Google Ads for Local Service Based Businesses: 5-Step Strategy for 2025
Apr 14, 2025For local service-based businesses, having a well-structured Google Ads strategy is critical. With some industries seeing cost-per-click (CPC) rates soaring above $50, even one misstep can result in wasted budget and poor lead quality.
This guide outlines the 5-step Google Ads strategy we use to help local service businesses reduce wasted ad spend, improve targeting, and generate more qualified leads in 2025.
Step 1: Why You Should Start with Search Campaigns
When launching or optimizing Google Ads, always begin with Search campaigns, not Performance Max (PMAX)
Search campaigns give you:
-
Greater control over keyword targeting
-
The ability to test and refine ad copy
PMAX campaigns are powered by machine learning and require accurate conversion data to perform effectively. Starting with Search allows you to build that foundational data by analyzing:
-
Which search terms lead to conversions
-
Which ad headlines and descriptions perform best
Once you understand what works, you can scale more confidently using PMAX.
Step 2: Improve Location and Keyword Targeting
Most service-based businesses lose money by targeting the wrong areas or using poor keyword strategies.
Optimize Location Targeting
Set your targeting to “Presence” only. This ensures your ads show only to people physically located in your service area—not to people who are merely interested in it.
Avoid Common Keyword Mistakes
-
Don’t rely on short-tail broad match keywords
-
Avoid skipping the creation of a negative keyword list
Instead:
-
Use long-tail broad match keywords with clear intent
-
Create both account-level and campaign-level negative keyword lists
-
Review your search terms report weekly to refine targeting and reduce irrelevant clicks
These steps ensure your ads are shown to people actually looking for your specific services in your geographic area.
👉How to Optimise Google Ads Campaigns
Step 3: Use Specific Ad Copy to Pre-Qualify Leads
Your ad copy should serve as a filter. It should attract the right customers and deter the wrong ones before they click.
Real-World Example
An IT support company saw costs per lead of over $100, largely due to calls from residential customers instead of small businesses. By:
-
Adding specific negative keywords like “computer help near me”
-
Rewriting ads with headlines such as “Small Business IT Support Only”
They cut irrelevant traffic, and their cost per lead dropped from $107 to $59.
If your business has a specific offering—such as installations only or a set price point—make that explicit in your ad copy. This approach minimises wasted clicks and improves conversion rates.
Step 4: Implement Remarketing at the Right Time
Remarketing can boost brand visibility and drive warm leads back to your website—but only if you’re ready.
Key Remarketing Rule
Don’t launch a display remarketing campaign until your website audience exceeds 1,000 visitors. Anything less, and your budget is likely to go to waste.
Remarketing Campaign Setup
-
Use “Target” for audience targeting (not “Observation”)
-
Exclude mobile app placements
-
Align ad messaging with your top-performing Search ads
-
Allocate 5–10% of your total Search budget
-
Let the campaign run for 60–90 days to measure performance
Focus on View-through conversions, which indicate whether your ad impressions are driving conversions later—even if users don’t click immediately.
Step 5: Scale with Performance Max Campaigns Strategically
Once your Search campaigns are driving consistent results, you can consider scaling using PMAX.
Two Ways to Scale Google Ads
-
Increase spend on high-performing campaigns (until CPCs become inefficient)
-
Expand reach to new, colder audiences using PMAX
Beware of CPC resistance—the point where increasing your budget raises your CPCs at a faster rate than your return on investment. This is often when it makes sense to introduce PMAX campaigns.
PMAX Settings for Service Businesses
-
Use campaign-specific goals linked with offline conversions
-
Enable bidding for new customers only
-
Exclude branded terms to focus on new traffic
With the right data and strategy, PMAX can help you scale while maintaining or improving lead quality.
Final Thoughts: Making Google Ads Work for Service-Based Businesses
Google Ads continues to be one of the most effective channels for local lead generation—when done right.
To recap:
-
Start with Search campaigns to build accurate performance data
-
Refine your location and keyword targeting
-
Use ad copy that filters out low-quality leads
-
Launch remarketing only when your audience is large enough
-
Scale with Performance Max once your foundation is in place