Google Integrates Ads into AI Mode Search, Signaling Shift in Digital Advertising Landscape

More advertisements are coming to Google AI Mode, report says

Google is pushing advertisers to buy ads in AI mode, according to a report from AdAge. The publication caught onto slides from Google pitching AI Mode ads to potential buyers. "Be part of our most powerful AI search experience, as customers explore their biggest questions with AI Mode," read one slide in the presentation. "As we apply the power of Generative AI to Search, Ads will continue to play a critical role in helping consumers find helpful information and enabling businesses to be discovered online." Google reportedly told advertisers that the new ads would come in the form of text and shopping ads with product details within AI Mode chats. The ads would be presented in response to user queries. This Tweet is currently unavailable. It might be loading or has been removed. From a mock-up in the presentation, the ads appear in banners under AI search queries, indicated by a "Sponsored" label. The slides describe the AI Mode advertisements as an "experiment." According to AdAge, Google will roll out ads in AI mode before the fourth quarter. The tech giant told AdAge that they have already started showing more ads in AI mode and have seen "incredible results." In May 2025, Google announced that it was testing these ads, writing in a blog post, "Where relevant, ads may appear below and integrated into AI Mode responses." Google's revenue from ads was estimated to be $96.5 billion in the fourth quarter of last year alone. So far, advertisements have been rare in AI chatbots like Google Gemini and ChatGPT. But as Google shifts away from traditional search and toward AI search, the company's massive ad inventory could shift as well. Google has a big head start when it comes to AI search, and so far it has 30 times more traffic than its rivals. Its AI search results surpassed those of rivals like ChatGPT, with 16.5 billion visits in December 2024. Google inserting ads into its AI search tools is just the beginning. Spending on AI-powered search advertising is projected to reach nearly $29 billion by 2029, according to Reuters.

Google AI Mode to feature integrated sponsored ads

Google is expanding its advertising presence within AI Mode, actively encouraging advertisers to purchase ad placements in this enhanced search environment, as detailed in an AdAge report. The tech company has been presenting slides to prospective buyers, emphasizing the integration of advertisements within its AI search experience. One slide stated, "Be part of our most powerful AI search experience, as customers explore their biggest questions with AI Mode." It further clarified, "As we apply the power of Generative AI to Search, Ads will continue to play a critical role in helping consumers find helpful information and enabling businesses to be discovered online." These new advertisements will manifest as text and shopping ads, incorporating product details directly within AI Mode chat responses to user queries. Mock-ups provided within the presentation indicate that these advertisements will appear as banners positioned beneath AI search queries. Each ad will include a "Sponsored" label, clearly distinguishing it as paid content. Google characterizes the implementation of these AI Mode advertisements as an "experiment." According to AdAge, Google intends to initiate the rollout of these AI Mode advertisements prior to the fourth quarter of the current year. The company informed AdAge that it has already begun displaying an increased volume of ads within AI Mode and has observed "incredible results." Google initially announced its testing of these ads in May 2025, stating in a blog post, "Where relevant, ads may appear below and integrated into AI Mode responses." Google's ad revenue reached an estimated $96.5 billion in the fourth quarter of the previous year. While advertisements have historically been infrequent within AI chatbots such as Google Gemini and ChatGPT, Google's strategic shift from conventional search to AI-driven search indicates a potential reallocation of its substantial ad inventory. Google currently maintains a lead in AI search, demonstrating 30 times more traffic than its competitors. In December 2024, Google's AI search results recorded 16.5 billion visits, surpassing rivals like ChatGPT. Projections from Reuters indicate that expenditures on AI-powered search advertising are expected to approach $29 billion by 2029.