The question of how Google (and Amazon) will make ad revenue from its smart speaker and smart display devices has not really had an answer — perhaps until now. Reuters discovered that Google is presenting Local-Services ads in voice search results for local queries.

Local Services ads. The Reuters article discusses Google’s relatively new ads in Home results in the context of whether the company is making the required disclosures to consumers and therefore whether it violates the FTC’s prohibition against “consumer deception.”

If users search for “plumber,” for example, Google Home takes consumers through a short interaction to confirm their location (and perhaps the nature of the job) and then offers up a list of results. It then offers to call the results in order. It also sends the list to a user’s email address.

Local Services by Google results sent via email.

Google Guaranteed but no ad label. The graphic shows my results for “plumber.” The results with the green badge (“Google Guaranteed“) are Local Services ads. Businesses cannot get that badge without being a Local Services advertiser.

There is no ad or “sponsored” disclosure in the email or in the voice interaction on Google Home. That will probably have to change to avoid FTC scrutiny and possibly a fine. When users do the same search online or on a mobile device, similar results appear; however all the Local Services ads are labeled “sponsored.”

Why you should care. This is the first evidence that Google intends to monetize Home with search advertising. The company will probably have to devise a to disclose the fact that some of its voice search results are ads. It might be able to do that by saying, “some of these results are from advertisers” or something similar.

However, from a marketing perspective, we’re getting our first glimpse of Google’s plan to generate revenue from its growing base of smart speaker users. The issue is less challenging on smart displays, where Google can simply reproduce the “sponsored” label on the screen as it does with conventional mobile or desktop results.

About The Author

Greg Sterling is a Contributing Editor at Search Engine Land. He writes a personal blog, Screenwerk, about connecting the dots between digital media and real-world consumer behavior. He is also VP of Strategy and Insights for the Local Search Association. Follow him on Twitter or find him at Google+.

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