Local SEO rankings remain a cornerstone for businesses striving for visibility in their communities. However, an emerging challenge is that despite stable rankings, many local businesses experience a significant decrease in calls and engagements. Understanding this paradox is critical for adapting strategies in the evolving local search environment.
The Changing Landscape of Local Packs
Traditional local search results often appear as map-based three-packs showcasing three businesses with direct call and website buttons. Recently, AI-powered local packs have begun replacing or supplementing these traditional listings. Unlike the original packs, these AI-driven results exhibit four major changes that impact local businesses:
Shrinking Real Estate
AI local packs typically display only two businesses instead of three, reducing the organic exposure for many local businesses. This contraction decreases the opportunities for consumers to discover different service providers at a glance.
Missing Call Buttons
Traditional packs often feature clickable call buttons, creating a seamless path for users to contact businesses instantly. Many AI-generated summaries omit these buttons, creating friction in the customer journey and lowering direct calls.
Different Business Listings
The businesses showcased in AI packs frequently differ from those appearing in traditional 3-packs. This discrepancy challenges businesses optimized for conventional local SEO methods.
Increased Paid Placements
Google has accelerated monetization of local search by integrating paid ads within or alongside local packs, which can push organic listings down and remove direct contact options, further reducing organic conversions.
“The traditional metrics of ranking well no longer guarantee customer engagement when AI alters local pack displays,” said marketing analyst Dr. Evelyn Harper.
Limitations in Measurement and Visibility
One critical issue is that rank tracking tools have been slow to adapt to AI local packs. Businesses may rank first in a traditional pack they never truly reach customers through because users primarily see AI results. Sterling Sky analysis reveals AI local packs surfaced only about 32% as many unique businesses as traditional packs did in 2026, with 88% of markets analyzed exhibiting fewer visible businesses overall.
Meanwhile, paid ads continue to consume prime local real estate, underscoring the shifting pay-to-play nature of local search. This is also reflected in Google Business Profile data showing impression shifts where AI-powered local packs and sponsored listings are becoming dominant while call and website actions from organic listings diminish.
Impact on User Behavior and Interaction
Although impression counts indicate exposure, actual user engagement metrics such as calls, clicks, and visits have declined. Some fluctuation comes from factors like seasonality or API anomalies, but the overarching trend indicates a declining action rate on local listings, especially in markets with aggressive AI local pack deployment such as the United States.
Comparative data from markets with limited SERP experimentation, like the Netherlands, displays more stable action trends. This contrast reinforces the role of SERP changes and AI adoption in shifting user engagement.
New Paradigm in Local SEO: Eligibility Over Ranking Factors
Traditional local SEO has emphasized factors such as proximity, relevance, reviews, and citations. However, eligibility—whether a business is allowed to appear in AI local results—is becoming the top gatekeeper for visibility.
Google’s AI evaluates the alignment between a business’s name, primary category, and real-world service offerings. Any misalignment can result in exclusion from AI-powered local packs despite thorough profile optimization.
“Ensuring your business information aligns perfectly across all signals is paramount for AI eligibility,” advised local SEO consultant Claudia Tomina.
Broadening the Scope Beyond Google Business Profile
AI systems assess signals from social platforms, forums, and directories. Entities lacking consistent, verified presence across these ecosystems risk losing visibility. Therefore, businesses must manage their reputation and authenticity beyond Google Business Profiles.
Visual Trust and Content
Visual content such as high-quality photos and videos help AI systems infer service quality and legitimacy. Frequently updated visual assets are now necessary to build trust signals for AI-driven classifications.
Integrating Paid Advertising in Local Strategies
Given the increasing dominance of paid ads in occupying key local SERP positions and retaining call buttons, integrating paid search strategies such as Google Local Services Ads is essential for maintaining customer contact points.
A hybrid approach combining organic local SEO efforts with paid campaigns ensures broader coverage and more consistent user engagement in a competitive and monetized local search landscape.
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Practical Recommendations to Future-Proof Local Visibility
Businesses must adopt a multifaceted strategy to navigate the evolving local search landscape effectively:
Ensure Data Consistency and Alignment
Maintaining consistent and accurate business names, categories, and service descriptions across all platforms reduces eligibility risk and enhances AI recognition.
Expand Local Presence Across Ecosystems
Active engagement and presence on platforms like Apple Maps, Yelp, Tripadvisor, Reddit, and niche local directories foster broad trust signals helping AI systems validate legitimacy.
Invest in Authentic Community Engagement
Encouraging genuine reviews, local mentions, and social interactions builds contextual relevance and entity authority within a community. Offline reputation also contributes to online AI assessments.
Employ Rich Visual Media
Regularly updating photos and videos strengthens AI trust signals and improves user perception simultaneously.
Balance Paid and Organic Efforts
Allocating budget to local paid advertising complements SEO work by securing prominent listing features like direct call buttons and expanded ad units.
Marketing strategist Dana Lee notes, “The winning local businesses will be those who master the interplay between AI eligibility, authentic local engagement, and selective paid amplification.”
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The New Reality of Local SEO Performance
Visibility in local search no longer corresponds straightforwardly with traditional keyword rankings. Instead, success derives from a combination of AI validation, broad ecosystem presence, and paid placement integration. Businesses must recognize that maintaining steady Google Business Profile rankings is insufficient if calls and user actions continue to decline.
By understanding the shift toward AI local packs and monetized search features, and by evolving strategies accordingly, local businesses and agencies can reclaim performance and future-proof local discovery. This approach demands a comprehensive, data-driven, and community-focused optimization effort transcending classic ranking factors.
The transformation in local SEO is ongoing. Remaining abreast of Google’s SERP experiments and adeptly navigating the eligibility criteria will be essential for sustained local business success in the coming years.
