AI Overviews Changed SEO, But What About PPC?
As our own data and industry data have confirmed, Google AI Overviews (AIOs) have hurt organic traffic. In fact, our clients are experiencing a 20%-40% YoY decline in organic traffic since AIO frequency spiked back in March 2025. But for paid search, the story isn’t as straightforward. Many advertisers are concerned about CPC inflation and limited ad inventory associated with the rapid expansion of AI search experiences. But are these concerns valid? We’re actually a lot more optimistic. But before we dive into the reasons behind that optimism, let’s take a quick look into the evolving landscape.
PPC is seeing its own evolution: one shaped by changing SERP dynamics, increased ad density, and smarter bidding behavior. Ads within Google’s AI-driven experiences are a critical piece of its business model, and they have clear ambitions to expand ad inventory by evolving how and where those ads appear. Before long, ChatGPT and other AI platforms will likely follow suit, exploring new ways to monetize their growing base of free users.
Let’s explore what’s changing in the SERP, how our clients have adapted, and what is needed to win in PPC in 2026.
What Changes Have We Seen in the SERP Landscape in 2025?
AIOs have dominated the conversations around SEM, and rightfully so, but changes to how Google monetizes the SERP have flown under the radar. Understanding these structural shifts is critical to developing competitive PPC strategies, especially as the auction itself continues to evolve. Let’s recap the notable changes:
Multi-Ad Serving Update:
- On April 14, Google announced an update allowing multiple ads from the same advertiser to appear on a single SERP.
- So what? This is a massive update and allows a single advertiser to appear in multiple placements on the same SERP (top, bottom, and even AI results).
Separate Auctions by SERP Placement:
- In March, Google confirmed (what had been previously only speculated) that Google has been running different auctions for each ad location for many years.
- So what? While not new, multi-ad serving now lets advertisers access each SERP placement individually through its own auction.
Integration of New Ad Placements:
- Over the past year or so, Google has been testing ads within organic listings, ads within AIOs, and, more recently, AI Mode.
- So what? Ads in organic listings and AI experiences have been minimal so far, but we fully expect that to change in 2026 as Google looks to monetize AI-driven experiences further.
Multi-Ad Serving: More Real Estate, More Competition
A Deeper Look:
Multi-ad serving represents one of Google Ads’ biggest updates in years, enabling advertisers to appear in multiple ad locations within the same SERP. These placements span the top (above organic listings), bottom (below organic listings), and emerging AI-driven experiences (e.g., AIOs, AI Mode, etc.).
Each position operates under its own auction, meaning advertisers can now compete across more ad locations – though not multiple times within a single placement. In other words, an advertiser can appear once in the top slot and once in the bottom, but not twice in the top results.
What We Are Seeing In Our Data:
- 71% of our clients have seen an increase in eligible impressions (total number of impressions you are eligible to win) YoY since this update was implemented.
- Nearly half of our clients have seen an increase of at least 30% YoY.
- Impressions for B2B software and lead gen accounts have increased 27% PoP since the multi-ad serving update, whereas impressions were up just 10% when observing the same periods last year.
- 80% of our clients saw a CTR decrease YoY as a result, which was expected as the number of impressions has increased significantly vs last year, with many of those impressions likely coming from lower quality placements expected to drive lower CTRs.
- While we saw CPC increases post-AIO rollout (~10%), we saw the same increases the prior year, indicating these are normal CPC increases and not directly caused by AIOs.
What Does This All Mean? The Synapse POV:
- More SERP visibility: We expect more search inventory in 2026, driven by new ad supply from ads in AI experiences (AIOs and AI Mode) and doubling serving. We also anticipate that traditional search ads will continue to be prioritized in the SERP, appearing more frequently above AIO results.
- Ad Quality Improvements: As AI search experiences continue to evolve, we anticipate improvements in ad quality and conversion rates within these experiences. Why? Because the AI engines will have significantly more data to utilize when matching queries or prompts to relevant ads. Longer-tail prompts are generally more descriptive and detailed, allowing the AI engines to more accurately match a user’s need to the most relevant products or services.
- Quality Score stability: While PPC CTR may decline as inventory expands, we don’t expect this to negatively impact Quality Score. Expected CTR (an element of Quality Score) is a relative metric based on the other results in the SERP, which the SERP changes will equally impact.
