When we went looking for an expert to talk about Google’s fast-growing Local Services Ads, everybody pointed to the same person: Austin Houser of Basecoat Marketing. A digital marketer and data scientist with over a decade of lead generation experience, Houser offered an inside view on how to use Google’s Local Services Ads to grow your business.
When did Google start pushing into local services?
Google has had local services ads around for a while, I want to say around 2014. But they’ve been slowly rolling it out across multiple industries. We noticed that when they rolled out the painting subcategories under the home, it was in the handyman category.
Not many people picked up on that – it was kind of a subtle thing that Google just kind of stuck out there. We picked up on that, because we spend $100,000s a month on Google. We get some pretty high up access within Google’s support team. And we were notified ahead of time, ‘Hey, guys, these are being pushed out in your category, here’s how you can go about setting them up.’
A lot of guys didn’t even touch it, because they’re like, ‘I don’t want to rank for somebody who needs a garbage disposal fixed,’ right? Not realizing the fact that you can dispute those leads, because you’re listed under the subcategory. So we were the first ones in this industry to really pick up on that and start offering it as a service for our clients.
Back then it was a massive opportunity. Now, it’s much more competitive, but it’s a good thing. Just a few years ago, Google was not showing local services ads in the majority of markets around the United States, because there wasn’t enough buy-in. So what we had to do was basically say to our clients, as they were onboarding, ‘Hey, this might not be available in your market right now, Google needed at least three competitors to start advertising because they don’t want you showing up at the very top for every single term.’
But with that said, it’s now really taken hold. I’ve been trying to scream from the rooftops for everybody to jump on this platform. And finally, Google released the painter primary category across the board. So we’ve now migrated all of our clients over in May.
What that means is, you’re not going to show up for handyman-related terms anymore, it’s just more painting-related terms. The cost-per-lead is slightly cheaper. In most markets, we’re seeing somewhere around $20 to $50, a lead. And just due to the fact that as a pay-per-lead service, you’re only paying for results, not clicks and impressions. So it’s a no-brainer for most painters to advertise on that channel.
What does a painting contractor do to get started?
You go through a background verification process where you have to submit – it’s different for every state – but most states will have you submit some legal documentation about your business, what the legal entity name is. Some states require business insurance as well.
Different types of insurance are required for different states. Some require a GC license, in addition to, you know, business verification and worker’s comp. Others just business verification, but you have to go through a slight verification process, there is a personal background check involved. That process can take anywhere from a couple of days to a couple of weeks.
Once we get through that process and you’re fully verified, your business profile is tied to this. So when we talk about local services ads, they are not a standalone ad type. They are tied to your free Business Profile on Google. And once that’s verified, you’re gonna start showing up at the very top of search results above any other ad type out there. Even pay-per-click advertising shows up below local services ads – so does the Map Pack. At the very bottom of that list is your website and organic results.
So, as far as visibility goes, you can’t get any better than local services ads.
How does the lead process work?
There are a few things that really impact overall ranking.
First of all is proximity. Where you’ve designated that the ad is going to show. The benefit of that ad channel is, even if your business profile is not organically ranking in the Map Pack, those top three positions, you can actually pay to have it rank wherever you want. So identifying where that target service area is, that’s one of the big factors that you have control over.
Your reputation, though, is ultimately one of the top three ranking factors. Everybody says, ‘Well, how many reviews do I need on my profile?” There’s not a straight answer to that. It’s a relative score. If you look in your market, you type in ‘painter near me,’ or ‘painting services,’ the top results are generally going to be those that are,first of all, open during office hours. But that have typically the most reviews and are closest to you.
Your reputation is becoming one of the most important ranking factors on Google given that you can’t buy it. And it’s Google’s way of fighting A.I. content out there.
The third most important ranking factor is going to be pick-up rate: actually answering the phone. Not many people consider the fact that if you have an IVR phone system, that can actually negatively impact your ad performance. It’s something that Google records – they don’t have somebody personally listening in on all the calls, but they do record every single call. They have a very smart algorithm behind that. And if the algorithm hears the exact same voicemail or IVR system without a human voice, they’re going to start to identify that as a non-answer. If you have enough of those – and it really it only takes a couple – if you do not answer your phone, let’s say twice in one day, Google is going to drop you down literally the same day. Like it’s that quick.
