Google is exploring ads in new AI Mode

Google confirmed to Adweek it will “explore bringing ads” to its new AI Mode search experience. The company will use lessons from ads already running in AI Overviews to inform its approach.

Ad buyers warn that user behavior in AI Mode’s conversational interface could reduce ad effectiveness.

Big picture. Google is looking to monetize its newest AI search experience, telling AdWeek it plans to “explore bringing ads” into AI Mode — the conversational search feature launched in beta this week. It executes multiple searches simultaneously to answer complex queries.

While ads aren’t yet appearing in AI Mode, Google’s approach will be informed by what it learns from ads already running in AI Overviews, the simpler AI-generated answers that sometimes appear at the top of search results.

How ads work in AI Overviews. According to Google, Ads within AI Overviews typically:

• Appear beneath AI-generated responses under a “Sponsored” heading.
• Draw from existing Search and Shopping campaigns.
• Match formats to user queries.
• Link to relevant products or services.

These ads are limited to U.S. mobile users. A Google spokesperson told Adweek that consumer response to these ads has been positive since their October debut.

Advertiser concerns about AI Mode. Industry experts express mixed feelings about ads in Google’s conversational AI environments:

Melissa Mackey, Head of Paid Search at Compound Growth Marketing, finds AI Overview ads “compelling” because they can effectively answer user questions. However, she’s more skeptical about AI Mode advertising, suggesting they “could feel more intrusive to users.”

• “Advertisers will need to get creative to capture attention and pull users away from the conversation in order to be effective,” Mackey said.

Navah Hopkins from PPC platform Optmyzr predicts potential challenges with AI Mode advertising:

• Lower click-through rates due to users staying within the conversation.
• Possible premium pricing leading to higher costs per click.
• Potentially lower return on ad spend.

• “The goal of AI Mode is to answer the question as completely in the chat,” Hopkins noted, which could reduce users’ incentive to click on ads.

Why we care. Google’s introduction of ads into AI Mode could significantly impact how users interact with paid search. Unlike traditional search ads, AI Mode’s conversational format may reduce click-through rates as users receive comprehensive answers within the chat.

This shift may require advertisers to rethink their strategies, focusing on more engaging and creative ad formats to capture user attention. Additionally, premium pricing and higher costs per click could affect return on ad spend, making it crucial for marketers to monitor performance closely as Google refines its AI-driven ad experiences.

Timing remains unclear. With limited information about auction dynamics or creative formats for AI Mode ads, Hopkins said it’s difficult to predict performance or adoption rates.

Meanwhile, some industry watchers, such as Glenn Gabe of G-Squared Interactive, said they haven’t seen ads in AI Overviews despite Google’s announcement, suggesting the rollout may be gradual or highly targeted.

Go deeper: Google continues to balance monetization strategies for its AI-enhanced search experiences as it evolves beyond traditional search results pages.