Google Tests AI-Based Ad Formats to Enhance Search Experience

Google is testing a new AI-powered advertising format built on the Gemini model to deliver more relevant and personalised product information to users during searches on Google. In a Wednesday 20 May announcement, Google said that 75% of users can make faster and more confident decisions when using AI Mode in Search. As a result, the company is expanding AI integration beyond search results into the advertising experience. The latest ad formats will provide AI-generated explanations that can automatically summarise product information, alongside content from advertisers. Google stressed that all formats will continue to carry a ‘sponsored’ label so users can distinguish ads from organic results. One format being tested is Conversational Discovery Ads. This format allows AI to answer user questions more specifically while displaying relevant products. For example, when a user searches for ways to make a home smell nicer, AI can surface room fragrance products with feature explanations tailored to the user’s needs. Additionally, Google introduces Highlighted Answers, a format that displays ad recommendations directly within the AI Mode answer list. For example, a user looking for travel tips abroad could see language-learning app recommendations deemed relevant by AI. Google is also expanding AI use in shopping advertising with AI-powered Shopping Ads. The feature targets categories such as electronics and home appliances. The Gemini model will automatically explain why a product is suitable for a potential buyer based on their search needs and preferences. Furthermore, Google introduced the Business Agent for Leads feature, enabling prospective customers to interact directly with an AI agent within the ad. The virtual agent can answer consumer questions based on information available on the company’s official site. The company is also expanding the Direct Offers programme first trialled in January 2026 with major brands such as Chewy, Gap and L’Oréal. In the latest update, AI can now create automatic promotional bundles based on a user’s search, including bundling products and direct checkout integration. Meanwhile, travel partners such as Booking.com and Expedia will also be able to feature special offers during AI-based trip planning. Google urged advertisers to utilise features such as AI Max for Search, AI Max for Shopping, and Performance Max to optimise the latest generative ad formats. The move underscores Google’s increasingly assertive push to embed generative AI across its digital business ecosystem—search, online shopping, and interactive advertising—while raising questions about advertising transparency, user privacy, and how AI may shape consumer behaviour in the future.