Advertiser Q&A: Local Services by Google
In 2015, Google began testing Home Service Ads, a digital advertising platform aimed at providers of on-location services such as plumbing, heating, and painting. The program is live in 17 U.S. cities. Google has now rebranded Home Service Ads as Local Services by Google and will expand it to 30 cities by the end of 2017.
The idea behind Local Services is to boost the presence of service providers with a dedicated advertising platform beyond paid search. As more businesses have gotten onboard with Local Services (under its old name), I’ve fielded many questions from clients and colleague in the industry who want to learn more about the platform. In the following Q&A, I’ve answered some of the more common ones. Check it out – especially if you provide an on-location service.
What exactly is Local Services by Google?
Local Services is a platform dedicated to providers of on-location services such as plumbing. Businesses that participate in the program have their ads appear above search results (even paid search results). For example, a Google search for “Plumbers in Los Angeles” reveals the following three sponsored placements for Ninja Plumber, United Plumbing Heating Air & Electric LA, and Expert Plumbing & Roofer – each of which is a Local Services ad:
Notice how the Local Services ads appear above paid search results for rooterhero.com, allsuburbanplumbing.com, and teamrooter.com. They also appear above the 3-pack results and organic listings.
Notice also the “Google Guaranteed” seal in each inset box. As Google notes, “Google Guaranteed” means that providers are pre-screened and meet relevant insurance and licensing requirements. When users book an eligible Local Services provider on Google, they are protected by the guarantee.
Now look at the rich level of detail that a user finds when clicking on one of the Local Services ads (for Ninja Plumber) – everything from customer reviews to information about services provided and location data:
A Local Services ad is more than a banner ad. It’s a mini website with clickable information to encourage a customer to do business with the provider. The content is drawn from a provider’s Google My Business page.
What is new and different about Local Services Ads?
The two most crucial content attributes of Local Services ads are the Google Guarantee and the prominence of customer reviews.
As noted, the Google Guarantee literally gives the provider Google’s stamp of approval. Per Google, here is what a Google Guarantee covers:
- “If you’re not satisfied with the work quality, we’ll cover claims up to the job invoice amount, with a lifetime cap of $2,000. Your job must be booked through Home Services. Add-on or future projects, damages to property, dissatisfaction with price or provider responsiveness, and cancellations aren’t covered.
- Claims must be submitted within 30 days of the job completion date.
- You can identify an eligible pro because they have the Google guaranteed symbol by their name and on their profile page.”
Meanwhile, the prominently placed customer reviews are intended to give users more confidence in their choice of a provider. In featuring a Local Services ad, Google gives preference to providers that have the highest volume of reviews. So it behooves providers to encourage their customers to review them.
What is the compensation model?
The compensation model is pay per lead, meaning that the advertiser pay only for leads resulting from the ad as opposed to clicks. Google charges $25-$30 per lead.
Is a Local Services ad a substitute for paid search?
No. Local Services ads complement paid search. But your paid search strategy may change depending on how effectively your Local Services ad is.
Local Services ads are very similar to Google Shopping ads for retail advertisers, the difference being that Local Services ads are for services, not physical products.
For retail advertisers, Shopping ads complement paid search (and vice versa) by doing a few things:
- The ad takes up more space on the search results page.
- The ad acts like a display branding ad by placing your brand name in multiple spots on the search results page, thereby making you more legitimate.
- The ad drives orders.
Local Services ads act in the same manner by:
- Placing your brand in more than one spot.
- Boosting your legitimacy.
- Allowing users to find and hire you via multiple tactics.
Local Services ads also result in your brand taking up more space in the search results page, thereby driving your competitors below the fold.
How do I participate in Local Services Ads?
You’ll need to undergo an extensive security and verification check that includes submitting background checks on your employees to the Pinkerton National Detective Agency. Note that the program is restricted to certain markets but is growing rapidly. To learn more, check out this Google page.
From our experience working with clients, you’ll want to prepare yourself by making sure your Google My Business page is up to date and that you are getting a steady stream of customer reviews.
What’s in it for me to advertise with Local Services Ads?
Local Services ads are especially appealing if your business has received a high volume of favorable customer reviews and your Google My Business Listings are rich with useful content. In a sense, a Local Services ad complements your website if the cost of the program is right for you.
The lead-based compensation model is especially appealing if your cost per lead is higher than $25-$30 because Google charges $25-$30 per lead delivered.
What should I do next?
- Closely examine your cost per lead to determine whether the compensation model is worthwhile.
- Audit your Google My Business page and make sure all its content and data are accurate and complete. Remember, your GMB page feeds your Local Services ad.
- Make sure you are actively encouraging your customers to review you.
- Be ready for an onboarding process, which can take weeks to complete. You may need outside help to complete the process.
- Monitor your paid search activity. If you see a decline in click and impression volume, your Local Services ad might be the reason. Determine whether your market is included in Local Services ads by reaching out to Google (or doing a search on your own). Then check to see if the decline in click and impression volume is due to a sudden drop in average position, which could be a sign of three factors:
- Local Services ads are in your market.
- Competition is heating up among established companies in your market, especially during the October-January months.
- A new entrant to your market is driving up the level of competition.
The Local Services ads end up limiting the number of paid search ads that are served — so your own Local Services ad could be the cause of the drop in click/impression activity. But keep in mind that Google will never show just a single Local Services ad to a user; rather, Google will show all available. So, it isn’t necessarily your own Local Services ad that causes the drop but rather the introduction of the new ad type as a whole.
If you see a drop in click and impression volume for paid search, the other option available to help increase paid search volume (impressions/clicks) is to improve your average position so that you show in the top 2-3 spots. But, an advertiser is going to have to be willing to accept higher average CPCs and spend more to get the same amount of volume as pre-Local Services launch.
Once you set up a Local Services ad, you can basically take a set-and-forget-it approach. You don’t need to worry about doing bid adjustments or other tactical tweaks.
If you need assistance figuring out whether Local Services ads are right for you, contact True Interactive. We’re happy to help. We can provide both counsel and management.
Lead image source: https://pixabay.com/en/building-glazurkarz-ceramic-tiles-1080597/