We recommend either putting a call-tracking number before that phone number, where it’s a passthrough number, or making sure that the number that their calling is sent to your phone. That way, what you can do is store that in your phone as ‘Google Local Services ads lead, answer immediately.’ That way, if you’re on an estimate, you can say, ‘Hey, I’m sorry, I need to grab this call really quick.” If you’re behind the brush, it’s your office manager than needs to answer the phone every time to ensure that that ad channel is not negatively impacted.
What does performance look like compared to other channels?
There’s a few different KPIs that we like to look at. Volume and cost-per-lead are two of those. Lead quality is going to be the third, and that’s more subjective.
When we look at volume, that is going to be the No. 1 complaint whenever it comes to local services ads.
The volume is primarily dictated by search volume and your reputation, and how visible your profile is. We have some ad profiles set to $10,000 monthly budget, and we’ll maybe spend a couple $100 of that.
It’s very difficult to beat the cost-per-lead, especially given the fact that you can dispute leads that are calling outside of your service area, or calling about a service you don’t offer. When you launch an ad campaign like this, it’s like a waterfall effect, you’ll have a ton of leads coming in that you’re going to pay for. And then as you start disputing those, your monthly spend becomes lower, because you’re then reusing the credits that were refunded from the previous calls.
Think of it as like the shared lead sites, except they’re exclusive to your business. And disputing leads is relatively easy. There are some caveats to that, that I’d be happy to talk through.
Sure, what are the caveats to disputing a Local Services lede?
A lot of people have the mindset of, “Let’s collect contact information right at the start of the call.”
Local services ads are very different. If you want to dispute a lead through that ad channel, you cannot collect any contact information, and you cannot refer somebody elsewhere.
The reason that’s important is, if you look at it through Google’s eyes, if you have the contact information, and you’re willing to call them back after the call, outside of Google’s phone system, that you can maybe get that lead for free. If you’re referring him to somebody else, you might own that other business, right? So it’s really important that you prequalify at the start of the call.
Where are you calling from? What services are you looking for? Get that out of the way and make sure they are what’s called a “quotable lead” in the eyes of Google.
From there, if you identify ‘Hey, I can service this person,’ then you progress the call. If you can’t, ‘I’m sorry, I cannot help you.’ And you can just hang up the phone. It’s something you need to be very clear on the call. Because when you dispute it, that is when, generally speaking, there is human intervention involved that it goes and listens to that call. They’ll identify, ‘Hey, that is something that you could have quoted, or you’ve collected contact information on that call.’
The other thing to keep in mind there is the fact that Google is not perfect, so they may flag something as a quotable lead that you can then appeal. The appeal process has a pretty high success rate. When we give our clients the tools and the training behind how they should go about answering those calls. I think we’re up to a 99% success rate in disputes and appeals.
It’s a pretty streamlined system that Google has in place. But it does require knowing that you have to answer the phone, how you position your business, making sure your office hours are set right.
Where we see most painting companies fail on this channel is if you have a call center or an office administrator who doesn’t know what leads are coming from what sources, or they’re not trained on how to do that. That’s when they’re gonna run into dispute issues.
What percentage of leads are clients disputing?
In the first 90 days, you might be disputing most of those. But as time goes on, and the quality of leads starts to get better, the disputes become less and less and less.
If you only have a few people calling you in the course of a month, it may take a couple of months for that really to start getting dialed in. I think that’s where most painting company business owners fail, is the fact that they don’t give it enough time – it can get scary and expensive advertising online, especially in those first 90 days. These lead channels always work given enough time.
If you’re in a small market, advertising online is always going to be challenging for you, given that it’s such a volume game. It really just comes down to how quickly we can get you through that learning phase up front, how much volume is in your market, that kind of stuff.
So in any ad channel, there’s always going to be a certain percentage of spam, we will look at roughly about 20% of the leads that you generate online, are going to be dead spam, you know, that kind of stuff, it’s just inevitable.
The best we’ve ever seen is about eight to 10% of calls are going to be spam or fraudulent, dead, whatever that is. So it’s going to be somewhere between let’s say 80 to 90% of your leads that you get should be a qualified lead.
