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Local Services Ads vs Google Ads

LSA is pay per lead, shown above search ads, ranked by reviews and responsiveness. Google Ads is pay per click with full control. Most local businesses should run both; here's how the economics compare and how to split the budget.

By Shane K. Penrod · Updated

Run both. Local Services Ads deliver cheaper, higher-intent leads with almost no control over targeting or message, and their volume is capped by your ranking. Google Ads delivers volume and control at a higher cost per lead. In the local service accounts we run, LSA typically produces 20 to 40 percent of the leads at roughly half the cost per lead of Search, and Search produces the rest. LSA alone leaves volume on the table; Search alone leaves the cheapest leads on the table.

How they differ

Local Services Ads Google Ads (Search)
You pay for A lead (call or message) A click
Position Above all search ads Below LSA, above organic
Ranking driven by Reviews, response rate, hours, proximity, budget Bid, Quality Score, relevance
Targeting control Service area and job types Keywords, audiences, schedule, devices, everything
Landing page Google's profile Your page
Badge Google Guaranteed / Screened None
Lead disputes Yes, for spam and wrong service No

The economics

A personal injury LSA lead might cost $200 to $500; the same firm's Search cost per lead is often two to three times that, because a $150 click has to be multiplied by a conversion rate. A plumbing LSA lead might be $25 to $60 against $80 to $150 from Search. LSA leads also convert better, because the caller chose you from a short list with stars and a guarantee. The catch: you can't buy more LSA volume with budget past a point; ranking decides it.

How to split the budget

Fund LSA to the point where it stops delivering, which you find by raising the weekly budget until leads plateau. Put the rest in Search, structured by intent. Revisit monthly; LSA share grows as reviews grow. LSA management, Google Ads management.

What makes LSA work

Reviews first. A weekly process that asks satisfied customers for Google reviews is the single biggest LSA lever. Then answer rate: calls that go to voicemail lower your ranking and cost you the lead. Then disputes: review every lead and dispute the spam and wrong-service ones inside Google's window, or you pay for them.

Shane K. Penrod

Founder of PPC & Co. SEO since 2000, paid search since 2012, 2015 Google Partners All-Stars winner. Leads strategy on every account and writes every guide on this site.

Frequently asked questions

Can I run LSA without Google Ads?
Yes, and for a very small budget it may be the right start. You'll cap out on volume quickly.
Does LSA work in every industry?
About 70 categories qualify, mostly licensed trades and professional services. Check eligibility for your category and state.
Why does my competitor always rank above me in LSA?
Usually more reviews, faster answer rates, or a higher budget. All three are fixable.
Do LSA and Google Ads compete with each other?
Different auctions, different positions. Running both doesn't raise the cost of either.

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