will happen to paid placements in AI-powered searches?

Google’s ad company will be celebrating its 23r year in this fall. However, paid search is undergoing major changes. As traditional search evolves through the introduction of AI-powered functionality will also see pay per click (PPC) advertising .

Google is unlikely to sit back and watch as paid placements drop. We do not yet know what Google will launch to capitalize on AI-powered searches – nor when users will see these ads.

We know that there will be fewer advertising options, more competition, and higher costs. However, AI will help advertisers target customers better and optimize campaigns.

This is a closer look at the future of paid search. However, advertisers will need to adjust their strategies in order to reach their target audience in this new era.

The new search

According to Aaron Levy vice president of paid searches at Tinuiti, AI assistants such as Google Bard will allow search to evolve from transactional and conversational,

He said that historically, every query would result in a set of answers. That’d be the end to the relationship.

“ChatGPT/Bard wants us to shift from repeating and tweaking search results towards refining with an human-esque conversation. It’s the exact same task, but with a different approach.

Also, search is getting a new UI.

“The normal list of links that you receive will be replaced with a chat box, where you can converse to an AI bot and receive direct responses,” stated Trifon Tsvetkov Head of Growth at CodeInterview.

“This will be, to a certain extent, similar to the featured-snippet functionality that we can see right now, but with much more detail.”

It remains to be seen if this experience will surpass traditional search.

Tsvetkov did note that traditional search will continue to decline. Businesses should therefore expect their paid search channels to be affected in some way.

Brands that rely on paid searches should be ready to change.

The new paid search

This could potentially be problematic for search giant Google, Jon Clark managing partner of digital agency Moving Traffic Media noted that Google has built its entire business model around paid searches.

He said, “But I cannot imagine Google’s just going up their ad models tomorrow.”

Tsvetkov also noted that Google may create new offerings to take advantage of its AI-powered search functionality.

He said that these “fundamentally” will continue to be driven by user input and online behavior just as it is now. Referring products and services that are related to your AI-powered searches, such as tickets for attractions, when you ask the AI bot to make a travel itinerary is one example.

Levy was however unsure of the point at which a query can be refined enough to provide a relevant ad experience.

“Are platforms going deliver an ad on that first question? Or embed it in the conversation? He asked.

“My expectations are that they will be interspersed, but closer to the ‘conclusion” of the chat experience.”

ChatGPT/Bard will take the time to understand a consumer’s needs and budget before they present sponsored ads.

Levy said, “This feels natural to me and won’t feel too ‘in-your face.'”

Similar to Eduard Dziak who is the CMO of B2B digital marketing site B2BDigitalMarketers pointed out potential in “a more sophisticated form of pay-per click (PPC advertising)” that is more natural, interactive, and displays “a list of companies that have paid to appear, along with relevant information like reviews, testimonials, and experience.”

He said that he believes it would provide a better return on investment (ROI), than paid search ads which only offer limited information.

To compensate for decreased web traffic, he envisions search engines including display ads in search results.

Dziak stated that these display ads could be integrated seamlessly with chatbots using images, animations, and even pre-selected frequently requested questions from advertisers.

“This will make search more interactive and natural for users less tech-savvy, like my grandma who can talk to chatbots about PPC and display ads.”

The new paid ads

However, less links means fewer ads.

“Companies must recognize that AI is driving more efficient searches that deliver more precise results to consumers,” stated Rob Silver executive vice president and chief of media at interactive agency Razorfish.

“This could result in higher ad cost for sponsored listings, and more competition for fewer placements.”

Hamzahanif, a web design agency Objects SEO executive, said that the agreed costs could rise as there is more competition for top results.

He said that advertisers may have to pay more in order to get the same visibility on search engine result pages as paid advertisements, particularly if AI-powered algorithms favour organic search results over ads.

“This is because AI algorithms may be more adept at matching user intent to organic search results, making paid search ads less competitive for visibility.”

Zaira Cespedes, junior SEO executive at digital marketing firm GA Agency, agreed.

She stated that paid search ads will be more difficult to stand out due to improvements in the relevancy and accuracy of organic search results. This can result in higher PPC campaign costs.

Iu, the founder of Gradient Insight AI Consulting, highlighted the possibility for greater competition from larger businesses with more resources and “an edge in developing and implementing AI powered strategies.”

Silver also noted that this evolution makes SEO more important because AI chatbot results increase organic search results’ prominence.

Casey Jones is the head of marketing at CJ&CO and expects that consumers will interact with fewer links. This will lead to an increase in attention on higher-funnel ads.

AI-powered searches can be used to plan a trip and eliminate many of the queries that traditional search cannot answer.

Jones stated that this means businesses will have to invest heavily in brand awareness so that AI can serve options and people will choose the ones they are familiar with.