Now, again, that goes for every channel – that’s not specific to local services.
How should painting contractors set up their Business Profile to get optimal results?
It all starts with your Business Profile on Google. You need to go have that done. I would say most successful painting business owners have already established this.
It’s nothing new, right? It used to be called Google My Business. A few years ago, Google rebranded it as Google Business Profile, nothing changed outside of the fact that they just rebranded it. The name change confuses a lot of people.
We have an entire checklist of things that you need to look for. But in general, it’s about creating activity, it’s about making sure that your NAP – which stands for name, address, and phone number – is consistent. So the phone number that you have on your business profile should match the website and any other directory listing that you have. Same goes for the address – that should all be consistent in your name as well.
If you’re listing your business as ABC Painting Company on your business profile, but then on your website, or other directories, it’s ABC Painting Company, Inc., that’s a NAP inconsistency. So you need to keep all of those details as consistent as possible, making sure that you’re filling out all of the fields as well.
You can add social profiles to your website. If you have an online booking form, having that in there as what’s called an appointment link. Filling out all available options, making sure that you have your services entered in there as well as important.
Really, there’s a few things that actually have a pretty substantial impact. First of all, it’s going to be the reviews on that profile, like you need reviews. Some people aren’t aware of the fact that the frequency that you capture reviews is just as important as the total number of reviews on that profile. For instance, we’ve had a client with 50 reviews outranking their competition with 150 because they’ve simply acquired more of those reviews more recently than their competition. So we really aim for our clients to get at least one new review per week or a couple each month. The best way to get reviews is by asking on the job, there’s a lot of free tools out there you can pay for that will automate the review after you leave. The capture rate on that is about 10 to 15%. You ask on the job and have a process in place on the final project walkthrough. Don’t be afraid to incentivize your customer.
From there, it’s really about activity. So activity comes in two primary forms on that profile, uploading images as often as you can. I recommend once a month uploading all of your project photos, team photos – upload that in bulk.
If you have before and after images, combine the images together and label them before and after. Because if you upload the before and the after, sometimes you can’t really differentiate the two. So make sure you label them, and it’s clear as to what is your work.
Don’t use stock images. Google is smart enough to know what is unique to your company and what’s not. The second form of activity is adding posts to that profile. It’s almost like a light form of social media, where you can just add an update if you add a blog post to your website. That generates activity that shows Google that you care about your business.
Then the final thing that not many people consider is your business hours. So if you’re listing your business hours there for the times that you’re actually working, but maybe you’re available to answer the phone outside of those hours, put that in there. The reason that’s important is, Google will actually hide your profile and your local services ads based on where you have those hours listed. So if you want to get a leg up on your competition, list your businesses open 24/7. Generally speaking, your competition is not available on the weekends. Somebody searching for you on a Saturday or Sunday, particularly on a Sunday, is one of the you’re going to show up and your competition will not.
How does it look through a customer’s eyes?
From a customer standpoint, the top two search blocks that they’re going to see are local services, and paid search. Those are both paid positions. The big difference is the customer can reach you directly on Google search without ever leaving the search through local services ads.
If they’re on their mobile phone, they can simply click ‘call now,’ and it’ll outbound call your company. Now, there is a call-tracking number ahead of that. So that number is not going to match the number that’s on your website or your business card. That’s how Google actually records that call.
Now, there are two forms of contact on the local services ads: there’s phone and there’s message. The big difference is the message is half the price of the phone call. So let’s say a phone call, on average, cost you about $30; the message is only going to cost you $15.
But after they submit the message, it will also after they submit that it’s going to present them with other options. We don’t recommend it because there is typically going to be a higher propensity for spam leads, given that it’s easier for bots to automate that part of the process.
Response time also plays a big role there. Let’s say that your phone rings. It’s a much more abrasive type of communication, versus a text message coming in. If you don’t respond to that right away. That acts the same as if you send a call to voicemail right? So we find that our clients just prefer the phone calls. We just disable the messages by default most of the time.
The way that I like to look at Google search, and really just any advertising online, is to give your prospects as many methods of communication as possible. They might be in their 60s, they might not like to text, they might like to talk to somebody on the phone. The younger Gen Z’s are for sure gonna want to text you; they don’t want to talk to people. So it’s different for each generation, everybody has a different comfort level.
