Alphabet Inc (NASDAQ:GOOG)'s Google unveiled a suite of artificial intelligence-driven advertising products at its annual Google Marketing Live event, targeting expanded wallet share from both offline budgets and social media platforms as it moves to cement its position in the emerging agentic search landscape.
The company introduced six new ad formats tied to its Gemini AI model, including Conversational Discovery ads that tailor product features to specific user queries, an AI-powered upgrade to Shopping Ads generating custom explainer copy, and a Universal Commerce Protocol-enabled native checkout embedded directly within AI Search responses.
Google also added ads eligibility for Highlighted Answers within AI Mode, a Promotional Bundling feature allowing Gemini to construct deals based on user search history, and a Business Agent for Leads that lets users interact with brand websites through a Gemini interface.
The announcements come as the company works to address investor concerns about AI disintermediation risk, given that ChatGPT counts roughly 900 million users and Meta AI approximately 1 billion users, compared to Google Search's more than 3 billion.
UBS analysts said company executives cited data showing 75% of users reported making faster decisions when using AI Overviews or AI Mode compared to regular Search, a figure the bank characterized as supportive of the view that AI-delivered clicks carry higher commercial intent and therefore deliver stronger return on ad spend.
UBS projected Search and YouTube combined ad revenues of $341 billion and $379 billion for 2027 and 2028, respectively, ahead of Street consensus estimates of $339 billion and $375 billion. The bank forecast total Search segment revenues of $260 billion, $293 billion, and $327 billion for 2026, 2027, and 2028, also above consensus.
On the measurement front, Google added the ability to analyze ad performance across Google and social platforms, including Meta, TikTok, and Pinterest, within Google Analytics 360. UBS characterized the move as an “offensive step to court social media budgets,” adding it “poses some risk to Meta but more so to the smaller platforms.”
Google also introduced a Gemini-based "Ask Advisor" agent allowing advertisers to optimize campaigns and seek regional insights across Google Ads, Google Analytics, Merchant Center, and Google Marketing Platform using natural language queries, alongside new features in Asset Studio aimed at streamlining ad creation.
For YouTube, the company announced GenAI-enabled ad formats previewed at YouTube Brandcast last week, including more targeted in-video ad placement, additional content alongside ads, expanded ad opportunities within creator content, and a two-click checkout feature.