AI and the Future of Search Advertising Spend

AI search platforms owners including Microsoft, Amazon, Google and Perplexity sell ads, but – for now – marketers are prioritising organic over paid.

However, just as organic implementation preceded the growth of paid advertising in search, social media and mobile, AI search is likely to follow a similar trajectory.

In the first of a new four-part series for WARC Media, Debra Aho Williamson, founder and chief analyst at Sonata Insights, examines how, when and why AI may impact advertising investment plans.

Why AI search ad investment matters

Between January and June 2025, shopping-related queries by US ChatGPT users rose 25%, according to Sensor Tower, while AI search platforms captured a ratio of 5.6% of US desktop browser-based search traffic in June 2025, double a year earlier.

As consumer behaviour shifts, advertising plans are likely to be disrupted. Traditional paid search may become less effective, and marketers may be required to adapt plans to meet a more intent-driven search mindset.

Four potential drivers of AI search spend

1. If AI platforms come up with groundbreaking new ad formats: Most AI ad formats mimic paid search. Advertisers would get a lot more excited if an AI platform unveiled a truly revolutionary format taking full advantage of AI’s capabilities.
2. If advertisers embrace an intent-driven search mindset: Paid search advertising traditionally targets queries with high purchase intent. However, today’s searchers engage with platforms for broader intents, such as research, learning and discovery.
3. If the efficiency of traditional search advertising declines: Google’s AI Overviews are already causing a drop in organic search traffic to publishers. If click volume to paid search ads on Google results pages were to also decline, advertisers’ cost per lead would rise.
4. If Google makes AI Mode a more prominent feature: Consumers must actively choose the AI Mode tab, so usage is minuscule. As it becomes a more prominent feature (or a default), more ad inventory would open up, giving advertisers more reason to try it.