Search "water heater repair" on your phone and a few ads sit at the top of the results, each with stars and a call button. A competitor tells you that's where most of their jobs come from.
They're Local Services Ads, and Google requires its advertisers to pass a screening. This was written in October 2026 from what Google's own help pages say today.
What are Local Services Ads, and where do they show up?
They're Google's paid listings for local service companies, shown prominently in Google Search. You pay when a customer calls, messages or books through the ad, not when someone clicks.[1]
Standard Google Ads charge per click, and you choose the keywords. Local Services Ads charge per lead, and Google picks the keywords. The ad pulls its details from your Business Profile.[2]
The badge on these ads is called Google Verified. Google says it's moving to one badge for every advertiser and discontinuing the Money Back Guarantee tied to the old Google Guarantee badge.[3] Eligible customers can request reimbursement for services booked before December 7, 2025.[3]
An August 2025 Google article still lists older names such as Google Guarantee and Google Screened.[2] If a salesperson uses one, ask which badge they mean.
Is Google moving Local Services Ads into Google Ads?
Yes, in phases, and a Google help page gives the dates.[4] It lists August 2026 for select US home and storefront service companies, including plumbing, HVAC, electrical and roofing. Service-area businesses with no storefront, and accounts with custom bidding or booking setups, are listed for late 2026, and everything left for 2027.
Plumbing is in the first group and service-area businesses are in the second, so a plumber who works from a truck could land in either. The page doesn't say which applies. For planned plumbing jobs, where a homeowner compares companies, see how a plumber checks online visibility.
Google emails the account administrator 14 days before a move.[4] I'd check that address reaches someone who reads it.
Google calls the Google Ads setup Performance Max campaigns with pay-per-lead goals. Ads still run on Search and Maps, you pay per valid lead, and there are no keywords.[4] Four changes from the original setup:
| What | Original setup | Google Ads setup |
|---|---|---|
| Where you manage it | A separate Local Services Ads dashboard | The Campaigns and Leads pages in Google Ads |
| Budget | An average weekly budget | An average daily budget, same monthly cap |
| Bidding | A manual maximum per lead is an option | Manual bidding is no longer supported |
| Reports | Kept in the dashboard | Don't carry over, though lead history does |
Google tells advertisers to save their reports before the move.[4] A new company may see either setup, because Google says its Google Ads sign-up flow is only for certain new advertisers.[5] I'd check which setup you're in before following a help page.
Can a contractor run Local Services Ads, and what does Google check?
Yes, if Google covers your trade and town and you pass its screening.[1] You also need a public, verified Business Profile.[6]
Check Google's category list first. It names plumbers, electricians, HVAC, roofers, general contractors, kitchen and bath remodeling, pool contractors and foundation work. It has no line for generators or concrete, so let Google's eligibility check decide.[1]
What Google checks depends on your category, your state and which setup you're in. Google's original requirements page lists background checks, insurance and licenses, some of them only where local law applies. It calls HVAC, plumbing and electrical urgent categories and adds screening that includes the technicians.[6]
The Google Ads requirements page lists a business registration check and a business representative check for the same trades.[7] Both pages say to expect about three to four weeks after you send your documents.[6][7]
On the Google Ads side, Google calls a name mismatch a common reason verification fails. If your Business Profile uses a trade name that your registration doesn't show, you must send DBA ("doing business as") paperwork.[8]
Google's rules page says diagnostic and trip fees must be disclosed, and customers must hear they owe them even if no work follows. It also bars passing a lead to another company.[9]
What do Local Services Ads cost, and what counts as a lead?
There's no flat price per lead. Google says it can vary with your location, the job type, the type of lead and your bidding mode.[10] Its cost FAQ says to budget by the new leads you want each week and points to a calculator on its site.[11]
Bids are part of that: similar local businesses bidding on the same lead decide what it's worth.[12] On the original setup, Google recommends automatic bidding (Maximize leads) with a weekly budget big enough for at least ten leads. It says the system needs about two weeks to learn your business.[12]
Your weekly budget is an average, so some weeks run over it. Google stops the ad for the rest of the month once you hit a monthly maximum worked out from that budget.[13]
A valid lead is a call you answer, a message, a voicemail or a booking request that fits your business.[10] A missed call can count too, if it comes during your Business Profile hours (and inside your ad schedule, if you set one) and the caller stays on the line for more than 20 seconds. Google's pages for both setups give that rule.[10][14]
Google doesn't charge leads it judges invalid or low quality, and it may credit a charged lead later, in most cases within 30 days. The first charge still shows on your invoice.[15]
Google says it doesn't credit leads for a job type or area you don't serve.[15]
You can flag a poor lead in the feedback survey, and Google may occasionally credit leads you report.[10] I'd list only the jobs and towns you really cover.
Who gets shown first in Local Services Ads?
Google runs an auction that weighs your bid and your profile quality. Its ranking page lists these factors:[16]
- Your bid: your ceiling for a lead, and you may pay less than it.
- Odds your ad brings a lead: how responsive you are, what the customer searched for, and whether messages and bookings are on.
- Profile quality: stars, review count, reply time, photos and the checks you've passed.
Google says a stronger profile may rank higher and pay less per lead, and that missed calls may count against your responsiveness.[16] Your reviews live on your Business Profile, not in the ad account.[17] Google also says serious or repeated negative feedback may lower your rank or stop the ad showing.[18]
For trades and home services, star ratings and review counts carry more weight than in any other industry, and 36% of trade customers weigh clear pricing or deals (vs 30% overall).
Source: BrightLocal consumer search behavior study · (opens in a new tab)
This week I'd ask every finished customer for a review and photograph each job.
What should you work out before you say yes?
Your own numbers: how many calls become estimates, and how many estimates become jobs. A lead log gives you both.
Then compare what a won job leaves you with what the leads cost, the same sum you'd run for a local SEO fee. Our piece on whether SEO is worth it runs that sum step by step, pay-per-lead included.
A month of ad leads for a Columbus HVAC company
- Charged leads: 20.
- Answered: 15. Five went to voicemail.
- Right job, right town: 9 of the 15. The rest wanted something else, or only a price.
- Estimates booked: 6. Jobs won: 3.
- Divide the month's bill by those 3 jobs. That's what a won job cost you from this source, before the work itself.
Illustrative examplemade-up numbers · use your own
Check your phone setup, too. A call from the ad rings your own line with a spoken "Call from Google," though forwarding or internet phone service can hide it.[19] In the US, Google records these calls, tells the caller first and lets you listen back.[19]
You can schedule the ad for the hours someone can answer, or pause it when the crew is booked out.[19]
I'd skip it if Google doesn't cover your trade, your crew is booked out, or your buyers take months to decide. Our remodeling piece covers when bought leads still make sense.
For a second opinion on the Business Profile your ad would use, the Expert Action Plan ($149) is our report plus a 30-minute consultation. We don't manage ad accounts, and the pricing page lists every plan. If a rep offers ads inside ChatGPT instead, read what ChatGPT ads are and aren't first.
What Google says about results, and what to re-check
Google's Local Services Ads page says actual results vary by advertiser.[11] The lead estimates in its Google Ads sign-up flow come from similar businesses and may not match yours.[5]
The Google rules above are what its pages said on October 5, 2026, and the missed-call rule on October 27. Platforms change their pages. Before you act, re-read Getting started with Local Services Ads,[1] the page on the move into Google Ads[4] and How leads work.[10]