Google Ads for Local Businesses: The Complete Getting Started Guide
Everything you need to set up your first Google Ads campaign the right way—from account creation to your first conversion
What You'll Learn
- How to set up your Google Ads account correctly from day one
- The exact campaign structure successful local businesses use
- Which keywords to target (and which to avoid)
- How to write ads that actually get clicked
- What to expect in your first 30 days
- The 10 most common setup mistakes (and how to avoid them)
Before You Start
Google Ads can work for almost any local business, but you'll get better results if you have these four things in place first:
1. A Website That Converts
Your website should clearly show what you do, where you serve, and have an easy way for customers to contact you (phone number, form, or booking system).
2. Google Business Profile
A verified Google Business Profile improves your ad performance and gives customers confidence. Set this up before you start advertising.
3. Tracking Phone Number
Use a tracking number so you know which calls come from Google Ads. This is critical for measuring ROI. Services like CallRail or CallTrackingMetrics work well.
4. Monthly Budget
Google Ads requires consistent spend to work. Here's what to expect:
- $500-$1,000/mo: Minimum viable test
- $1,000-$3,000/mo: Solid starter budget
- $3,000-$5,000/mo: Competitive advantage
- $5,000+/mo: Market dominance
Step 1: Create Your Account (The Right Way)
Critical Decision: Expert Mode vs. Smart Campaign
When you create a Google Ads account, Google will try to steer you into a "Smart Campaign." This is designed for people who don't want to manage their ads.
For local businesses, Expert Mode is better. Here's why:
| Feature | Smart Campaign | Expert Mode |
|---|---|---|
| Keyword Control | None (Google chooses) | Full control |
| Ad Copy Control | Limited templates | Full control |
| Budget Flexibility | Daily only | Daily, monthly, shared |
| Performance Data | Basic metrics | Complete visibility |
| Best For | Very small budgets (<$300/mo) | Serious businesses |
Account Settings (Set These First)
| Setting | Recommended Value | Why |
|---|---|---|
| Time Zone | Your business location | Can't be changed later |
| Currency | Your local currency | Can't be changed later |
| Auto-apply Recommendations | Turn OFF | Google's recommendations often waste money |
| Conversion Tracking | Set up immediately | You can't optimize what you don't measure |
Step 2: Set Up Conversion Tracking
This is the most important step. Without conversion tracking, you're flying blind. Here's what to track:
Track These
- •Phone calls (most important for local businesses)
- •Form submissions (contact, quote request)
- •Online bookings or appointments
- •Click-to-call on mobile
- •Direction requests (to your location)
Don't Track These
- •Page views (not a conversion)
- •Time on site (vanity metric)
- •Newsletter signups (unless that's your business model)
- •Resource downloads (not a lead for most businesses)
Call Tracking Options
| Option | Cost | Best For |
|---|---|---|
| Google's Website Call Conversion | Free | Basic tracking, no call recording |
| CallRail | $45-$145/mo | Most local businesses (includes recording) |
| CallTrackingMetrics | $39-$169/mo | Multi-location businesses |
| Marchex | Custom pricing | Enterprise (advanced AI features) |
Step 3: Campaign Structure
Most local businesses should start with this simple, proven structure:
Campaign: [Your Service] - [Your City]
Example: "HVAC Repair - Sacramento"
Ad Group: Emergency Service
Keywords: "emergency hvac repair", "24 hour hvac", "hvac repair near me"
Ad Group: Installation
Keywords: "hvac installation", "new ac unit cost", "furnace replacement"
Ad Group: Maintenance
Keywords: "hvac tune up", "ac maintenance", "furnace cleaning"
Campaign Settings
| Setting | Recommended Value | Why |
|---|---|---|
| Campaign Type | Search | Highest intent, best ROI for local |
| Networks | Search only (no partners) | Search partners waste money |
| Locations | Your service area (radius or specific cities) | Only target where you actually serve |
| Location Options | Presence: People in your targeted locations | Don't waste clicks on tourists |
| Languages | English (or your market's language) | Match your website language |
| Bidding | Maximize Conversions (with target CPA after 30 days) | Balance learning and control |
| Budget | Daily budget = Monthly budget ÷ 30.4 | Consistent delivery |
Geographic Targeting Trap
Google's default setting is "Presence or interest: People in, regularly in, or who've shown interest in your targeted locations."
Change this to "Presence: People in or regularly in your targeted locations." Otherwise, you'll pay for clicks from people who are nowhere near you.
