Google Just Made a Massive Change to Local Services Ads – What You Need to Know!
There was a massive change to Local Services ads recently that I’m not seeing many people talk about yet.. This update was so big that we are seeing huge shifts in spending trends in the last 30 days for almost every account we manage.
Crystal Horton was the first to talk about this on Aaron Weiche’s podcast. These changes happened in September and fundamentally changed 2 things about how Local Services Ads work.
Google No Longer Shows 3 Ads at the Top
First, Google shrank how many ads appear in the local services section from 3 to 2 on desktop:
However, on mobile, we still see 3 results 50% of the time:
Google is now rotating Ads more evenly
The second change was that Google started rotating the ads a lot more. Previously, if you had a good account history, it was possible to completely dominate a market and make it really hard for new advertisers to get shown. That is no longer the case. To help illustrate what it looks like now, we set up a ranking report using Places Scout and had it scanned every hour for 4 days.
What we found was unbelievably different from what we used to see in the past. In the 124 scans that we looked at over 4 days, Google rotated 10 different advertisers in and out of the top spots.
| Business | Mobile | Desktop |
|---|---|---|
| Business A | 5.81% | 8.00% |
| Business B | 5.81% | 8.80% |
| Business C | 37.42% | 6.40% |
| Business D | 3.87% | 3.20% |
| Business E | 12.90% | 22.40% |
| Business F | 0.65% | 0.00% |
| Business G | 9.03% | 23.40% |
| Business H | 0.65% | 0.80% |
| Business I | 10.97% | 12.80% |
| Business J | 11.61% | 15.20% |
How did Google’s Change Impact Advertisers?
How did these 2 changes impact advertisers? The impact was pretty substantial for most accounts.
If you are in an industry that is extremely saturated and competitive, you likely got hurt by this.
However, if you only have a few competitors participating in local service ads, you could benefit greatly
| Industry | Aug Cost | Sept Cost | Cost Change |
|---|---|---|---|
| Lawn Care | $378.00 | $169.66 | -55.12% |
| Electrical | $519.48 | $339.63 | -34.62% |
| Water Damage | $793.40 | $422.34 | -46.77% |
| Handyman | $1,518.83 | $665.87 | -56.16% |
| Plumbing | $1,095.94 | $990.82 | -9.59% |
| Real Estate | $1,641.04 | $1,395.94 | -14.94% |
| Pest Control | $2,799.94 | $1,396.21 | -50.13% |
| Tree Services | $2,208.10 | $3,172.48 | 43.67% |
| Dentistry | $7,831.55 | $4,450.50 | -43.17% |
| Locksmith | $5,120.03 | $5,294.52 | 3.41% |
| HVAC | $12,534.55 | $5,376.33 | -57.11% |
| Roofing | $3,442.62 | $6,305.01 | 83.15% |
| General Contracting | $5,101.06 | $9,333.72 | 82.98% |
| Disability Law | $17,661.88 | $11,467.53 | -35.07% |
| Personal Injury Law | $20,711.43 | $17,468.80 | -15.66% |
| Family Law | $37,903.40 | $22,799.66 | -39.85% |
| Criminal Law | $33,390.51 | $32,180.54 | -3.62% |
| Foundations | $92,969.53 | $136,791.48 | 47.14% |
This change also appears to have helped the smaller business. For advertisers who spent $1000 or less in August, we saw an overall increase of 25% in September.
Overall, across all accounts, we saw spending go up by 5% in September. So yep, Google made more money. Shocking, I know.
What Local Services Ads (LSAs)Display on Mobile and Desktop Varies a Ton
We also noticed that Google often shows completely different businesses on mobile than they do on desktop for the same search. In the scans we looked at, mobile-only showed the same top 2 businesses in the same order 11% of the time.
If you run local service ads, what have you seen in the last 30 days? Please share with us in the comments.
Too many LSA clicks, and not enough traditional ad clicks make Google sad.
I’m actually curious what others have experienced as LSAs have snuck into the 3-pack. Since they are now showing up at the top of the map pack, who has seen the cannibalization of local leads by LSA leads? I can’t find anyone else talking about this, but that’s a huge frustration because it seems like customers lean towards selecting the “Google Guaranteed” option in maps rather than the organic listing.
I see the part about someone dominating LSA and another competitor not able to break through. This is me. I get about one call a month from LSA and would love 20. But the October lead cost almost half of what the September lead did so that is a plus I suppose.
Staying up to date with such developments is crucial for businesses striving to maintain their competitive edge in the ever-evolving world of online advertising. Thank you for highlighting this topic. I look forward to learning more about the details of this update and how it’s affecting local advertising strategies and others in the community.
My HVAC client finally showed up in LSA’s in October after being in the program for years without any results despite all our best efforts – so something is surely up. But today, when I do a search, there are no LSA’s at the top of my desktop browser?? But the good news is he broke through into the 3-Pack.