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Navigating Google Ads vs. Local Services Ads (LSA)


 

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Welcome to our latest newsletter! In this Sunday's edition, we will explore the differences between Google Ads and Local Services Ads (LSA), highlight the importance of intent-based advertising, and why it's often more effective to avoid running both ads simultaneously. Additionally, we'll compare the differences of low-cost Google Ad clicks and higher-cost LSA leads.

 

Google Ads vs. Local Services Ads (LSA)

 

Google Ads:

  • Intent-Based Search: Google Ads allows you to target users based on specific keywords they search for, ensuring your ads reach those actively looking for your services.

  • Versatile Ad Formats: While Google Ads offers various formats (search, display, video), focusing solely on search ads is crucial for capturing intent-based traffic. (It's the only type of ads I run for my business after testing campaigns on various Google, Meta, and other social channels).

  • Pay-Per-Click (PPC) Model: You pay each time someone clicks on your ad, making it a cost-effective way to drive traffic to your website.

  • Optimizing Landing Pages: Optimizing your landing page is crucial for capturing customer information. Using lead forms above the fold ensures that you capture interest right away. This technique can be just as effective as LSA, capturing those customers who are genuinely interested and motivated to hire your services. Customers who do not submit forms or hesitate to provide information are typically less motivated and may just be price shopping, making them less likely to convert into jobs.  


Local Services Ads (LSA):

  • Localized Intent-Based Search: LSA is designed to connect you with customers in your area actively searching for your services.

  • Google Guaranteed Badge: Enhances credibility and trust among potential customers.

  • Pay Per Lead: You pay only for actual leads, such as phone calls or messages, which can be more expensive but highly targeted.

 

To be accepted into LSA, a company must:

  1. Sign Up: Visit the Google Local Services Ads website and create an account.

  2. Background Check: Pass a background check, which includes verifying business owners and, in some cases, employees.

  3. Licensing and Insurance: Provide proof of necessary licenses and insurance to meet Google’s requirements.

  4. Business Profile: Create a business profile with detailed service information and high-quality photos.

Once these steps are completed and verified by Google, the company can start using LSA to generate leads.

 

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The Importance of Intent-Based Search Advertising

 

Focus on Intent:

  • High Conversion Potential: Users searching for specific keywords related to your services are more likely to convert, making intent-based search ads highly effective.

  • Avoid Distractions: Distraction-based ads, such as display, video, and social media ads may capture attention but often lack the immediate intent, leading to much lower conversion rates and much higher costs without substantial returns.

 

Why Intent-Based Search Ads Convert at a Much Higher Rate:

  • Targeted Reach: Ensures your ads are shown to users with a clear intent to find your services.

  • Efficient Spend: Higher likelihood of conversion means better ROI on your advertising budget.

  • Quality Leads: Intent-based searches typically result in more qualified leads ready to take action.

 

Now, knowing this information, why would you spread your budget out on other types of platforms? Imagine spending your budget on a variety of channels, like social media or display ads, only to find that your ads are mostly seen by people casually browsing, rather than those actively looking for your services. It would be like setting up a billboard in a busy area but not knowing if anyone passing by actually needs your offering.

 

My opinion, small businesses don't have the budgets to play around with wide brand-based types of ads. We can't risk the capital exposure of advertising that doesn't convert highly and quickly. We need ads to be seen by people needing the service now or in the near future and who are ready to pull out their wallets. This fuels our ads and allows us to continue to advertise and grow!

 

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Why You Shouldn't Run Both Google Ads and LSA Simultaneously

 

Risk of Overlap:

  • Double Charging: Running both increases the risk of being charged twice for the same lead if a customer interacts with both ads.

  • Budget Dilution: Splitting your budget between two platforms can dilute the effectiveness of your campaigns, leading to suboptimal results.

 

Focus on Efficiency:

  • Maximize ROI: Concentrating on one platform ensures more efficient use of your budget and resources.

  • Simplified Management: Managing one advertising platform is simpler and allows for more precise optimization and tracking.

 

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Cost Comparison: Google Ads Clicks vs. LSA Leads

 

Google Ads:

  • Lower Cost Per Click: Google Ads typically offers a lower cost per click (CPC), making it cost-effective for driving website traffic.

  • Cost Efficiency: Suitable for expanding your reach and attracting more potential customers to your site.

  • Real-World Example: Consider a cost of $2-$6 per click for Google Ads. If clicks from Google Ads result in high-value conversions, such as full-service hauling jobs, the lower CPC can offer a better return on investment. With more chances and better keyword targeting, you can optimize to ensure these high-value conversions happen.

 

LSA Leads:

  • Higher Cost Per Lead: LSA leads can be significantly more expensive, but they often come with higher intent and quality.

  • Real-World Example: Consider a lead cost of $30-$50 for LSA compared to a few dollars per click for Google Ads. If leads from LSA are not converting into high-value jobs, such as if many inquiries are for low-profit tasks like a single mattress pickup, the higher cost may not justify the investment. (From the many people I've spoken with about LSA, these kinds of leads, as well as free pickup requests, unfortunately come in more often than not.)

 

Balancing Cost and Value:

  • Evaluate Lead Quality: Assess the quality and profitability of leads from both platforms. If LSA leads are frequently low-profit, focusing on lower-cost Google Ads might be more beneficial.

  • Optimize Budget Allocation: Direct your budget towards the platform that consistently delivers the best ROI, ensuring cost efficiency.

  • Measure Everything: Continuously track and analyze performance metrics to refine your strategy and make data-driven decisions. This will help you identify trends and adjust your campaigns for maximum effectiveness. (Otherwise, you'll have no clue what's working, what's not, and risk falling into the mindset that "advertising doesn't work.)

 

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In Closing

Focusing on intent-based search advertising is crucial for maximizing the effectiveness of your marketing efforts. While both Google Ads and LSA have their merits, prioritizing one can lead to more efficient budget use and better results. Carefully consider the cost and quality of leads from each platform, and allocate your budget to achieve the highest return on investment for your business. Need assistance? Reply to this email and we can set up a time to talk.

 

Stay tuned for next week's insights, and keep hauling success!

 

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Got ideas or stories of your own? We'd love to hear from you! Reply and or share your insights with us in the Haulers Forum. Together, let's inspire and guide each other toward building businesses that aren't just successful today but poised for future success.


Justin Hubbard

Justin Hubbard

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