Posted by Dr-Pete
Over the past year, you may have spotted a new kind of Google ad on a local search. It looks something like this one (on a search for “oil change” from my Pixel phone in the Chicago suburbs):
These ads seem to appear primarily on mobile results, with some limited testing on desktop results. We’ve heard rumors about local pack ads as far back as 2016, but very few details. How prevalent are these ads, and how seriously should you be taking them?
For this study, we decided to look at 110 keywords (in 11 categories) across 100 major US cities. We purposely focused on competitive keywords in large cities, assuming, based on our observations as searchers, that the prevalence rate for these ads was still pretty low. The 11 categories were as follows:
We purposely selected terms that were likely to have local pack results and looked for the presence of local packs and local pack ads. We collected these searches as a mobile user with a Samsung Galaxy 7 (a middle-ground choice between iOS and a “pure” Google phone).
Why 11 categories? Confession time – it was originally 10, and then I had the good sense to ask Darren Shaw about the list and realized I had completely left out insurance keywords. Thanks, Darren.
I’ll be honest – I expected, from casual observations and the lack of chatter in the search community, that we’d see fewer than 5% of local packs with ads, and maybe even numbers in the 1% range.
Across industry categories, the prevalence of pack ads ranged wildly, from 10% to 64%:
For the 110 individual keyword phrases in our study, the presence of local ads ranged from 0% to 96%. Here are the keywords with >=90% local pack ad prevalence:
There was no discernible correlation between the presence of pack ads and city size. Since our study was limited to the top 100 US cities by population, though, this may simply be due to a restricted data range.
Every local pack with ads in our study had one and only one ad. This ad appeared in addition to regular pack listings. In our data set, 99.7% of local packs had three regular/organic listings, and the rest had two listings (which can happen with or without ads).
Despite their appearance, local packs ads are more like regular local pack results than AdWords ads, in that they’re linked directly to a local panel (a rich Google result). On my Pixel phone, the Jiffy Lube ad at the beginning of this post links to this result:
This is not an anomaly: 100% of the 3,768 local pack ads in our study linked back to Google. This follows a long trend of local pack results linking back to Google entities, including the gradual disappearance of the “Website” link in the local pack.
If you’re in a competitive local vertical, it’s time to take local pack ads seriously. Your visitors are probably seeing them more often than you realize. Currently, local pack ads are an extension of AdWords, and require you to set up location extensions.
It’s also more important than ever to get your Google My Business listing in order and make sure that all of your information is up to date. It may be frustrating to lose the direct click to your website, but a strong local business panel can drive phone calls, foot traffic, and provide valuable information to potential customers.
Like every Google change, we ultimately have to put aside whether we like or dislike it and make the tough choices. With more than one-third of local packs across the competitive keywords in our data set showing ads, it’s time to get your head out of the sand and get serious.
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