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Marketing and growth

Google Local Services Ads for contractors: how they work now

Updated November 10, 20265 min read

Google Local Services Ads are pay-per-lead ads for trades such as plumbers, HVAC, electricians and roofers. You pay when a customer contacts you through the ad by call, message or booking request, not per click. To run them you pass Google's screening, which earns the Google Verified badge that replaced Google Guaranteed and Google Screened. Ranking depends on your bid, how responsive you are, and your rating and reviews.

What Local Services Ads are

Local Services Ads (LSA) show at the top of some Google searches with your rating, reviews and a badge. Google's Local Services Ads page says you pay for results, not clicks: you're charged when a potential customer gets in touch through the ad. Its list of eligible US home services includes plumber, HVAC, electrician, roofing and general contractor, among many others.

They are separate from your free Google Business Profile and from regular search ads, where you pay per click.

Google Verified replaced Google Guaranteed and Google Screened

If you remember the green Google Guaranteed check, that program is gone. In an August 20, 2025 announcement, Google said that starting in October it would unify all Local Services Ads badges into one, and that Google Verified would replace other LSA badges and programs, like Google Guaranteed, Google Screened, License Verified by Google and the Money Back Guarantee.

Google's About Google Verified badge help page says:

  • Existing advertisers who had completed verification earned the badge automatically.
  • New advertisers must complete the Local Services screening and verification process to get it.
  • The badge shows on your Local Services Ads profile and may appear on other Google surfaces, along with details of which verification checks you passed.
  • Google is discontinuing the Money Back Guarantee that was tied to the old Google Guarantee badge.
  • Ad ranking is not affected by the change.

So don't promise customers a Google money-back guarantee in your ads, website or phone script. If you want a guarantee, make it your own written workmanship warranty.

Screening: what to have ready

Google's screening and verification page says the process varies by business category and location, and may include background, business registration, insurance and license checks, plus minimum review requirements. Have these ready before you start:

  • Your state contractor license number, matching the business name you advertise under.
  • Proof of liability insurance.
  • Business registration documents.
  • Enough real Google reviews to meet your category's minimum, if one applies.

Google also warns that advertisers who don't finish later verification steps can lose the badge, have ads paused or have the account suspended. Keep license and insurance documents current.

What you're charged for, and what you're not

Google's How leads work page spells this out:

ChargedNot charged
A call you answer, or call back and speak toLeads judged invalid or low quality at first contact
A missed call during business hours if the caller stays on the line more than 20 secondsMissed calls that ring under 20 seconds
A text, email or voicemail from the customerCallers who hang up at an automated menu without pressing a key
A booking request (US and Canada)Repeat contacts from the same number or email within 15 days of a charged lead

Read that missed-call row twice. A call you don't pick up can still cost you. Every unanswered LSA call is money spent on a customer who is now dialing the next shop.

On bad leads: Google's automated lead credits page says charged leads are reassessed and may be credited automatically if found low quality, usually within 30 days. It also says Google no longer supports credits for "job type not serviced" or "geo not serviced" leads. That makes your settings your protection: turn off job types you don't do and keep your service area tight. Use the "Rate this lead" feedback on the Leads page so Google learns what a good lead is for you.

What drives ranking

Google's About ad rankings page lists three groups of factors:

  1. Bid: the most you're willing to pay for a lead.
  2. Likelihood of generating a lead: including your responsiveness to customer inquiries and what the customer searched for.
  3. Profile quality: your rating, number of reviews, average response time and use of high-quality images.

Google's getting-started page adds that if you regularly fail to answer calls or respond to messages, your ranking may be affected. Two of the three levers, responsiveness and reviews, are things your office controls. A steady review habit pays off here too.

Worked example: does it pay?

These figures are made up for illustration. Your lead cost depends on your trade, market and bid.

Shop AShop B
Charged leads in a month4040
Example cost per lead$60$60
Monthly spend$2,400$2,400
Booking rate30%60%
Jobs booked1224
Revenue at a $450 average ticket$5,400$10,800
Ad cost per booked job$200$100

Same ads, same spend. Shop B simply answers faster and books more of what comes in. Before raising your budget, measure your booking rate on LSA calls and fix it; our guide to booking more of the calls you get covers the phone side, and the missed-call revenue calculator puts a number on unanswered calls.

Setup checklist

  • Business hours and ad schedule match when someone will really answer.
  • Only job types you want are switched on.
  • Service area is where you want to drive, no farther.
  • Real photos of your crew, trucks and work.
  • Every lead gets a reply within minutes, including messages.
  • Leads are rated in the dashboard every week.

Answering every lead with SWITCHBOARD

LSA calls ring your normal number, so the real fix is making sure that number gets answered. SWITCHBOARD's AI receptionist can pick up when the office is busy or after hours, answer in your shop's name, book the job while the caller is on the line, and put the call, transcript and any texts in one inbox.

Questions people ask

Is Google Guaranteed still available?

No. Google announced in August 2025 that, starting that October, a single Google Verified badge would replace Google Guaranteed, Google Screened, License Verified by Google and the Money Back Guarantee.

Do I pay per click with Local Services Ads?

No. You pay when a customer contacts you through the ad, such as an answered call, a message, a voicemail or a booking request. Some missed calls over 20 seconds during business hours are charged too.

Can I get credit for bad leads?

Google reassesses charged leads and may credit low-quality ones automatically, usually within 30 days. It no longer credits leads marked job type not serviced or geo not serviced, so keep your settings tight.

What does Google check before I can run the ads?

Google says screening varies by category and location and may include background, business registration, insurance and license checks, plus minimum review requirements.

How do I rank higher in Local Services Ads?

Google lists your bid, how likely you are to generate a lead (including responsiveness), and profile quality: rating, number of reviews, response time and good photos.

Sources

See it on your own shop.

Thirty minutes on a call, built around your trade and your week. We set it up with you, and pricing is quoted per shop on the call.

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