Local Customer Optimization For Performance Max: The Setup Guide For Store Goals

Google Ads is rolling out a new campaign setting called local customer optimization. It sits inside Performance Max campaigns that are set up for store goals, and it tells Google to prioritize shoppers who are close to your business and appear ready to act right away. Google says the setting uses signals from people who are navigating, planning trips, or searching for a location across Google Maps, Waze, and local formats on Google Search. If you run brick-and-mortar stores, or you manage clients who do, this is a new lever that can meaningfully shift where your Performance Max budget goes. Here is what the feature does, who it fits, and how to set it up cleanly this week.

What Local Customer Optimization Actually Does

Local customer optimization is a campaign-level toggle inside Performance Max for store goals. When you turn it on, the campaign focuses budget on shoppers who look like they are about to visit a location, request directions, or call a store. Google says the setting draws on live signals from Google Maps, Waze, and Google Search. That gives the campaign a sharper read on immediate intent than a standard Performance Max for store goals campaign has by default.

Before this setting existed, a Performance Max for store goals campaign already used your Business Profile locations and radius targeting to reach nearby shoppers. The new setting adds an intent layer on top. Instead of just serving to anyone near a location, the campaign puts more weight on shoppers whose recent behavior points to a visit soon.

Two limits are worth knowing before you decide to use it. First, local customer optimization is not compatible with online campaign goals. If your Performance Max campaign is optimizing for online sales, you cannot layer this on. Second, it is not compatible with Performance Max campaigns that advertise products from a linked Merchant Center account. Google’s retail Merchant Center guide covers how store campaigns and product feed campaigns work side by side, and this new setting sits on the store side of that split.

Who Should Turn Local Customer Optimization On

Three types of advertisers should look at this first.

Multi-location retailers with a store-goals campaign are the most obvious fit. If you already run Performance Max for store goals with store visits or store sales as the conversion goal, this new setting gives you a fresh way to bias budget toward high-intent nearby shoppers. Google’s recommended minimum for store-goals campaigns is 10 business locations for store visits or store sales, and 5 for local actions, so an operator running a chain across a metro area is well set up to test this.

Service businesses with a physical location are the second group. Auto shops, home services depots, dental groups, and clinics that get direction clicks and calls as their real conversions can enable this setting on their local-actions campaigns. The intent signals from Maps and Waze often match how customers actually find these businesses.

Franchisors and agencies managing multi-brand accounts are the third group. If you run campaigns for a franchise system across many markets, the new setting is a way to standardize a local-intent bias across every franchisee without having to hand-tune radius targeting or bid modifiers per market.

Skip local customer optimization if your Performance Max campaign is running from a Merchant Center product feed. Those campaigns should stay focused on the online or omnichannel goals they already optimize for. If you want the new local behavior, you need a separate Performance Max for store goals campaign that does not use the Merchant Center feed.

Store Sales Measurement Also Got Easier

Alongside the new setting, Google is expanding store sales measurement for Performance Max. Store sales is Google’s online-to-offline measurement that uses your uploaded first-party sales data to match ad clicks back to in-store purchases. Google’s help center describes the upgrade as reporting and bidding capabilities for advertisers using Performance Max campaigns with store goals, omnichannel bidding goals, and Google Merchant Center feed campaigns with omnichannel bidding goals.

For operators, that means three things get easier. Smart bidding can now optimize for store sales conversions directly. Your ROAS calculation can pull in both online and offline conversions in one view. And reporting aligns store visit to store sales in the same methodology, so you can see the visit-to-purchase rate by campaign.

The catch is that store sales requires a specific data feed. You need to upload transaction data from your point-of-sale system, and Google matches those transactions to ad clicks in a privacy-safe way. If your point-of-sale exports do not include hashed email or phone numbers for each transaction, get that in place before you plan to use store sales as a bidding target.

The Setup Checklist For Local Customer Optimization

If you are ready to turn the new setting on, here is a clean sequence.

