AI-powered ads deliver up to 80% revenue gains for brands, Google reports

Google is reporting significant performance improvements from its AI-powered advertising tools, with some brands seeing online sales increase by as much as 80%, according to Modern Retail. The results come as the company continues to expand advertising within its AI-driven search experiences while refining how marketers reach consumers in more conversational environments.

The company attributes these gains to tools such as AI Max and Performance Max, which use machine learning to match ads with user intent rather than relying solely on traditional keyword targeting. Fashion retailer Aritzia is among the examples cited, recording a sharp rise in revenue after adopting AI Max, which analyzes product catalogs and creative assets to dynamically serve ads based on user behavior.

This shift is closely tied to changing search patterns. Google says queries within its AI Mode—powered by Gemini—are typically two to three times longer than conventional searches. These extended, more descriptive inputs provide additional context, allowing the system to better interpret intent and deliver more relevant advertising placements.

At the same time, Google is testing new formats designed specifically for AI-driven discovery. Features such as “direct offers” enable brands to present personalized promotions when users show signs of purchase intent during AI-assisted searches. Early participants in these pilots include companies like Poshmark, Reebok, E.l.f. Beauty, Chewy and L’Oréal.

The broader strategy also includes deeper commerce integrations. Google has introduced a Universal Commerce Protocol in partnership with Shopify, allowing transactions to take place directly within AI-generated interactions. Additionally, a “business agent” capability enables brands to shape how their products and messaging appear in AI-generated responses.

Despite the expansion of advertising in AI Mode, Google has indicated that it does not currently plan to introduce ads within its Gemini chatbot environment. Instead, the company is focusing on refining ad performance within search-driven AI experiences while continuing to evaluate user response and advertiser outcomes.