Local Campaigns in Google Ads: A Step-by-Step Guide
Even as online sales keep growing every year, for many niches, a physical location still decides everything: dentistry, auto repair, retail chains, restaurants. The person isn’t looking for a website; they’re looking for an address to go to today. Local campaigns in Google Ads are built exactly for this job, and today they’re built almost entirely on Performance Max rather than the standalone format that existed before.
Who this format is for
- Businesses with a physical location or a chain of locations, where the goal of advertising is to bring people offline, not just to the website
- Niches with a short decision cycle near home or work: dentistry, auto repair, beauty salons, restaurants, appliance stores
- Chains where it matters to compare performance across different locations, not just look at the overall result
If the campaign’s goal is online sales with no tie to a specific address, the local format isn’t the right fit; regular Search campaigns or Shopping are what work there.
Step 1. Get your Google Business Profile in order
Everything starts not with Google Ads, but with the business listing. Accurate hours of operation, correct business categories, real photos of your locations, and active review management aren’t a formality: this is exactly the data Google Ads pulls into ads, and outdated information directly hurts conversion. If the listing says “closed,” the person simply won’t come, even if the ad was targeted perfectly.
The business category should be checked separately for each location: a mismatched or outdated category narrows the range of queries the listing can even appear for. Photos need to be updated with real shots from the actual location rather than stock images or photos from an opening that happened years ago; a mismatch between expectations and reality is one of the most common reasons people turn around without walking in. Responding to reviews, especially negative ones, also affects trust; an empty feed with no business response at all reads like an abandoned account.
Step 2. Link Google Business Profile to Google Ads
Without this link, a local campaign simply doesn’t work: the system doesn’t know which addresses to show or where to send someone with the “Directions” button. The connection is made once in account settings and applies to all future campaigns.
Step 3. Set up Local Actions
Local Actions are local conversions: a “Directions” click, a phone call click, or a view of the menu or price list in the listing. Each action should be assigned a realistic monetary value, since these are exactly the values Performance Max uses to learn who to show ads to more often. If all actions carry equal weight, the algorithm optimizes not for the action of real value to the business, but for the cheapest one, and that’s almost always a phone call click, not an actual visit.
Account structure: how many campaigns do you need
There’s a simple threshold here that’s easy to overcomplicate for no reason.
- 1-3 locations in one city: one Performance Max campaign covering all locations. Splitting them into separate campaigns without a reason just spreads the budget and the algorithm’s training data thinner.
- A chain of 20+ locations: here grouping becomes necessary. Addresses are combined using labels by geographic cluster, and campaigns are built around groups of locations rather than individual addresses.
Cases in between (5-15 locations) should be evaluated individually, depending on how different the audiences and budgets are across districts and cities.
The reason this matters isn’t purely organizational. The Performance Max algorithm learns from data within a campaign; if you split 3 locations in one city into 3 separate campaigns, each one gets three times less training data and takes longer to reach a stable result. Grouping by labels solves a different problem: it lets you compare cluster performance against each other and redistribute budget to where it’s actually working, without losing the shared learning within a cluster.
Building a campaign step by step
- Choose the campaign goal: Performance Max with a focus on offline location visits.
- Verify that the conversions from Step 3 are connected and tracking correctly before spending any budget.
- Select the specific addresses or group of locations for the campaign.
- Instead of a dedicated landing page, the campaign uses the business listing itself, so make sure it’s final, not a draft.
- Name the campaign so its city/cluster and purpose are clear without opening the account.
- At launch, choose the “Maximize Conversions” bidding strategy with no CPA cap; a cap at this stage only gets in the system’s way as it learns.
- Set languages and devices to match the location’s real audience.
- Build an asset group: up to five logo variants, up to 15 headlines, and up to 50 words or phrases tied to search themes related to the brand and location.
- Set your budget accounting for the fact that the first 2-4 weeks go toward algorithm training, not a stable result.
- Set geo-targeting around each address with a realistic radius, not the whole country “just in case.”
- Launch, and don’t touch the bidding settings for at least 2-4 weeks.
