Google I/O wrapped up on May 14th, and Google is leaning hard into its Gemini Era.
Coming on the heels of Google I/O, the 11th Google Marketing Live just rocked the paid marketing world on May 21st, 2024. Google Ads is leveraging Gemini to up its matchmaking game and improve its role as Cupid — matching the perfect ad to the ideal consumer.
Bringing the concept of matchmaking to new heights, Google will start testing search and shopping ads in AI overviews, displaying the perfect ad for each searcher.
But what else is on the horizon for Ads?
As a start, improved Ads integration into visual search, AI-powered creative, innovations to Performance Max campaigns, and clickable stickers on YouTube Shorts ads for more interactive campaigns, but things don’t end there.
Let’s take a closer look at the future of Google Ads.
Key Takeaways
- AI Overviews promises to meet the growing user demand for providing answers to complex searches, creating new opportunities for Google Ads.
- Innovations to AI-powered creative promise ad generation at a far greater scale, creating images in seconds and being trained to match the needs of each specific industry. There are also far more specialized controls and customization for colors, backgrounds, and more.
- Google Ads campaigns are seeing several new updates, including the ability to animate image ads, profit optimizations, as well as new loyalty promotions and promoting video creators in Brand Connect.
- Pairing Performance Max with search campaigns ads provides greater ROI across all of Google. This is now more accessible through Power Pair, and has 27% improved conversions over those that don’t use this mix.
- YouTube is seeing several improvements to the ad experience, including Stickers on Shorts and integration with Shopify and YouTube Shopping.
- Google Shopping is getting several improvements to replicate a window-shopping experience, like virtual try-on, style-aligned assets, brand profiles, and 3D shopping ad formats.
- To make use of AI for Google Ads, Google recommends following the 3-step practice of get ready, take action, and shift mindsets.
Changing Attitudes Around Search and Ads
One of the major things that the Google team put into context for us was how these changes are all about meeting user needs.
For example, the volume of searches with five or more words grew 1.5x as shorter queries, and there’s a demand to make complex searches easier. Gen AI helps in a big way by expanding searches and making those queries that are hard to describe easier to answer.
In addition, search channels are changing. For example, 12 billion visual searches a month are done using Lens, with 1 in 4 of them having commercial intent.
Another example of how search preferences are changing is “search beyond answers.” This is a case where the user doesn’t necessarily want a fast answer but a launchpad to explore and be inspired.
Look at some of the queries that got double-digit YoY growth on Google.
- outfit ideas
- best places to eat with kids
- rainy day experiences
AI Overviews just rolled out last week, the day of Google I/O, and this is the beginning of making those complex searches more efficient.
Ads in AI Overviews
So, you may wonder, how will ads play a role in AI overviews? Google is starting to test ads in the AI overview result. Ads, in the form of Sponsored Posts, will be displayed at the top and/or bottom of the AI overview result, with the aim of bringing the perfect ad to the searcher.
Oh, and there is one upgrade to this experience. In the past, you would click on the sponsored post and potentially still have to do another search. Now, you can click and buy – straight from the ad. This cuts down on search time and improves ad ROI.
Another improvement to the experience is the new ability to see AI Essentials in Optiscore. This only takes a few clicks to implement, and on average, advertisers that increased Optiscore by 10 points saw an average 15% lift in conversions.
Moving back to improving ROI, let’s check out how creative is being transformed with Gen AI.
AI Powered Creative: The Ultimate Time Saver
Creative ad assets can traditionally take weeks to spin up – from the product sourcing, staging, photoshoots, editing…you get the picture.
Now with generative AI, it has never been easier, or quicker, to create your ad creative.
Tim Frank, Senior PM Director at Google, took us through an example for Branch Furniture.
He showed how you can upload images as a reference point, input your brand’s hex color, choose a font that matches your brand’s, and create a whole ad from it. Several, actually.
This is a boon for your existing creative teams. By using options like generative fill and smart prompts, creatives now have the ability to flesh out their ads or experiment with potential concepts at a far greater scale.
One thing we need to mention, though, when it comes to any sort of AI in marketing, is that there’s always going to be need for human presence. After all, AI doesn’t have taste, creativity, strategic insights, or its own expertise.
Instead, we should think of these innovations as a way to bring what is out of reach in reach, and creating new opportunities for business transformation.
Performance Max Gets an Upgrade
Performance Max (PMax) has been a mainstay for Google Ads support, and Google notes that most retail advertisers on the platform are using it and see good results.
However, Power Pair, the combination of search and PMax campaigns, promises to deliver even better conversion performance and ROI across all of Google. AI-powered search specifically is a good combination with PMax. In the past six months, Google says that AI-driven improvements have improved broad match improvement by 10% for advertisers using smart bidding.
PMax is also seeing several improvements as a standalone platform. Users will soon have the ability to see performance by creative, placement details, while also being able to implement YT exclusions.
What else does the future of PMax look like? A newfound emphasis on profit optimization. For example, if there are two pairs of sunglasses that both cost $50, but one profit is $35 and the other $25, Google can leverage profit bidding to save your team money overall.
YouTube’s AI Glow-up
YouTube is a jewel in Google’s crown, the number one watched streaming platform over the past 12 months according to Neilsen. In addition, it also brings 1 billion in CTV daily views and 70 billion daily views across YouTube Shorts.
Generative AI promises to be the next playground for your team’s ad creative, with innovations like Music Sandbox, Veo, and Imagen3.
