Google Is Moving Local Services Ads Into Performance Max: What Local Businesses Need to Know

How much should small and medium sized businesses budget for marketing annually?

Do you advertise your business using local Google advertising features? Location-specific advertising is important for businesses that provide services in a specific geography. Doctors, dentists, veterinarians, lawyers, dry cleaners, retailers, restaurants, coffee shops and more all rely upon customers finding their business online but visiting them in person. Targeting ads to customers based on geography is vital. Otherwise, businesses waste time and money, and customers get frustrated because that great bagel place in Brooklyn Park is actually IN Brooklyn, New York—not Minnesota!

Google just announced that they are migrating Local Services Ads (LSAs) into a specialized form of Performance Max called Performance Max with pay-per-lead goals. The advertising experience is moving into Google Ads, while many of the things advertisers value about LSAs, such as local Search/Maps placements and paying for valid leads rather than clicks, will remain. 

Google began the U.S. migration in August 2026 for selected home and storefront services, with broader groups, including professional services and service-area businesses, expected to transition later in 2026. Remaining categories and non-U.S. accounts are scheduled for 2027. 

There’s a lot to take in with this topic. First, let’s take a big-picture look at the terms. Then, we’ll go into what each means. 

Key Takeaways

  • Google is moving Local Services Ads into Google Ads. Eligible LSA campaigns are transitioning to Performance Max campaigns with pay-per-lead goals.
  • The way local advertising is managed is changing, but you can still pay for leads rather than clicks, with ads continuing to appear on Google Search and Maps.
  • Your Google Business Profile matters more than ever. Accurate business information, services, categories and service areas help Google understand your business and connect you with potential customers.
  • Google is taking on more of the day-to-day advertising decisions. Businesses need to focus increasingly on providing accurate information, clear goals and reliable conversion data.
  • Save your historical LSA reports before your account migrates. Past lead information will transfer, but historical campaign performance data will not.
  • Local search is becoming more automated—and more complex. Having an experienced partner who understands both local SEO and paid search can help you adapt as Google’s advertising system continues to change.

Table of Contents

Understanding the Terms

Google’s terminology can be confusing, so before we go into what all this means for business owners, let’s go through the alphabet soup of acronyms. Google has a lot of advertising products that share similar names, which can also be confusing to many people. 

  • Local Services Ads (LSAs)—the familiar pay-per-lead local advertising product. 
  • Local Ads—ads that can use location information and appear through Search and other Google inventory. 
  • Performance Max—Google’s goal-based campaign type that can potentially serve across Search, Maps, YouTube, Display, Discover, and Gmail. 
  • Performance Max with pay-per-lead goals—the specialized campaign type Google is using for the LSA migration. 

This distinction is particularly important because the new pay-per-lead Performance Max campaigns aren’t simply ordinary Performance Max campaigns. Google says these campaigns remain focused exclusively on Google Search and Google Maps, unlike standard Performance Max campaigns, which can use Google’s broader advertising inventory. 

What’s Actually Changing?

If you’ve used Local Services Ads before, one of the biggest changes you’ll notice is where you manage them. If you don’t manage your Local Services Ads but we do, you can skim this section or skip ahead. 

Before: A Separate Local Services Ads Experience

Local Services Ads have traditionally lived in their own environment, separate from the main Google Ads platform. You managed your local advertising, budget, targeting and customer leads through the Local Services Ads dashboard.

After: Your Local Campaigns Move into Google Ads

As Google migrates Local Services Ads, your campaign will move into Google Ads, where it will become a specialized Performance Max campaign with pay-per-lead goals. 

Google says the migration is designed to happen automatically. Your existing campaign setup—including your targeted locations, service types, business categories, budget limits, ad schedule, and business photos—will transfer to the new campaign. If your business has already completed the required verification, your verification status and Google Verified badge will transfer as well. 

Once your account has migrated, the old Local Services Ads dashboard will no longer be available. If you try to access it, Google will redirect you to your campaign in Google Ads. 

There is one important exception: your historical LSA performance reports will not transfer. Google recommends saving your historical performance information before your migration if you want to retain it for future comparison. Your previous customer lead history, however, will transfer to Google Ads. 

The Bigger Strategic Change

The change is about more than moving a dashboard from one Google product to another. Google is bringing local lead generation into the same advertising environment where businesses manage other Google campaigns. 

That creates a more unified way to manage local advertising, with campaign settings, budgets, targeting and customer leads accessible through Google Ads. Google also says the new system gives advertisers greater control over certain campaign settings, such as service areas, ad schedules, and the phone number used to receive leads. 

For local businesses, however, the move doesn’t mean everything about Local Services Ads is changing. You still pay for valid leads rather than clicks, and your ads continue to appear on Google Search and Google Maps. The new pay-per-lead Performance Max campaigns also remain keyword-less, using information about your services and service areas rather than traditional keyword lists. 

In other words, Google is changing the management platform and the technology behind the campaigns, while preserving many of the things that made Local Service Ads different from traditional Google Search advertising. 

 

What’s NOT Changing? 