When it’s okay to cap bids
Capping target CPA or ROAS only makes sense after the campaign has gone through its learning period, usually 2-4 weeks. Before that, the algorithm simply lacks the data to understand what a realistic cost per action looks like, and a hard cap this early usually just throttles impressions rather than saving budget.
| Step | Common mistake | What to do instead |
|---|---|---|
| Google Business Profile | Outdated hours or stale photos | Update the listing regularly, not just once before launch |
| Local Actions | Equal value for a call and a directions click | Assign a realistic value to each action individually |
| Bidding strategy | Capping CPA right after launch | Give it 2-4 weeks to learn without caps |
| Account structure | A separate campaign for each of 3 locations in one city | One campaign for 1-3 locations in one city |
Expert tip. The most common reason “local advertising isn’t working” isn’t the campaign settings, it’s the business listing itself. Before troubleshooting Performance Max, check whether the Google Business Profile matches reality: hours, address, photos, business category.
Something to watch for. Local Actions count actions on the business listing, not actual visits or sales. A “Directions” click is intent, not a guaranteed visit. To see the real picture, Google Ads data needs to be cross-checked against offline results: calls, new visitors, average ticket size.
How to evaluate results
CTR and cost per click are secondary metrics here. The main question is how many real calls, visits, and ideally sales the campaign is driving. This requires manual work: cross-referencing Google Ads data with call records and actual foot traffic, not just looking at the dashboard. Without this cross-check, it’s easy to optimize a campaign toward numbers that look great in the interface but never translate into money.
In practice, this means setting up call tracking: a dedicated number or dynamic number insertion for ad traffic, to distinguish calls from Google Ads from organic calls or calls from other channels. For locations with physical visits, it’s worth at least roughly asking at the register or front desk how the person heard about the location; it’s a rough but functional way to check whether the dashboard numbers line up with reality. If the dashboard shows Local Actions growing but the location owner isn’t seeing new faces, the problem isn’t necessarily the advertising; sometimes it’s that staff aren’t asking or logging the source.
FAQ
Do I need a dedicated website for a local campaign? No, Performance Max for local campaigns uses the Google Business Profile listing itself as the landing page; a dedicated landing page isn’t required, though it won’t hurt for other goals.
How many campaigns are needed for a chain of 10 locations? There’s no formal threshold; evaluate it based on how similar the audiences and budgets are. Often one or two campaigns with locations grouped by labels are enough, rather than ten separate ones.
Why can’t you cap CPA right away? The algorithm needs the first 2-4 weeks of data to understand the real cost of an action. Capping too early usually just reduces impressions rather than saving budget.
What value should I assign to a “Directions” click? Base it on the real average value of a visit for your business, not an arbitrary number, otherwise the algorithm optimizes for the wrong actions.
Can one Google Business Profile listing be used for multiple campaigns? Yes, but without clear grouping by labels, it complicates analytics and budget management for each location cluster.
What if the listing has several outdated photos or inaccurate hours? Update them before launching the campaign; this isn’t a cosmetic detail, outdated information directly reduces conversion into real visits.
Does the number of headlines and phrases in an asset group affect results? Yes, more relevant variants (up to 15 headlines, up to 50 phrases) gives the system more material to test combinations with; it’s worth filling these out fully rather than minimally.
How do I know a campaign is really driving sales, not just clicks? Cross-reference Google Ads data with offline metrics: call records, the number of new visitors, average ticket size over the campaign period.
Do I need a separate budget for each location within one campaign? No, within a single Performance Max campaign, the algorithm automatically distributes budget across locations based on their performance; manual allocation per address isn’t supported and usually isn’t needed for 1-3 locations in one city.
Conclusion
A local campaign in Google Ads isn’t a separate, complex format; it’s Performance Max built around the business listing and Local Actions. The main risks aren’t in the technical setup but in two things: outdated information in Google Business Profile, and intervening in bids too early, before the learning period is over. And most importantly, what should be evaluated isn’t clicks in the dashboard, but real calls and visits.
If you’d like to work through your specific chain of locations, let’s discuss it in an audit. More on working with Google Ads is on the platform page.