The news: Google is rolling out new ad tools for AI Overviews, targeting retailers in a bid to curb concerns about AI responses’ impact on referral traffic and clickthrough rates (CTRs), per a blog post.

The new features include:

• Expanded ads for AI Overviews that allow retailers to link into AI responses. In one example, Google said a user asking about low water pressure would generate an AI answer with tips and an ad for a plumber. The sponsored feature, which is still in testing, will require advertisers to pay for representation in AI results.
• AI content generation tools for its Asset Studio feature in Google Ads, allowing brands to develop videos and images in-stream by uploading a product photo and text prompt.
• The company also added batch generation for its AI features, new text-to-video tools for content creation, text guidelines to ensure brand-safe content, and shoppable YouTube masthead ads.

Addressing concerns: The key feature in Google’s updates is its expansion of ads for AI Overviews, which directly addresses concerns about Google’s AI search responses after several studies found AI Overviews harmed advertisers.

• An Ahrefs study found that AI Overviews decreased CTRs by 34.5% on average.
• AI Overviews lead to as much as a 25% decrease in publisher referral traffic, per Digital Content Next.
• Analytics company Authoritas noted that sites previously ranking first in Google’s search results lost nearly 80% of traffic when results showed up below AI Overviews.
• Pew Research found that AI Overviews cut the number of users who clicked on links by nearly half. Only 8% of users with searches triggering AI Overviews clicked on a link, compared with 15% in standard results.

Our take: Giving retailers more opportunities to show up prominently in AI results could curb worries about AI Overviews cannibalizing CTRs and traffic, but brands still need to adapt to the rise of AI responses to remain competitive.