As brands commit more budget towards retail media, and the number of platforms increase, marketers may be forced to make trade offs where their ad spend goes. Advertisers will also need to rethink their approach to paid search and SEO, and particularly how their brands show up towards the bottom of the purchase funnel.
Search experiences are fragmenting across platforms
Younger audiences increasingly favour searching for information and inspiration on visual platforms such as TikTok, Instagram, Pinterest and YouTube or RED, Douyin and Zhihu in China. According to data from GWI, in 2020, 19.2% of internet users turned to TikTok to search, rising to 27.5% last year.
As search evolves into a “system for exploration” and search strategies diverge depending on category and demographic, Google’s dominance of the global search advertising market is being challenged.
According to WARC Media, whilst Google remains the dominant force in search and is forecast to earn $176.4bn in advertising revenue in 2023, its share of total search, which includes retail media, is set to drop from 51.0% in 2021 to 50.4% in 2023.
Over half (53%) of global advertisers surveyed by WARC for The Marketer’s Toolkit 2023 report said they plan to increase ad investment with Google this year, down from 59% the previous year.
Generative AI threatens to disrupt search behaviour
A race has begun to develop the most compelling AI chatbot search product. Microsoft plans to incorporate OpenAI’s ChatGPT – estimated to have become the fastest-growing app in history, reaching 100 million monthly active users in only two months – into Bing.
However, as it stands, Bing is only forecast to earn a 5.2% share of the global search market in 2023, per WARC Media. Yet the news was deemed a “code red” situation for Google, which has subsequently rushed to launch Bard, its conversation technology.
The arrival of generative AI will cause major considerations for brands, such as how paid ads will fit into the conversational nature of the content, the partiality of chatbot responses, risk of content misinformation and misalignment with brand guidelines.
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