Step 4: Choose Your Keywords
For local businesses, there are three types of keywords that work:
1. High-Intent Service Keywords
These include your service + location or "near me":
plumber near me
emergency electrician [city]
roof repair [zip code]
2. Service-Specific Keywords
These describe exactly what you do:
water heater replacement
electrical panel upgrade
roof leak repair
3. Problem-Based Keywords
These describe problems you solve:
no hot water
power outage in house
roof leaking when it rains
Match Types Explained
| Match Type | Syntax | What It Matches | Use Case |
|---|---|---|---|
| Broad Match | hvac repair | Anything Google thinks is related | Rarely (wastes money) |
| Phrase Match | "hvac repair" | Searches with your phrase or close variants | Start here (80% of keywords) |
| Exact Match | [hvac repair] | Your exact keyword or very close variants | High-value keywords only |
Negative Keywords (Critical)
Add these immediately to avoid wasting money:
Universal Negatives
- free
- diy
- how to
- jobs
- careers
- salary
- course
- training
- school
- supplies
Industry-Specific
- rental (if you don't rent equipment)
- wholesale (if you're not a distributor)
- used (if you only sell new)
- commercial (if you only serve residential)
- residential (if you only serve commercial)
Step 5: Write Your Ads
Google Ads show three headlines (30 characters each) and two descriptions (90 characters each). Here's what works for local businesses:
Headline Formula
| Headline Position | What to Include | Example |
|---|---|---|
| Headline 1 | Keyword + Location | HVAC Repair Sacramento |
| Headline 2 | Benefit or Speed | Same Day Service Available |
| Headline 3 | Trust Signal | Licensed & Insured - 20 Years |
Description Template
Description 1 (Problem + Solution)
"AC not cooling? We fix it fast. Same-day emergency service in [City]. Call now for expert repair."
Description 2 (Credentials + CTA)
"Licensed, insured & local since 2005. Upfront pricing, no hidden fees. Get your free estimate today!"
Ad Extensions (Required)
Extensions make your ads bigger and more effective. Add all of these:
| Extension Type | What to Include | Example |
|---|---|---|
| Sitelinks | 4 key pages on your site | Emergency Service | Free Estimate | About Us | Reviews |
| Callouts | Short benefits (no punctuation) | 24/7 Emergency Service | Licensed & Insured | Free Estimates | Same Day Service |
| Call Extension | Your tracking number | (916) 555-0100 |
| Location Extension | Your Google Business Profile | Link to your GBP |
| Structured Snippets | Services or brands you work with | Services: Repair, Installation, Maintenance, Emergency |
Step 6: Your First 30 Days
Here's what to expect and when to make changes:
Days 1-5: Learning Phase
Don't panic about performance yet
- •Google is still learning who to show your ads to
- •Your CPCs may be higher than they'll eventually be
- •Focus: Make sure tracking is working correctly
- •Action: Test your phone tracking by clicking your own ad
Days 5-14: Data Collection
Start seeing real performance data
- •Check Search Terms report daily (look for wasted spend)
- •Add negative keywords for irrelevant searches
- •Pause any ad groups with CTR below 3%
- •Action: Review and add negative keywords every other day
Days 15-30: Optimization
Now you can make meaningful changes
- •You should have 30-50 conversions by now (if not, increase budget)
- •Identify your best-performing keywords (lowest cost per conversion)
- •Increase bids on top performers by 20%
- •Pause keywords with zero conversions and 50+ clicks
- •Action: Set up Target CPA bidding if you have 30+ conversions
ROI Timeline (What's Normal)
Month 1: Break-even or slight loss (you're buying data)
Month 2: Positive ROI begins (1.5-2x return is normal)
Month 3+: Strong ROI (2-5x return is achievable)
10 Setup Mistakes That Waste Money
Avoid these common pitfalls:
Using Smart Campaigns Instead of Expert Mode
Smart Campaigns give Google too much control. You can't see what's working or optimize properly.
Fix: Switch to Expert Mode for full visibility and control.
Not Setting Up Conversion Tracking
Without tracking, you're guessing. You won't know which keywords or ads actually drive calls or leads.
Fix: Set up call tracking and form tracking before spending a dollar.
Targeting Too Large a Geographic Area
If you serve a 20-mile radius, don't target a 50-mile radius just to get more impressions.
Fix: Only target areas where you actually want customers (and can serve them well).
