The news: Google is embedding ads into AI Mode, its new conversational search tool that allows users to ask detailed questions and get multi-step responses.

• These ads can appear directly within or beneath AI-generated answers, targeting users during deeper search moments.
• The ads are being rolled out for US desktop and mobile users following a beta in March, with broader international rollout planned.
• Advertisers already using Performance Max, broad match for search or shopping, or the new AI Max for Search are automatically included.

This expansion builds on last year’s debut of AI Overviews, which generates summaries at the top of results pages. After initial testing last October, AI Overviews will now ads offer desktop and will expand globally across more than 200 markets in over 40 languages.

Why it matters: These changes mark a major transformation of Google Search. AI-generated responses are changing how people interact with queries—and how they encounter ads.

• Google’s VP of ads & commerce Vidhya Srinivasan said AI Overviews have led to more commercial queries and increased user satisfaction, the AFP notes. Liz Reid, who leads Search at Google, noted these changes have delivered more time spent on advertiser-linked sites.

Yes, but: AI Mode traffic can’t currently be measured, Search Engine Land reports; clicks from AI results are labeled as “Direct” or “Unknown” in analytics due to a lack of referral data. This opacity has drawn criticism from marketers who argue they’re being left without actionable performance metrics.

At the same time, clickthrough rates on traditional search results have sharply declined—down nearly 30% over the past year, according to The Guardian. This suggests users are increasingly finding what they need within Google’s own interface without clicking out to publisher sites, leading to lawsuits from players like Chegg who claim that AI Overviews are cutting its traffic and revenues.

Our take: Google is trying to balance AI innovation with its advertising revenue model. While embedding ads into AI responses makes sense commercially, the loss of transparency and declining external traffic raise legitimate concerns. Until Google shares meaningful performance data, advertisers will have to take the company’s word on ad effectiveness—something many aren’t willing to do blindly.