Google Ads is adding a setting called Local Customer Optimization to Performance Max campaigns built around store goals. It tells the campaign to prioritize people who are physically close to your location and look ready to act right now. It is opt-in, it is rolling out globally, and it does not work with product feeds, which is the detail most retailers are going to trip over.
What Local Customer Optimization Does
Search Engine Journal reported the new setting on September 8, 2026. It is a campaign-level control for Performance Max campaigns that are focused exclusively on offline and store goals.
In Google's own wording, the setting "prioritizes consumers who are close to or interested in a business location and appear ready to take an immediate action." That means someone about to visit a store, request directions, or place a call.
The signals behind it come from Google Maps, Waze, and local search formats on Google Search. So this is not just a radius. It is Google reading behavior across its mapping and local surfaces and pushing budget toward the people showing store intent.
The Limitations You Need To Know
- Store goals only. The setting is incompatible with online campaign goals. If your Performance Max campaign is chasing online sales or online leads, this is not available to you.
- No product feeds. It cannot be used with feed-based Performance Max campaigns linked to Merchant Center.
- Retailers need to split campaigns. If you are running a product feed and you want this, you have to create a separate campaign for it.
- It is opt-in. Nothing turns on by itself. You enable it when you create an eligible campaign, or inside the budget and bidding settings of an existing one.
The feed restriction is the real friction. A lot of local retailers run one feed-based Performance Max campaign and treat it as the whole account. Splitting that into a feed campaign plus a separate store-goal campaign means two budgets, two learning periods, and two sets of results to read.
Store Sales Data Is Coming To Data Manager Too
The same announcement covered a second piece. Store sales data is coming to Google Ads Data Manager, letting you connect in-store transaction data from a CRM or from Google Sheets directly into Google Ads for reporting and Smart Bidding.
Google expects that rollout to begin at the end of September. It is opt-in and limited to eligible or allowlisted advertisers, so it is not universally available.
A few requirements worth noting. Customer data including email, phone, and addresses has to be hashed before upload. Google recommends daily or weekly uploads. And dynamic conversion value reporting requires the previous 30 days of transaction data.
My Take
I like this more than most Performance Max additions, because it is a setting you control rather than an automation that decides for you. You are telling the campaign what kind of customer counts, instead of hoping it figures that out.
Keep in mind, a setting that prioritizes people ready to walk in is only as good as the store conversion data underneath it. If your account is not measuring store visits, calls, or direction requests properly, Local Customer Optimization is optimizing toward a goal you cannot verify.
One of the biggest mistakes I see with store-goal campaigns is skipping the measurement work and then blaming the campaign type. Before you turn this on, make sure your conversion tracking for local websites is actually firing on the actions that matter to the business.
The same goes for your assets. If your location information is incomplete, a campaign built around location intent is working with one hand tied. Get your local ad assets in order first.
What To Do Now
- Check your campaign goal. Confirm the campaign is set to store or offline goals only. If it is mixed, the setting will not be available.
- Check for a product feed. If the campaign is linked to Merchant Center, plan the separate campaign now rather than after you find out.
- Audit your store conversions. Store visits, calls, and direction requests need to be tracked before you optimize toward them.
- Budget the split. If you are separating a feed campaign from a store campaign, give each one enough budget to exit the learning period.
- Give it real time. Do not judge a new Performance Max campaign in a week. Let it get through the learning period before you touch anything.
Question to Answer:
Can you currently prove how many store visits, calls, or direction requests your Google Ads campaigns are driving each month?
In Summary
Local Customer Optimization is an opt-in Performance Max setting that pushes budget toward people near your location who look ready to act. It only works on store-goal campaigns and it will not run alongside a Merchant Center product feed.
Fix your store conversion tracking first, then turn it on. A setting that optimizes for foot traffic is worthless if you cannot measure foot traffic.
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