3 Ways AI is Reshaping Paid Search

Key Takeaways:

• AI Overviews have changed the attention dynamics of Google’s search results page, with significant implications for how paid search performance is measured and communicated.
• AI is affecting upper- and lower-funnel search intent differently, creating both challenges for brand discoverability and opportunities for advertisers who prioritize action-oriented keywords.
• As AI search resolves more queries without a site visit, paid search value is increasingly tied to brand exposure's influence on recall, trust, and consideration—outcomes that require more sophisticated measurement approaches to capture.

AI is transforming how consumers search online and what paid media can accomplish within those environments.

This transformation is resulting in three key shifts that marketers must understand to invest effectively in paid search:

• First, AI summaries are compressing the attention available to paid listings on the search results page.
• Second, AI is impacting different types of search intent in different ways, with informational queries increasingly resolved without a click while action-oriented queries remain largely unimpacted.
• Third, as zero-click search resolves more queries without a site visit, paid media's value is shifting away from direct clicks and toward the influence that brand exposure has on recall and consideration.

For advertisers, understanding how to strategize around each of these shifts is essential to building a paid search strategy that holds up in an LLM-powered environment.

AI Overviews Are Compressing Attention on the Search Results Page

The search results page has always been a place where advertisers vie for attention, but AI is changing the terms of that competition. AI Overviews now dominate above-the-fold real estate on Google for about half of all queries, pushing paid and organic listings further down the page. As users opt to scan AI-generated summaries first and scroll less as a result, there are fewer moments for them to see and act upon your ads.

This attention compression directly affects paid search performance, with recent research finding that the presence of an AIO correlates with a 58% lower CTR for the top-ranking page. As advertisers compete for fewer available clicks, these changes could drive up CPCs as well.

For agencies and internal marketing teams, it's critical to proactively communicate the context of these changes to stakeholders, so that declining CTRs and rising CPCs are understood in context rather than treated as performance failures.

AI is Resolving Upper-Funnel Queries Before Users Click

Not all search intent is affected equally by AI. AIOs are showing up predominantly for the upper-funnel, research-driven queries that users rely on to learn, compare, and evaluate before making a final decision. In fact, 99.2% of the keywords that trigger AIOs are informational in intent.

This means that it has become more difficult for paid search to deliver the upper-funnel discoverability and efficient clicks it is known for. There are also emerging implications for programmatic, as fewer impressions become available from key publishers whose organic traffic is being absorbed by AI-powered search experiences.

Action- and decision-oriented queries, however, remain largely unaffected—which presents a clear opportunity for search advertisers. Lower-funnel, intent-driven keywords should be prioritized accordingly.

Paid Search Value is Shifting from Clicks to Brand Exposure

Perhaps the most important mindset shift for search advertisers right now is reframing the value paid search provides. As AI search increasingly resolves questions without site visits, paid media will drive fewer clicks. But that doesn’t necessarily mean those investments are driving less value.

Clicks have long been advertisers' primary focus because they’re measurable, but paid search has always contributed to outcomes beyond that immediate action. Paid search-driven brand exposure drives recall and brand trust, influences later decisions and return visits, and impacts whether a brand makes it into a consumer’s consideration set at all.

Of course, measuring the impact of paid search in this way is more complex than traditional paid search attribution. As the causality between paid search exposure and action becomes harder to track, teams will need to lean more heavily on marketing mix modeling and multi-touch attribution to connect paid media investment to business outcomes.

The Future of Paid Search in the AI Era

AI’s impact on paid media performance is already significant: Attention is more compressed, different intents are leading to different outcomes, and the click-based model of demonstrating paid media value is under pressure.

Advertisers who understand these dynamics and adjust their strategies, benchmarks, and measurement approaches accordingly will be far better positioned to drive results from paid search investments as the search landscape continues to evolve.

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Looking for more insights on the future of search engine marketing? Explore everything marketers need to know about the shifting landscape by watching our recent webinar: Is Search Totally F**ked? What Do We Do Now?.