Advertisers remain committed to Google as TikTok and AI-powered Bing try to become search competitors

By Kimeko McCoy

Digital ad costs are rising, the online ad marketplace is becoming more saturated and the way people look for information on the internet is changing, popularizing new ways to search beyond Google. It’s left advertisers thinking about diversifying their search spend away from Google, agency executives say.

The bottom line

There are many ways people can find brands and products now, and advertisers are reconsidering what the future of search could mean for advertising.

The cracks of fragmentation are starting to show across search advertising as platforms like Bing’s new AI integration and TikTok’s functionality present search ad options beyond Google. However, advertisers say they’re not ready to pony up the cash for those options — at least not until they prove their brand safe and scalable enough to work with, or in place of, Google.

“Google remains the tried-and-true method of reaching the bottom-of-the-funnel and this isn’t going to change overnight,” said David Gelt, director of paid search and YouTube at Rain the Growth Agency, in an emailed statement to Digiday, “but as users shift behavior, there will be opportunities for advertisers to spend their budgets elsewhere.”

As is true with marketing, advertisers chase audiences where they migrate to most frequently. The trick is to get into emerging spaces and platforms early enough to be a first-mover, and capitalize on developing audiences for potentially less ad spend. Betting on audiences remaining there though isn’t easy as online consumption habits frequently change.

Even so, the way people search for things is shifting. Historically, Google has been the go-to search engine. Now, search has become fragmented as TikTok and YouTube serves as a search platform for things like video tutorials. Reddit and Amazon are product information search go-tos. Meanwhile, Microsoft’s new ChatGPT and AI-powered search function makes for a more nuanced conversation as opposed to a one-way search. There are many ways people can find brands and products now, and advertisers are reconsidering what the future of search could mean for advertising.

This year, Google is expected to account for more than half of U.S. search ad revenues, according to eMarketer. At Gupta Media, e-commerce and retail clients are shelling out about 30% of their ad budgets on paid search. In some cases, that figure ranges from 10% to 30%. Still, the bulk of those dollars go to Google, said Phil Decoteau, account director at Gupta Media. Over at Tinuiti, startup, performance-driven brands are spending between 60% to 70% of budget on paid search. That figure is estimated between 10% to 15% for more mature brands, according to Aaron Levy, vp of paid search at Tinuiti. Again, the bulk of those dollars go to Google. (Neither Decoteau nor Levy provided exact spend figures nor name specific channels.)

But with rising CPCs (find a full breakdown on that here), the increasingly saturated digital ad marketplace and its crop of new entrants into the search ad space, agency executives say they’re considering these new options — and potentially moving …read more

Source:: Digiday