- CPC volatility as algorithmic bidding adapts: With more bidders per auction, CPCs could fluctuate in the short term. Smart Bidding systems will need time to recalibrate across new placements to find efficiencies. An increase in advertisers per auction may contribute to CPC increases, but less expensive ad placements will create a balance.
- Test to maintain efficiency: Larger advertisers will apply increased auction pressure, as they can leverage their large budgets to secure multiple ad locations. Smaller advertisers will need to test rigorously to discover cost-efficient options.
- Don’t be concerned by lower CTRs: As advertisers gain more impressions through new ad inventory sources, lower CTRs are expected. This reflects an increase in total ad supply, not declining performance, since double serving and AI-driven placements will enable more visibility overall.
So, overall, there is a lot to be excited about in the world of PPC. We believe the following will benefit advertisers greatly and help keep performance strong heading into 2026:
- AI-driven ad expansion: Expect ads in AI experiences (e.g., AIOs, AI Mode, ChatGPT) to become more prevalent, creating new inventory and engagement opportunities.
- This also extends to how Google prioritizes traditional placements by promoting ad visibility above AIO results.
- Make sure to keep an eye on when ChatGPT finally pulls the trigger on ads for free users, as we continue to see Sam Altman comment on how that may be a reality as soon as 2026.
- Limited Impact on CPCs: We expect any CPC inflation from double serving to be offset by the increased inventory referenced above.
- This will be reinforced by Quality Score stability, as we don’t expect double serving to negatively impact expected CTR.
- Advertiser advantage: With more surfaces and smarter systems, advertisers can expect stronger reach, better targeting, and improved conversion potential.
2026 will reward advertisers who lean into AI-driven efficiency early. Those prepared to test, learn, and adapt will be best positioned to win on PPC and outperform the competition.
How We’re Preparing Clients for 2026
As the search landscape evolves, with AI-driven experiences being the main driver, staying ahead will require smarter bidding, early adoption of new placements, and disciplined testing. Below are the key focus areas we’re guiding clients toward as we react to the new SERP experience and prepare for 2026.
Reassess Bidding Strategies:
- Monitor traffic mix shifts: Multi-ad serving may lead to lower-quality clicks from ads lower on the SERP, so track how placements impact lead quality.
- Feed deeper funnel conversion data: Use Offline Conversion Imports (OCI) to provide Google’s bidding with lower funnel metrics (e.g., SQLS, closed-won deals, etc.) so automation optimizes for business value.
- If you’re optimizing towards leads and 90+% of those leads don’t turn into customers, then you’re optimizing towards a goal that will rarely produce a customer. Use your deeper funnel conversion events to better inform Google’s bidding algorithm.
- Audit bid performance regularly: Reevaluate whether Smart Bidding is driving the intended outcomes, and adjust conversion signals or goals to maintain efficiency.
Plan for Expanded AI-Integrated Ad Placements
- Anticipate growth in AI-driven inventory: Ads within AI Overviews and AI Mode remain limited today but are expected to ramp up significantly in 2026.
- Test eligible campaign types now: Begin optimizing Performance Max and AI Max campaigns, which can serve ads within these emerging AI surfaces.
- Watch the broader AI ad ecosystem: With reports that OpenAI is building an ad platform, monitor developments closely as user behavior continues to shift toward conversational and generative search tools.
Test and Iterate Continuously
- Prioritize CRO and landing page testing: Maximize the value of every click by refining the post-click experience. Utilize more advanced GA4 tagging and heat mapping to better understand why a certain landing page experience outperformed another.
- Adopt a test-and-learn mindset: Run controlled experiments to understand how new placements, creative, and audience strategies perform across evolving SERPs.
While AIOs and answer engines aim to satisfy users within their own experiences, Google and other platforms still depend on clicks to drive ad revenue. Multi-ad serving and emerging AI-driven experiences will expand ad opportunities, but also heighten reliance on PPC as a key driver of growth. Winning in this new landscape will require smarter bidding, adaptability, and a commitment to agile testing.
If you have any questions about how AIOs might be impacting your business, you can learn more by downloading our latest eBooks. If you are interested in more immediate support, please contact us by email at sales@synapsesem.com.