Your audience is primarily going to be made up of women. For the most part, those are the ones that have the highest conversion rate. They like to ask a bunch of questions on the phone – men just like to get something on the calendar and move on. So having those various options out there is important.
The friction that you’re going to have on local services, that’s always going to be lower. However, when we look at the price again, the price on local service ads, $20 to $50 on average, Google search anywhere from $100 to $150, is a good price lead and generally going to be a good quality lead as well.
What does the future hold for Google’s local service ads?
Unfortunately, I don’t think the future is bright. The reason I say I think the future is dim is because Google is going to look at how much you’re willing to spend for a lead on paid search. Now, they’ve changed their algorithm.
Anybody that you talk to, that has been advertising on Google search over the last two to four years, they’ve seen their lead cost about double. It used to be that you could acquire leads $50 to $75. Now, it’s $100 to $150. It’s because they changed their paid search algorithm.
They’re now pushing home service businesses into the local services ads, that’s where they want you. Now what that means is, if you have a larger budget, they’re gonna prioritize that over the smaller budget.
It’s no longer an even playing field. You have companies like Angie, Home Advisor, the large franchises CertaPro, Fivestar – they’re willing to spend $30 on a click, knowing that at scale, that math will make sense for them. That’s how they’re gonna outpace the average local painting company.
So Google has identified that there’s still an opportunity for them to charge more for the same lead, so I think they’re going to trend more towards what Angie and HomeAdvisor are doing in the shared lead space.
Things are gonna get more competitive and more costly.
With that in mind, is it for a painting contractor to invest in this platform at this point?
You need to be on that channel, there’s no reason for you not to be on there. The age of your ad campaign plays a role in how well it ranks as well. So go get it done.
This is very similar to home buying. People are like, ‘Should I invest in the housing market today, or should I wait for it to crash.” Just go put your money out there today, guys, this is a no-brainer.
We don’t even look at this ad spend, there’s no reason to stop investing in this channel Today, our clients are willing to spend $10,000 a month on this particular channel, simply because the cost-per-lead and the quality of lead is so high.
When you look at other channels, like Meta – Facebook and Instagram – you’re paying for Likes and Impressions. You can’t deposit a Like in the bank account.
Google, you’re paying for clicks and impressions. You’re paying for things that don’t generate results.
Over here on local services ads, you’re only paying for results. It’s much further down the marketing funnel.
How much money should someone alot in their budget for advertising on this channel?
Great question. So, on average, we say, ‘Hey, we’re probably not going to spend at all, but just set $500 aside each month, just in case. Local services ads, is a pretty low volume ad channel in comparison to what else is out there.
Let’s say that you are the No. 1 rated painting company in your market, you have over a million people in your target service area that you’re willing to serve, you should be expecting a couple of phone calls a week.
If you are in, let’s say, the backwoods sticks of Louisiana, you’ve got a few other competitors out there, but nobody’s really got over 4.8 stars, you know, you might, you might get a couple phone calls in a month. So if you just do the math, you know, $20 to $50 per lead, you should anticipate spending that minus any disputes for the following month.
Any other channel – whether it’s Google search or social media – we recommend nothing less than $60 per day. It comes out to roughly $2,000 a month. When you get to that point, that’s where the volume is. I think our highest budget on that channel with any of our clients is still under $2,000 per month.
For those that are looking to really scale and grow, you need to supplement local services ads with another channel, whether that’s social media or Google search. But that’s where the larger budget comes into play, you cannot go into those ad channels with anything less than $60-a-day and expect scalable results.
Is there anything I didn’t ask that you think would be important to understanding local services ads?
I think it’s important to understand the entire makeup of advertising online, because a lot of guys look at local services ads, and they have this expectation that it’s going to be a game changer in their business. It’s just another tool in your tool belt. Understand that it’s not going to be the thing that’s going to take you from, you know, $1.5 to $3 million, it’s going to be maybe something that generates some supplemental income that you would not have had otherwise.
There’s no silver bullet in the world of marketing, but it is very much about authenticity and trust. If you are putting yourself out there as a service-based business, great. You need to build and sell yourself as the authoritative source that people trust, because people are only going to buy from you if they know, like, and trust you. That’s just Marketing 101.
