Google Rolls Out Local Customer Optimization Feature as Local Services Ads Migrate to Performance Max
Google has published new help documentation detailing a "Local customer optimization" feature within its Performance Max campaigns for store goals. The documentation arrives as Google folds Local Services Ads into the main Google Ads platform.
The documentation, posted to Google Ads Help this week, describes a toggle-based feature that lets advertisers prioritize reaching nearby customers who are actively searching for services on Google Maps, Waze, or Google Search.
The details
Local customer optimization is designed for Performance Max campaigns with store goals, the campaign type Google is building as the destination for migrating Local Services Ads (LSA) accounts. According to the Google Ads Help documentation, the feature "allows you to prioritize reaching potential customers who are close to or interested in your business area and ready to take action immediately such as visit or contact."
The feature targets users at what Google calls "the most critical moment": when they are actively navigating, trip-planning, or searching for locations on Google Maps, Waze, or Google Search for a service in a specific area.
Google lists two primary benefits. The first is capturing ready-to-act customers who are planning routes, searching for services, or traveling near a business location. The second is directing campaign budgets to locally tailored ads on channels like Google Maps, Waze, and local formats on Google Search.
The feature is available as a toggle during campaign creation or can be enabled in existing Performance Max store goals campaigns through the "Budget and bidding optimization" section in campaign settings. Advertisers can also disable the toggle to return to a standard Performance Max configuration.
There are important compatibility constraints. Local customer optimization does not work with online campaign goals or Performance Max campaigns that include products from Merchant Center. To add an online conversion goal to a campaign, advertisers must first turn off the local customer optimization toggle.
The broader LSA migration
The new feature documentation arrives as Google begins the first phase of migrating Local Services Ads into Google Ads. According to Google's transition documentation, the migration follows a phased timeline:
- August 2026: The first wave targets select home and storefront service advertisers in the United States, including plumbing, HVAC, electrical, appliance repair, house cleaning, lawn care, roofing, pest control, and moving companies.
- Late 2026: Expansion to broader advertiser groups, including service-area businesses without physical storefronts and accounts with custom bidding or booking configurations.
- 2027: Non-U.S. accounts and all remaining business categories.
Google states that the pay-per-lead model remains intact through the migration. Advertisers still pay for valid leads rather than clicks. Ad placements on Google Search and Google Maps also stay the same. What changes is the management interface: campaigns move from the standalone Local Services Ads dashboard to the Google Ads platform, where advertisers gain self-service controls over phone numbers, budgets, and targeting settings.
The migration also deprecates manual bidding and vertical-level Target CPA settings. Weekly budgets convert to daily averages, and Better Business Bureau callouts are no longer supported.
Why this matters for search and AI visibility
The Local customer optimization feature tightens the connection between local ad spend and physical-world intent signals like navigation, proximity, and real-time location context. For businesses with physical locations, paid visibility on Google Maps and local search results can now be more closely aligned with users who are genuinely nearby and ready to act.
As Local Services Ads migrate into Performance Max, the line between organic local search presence and paid local advertising gets thinner. Businesses that keep their Google Business Profile up to date with accurate hours, service areas, photos, and reviews will likely benefit across both their organic and paid local visibility.
What to watch next
The August 2026 migration wave is limited to specific U.S. service categories. Advertisers in those verticals should monitor their accounts for migration notifications, which Google says arrive 14 days before the transition. The broader rollout in late 2026 and 2027 will affect significantly more businesses and markets.
Performance data from the first migrated accounts will be worth tracking, particularly whether the local customer optimization toggle delivers measurable improvements in foot traffic and contact conversions compared to standard Performance Max store goals campaigns.
Sources
- About Local customer optimization within Performance Max campaign for store goals, Google Ads Help
- Local Services Ads transition to Performance Max campaigns with pay-per-lead goals, Google Ads Help
- About Performance Max for store goals, Google Ads Help
