Both put you on Google. Only one charges you per lead. Here’s the call.

If you run a trade, you’ve seen both. The green badge at the very top with the stars. And the regular text ads right under it. They look similar. They are not. One charges you when someone clicks. The other charges you when someone actually calls or messages. Picking wrong burns money. So let’s sort it out.

TL;DR: Local Service Ads (LSA) charge you per lead and sit above everything with a Google badge. Google Search Ads charge you per click and give you way more control. For emergency trades that just need the phone to ring (plumbing, electrical, HVAC, locksmith), start with LSA. For bigger project jobs where you want to control the message and the landing page, Search Ads earn their keep. Most contractors over $50K a month should run both. The lead source only matters if you answer fast.

What’s the real difference between LSA and Google Ads?

Home service leads on Google Search cost an average of $90.92 each, and that’s up over 10% from last year (LocaliQ, 2025). That number is for Search Ads, where you pay every time someone clicks, whether they call you or not.

Local Service Ads work different. You pay per lead, not per click. Someone has to actually call or message you before Google charges you. The ad shows up at the very top of the page with a verified badge and your star rating. No headline writing. No landing page. Google pulls your reviews and your service area and builds it for you.

So the short version:

• LSA = pay per lead, badge at the top, less control, dead simple
• Search Ads = pay per click, more control, your own landing page, more work

One isn’t better than the other. They do different jobs. Want the full lay of the land on where to put your money? Read where contractors should advertise in 2026.

How much do Local Service Ads cost vs Google Ads?

Search Ads run an average cost per click of $7.85 in home services, with a 7.33% conversion rate (LocaliQ, 2025). Do the math and that’s about $91 to turn a click into a real lead. And it swings hard by trade. Roofing and gutter leads average $228 each. Pools and spas come in around $45.

One electrician we talked to put the pay-per-click trap better than we could: “Spending around $1,000 a month on Google Ads, getting clicks but not phone calls. Some of those clicks are people calling for other businesses.” That’s the catch with Search. You pay for the click even when it’s a wrong number or a tire-kicker who never books. LSA flips that. No call or message, no charge.

Here’s the honest part. Nobody can hand you a clean, sourced “LSA costs exactly $X per lead” number. The agency blogs that throw out “$60 a lead” don’t show their work, so we’re not going to repeat it. What we can tell you is how the model works and why it changes your risk.

With LSA, you set a weekly budget and Google charges you per lead inside it. The big win used to be that you could dispute junk leads and get your money back. That changed. In July 2024 Google killed manual disputes and switched to an automated lead-credit system (Search Engine Land, 2024). Now machine learning grades every lead. Low-quality ones don’t get charged at the start, and charged leads get reviewed again, with credits applied inside about 30 days (Google Local Services Help).

That’s still better than shared lead sites that charge you for the same dead lead they sold to nine other guys. But it’s not the blank check refund it once was.

For the full picture on what to budget across ads, reviews, and follow-up, see how much contractors should spend on marketing.

Do LSAs really get more clicks than regular ads?

When LSAs show up, they grab 13.8% of all the clicks on the page, and the top LSA spot alone pulls 7.4%, more than the second and third spots combined (BrightLocal Click Study). Worth noting that study is from 2018, so treat it as the shape of the thing, not gospel. But the shape hasn’t changed. LSAs sit above the regular ads, which sit above the map, which sits above everything else.

Why does that matter for a trade? Because 46% of all Google searches have local intent (Google, via Search Engine Roundtable, 2018). When someone types “plumber near me” at 9pm with water on the floor, they’re not reading. They’re tapping the first thing that looks legit. The badge and the stars at the top do a lot of heavy lifting there.

That’s also why the badge change matters. As of October 20, 2025, Google rolled “Google Guaranteed,” “Google Screened,” and “License Verified” into one “Google Verified” badge, and they dropped the old $2,000 refund that used to come with it (Google Local Services Help). If your old marketing guy is still selling you on the “$2,000 guarantee,” that’s a sign he hasn’t looked at the platform since last year.

Which one should you pick for your trade?

It comes down to how people find you and how much you care about controlling the message.

Go LSA first if:

• You run an emergency trade. Plumbing, electrical, HVAC, locksmith, garage door, water damage. People search, they panic, they tap the top result.
• You’ve got strong Google reviews. The badge pulls your stars in, so 81% of folks who check Google reviews before they call (BrightLocal, 2024) see them right away. Stacking reviews? Here’s how to get more 5-star reviews.
• You want simple. No landing page to build, no headlines to test.

Lean Search Ads if:

• You sell bigger project work. Roofing, remodels, additions, custom jobs. The buyer shops around, reads, and compares. You want your own landing page and your own pitch.
• You want control over the words and the offer, not whatever Google auto-builds.
• You’re already running a tight site that turns clicks into calls.

Honestly? Most contractors doing over $50K a month should run both. LSA grabs the panic searches up top. Search Ads catch the people who scroll past the badge and want to compare. Just don’t try to run both before you’ve got your follow-up dialed. More on the platform fight in Google Ads vs Facebook Ads for contractors.

Why the lead source barely matters if you don’t answer fast

Call a fresh lead within 5 minutes instead of 30 and you’re 21 times more likely to qualify them (MIT Lead Response study). That study’s old, but the truth in it never aged. Speed wins jobs.

Here’s where contractors light money on fire. They argue about LSA versus Search for a week, pick one, turn it on, then let leads sit for two hours before they call back. Doesn’t matter if that lead cost you $91 on Search or came through the LSA badge. If you call it back cold and slow, the guy down the road who called in 90 seconds already booked the job.

The platform gets the phone to ring. What you do in the next 5 minutes decides if it turns into a paid invoice. Get that part right first. Here’s the speed-to-lead playbook for contractors, and if your leads keep ghosting, read why your Google leads aren’t converting.

FAQ

Are Local Service Ads cheaper than Google Ads? Sometimes, but there’s no clean sourced number that says so across the board. Search Ads average $90.92 per lead in home services (LocaliQ, 2025). LSA cost depends on your trade and market. The real difference is the model. LSA charges per lead, Search charges per click, so with Search you can pay for clicks that never call.

Do I need good reviews to run LSAs? It helps a lot. The LSA badge shows your Google star rating right at the top, and 81% of people check Google reviews before they buy (BrightLocal, 2024). Thin reviews and a weak rating will drag your LSA results down.

Can I still dispute a bad LSA lead? Not the old way. Google ended manual disputes in July 2024 and moved to automated lead credits (Search Engine Land, 2024). Machine learning grades leads now and applies credits inside about 30 days.

Is the Google Guaranteed badge still a thing? The name changed. As of October 20, 2025 it’s the “Google Verified” badge, and the old $2,000 refund that came with it is gone (Google Local Services Help).

Should I run both LSA and Google Ads? If you’re over $50K a month, usually yes. LSA grabs the top of the page, Search catches the shoppers below it. Just lock in your follow-up first, because a slow callback wastes either one.

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Not sure which one fits your trade, your market, or your budget? That’s the kind of thing worth talking through before you spend a dime. Book a Growth Chat and we’ll map it out with you. No pressure, no pitch deck.

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