Google Ads vs Local Services Ads for Contractors

What is the difference between Local Services Ads and Google Search ads?

They are two different blocks on the same results page, bought in different ways and limited by different things.

Which is cheaper per lead?

Local Services, on every account I run.

I won't tell you otherwise, because you could check it inside a month. The real difference is not price. It is supply.

Why does Local Services run out?

Because it bills per lead and there are only so many leads for your trade in your area. The block holds a handful of companies, ranks them mostly on reviews and responsiveness, and sends each one the leads it decides they get. Raising the budget does not create more of them. On the accounts I run, the budget goes mostly unspent every single month.

The money is there. The leads are not.

So Local Services will be your cheapest leads and you will run out of them. Search is the part with a dial on it.

How do I know when Local Services has run out of room?

Watch two numbers together. If your Local Services lead count flattens while your review count keeps climbing, the block is full. You are ranking well and there is simply no more of it to buy. That is the point where Search is the only way to get more work next month.

Which trades can use Local Services?

Many home service trades in the US, including plumbers, HVAC companies, electricians, roofers, and garage door and fencing companies, with the list varying by area. In Canada the list is shorter: roofers, plumbers and HVAC companies are on it, painters are not. I check your category in your county on the estimate call rather than guess.

What changed in Local Services in 2026?

Two things worth knowing, both documented by Google.

• Local Services is moving into Google Ads. The first US phase started in August 2026 with home service trades including plumbing, HVAC, electrical and roofing. Manual maximum-per-lead bidding goes away and the standalone dashboard disappears after the move. Whether your account has moved is a question for your account, not something to guess from Google's list.
• Lead credits are automatic now. Google's models review charged leads and issue credits on their own, and Google says it no longer credits leads for a job type you don't do or an area you don't serve. So the job types and service area you set are the filter. Set them carefully.

The budget numbers above were measured before the move, so I re-measure them on each account rather than quoting them as current.

What does running both look like?

Local Services goes live first, because it is cheap while it lasts and most home service businesses already carry the licence and insurance it needs. Search runs beside it with campaigns split by job, so it buys the searches the block does not cover, sends clicks to a page built for the ad, and tracks every call.

Both are in every Google Ads engagement I run, from $1,500 a month. Local Services leads are billed by Google per lead, separately. How I build the Search side.

Can I just run Local Services?

You can, and I'll set it up either way. Just plan around the cap. If Local Services gives you all the work you can handle, you may not need Search yet. If you want more than the block sends, Search is how you get it, and Local Services will not answer that however much budget you give it.

Elijah Nawrot, founder of Red Orca Digital. Three years on roofs, four running paid ads for roofing companies. Red Orca is a Google Partner. More about me.
Last updated September 24, 2026