Start with a Performance Max campaign that is set up for store goals only. If your current Performance Max campaign mixes online and offline goals, you cannot enable local customer optimization on it. Either turn off the online goal first, or create a separate campaign focused only on store visits, store sales, calls, or directions.

Confirm your business locations. Local customer optimization needs your Business Profile locations or your affiliate location assets. Aim for at least 10 locations if you are optimizing for store visits or store sales, and at least 5 if you are optimizing for local actions. A campaign with only two locations will not have enough signal to feed the AI.

Confirm you are not using a Merchant Center product feed in that campaign. If you are, deselect the “Advertiser products from a Merchant Center account” option before you enable the toggle. If you want to keep advertising products from your feed, do it in a different Performance Max campaign.

Toggle the setting on. In a new campaign, the panel appears during setup. In an existing eligible campaign, find it under Budget and bidding optimization in the campaign settings, and click Save after you enable it.

Set your conversion goal values with care. Google recommends explicit values for store visits and calls when your campaign has offline goals. A store visit valued at $25 is a reasonable starting point for many retailers, but the right number depends on your average basket size and your visit-to-purchase rate. Get finance to sign off on the value so smart bidding is optimizing for a number your business actually earns.

Give the campaign 30 days minimum before you judge it. Google’s Performance Max for store goals guidance calls for 30 days as a minimum campaign duration to see meaningful data. Shorter windows are only appropriate for time-boxed seasonal campaigns like Black Friday or Back-to-School.

Watch the per-store performance report every week. Google surfaces visits and local actions by individual store location. If one location is not getting enough impressions or conversions, ask whether the location has enough business profile completeness, whether the radius targeting is right, and whether your local ad creative reflects that location.

How This Fits Into Your Retail Media Plan

Local customer optimization is one more setting inside a Performance Max for store goals campaign, not a new campaign type. If you are already running that campaign type, adding this setting is a small operational change with a potentially large budget-allocation change. Test it in one campaign for 30 days before you roll it across every market.

If you are also using yesterday’s news, commerce audience sharing, alongside your store-goals campaigns, you have two related updates to plan around. Commerce audience sharing lets retailers hand first-party segments to brand partners for campaigns that route back to the retailer’s site. Local customer optimization tightens the local-intent lens for the retailer’s own store-goals campaigns. Neither one replaces the other, and both need clean first-party plumbing to work. Our customer list labeling audit covers the segment hygiene you need in front of either feature.

For retailers with a shopping feed, our recent Merchant Center AI insights playbook is still the right starting point for your online-side Performance Max campaigns. Layer the store-goals campaign with local customer optimization on top of that, not instead of it, since the two campaigns serve different goals and pull on different signals.

For agencies managing multiple retailer accounts, the Merchant Center 1,000-account ceiling still shapes how you structure client accounts. Your Performance Max for store goals campaigns live in the Google Ads account, not the Merchant Center account, so this new setting does not add to your Merchant Center ceiling. But every account you enable it in needs Business Profile access, so plan permissions before you launch.

What To Watch Next

Google says local customer optimization is rolling out globally soon, per Ginny Marvin’s LinkedIn post that Search Engine Journal quotes. That means the setting may not appear in every account on day one. Check the Budget and bidding optimization section of your existing Performance Max for store goals campaigns weekly. If the toggle is not there yet, watch for it in the next 30 days.

Two related updates are worth tracking at the same time. The PMax destination setting gives you fine control over where your Performance Max clicks land. And the AI Max migration audit covers the September Performance Max changes that are already live in many accounts. Get those cleaned up first, then enable local customer optimization on the campaign that will benefit most.

The language targeting removal playbook and New Customer Acquisition bidding split round out the current wave of Performance Max changes. Read all of them alongside the new setting, because Google is pushing the same theme. Feed the AI cleaner signals about your customers, your goals, and your locations, and give it a well-defined slice of budget to optimize.

If you want help deciding which Performance Max campaigns should turn local customer optimization on, or want an audit of your store-goals setup before you enable it, book a free consultation with our team. We will walk through your locations, your conversion goals, and the campaigns that will pay back first.

Let’s Grow!