Google’s AI Mode: Search is changing, so should you
by Alina Pruteanu, Digital Developement Director, The Grove Media
Over the past few weeks, the ad industry has been buzzing with the news of Google’s AI Mode, unveiled just a year after the introduction of its AI Overviews.
If you’ve used ChatGPT, Gemini, or any other AI assistant, AI Mode will feel familiar.
Google is already serving ads in AI Mode in the UK on a trial basis, and if you’re running Search with Broad Match or Performance Max campaigns, then your ads are already eligible to appear in AI Mode results.
So, in many respects the launch of AI Mode feels like a natural evolution in Google’s rollout of AI-powered search. But it equally signals a more major shift in search, raising questions about how paid search will perform in the longer term.
Nearly half (47%) of all digital adspend in the UK is currently invested in search advertising. The IAB UK forecasts that about 33% of search advertising spend will be redirected towards AI-powered search interfaces, or “answer engines”, by 2028.
This is a significant change, with ad targeting shifting from keywords to conversational context, which will likely see the phasing out of ‘traditional’ SEO and SEM.
Google says that AI Mode queries tend to be longer and more exploratory, which it believes will open up the type of opportunities for advertisers that were harder to surface via keyword-focused targeting.
Ads in AI Mode will be triggered from an entire AI conversation, including follow-up prompts and AI-generated responses. The two main formats will be text-based search ads, (similar to traditional search) and shopping ads (showcasing product details and integrated within AI-generated responses).
But while AI Mode is set to open up new ad opportunities, its conversational format may reduce click-through rates, as users get answers without the need to visit websites. This arguably undermines the core principle of ad-funded search.
Not surprisingly, publishers are voicing their concerns. News publishers in the US have gone on record saying that AI Mode deprives publishers of both traffic and revenue. BuzzFeed went as far as to note AI Mode’s threats to its business model in its August quarterly announcement.
Google is striking deals with publishers to train and enrich its AI models, but we are a long way off industry licensing or regulations to protect publisher content. Clearly publishers are going to have to shift their models and approach for generative engine optimisation (GEO), but the issue of potentially diminishing click-throughs is, at present, a topic of much debate.
While some commentary in the market is quite alarmist, agencies and advertisers are far better prepared for this shift to AI-powered search than some would have you believe.
In the ‘real world’ of media, we’ve been reducing dependence on keywords for some time. And we’ve been focusing budgets on areas where audiences are active and where competitors are absent.
Yes, planning and optimising in a world where we’re not just trying to rank but appear in many different conversations is very different from how search started out. But, it’s a journey we’ve been on since AI was first introduced to search. And it’s something we’ve been talking with our clients right from the outset.
Advertisers will be reassured to know that ads will appear in AI Mode through existing broad match Search or Performance Max campaigns, where appropriate. So, operationally, no immediate changes are required with Google. But there are some very important actions that advertisers can take – and have been taking since the start of AI-powered search – that will help to drive performance. While the industry and regulators navigate their way through some pretty challenging issues, advertisers can get ahead and develop smart, AI-focused media strategies.
Prioritise content that earns inclusion in AI summaries: it’s all about clear, structured and authoritative narratives. Diversify traffic sources beyond Google to reduce dependency, and test creative formats that encourage engagement within the AI experience itself. Advertisers should view GEO as a new optimisation discipline alongside SEO and PPC, planning for scenarios where visibility matters more than clicks, and building first-party data strategies to capture and nurture audience attention once it does land on their properties
As we move forward with AI Mode, maintaining brand visibility is going to be key. In the short term, impressions and presence may take on greater importance. In AI Mode, visibility may matter as much as clicks. Brands should focus on citations and being referenced in summaries, making content easy to extract, and reinforcing distinctive assets so they stand out when surfaced by AI. In addition to the focus on brand visibility, ‘feed hygiene’ will matter more than ever. Advertisers must ensure that their product catalogues are accurate and up-to-date, as these feeds directly influence visibility in AI‑driven shopping placements.
As well as publishers seeing a fall in traffic, advertisers may also experience a drop in click-through rates(CTR) and clicks from ‘traditional’ paid search results. As more users migrate to AI Mode, this is to be expected. However, this migration should also see some traffic quality improvements. AI Mode clicks may come after a conversational exchange that better qualifies users before they reach your site, potentially improving ROI.
It’s possible that the move to AI Mode could have an impact on cost per click (CPC). Tighter targeting, and Google’s aim to protect revenue, may lead to higher CPCs. If CPCs do rise, they are likely attached to higher intent, and better qualified traffic. Advertisers can get ahead by leaning into smart bidding strategies, refining audience segmentation, and ensuring their creative and landing pages are optimised for conversion. In short: accept you may pay more per click but work to make every click count harder.
Google’s AI Mode, along with the rollout of AI Max for Search marks a major shift, but not necessarily a disruption, for advertisers. While keyword strategies are evolving, existing Search and Performance Max campaigns are already positioned to perform in this new environment. And the need to focus on high-quality product feeds and embrace broad match targeting with Smart Bidding will be essential. Standing still is not an option. Those who ignore automation, and cling on to keyword- and ‘precision’ focused targeting strategies will be left behind. In the long run, embracing AI-driven optimisation will lead to better visibility, share of voice and a competitive advantage in the search ecosystem of tomorrow.
Photo courtesy of Shutter Speed @ Unsplash
