• by Laurie Sullivan  @lauriesullivan, October 25, 2023

Google CEO Sundar Pichai said on Alphabet's Q3 2023 earnings call Tuesday that the company would experiment with new formats such as native as a way to integrate ads into its Search Generative Experience (SGE).

“We'll experiment with new formats native to SGE that use Generative AI to create relevant high-quality ads customized to every step of the Search journey,” Pichai said.

SGE, an experimental version of Google's search engine, uses artificial intelligence (AI) to generate contextual answers to complex questions.

Pichai said that with GAI applied to Search, the company can serve a wider range of queries and answer new types of questions, including those that benefit from multiple perspectives. The company is serving more links with SGE and linking to a wider range of sources on the results page.

Pichai said he is confident in the strength in the organic side, search engine optimization, and advertising, to drive the right experience for users.

“We’ve always worked through these transitions, be it from desktop to mobile, or from now mobile to an AI-enhanced experience,” Pichai said.

The move would give Google another advertising format and the ability to expand GAI across its ad services. While the goal is to integrate ads with SGI, for now the experience is only available as an opt-in basis, which suggests Google will make change the feature as generally available to all.

Insider Intelligence estimates Google will remain the dominant player worldwide for search ad revenue, with $140.97 billion in 2023. 

Google initially announced it would “customize to every step of the search journey” in May 2023, at Google Marketing Live where it hinted at delivering new ads experience with GAI.  

At the time, the company said it would experiment with Search and Shopping ads that are directly integrated into the GAI and conversational technology.

Pichai said the company also is focused on boosting creativity and productivity through Bard, Google’s experimental AI chatbot, which provides a direct interface with conversational large language models (LLMs).

Bard can integrate with Google apps and services, serving information from Workspace, Maps, YouTube, and Google Flights and Hotels.

Pichai did not provide details on the ad formats during the earnings call, but earlier this year in a blog post, Jerry Dischler, vice president and general manager of ads, wrote about integrating GAI into products including Performance Max and Smart Bidding.