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AI continues to expand into every facet of the tech industry and life in general, but could the expansion eventually hurt some of its biggest proponents? A report detailed on Adweek suggests that Google’s Search Ad business has slipped slightly in the wake of AI barrelling its way into the search business and – incredibly – Google might be okay with it.
Why? Because AI-powered ads have been proven to yield a 25% higher relevance compared to traditional search! AI is getting ready to shake up digital advertising – especially paid search – and it’s time to pay attention. Let’s take a look at the details and see what advertisers need to know about the continued rise of AI-powered search.
Amidst Google’s Struggles, AI Search is Gaining Momentum
ChatGPT arguably ignited the GenAI craze with its release in late 2022, and the public was slower to embrace it compared to the major players in the tech industry. After three years of relentless pushing toward an AI-powered future, however, a large number of consumers have come around to using AI as a replacement for Google Search.
Google remains the top search engine and it’s not particularly close; Statista reports that in March 2025, Google maintained 89.71% of the search market share. However Eddy Cue – an executive from Apple – recently noted that Google searches on Safari are down for the first time ever.
Similarweb told a similar story regarding total web traffic across desktop and mobile: Google site visits are down 1% YOY. The same report also showed that GenAI sites are rapidly growing: ChatGPT and Perplexity increased YOY web traffic by 182% and 181% respectively. Microsoft’s Copilot drew a 155% increase; Claude AI Assistant bumped up by 115%; Google’s own Gemini AI grew by 13%.
Google Search may still be the top dog, but the current momentum is in favor of AI taking over as the go-to search model for consumers. The pressure surely compounded when Google lost an antitrust suit not once, but twice in a federal court, the repercussions of which are still yet to be seen. From the outside looking in, Google and its core services appears to be under siege
And yet, Google doesn’t seem to mind that Gemini is taking consumers away from Search. Internal emails released as part of Google’s court cases in October disclose the thoughts of the higher-ups on the matter. Nick Fox, head of Google’s knowledge and information division, said: “We have 3 options: (1) Search doesn’t erode, (2) we lose Search traffic to Gemini, (3) we lose Search traffic to ChatGPT. (1) is preferred but the worst case is (3), so we should support (2).”
What is the Future of Paid Search Ads?
Google might be okay with cannibalizing its Search service to grow Gemini, but what does it mean for advertisers? About 80% of businesses around the world use Google for their paid search campaigns; that’s a lot of advertisers relying on the traffic that Google Search generates. A push toward AI Search would reduce the value of Google’s Search Ads, which already makes up the bulk of Google’s entire advertising revenue.
In addition to advertisers’ Google Paid Search campaigns suffering, organic search results are also seeing a decline. According to Google AI search results, Google’s top organic click through rates dropped from 28% to 19% following the expansion of AI overviews. Another study displayed a 34.5% lower average CTR. Why? Because users don’t need to click through a site to find the information they need, it’s all present within AI Overview.
A natural next step would be to monetize AI Search, which many platforms have already done. Here are a few platforms that have introduced paid ads into GenAI responses:
Perplexity AI
Perplexity has been experimenting with “sponsored answers”, but has the user ask multiple questions before seeing these ads. This multiple step process allows for an even more custom tailored result, making conversions rate possibilities infinitely higher.
Microsoft’s Copilot
Copilot has sponsored answers already as part of Microsoft Ads.
Snapchat’s “My AI”
Even more conversational than other chatbots in an effort to maintain the “playful” tone of the app. My AI tries to determine “commercial intent” before reaching out to advertising partners with queries. Ads are presently contextual only.
Taboola’s DeeperDive (currently exclusive to USA Today)
Rather than conversational, DeeperDive is billed as a research tool that provides links and data as default. Taboola aims to create “search-like advertising revenue within their own environments.”
Google has already taken the first step by introducing sponsored links within its “AI Overview” service now integrated with Search. These overviews are created using Gemini, though the Gemini Chat feature itself currently doesn’t place ads in its conversational responses. It is fully expected that Gemini will eventually include sponsored answers like Perplexity and Copilot.
It seems that ads in AI Search are an inevitability and will probably draw both users and advertisers away from Google Search. It’s highly unlikely that Google Search Ads will go away completely anytime soon, but it may quickly lose its value and status as a go-to necessity for online advertisers.
With consumers split among so many other platforms, digital marketing teams need to prepare for the future by diversifying their own ad offerings, which will allow them to reach consumers regardless of their platform choices.
Advertisers Must Go Beyond Search
So why has AI integration shaken the marketing world up so much? When you take a deep dive, it really boils down to three things: Convenience, Accuracy, and Competition. AI Overview makes finding what you need from multiple sources exponentially faster and easier. Microsoft estimates that AI-generated search results are around 25% more relevant to the query compared to traditional search. Since the search results are pulled from many different sources, potential biases are also effectively neutered.
With the decline in Google Search and Organic, it will be imperative now more than ever for advertisers to be agnostic in their marketing approach. The average American household contains 21 smart devices spread across 13 device types; consumers are online and in more places than ever before. Genius Monkey finds that it usually takes between 50 and 100 brand impressions or interactions before a customer converts, and search alone can no longer fulfill that number.
To succeed in an AI-powered future, advertisers must go beyond search and embrace a multimedia approach to digital marketing. Expanding across multiple channels isn’t just a matter of surviving in the market; it’s a great way to bolster conversions and a strong consumer base.
Consider the case of a telemedicine company; they approached Genius Monkey with a conservative budget and ambitions to break into the audio ad market. After consultation, the company decided to begin campaigns with audio, OTT, and eventually display as well. After 4 months, the telemedicine company saw a 300% return on ad spend and increased conversions by 150%.
For Genius Monkey users, the future is already here; our proprietary platform makes it possible for advertisers to reach their target audience no matter where they go. If you’re ready to increase your conversions and improve your ROI, get in touch with Genius Monkey today!