“If people are able to identify and make informed purchases when they know the contents of your products and services, they will be able distinguish between them and theirs.”

Silver was also a signatory.

He stated that companies must prioritize brand awareness by creating elevated content that highlights the benefits and differentiations of their offerings.

“When an ad for their company appears, it will be even more important that it resonates and has an impact on the consumer who views it.”

AI-powered search can also prioritize ads that are more relevant to a query because it better understands the user’s intent. It could even be more selective in which ads it displays.

“This means advertisers will have to create more targeted ads tailored for specific user needs and interest,” stated Syed Sameem Rizvi a data scientist at Code Avenue.

“[And] advertisers might need to create a variety ad formats to maximize their visibility on SERPs.”

The new targeting

AI-powered searches should result in better targeting.

“AI can analyse large sets of data more efficiently that humans can without compromising accuracy and relevance,” stated Oskar Nowik head of SEO at Epos Now.

This capability allows search marketers to predict more accurately what consumers are looking for when they ask questions. It results in more targeted ads and higher conversion rates.

Additionally, AI-powered searches can provide more precise insights into search behavior which will help target consumers, personalize information, and increase efficiency/ROI of paid search campaigns, stated Soren Jensen, a junior marketer at cybersecurity firm CyberPilot.

The new optimization

Hanif also believes that AI-powered algorithms can help advertisers optimize their paid placements.

Hanif stated that AI algorithms can be used to identify which ads will resonate most with users by analysing user behavior and search patterns.

“Advertisers will then be able to use this data for tweaking their ad copy and keywords, as well as targeting parameters, which can improve their ad performance over the long-term.”

Ayala agreed.

He said that AI is able to find the most relevant keywords, ad placements, and targeting strategies.

AI-powered tools are able to analyze consumer behavior and other historical data and make recommendations about how to optimize campaigns and increase conversion rates.

Nowik also noted that AI-powered algorithms could determine the best ad placements for advertisers and the best time for consumers to see ads in order to maximize conversions.

Cespedes stated that some AI-powered search engines might not be transparent about how results are generated. This could pose a problem for optimization.

Jensen cautioned that algorithms and AI-powered searches might not capture every nuance of a query. This could result in inaccurate results or costly errors if they are not closely monitored.

Because of the complexity and sophistication of the AI algorithms, he expects that results will be hard to replicate and monitor.

Jensen said, “This can also lead skewed data insights that can lead to incorrect decision-making.”

“Also how will it be done? It is well-known that AI bots learn from previous conversations that you have had with them.

Levy said that tracking is “very broken” and that he believes it will get worse as cookies are removed and Google launches its version of Safari’s Intelligent Tracking Prevention.

He said that things will become more complex and that AI modeling would be more effective in presenting the best view of performance.

The new keywords/bidding

Finally, you can expect some changes in the backbone PPC campaigns: keywords.

Nowik believes that AI-powered algorithms can automate bidding by detecting the most relevant keywords so that marketers don’t have too many combinations to test manually.

He said that this saves time and money as prices for keywords do not need to be adjusted based upon trial-and-error testing.

Jones anticipates that broad match, which allows advertisers to reach wider audiences with less keyword lists, will continue to be relevant.

He said that this is good news for Bing, as it uses Microsoft’s AI Model, which prioritizes relevancy. It will also improve the performance of broad matches in paid search.

He stated that Microsoft’s language model was better equipped to improve Bing’s broad matching and increase paid search traffic for advertisers in the current scenario.

This means that Bing will have a higher paid search budget than Google. This will be a huge positive for advertisers.”

Levy questioned whether AI-powered search will change auction dynamics from a bidding model to a commission-based/affiliate model, like Microsoft’s Hotel Price Ads and Google’s Local Services Ads.

He said, “I see more payment options available for advertisers. This could throw things for the loop.”

However, Kacper Rafalski from Netguru’s demand generation team, stated that it could lead to greater reliance on automated systems as well as decreased control over bidding and ad targeting.

John McGhee is the owner of digital agency Webconsuls. He believes that keywords will be obsolete as Google Ads and Microsoft Ads move to a conversion-based system.

He said that adjusting keyword match types and keyword bids, as well as adding negative keywords, are the best ways to increase relevancy and get your ads seen by the right users.

“In the future these tasks will be transferred to adjusting various conversion actions as well as their values.”

This means that PPC will now use ROI-based bidding strategies. Instead of raising a keyword budget, advertisers will adjust a conversion action’s value.

He said that AI is expanding the reach of touch points dramatically, and signals will replace search query as the primary method to gauge user intent.

Search Engine Land – How will paid placements evolve with AI-powered search – This post was originally published on Search Engine Land .