The ability to generate video content and audio through AI drives your team’s scalability to a new level.
Shorts is an especially important area for advertisers, as short-form video becomes the preferred medium for a larger and larger audio segment. Google’s data shows that vertical assets in campaigns increase view-through rate by over 40%.
Stickers on Shorts ads will help make them more interactive and better at driving action, clickable right on top of the Shorts ad. Access to long-form ads from Shorts ads will be available soon also.
Another YT ad type that the Google team called attention to is Creator Ads. A whopping 98% of the user audience said they are more likely to trust YouTube creator ads. YouTube’s ad platforms will now use the power of AI to show existing content where creators have mentioned your brand so you can start promoting.
YouTube Shopping opens up a new channel for you to take advertising advantage of as well.
Users watched over 30 billion hours of shopping videos on YouTube last year, and now creators can tag products in their videos via an affiliate program. In the next few months, Shopping Ads will also start highlighting key attributes of individual products.
This option will soon be open to Shopify merchants as well.
Imagine a future where a Shopify merchant can connect their product to YouTube affiliate marketing and be able to see what creators and content are having the biggest impact on sales. Buckle up, because it will be a reality later this year.
AI Enhanced Shopping Experience
On the topic of shopping, Google Shopping is becoming more and more personalized thanks to AI. With virtual try-ons and 3D modeling of products, shopping online has become much easier with less risk.
Say you’re shopping for a new top, and it’s hard to commit to one because you don’t know how it will fit. Enter AI! Now, with a few clicks of a button, you can customize the ad with a model similar to your body type to help you inform your purchasing decisions.
The ultimate goal? Replicate the window-shopping experience online.
Product Studio, which was announced last year and is off to a good start, is getting some new features as well:
- Style-aligned assets: This allows you to create visuals that match brand style. Just upload one image that represents ascetic, pick four images that are on brand for you.
- Brand profile: This allows users to see a brand profile from search results, reviews, products, and other items that users use to find brands online.
New Data Updates
We know that AI is the engine of a lot of the changes behind Google Ads, but good AI is reliant on good data. Of course, with the deprecation of third-party cookies, the data game is a lot harder to play.
The answer? First-party data. Google recommends thinking of first-party data as money – you work for a long time to earn it, you store it to use it, and it compounds.
Data Connectivity
To help with this, Google Ads Data Manager is now available to everyone, bringing the functionality to connect a product to Google Ads. This promises an end to the days of manual cleaning, organizing, and uploading it over and over. In just a few clicks, you can have an active pipeline of data from all data providers.
In addition, you can get measurement diagnostics from Google Ads itself, including where you have data gaps and step-by-step instructions to fix them.
In the near future, Google also will be setting up the ability to connect products to Google Ads, bringing all data into one greater ecosystem. This means not having to do any more manual cleaning, organizing, and uploading data over and over again. Instead, there will be an active data pipeline from all your data providers, including CRMs. Things will no longer be segmented, but unified.
Data Protections
Hand-in-hand with this are improvements to data privacy. You now have the ability to implement trusted execution environments into Google Ads. This limits how data is used and brings new transparency into the process. Google is also working to implement robust security structures to protect the data that you gather.
Data Measuring
To make the most out of your data, Google is also introducing AI-generated insights and results. You can now ask for a quick report and get an instant pull with visuals, along with recommendations and trends to help you act.
However, the true innovation here is Google’s upcoming open-source marketing mix modeling tool (MMM). Meridian will provide new insights on how marketing and media investments impact KPIs across your business, such as revenue or sales.
How to Put AI into Practice
Google is looking towards a future where AI will supercharge the entire advertising cycle, from building creative to running media to measuring results. At the same time, though, such an overhaul can sound daunting.
Sean Downey, VP of Media Platforms at Google, addressed the most prevalent thought any marketer has about AI and marketing: I need an AI strategy. His counterstatement? “Businesses don’t need an AI strategy; they need AI to run the strategy.”
So where do you start?
Sean and Selin walked us through the Google Ads AI Essentials:
- Get Ready
- Take Action
- Shift Mindsets
Get Ready
This is where you lean into your first-party data collection. Build that solid foundation with collected first-party data and get creative. Sean and Selin remind us of what so many may lose sight of, that generative AI can only do its best with YOUR best.
You still need your best marketers working on these campaigns to get the best campaigns.
AI needs a human touch.
Take Action
Test, learn, and scale your approach with AI and integrate it into your marketing campaigns. There is going to be a measured, experimental mindset to start. This is the time to really lean into your agencies, Selin reminds us. This is because agencies are often at the cutting edge of innovation when it comes to new advances in marketing.
Relying on agencies to help provide expertise and support will help brands focus on their core assets while scaling out.
Shift Mindsets
The use of AI will break down silos across brands and help improve cross-channel marketing. Sean and Selin showcased how brands like Adidas improved the effectiveness of their marketing campaigns by focusing on cross-channel marketing.
Conclusion
AI has expanded exponentially over the past two years, but Google has been leveraging AI for the past decade. The infrastructure for AI is 100% more efficient than it was 18 months ago.
Why does this matter? Google is able to build better consumer products for brands to reach their consumers better.
While AI in Google Ads is new, the biggest mistake a marketer can make is not adapting to the changes rolling out. The do-nothing approach will set you so far back compared to your competition.
As a result, even if you don’t plan on using all these tools right away, it pays to know what they do and what their value is. This testing might be what you need to avoid falling behind with your ads.
