How Google’s AI Overviews Are Transforming Paid Search Strategies
Google’s AI Overviews feature recently celebrated a year since its launch, and it’s causing ripples in the world of paid search strategies. This innovative feature provides AI-generated summaries at the top of search results, often overshadowing traditional links to articles and websites. As these AI summaries become a staple in search results, marketers are re-evaluating their approaches to attract both human users and AI crawlers.
Impact of AI Overviews on Search Traffic
Since the debut of AI Overviews in the U.S. on May 14, 2022, marketers have reported a significant decline in search traffic to publisher and brand sites. For instance, Mail Online experienced a staggering 56% drop in click-through rates attributed to the presence of Overviews source. Research from Bain highlights that 80% of consumers resolve 40% of their searches without clicking through further—an alarming statistic for marketers source.
Given this new landscape, many marketers are deeply concerned that decreased organic traffic may also jeopardize their paid media investments.
Are AI Overviews Affecting Paid Search Performance?
“While it’s not yet widespread in the U.K., we’re seeing slight drops in impression share and CTR on generic upper-funnel terms,” stated Billy Bojku, head of performance media at VML U.K., who is monitoring trends closely alongside his clients. The extensive shift towards AI Overviews has primarily influenced organic search traffic, but the implications for paid search are becoming clear.
According to insights gathered from nine agency specialists interviewed by Digiday, the impact of AI Overviews on paid search performance has been limited. This is largely because the informational queries that trigger Overviews generally fall outside the range of terms that brands aggressively target for paid advertising.
“AIOs are all concentrated in that early funnel informational section. Paid search is primarily in the mid to end funnel,” explained Katie Tweedy, director of SEO and content marketing at Collective Measures. As such, while some clients have experienced reduced clicks, they haven’t necessarily felt the pinch in sales conversions. Charlie Marchant, CEO of Exposure Ninja, noted, “Our clients are seeing fewer clicks… [but] we haven’t seen a drop in conversions.”
How are Marketers Responding to the Changes?
Marketers are not sitting idly by as the landscape evolves. Many search agencies are keen to develop alternative strategies. “We’re not waiting around,” remarked Jason Hartley, head of search at PMG, emphasizing the proactive measures agencies are undertaking in response to changing organic search dynamics.
When AI Overviews mention a brand directly, many marketers are concerned about the inefficiency of running paid ads on the same search results page, leading to potential cannibalization of their organic traffic. As such, clients are often rerouting their budgets or increasing their focus on brand keywords to secure visibility. Christopher Liversidge, CEO of QueryClick, observed, “Some clients have redeployed that budget elsewhere, while others have decided to increase spending on brand keywords.”
At VML, Bojku reported a noticeable shift, “Some clients are increasing brand budgets by up to 20% to maintain visibility when AI-generated answers feature competitor links.” In a similar vein, José de Carvalho, head of paid search at Gain, revealed a 15-20% decline in CTR following the launch of Overviews. Many clients have responded by boosting their spending on broad keywords, which now constitutes a significant portion of their annual budget.
Moreover, brands are beginning to explore zero-click search opportunities. Corey Kahn, svp and head of search at Digitas, mentioned discussions around allocating some paid spend to platforms like Perplexity, indicating a trend toward diversification in advertising strategies.
The Future of AI Overviews in Search
As AI Overviews make their presence felt across more search queries, agencies anticipate shifts in user behavior. While Google has so far limited the deployment of AI Overviews, their appearance in 13% of all U.S. desktop searches as of March 2023—up from 6.5% in January—signals a growing trend source.
The industry is closely monitoring Google’s efforts to integrate paid ads into AI Overviews. Laura Williams, PPC manager at North, noted, “We expect Google to incorporate more paid ads into the AIO in time, which will have more of an effect on results.”
To navigate these challenging waters, agencies are increasingly investing in tools and services that provide insights into the evolving search landscape. For example, Exposure Ninja has developed an AI search practice to guide clients through the complexities of generative AI in search. Similarly, the sister SaaS business of QueryClick offers attribution modeling to enhance traffic prediction accuracy.
Conclusion
The relentless march of AI Overviews is reshaping the very fabric of search marketing. As brands navigate these changes, they must adapt their tactics and stay alert to emerging trends and technologies. The shift from purely traditional SEO to a more nuanced understanding of AI’s role in search will demand innovation and agility from marketers to keep their approaches relevant. Ultimately, the future of both paid search and SEO will hinge on the strategic integration of AI insights, ensuring that brands remain visible and competitive in an increasingly complex digital landscape.
