Navigating the AI Shift: How is the AI Overview Impacting Your Paid Ads Performance?

If you’ve noticed a dip in your paid advertising performance (such as your Google Ads or Bing Ads) recently, you’re not alone. 

Like countless businesses, you’re investing more and more, but seeing less and less in return. 

The question that’s probably on your mind is “why?” What changed?

The answer lies in a fundamental shift happening right on the search results page. The landscape of paid advertising is being reshaped not by a new competitor, but by the platforms themselves.

Let’s take a closer look.

The Elephant in the Room: AI Overviews and The Click Drought

The most significant change is the aggressive rollout of Google’s AI Overviews (formerly the Search Generative Experience). 

This feature aims to answer user queries directly on the search page, synthesizing information from various sources into a single, neat box at the top of the results.

Recent 2025 studies by Seer Interactive and Search Engine Land show that for queries where an AI Overview appears, Paid Click-Through Rates (CTR) have plummeted by 68% (dropping from a 19.7% average to just 6.34%).

Even more concerning for the mobile-first world, Adthena reports that ads are now pushed “below the fold” nearly 50% of the time on mobile devices when an AI Overview is present.

For the user, it’s convenient. For advertisers, it’s a potential black hole for clicks.

Think about it: If a user gets their answer directly from Google, why would they ever click on your ad or organic listing? 

This isn’t a hypothetical. We’re already seeing early data suggest a reduction in click-through rates (CTR) for certain informational queries as users engage with the AI Overview instead of the links below it.

This is a classic case of the platform innovating for the user at the expense of the advertiser.

Your Budget is Fueling Their AI Engines

Here’s the uncomfortable truth many agencies won’t tell you: your advertising platforms (Google, Microsoft, Meta) are in an arms race to build the best AI. 

And guess who’s funding a significant part of that R&D? You are.

When broad, unoptimized campaigns are left to run on “auto-pilot,” a larger portion of your ad spend is being used to feed data into the platform’s machine learning models. 

The platform’s goal is to learn what works in general, not what drives profitable results for your specific business.

This leads to:

• Inefficient Spending: Your budget is burned on clicks that look good in the platform’s report (clicks, impressions) but don’t translate to your bottom line (leads, sales, ROAS).
• Poor Quality Traffic: You’re attracting window-shoppers and curious searchers, not ready-to-buy customers.
• Frustration and Stagnation: You’re spending more to get the same, or worse, results.

Even more serious is how the different ad platforms will only reinforce these issues by offering “recommendations” that do little to stop the stagnation. 

Take Google Ads, for example, nine times out of ten when a campaign is doing poorly, the engine or even their human reps will tell you to simply increase your budget or trust in the AI tools for longer.

But aren’t those the two things that got you here in the first place?

Let’s Do Things Differently with Your Paid Ads Management

At Acorn, we’re not here to just adapt to these changes in the digital advertising landscape like it’s another day at the office. Our goal is to steer every business through it, with the best returns possible. 

Let’s be clear: this new era of AI takeovers and higher competition for your ad dollar doesn’t spell the end of performance marketing. Rather, it signals the end of lazy marketing. 

First up, the strategies that worked two years ago are no longer enough. At Acorn, our performance-focused approach is built for this exact challenge. True, AI might look like a threat, but it can also be a tool to master.

Here’s how we mitigate the damage and turn the AI shift into your advantage:

1. Precision Targeting Over Broad Reach: We’re moving beyond simple keyword matching. We double down on high-intent audiences, detailed demographic targeting, and sophisticated exclusion strategies to ensure your ads are only shown to users who are genuinely in the market for your service. If AI Overviews capture the “what is” queries, we’ll capture the “buy now,” “near me,” and “vs.” and other high intent queries that get you sales and leads.

   This shift is critical because AI Overviews are no longer just for “fun facts.” Semrush data from late 2025 shows that AI summaries have expanded aggressively into commercial intent, with transactional query coverage increasing from 2% to 14% in just one year. We ensure your ads are appearing where the AI cannot yet provide a shortcut to the finish line.

2. A Relentless Focus on Conversion Architecture: A click is worthless if it doesn’t convert. We obsess over your post-click experience. This means crafting hyper-relevant landing pages, streamlining your conversion forms, and implementing advanced tracking to ensure every dollar spent is accountable. We make sure that the traffic we drive is so well-qualified that it *has* to convert.

3. Data-Driven Bidding with a Human Touch: While we leverage smart bidding strategies, we don’t cede full control to the platform’s AI. Our experts constantly analyze performance data, adjusting bids, budgets, and targets based on real-world outcomes—not just the platform’s vague “learning” signals. We tell the AI what *true* performance looks like for you.

4. Embracing New Ad Formats & Placements: The AI Overview is just one part of the page. We’re testing and leveraging other high-visibility, high-intent formats like Performance Max campaigns, YouTube Shorts ads, and strategic Display placements to capture attention across the entire digital ecosystem.

5. Using SEO Tactics to be Present on AI Overview: As we see now, the AI Overview is NOT helping your ads performance, but you can leverage this tool to boost your organic visibility by creating a strategy that will keep you on the top of results thanks to solid AI search foundations.

Pro Tip: Brands that are cited as a source within the AI Overview actually see a 91% higher Paid CTR on their accompanying ads compared to brands that are not cited. By aligning your SEO and Paid strategies, we don’t just “survive” the AI box, we use it as a trust-builder for your paid campaign.

The Bottom Line?

Yes, the platforms are changing.

Yes, they are using your ad spend to train their AI.

But with a partner like Acorn, you are not just a line item in a budget report. You are a client whose success is our primary KPI.

We give the platform’s AI the right signals, the right data, and the right constraints to work for you, not against you. We transform your ad spend from a cost of learning for them, into a direct investment in your growth.

Ready to future-proof your digital advertising?

Let’s have a conversation about building a paid ads strategy that’s resilient, agile, and relentlessly focused on your performance.
Contact Acorn Digital Today for a free audit of your paid ads account.