Google is Testing a New Search Advertising Tool

Google has been pitching advertisers on a new AI-powered search tool, called Search Bidding Exploration, which aims to find new pockets of valuable traffic. It does this by identifying lower-traffic queries within search that actually drive conversions, according to documents seen by ADWEEK. Low-traffic queries are when someone types in a less popular search query. Brands still want to show up here because they can find new audiences on these searches. The product was pitched in the third quarter of this year, according to the documents, and has not been publicly announced. A Google spokesperson declined to comment. Search remains Google's biggest cash cow, making up 75% of revenue last quarter. But it's also facing pressure: Recent antitrust rulings could lead to structural or behavioral changes to Google's search units, and the tech giant's share of the search advertising market in the U.S. is projected to dip below 50% by 2025 for the first time in a decade, per Emarketer. Against this backdrop, Google, which regularly shares product ideas with buyers, is continuing to innovate to keep corporate ad budgets flowing. The tech lives within Google’s Smart Bidding suite of products which use AI to optimize search ads toward conversions. Without Search Bidding Exploration, Smart Bidding typically bids on search queries that historically would have performed well for the brand, but the tech has a harder time predicting the efficacy of lower-traffic queries. Advertisers using Search Bidding Exploration should lead to around a 10% decline in return on ad spend, but the tool will ideally lead to more clicks and conversions, according to the documents reviewed by ADWEEK. The tool is only available for campaigns without budget constraints. An ad buyer speaking anonymously said this tool addresses a longstanding concern that AI-driven buying tools, such as Google's Performance Max or Meta's Advantage+, pick the low-hanging fruit audiences that would have converted anyway. Since there is a relative lack of transparency, buyers aren’t able to diagnose whether AI is driving true value. "Part of the issue with any of the AI-driven products is they optimize in the margins, but you’re optimizing against the same pools,” the buyer said. “You’ll hit a ceiling.” This tool might give buyers more transparency around which low-traffic queries actually perform well, the buyer said, though it’s not clear what sort of reporting Google intends to make available for Search Bidding Exploration. As of the third quarter, Search Bidding Exploration was in allowlist beta, which means the product is available for a certain set of customers. Advertisers had to apply to test the product by September 16. Of note, both Google and Meta have recently made tweaks to their popular AI-media buying products that seemingly address buyers’ transparency concerns. In July, Google rolled out new transparency updates for Pmax, which uses AI to decide which media channel (search, display, YouTube, etc) an ad is served. These updates included sharing which YouTube videos ads appeared on, breaking down the performance of particular assets, and more brand safety controls. In August, Meta changed how it counts conversions, effectively giving itself a higher bar to prove that its tech works. Buyers have complained that AI-buying tools have led to campaign reports that are more modeling than reality, and have a tendency to give Meta too much credit for outcomes.

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Google Quietly Tests AI Search Ad Tool to Help Advertisers Reach New Audiences

It comes as marketers question how much incremental value AI ad tools actually drive

Catherine Perloff

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Catherine Perloff