Thankfully, not everything is changing! For eligible businesses, Google says:

You still pay for leads, not clicks. 

That’s great news, because it helps control your budget to a measurable and desirable outcome. Sure, you want clicks, but clicks can be automated (hello, bots). A lead is a tangible result of a click, and one that cannot be faked by bots randomly clicking to drain account balances.

Standard Performance Max campaigns generally operate around clicks/conversions and broader Google inventory. The specialized pay-per-lead version charges for qualifying customer contacts such as calls and messages.

Other features that will stay the same include:

  • Ads continue appearing on Google Search and Google Maps.
  • The campaigns remain keyword-less.
  • Local targeting remains central.
  • Google Business Profile information continues to play an important role.
  • The emphasis remains on generating customer connections rather than simply generating website traffic.

Like Performance Max, campaigns are set up by providing Google with contextual clues about your business rather than cut-and-dried keyword lists. In years past, for example, we may have given Google a list of keywords like “plumber in Minneapolis” or “plumbers to install hot water heaters in Plymouth.” Now, however, when we set up the campaign, we provide Google with many pieces of information, including a list of services and goals for the campaign. It sets up the rest—and does a great job of it, as our case study attests.

Why Is Google Doing This?

We can’t say for sure (nobody but Google can), but we do know that Google’s goal is, like any company, to make money. And they do so when they fulfill their mission: to help people find what they need online (search discovery). So, it is logical to assume that this advertising change is intended to help customers find advertisers, and vice versa, more easily. 

Google describes the move as creating a more integrated, self-service experience in Google Ads. It allows advertisers to manage budgets, targeting and leads alongside their other Google advertising activity. 

The bigger trend: Google is increasingly putting AI and automated campaign management between advertisers and individual searchers. 

Performance Max is built around Google’s AI determining where and when ads should appear based on the advertiser’s goals, available assets, and conversion data. 

What Does This Mean for Local Businesses? 

For local businesses, the move from Local Services Ads to Performance Max has several practical implications. One of the most important is that your Google Business Profile becomes even more important to your advertising strategy. 

Google says information from your Business Profile is used to populate your campaign. Your business name, address and standard business hours are synced from the profile, while your business categories, service areas and service types help inform targeting. 

That makes this a good time to review your Google Business Profile carefully. Does it have the correct business category? Are your service areas accurate? Have you listed the services you actually want customers to find you for? Is your phone number current? Are your hours, addresses, and other business information correct?

These details have always mattered for local search, but the closer connection between your Business Profile and advertising makes keeping them accurate even more important. Local SEO and local advertising are becoming increasingly interconnected. The information Google uses to understand your business can influence both how people find you organically and how your paid local advertising reaches potential customers. 

There’s another important change in the background: you’re giving Google more control over how your advertising is delivered. 

Performance Max is an automation-driven advertising system. Instead of manually controlling every search term, bid and placement, advertisers provide Google with information about their business, their goals, geographic targeting, and advertising assets. Google’s systems then determine how to allocate advertising opportunities based on those inputs. 

For local businesses, that means the questions you ask when managing your advertising may start to change. Rather than focusing primarily on “Which keyword should I bid on?”, you’ll need to think about whether you’re giving Google the right information about your business, whether you’ve defined your services accurately, whether you’re measuring the conversions that actually matter, and whether your advertising budget makes sense for the value of a qualified lead. 

In other words, as Google takes over more of the tactical decision-making, the information and goals you give it become increasingly important. 

We Take the Confusion Out of Local Search Advertising

Google’s entire advertising ecosystem is moving toward greater automation. Increasingly, businesses provide Google with the building blocks: accurate business information, advertising goals, geographic parameters, creative assets and conversion data. Google’s systems then make more of the decisions about who sees an ad, where it appears, when it appears, and how much to bid. That changes what effective local advertising management looks like. 

You don’t necessarily need to spend your time trying to control every individual keyword or search. Instead, you need to make sure Google has the right information and the right signals to work with. Your business category needs to be accurate. Your services and service areas need to be clearly defined. Your Google Business Profile needs to be up to date. Your advertising needs compelling creative, and your conversion tracking needs to tell you whether the leads you’re paying for are actually valuable to your business. In other words, as Google takes on more of the tactical work, strategic oversight becomes more important. 

For local businesses, the lesson isn’t that Performance Max is simply “taking over.” It’s that Google is taking more responsibility for deciding when and where your advertising appears. Your job is increasingly about giving Google’s system accurate information, clear goals, and strong signals to work with—and then paying attention to what happens as a result. 

That can be a lot to manage, particularly if you’re busy running the business itself. If you’re unsure how the changes to Local Services Ads and Performance Max affect your business, Dashboard Interactive Marketing can help. From local search strategy and Google Business Profile optimization to paid local advertising, campaign management and ongoing support, the Dashboard team helps businesses navigate Google’s constantly changing local search landscape. Whether you need advice on what to do next or want an experienced partner to manage your local search efforts for you, Dashboard Interactive Marketing is ready to help. Call us at 763-242-2454 or our new office number, 845-540-5619.