For many years the only way to run ads on Google was through pay-per-click strategies called Google Ads. These are universally known and utilized by businesses around the world. If you’re reading this article, chances are you already know the basics of Google Ads and how they work.
In 2021 we saw the introduction and integration of Google Local Service Ads in the paid-advertising market. Still run and managed by Google, the new ads have introduced a new way of lead management AND lead cost.
This is the first time businesses have had the option to change how they advertise on Google. With Local Service Ads still expanding and relatively new to the internet marketing world, it can leave business owners questioning if the risk is worth the reward.
Let’s break it down.
Pay Per Click vs Pay Per Lead in 2022
Pay Per Click
One of the long-standing issues with pay per click ads is that it is impossible to filter out those who click on an ad without being the right audience and target market. Chances are, we’ve all accidentally clicked on the first paid search result of Google only to realize it wasn’t what we were looking for. We backtrack, wasting only a few seconds of our time, but the business that paid for the spot is being charged for the click either way.
Pay per click managers and experts do their best to narrow down and target niche realms for these ads, but there is never a 100% guarantee that every click will be relevant. Those who run Google Ads know that it is not cheap, and when spending that amount of money to be seen, one would hope for the highest ROI possible.
Pay Per Lead
Ever since the start of the internet and paid advertising, there has never been a pay per lead option. That is, until 2021, when Google Local Service Ads launched and offered a new way of advertising to business owners. When it first launched, Google Local Service ads were only available to a select few of professionals, such as lawyers. In the past year, the service is now opened to a wide range of other businesses, such as
- Real Estate Agents
- Property Managers
Launching Google Local Ads are unique and preferred because business owners are only charged when a direct phone call takes place. If the phone call is not answered or abandoned, there is no charge. Business owners also gain access to a Google Local Ads dashboard where they can view and listen back on phone calls. If there are any phone calls that came through and were not relevant, they can then be disputed with Google and refunded back to the account.
There’s no question why pay-per-lead ads are favorable to many businesses, but they also take considerably to get approved and launched. Before ads are live, each partner or business owner must for through a background check, verify their identity, and submit additional information such as license numbers and expiration dates.
The Google account is then attached to the business Google My Business listing. The Google My Business rating is shown directly under your profile on the ad, which means having a great rating on Google is vital to a successful campaign.
The Cost: Pay Per Click vs. Pay Per Lead
When you sign up for Local Service Ads to launch a pay-per-lead campaign, Google will review the profile and make a recommended weekly as spend based on competition. This can be anywhere from a couple of hundred to over a thousand dollars weekly. Google does not allow running Google Local Service ads for any less than the recommended ad spend because it will not have the ROI or budget needed to get at least one conversion from the campaign. Depending on the profession, most should expect to spend anywhere from $1,500 to $7,000 minimum on Local Service pay per lead ads.
Lawyers typically have the highest minimum ad spend on Local Service Ads, with smaller service-based businesses having lower local ad spend requirements.
For pay per click, budgets have more flexibility. Although having a monthly ad budget of $400 will not likely draw many leads or have the highest ROI, it is possible to run small campaigns with Google Ads through pay per click. The recommended spend on pay per click ads is somewhat similar to pay per lead in the sense that the amount varies based on target markets and keywords.
Budgets can look somewhat similar, however. In a majority of cases for our pay per click clients, we have recommended ad budgets anywhere between $1500-$5000 monthly. Having a PPC professional preform an audit of the business and competition can shed better light on what you can expect to spent on pay per click ads.
Setting Up Pay Per Lead Ads with Local Service Ads
There are a lot of steps and verifications needed to launch and set up Local Service Ads. To ensure the profile is set up correctly and fully optimized to reach the best target markets, we recommend hiring a professional Local Service Ads company to help. At Send it Rising, we charge a flat fee of $750 to set up Local Service Ads and eliminate the stress of doing it manually. In addition, we charge 10% of budget ad spend to monitor the ads and dispute incorrect leads monthly.
However, if you are looking to get Local Service Ads set up on your own, there is a step-by-step guide from Google you can access here.
Contact Send it Rising for Local Service Ads assistance here.
Learn more about pay per lead Local Service Ads from Google here.