Using Broad Match Keywords
Broad match will trigger your ads for searches you never intended, wasting budget on irrelevant clicks.
Fix: Start with Phrase Match ("+keyword") and Exact Match ([keyword]).
Not Adding Negative Keywords
You'll pay for searches like 'HVAC jobs', 'DIY HVAC repair', 'HVAC salary', etc.
Fix: Add a negative keyword list on day one.
Including Search Partners in Your Campaign
Search partners (sites other than Google) deliver lower-quality traffic at similar prices.
Fix: Turn off Search Partners in campaign settings.
Setting Wrong Location Targeting Options
Google's default includes people 'interested in' your area (tourists, people researching, etc.).
Fix: Change to 'Presence: People in or regularly in your targeted locations'.
Writing Generic Ad Copy
Ads like 'Best HVAC Service - Call Now' don't differentiate you or give people a reason to click.
Fix: Include specific benefits (same-day service, free estimates, years in business).
Not Using Ad Extensions
Extensions make your ads bigger, more visible, and more useful. They improve CTR by 10-15%.
Fix: Add all available extensions (sitelinks, callouts, call, location).
Making Too Many Changes Too Soon
Google needs time to learn. Changing bids or keywords every day resets the learning phase.
Fix: Wait at least 7 days between significant changes. Review weekly, not daily.
Google Ads vs. Local Service Ads (LSAs)
Local Service Ads appear above regular Google Ads. Here's how they compare:
| Feature | Google Ads | Local Service Ads |
|---|---|---|
| Position on Page | Below LSAs, above organic | Top of page (above everything) |
| Pricing Model | Pay per click (CPC) | Pay per lead (CPL) |
| Control Over Ads | Full control (keywords, copy, landing pages) | Limited (Google controls most) |
| Requirements | Credit card, website | Background check, insurance, license verification |
| Google Guarantee Badge | No | Yes (increases trust) |
| Available For | All businesses | Limited industries (HVAC, plumbing, electrical, etc.) |
| Best For | Businesses wanting full control and optimization | Businesses wanting simple setup and top positioning |
Our Recommendation: If you qualify for Local Service Ads, use both. LSAs get you top placement, while Google Ads gives you more control and scale. Many successful local businesses run both simultaneously.
Pre-Launch Checklist
Before you launch your campaign, make sure you've checked every box:
Frequently Asked Questions
How much should I spend on Google Ads per month?
Minimum $500/month for testing, but $1,000-$3,000/month is ideal for most local businesses. This gives Google enough data to optimize and gives you enough conversions to measure ROI. Higher competition industries (lawyers, contractors) may need $5,000+/month to compete.
How long does it take to see results?
You'll get clicks immediately, but meaningful ROI takes 30-60 days. The first 30 days are a learning phase where Google figures out who to show your ads to. Most businesses see positive ROI by month 2 and strong ROI (3-5x return) by month 3.
What's a good click-through rate (CTR) for local businesses?
5-10% is good, 10-15% is excellent, and 15%+ is outstanding. Local businesses typically get higher CTRs than e-commerce because the intent is so strong. If your CTR is below 3%, your ads or keywords need work.
Should I hire an agency or do it myself?
If you're spending under $3,000/month and willing to learn, you can manage it yourself. Above $3,000/month, an experienced agency typically pays for itself through better optimization and time savings. Look for agencies that specialize in your industry and charge 15-20% of ad spend (or a flat monthly fee).
What's the difference between Google Ads and SEO?
Google Ads is paid traffic (you pay per click), while SEO is organic traffic (you rank naturally). Ads give you immediate results but stop when you stop paying. SEO takes 6-12 months but builds long-term value. Most successful businesses use both.
Can I pause my campaign if I get too busy?
Yes, you can pause anytime. But be aware that pausing for more than 7 days will reset Google's learning phase, so performance may dip when you restart. A better approach is to reduce your budget rather than pause completely.
What if I'm in a very small town?
Google Ads can still work, but you'll need to expand your targeting radius or target multiple nearby towns. You may also have lower search volume, which means a smaller budget ($500-$1,000/month) can be effective. The key is to target all the ways people search for your service in your area.
Should I advertise 24/7 or only during business hours?
If you offer emergency service, advertise 24/7. If not, you can use ad scheduling to show ads only during business hours (plus a 30-minute buffer before and after). However, many people search outside business hours and call the next day, so test both approaches.