisers didn't need to do anything.
So if a salesperson offers to get you "Google Guaranteed" today, what they mean is Google Verified through Local Services Ads.
Who qualifies for Local Services Ads
LSA is only available in certain categories and areas. In the US, Google lists hundreds of eligible categories across home services (plumbers, electricians, HVAC, roofers, cleaners, pest control and more), professional services (lawyers, accountants, financial planners, real estate) and health and personal services.
To get verified, US businesses typically go through screening and verification that can include:
- Business and owner background checks, run by third-party companies
- State or local licenses where your trade requires them
- Proof of insurance, with the type and amount depending on category
- A public, verified Google Business Profile
Google says the process takes three to four weeks on average after you submit documents, so start early.
How Google Ads search campaigns work
Google Ads search campaigns are the text ads that show for the keywords you choose. With cost-per-click bidding, you're charged only when someone clicks your ad. You set a daily budget and choose which searches to target, write the ads, and decide where people land.
Google Ads isn't limited to service categories, doesn't require background checks, and gives you far more control: keywords, ad copy, landing pages, schedules, audiences and locations. The tradeoff is that you pay for clicks whether or not they turn into calls, and you're responsible for making the landing page convert.
Local Services Ads vs Google Ads compared
| Local Services Ads | Google Ads (Search) | |
|---|---|---|
| You pay for | Leads: calls, messages, bookings | Clicks to your site or calls from ads |
| Who can use it | Eligible service categories, after screening | Almost any business |
| Setup effort | Verification documents, a few weeks | Campaign build, keywords, landing pages |
| Where people go | Your LSA profile, then call or message | Your website or landing page |
| Your control | Services, area, hours, budget, bid | Keywords, ads, pages, bids, audiences |
| What drives position | Bid, responsiveness, reviews, verification | Bid, ad quality, landing page experience |
| Trust signal | Google Verified badge | Your site, reviews and ad assets |
Which one fits your business?
Start with Local Services Ads if
- You're in an eligible category and can pass verification
- Someone can answer the phone during business hours, every time
- You already have a good number of solid reviews
- You don't have a landing page that converts well yet
LSA does a lot of the work for you: Google provides the profile, the badge and the contact buttons. The catch is that you control very little, and responsiveness drives results. If calls go to voicemail, rankings and lead volume suffer.
Start with Google Ads if
- Your category isn't eligible for LSA
- You sell high-value services where you want to choose exactly which searches you pay for
- You have, or will build, a landing page that turns visitors into leads
- You want to target searches LSA doesn't show for, like specific products or research-stage queries
Google Ads rewards businesses that track conversions carefully and keep improving their ads and pages. Our post on whether Google Ads work for small businesses walks through the breakeven math.
When to run both
Many local service businesses do best with both. LSA captures people who want to call someone now. Google Ads covers searches LSA doesn't, and sends people to pages where you can explain your offer in detail. Running both also means you're not dependent on one channel if costs change.
If you run both, track them separately. Use different phone numbers or call tracking so you know which leads came from which, and compare cost per booked job, not just cost per lead or per click.
Don't forget the free listings
Neither ad type replaces your Google Business Profile and organic local rankings. LSA requires a verified Business Profile anyway, and your reviews feed both. Google states that you can't pay for better local ranking in the free map results, so the ads and the organic work do different jobs. We cover the organic side in SEO for contractors.
What we'd do
For an eligible home service business with decent reviews, we'd usually start LSA first: apply for verification, set service areas and job types precisely, and make sure every call gets answered. While verification runs, we'd set up call tracking and a simple lead log.
Once LSA is running, we'd add a focused Google Ads search campaign for high-value services, pointed at a dedicated landing page. Then we'd compare cost per booked job across both and move budget toward what's working.
Whichever you choose, set up tracking first, so you can see which one actually books jobs.
