As Google faces its biggest challenge yet, here’s how you can turn uncertainty into your next big win.
Google is cooked … cooked like a luxurious, rich, decadent, yet tender steak on the Fourth of July.
I know that sounds dramatic, but we could be witnessing the slow demise of Google as we know it.
Testifying in Google’s antitrust trial, Apple’s head of services, Eddy Cue, confirmed that fewer iPhone users are using Google Search on Safari and are instead turning to AI.
Cooked!
Now, before you think I’m writing Google’s obituary, let me be clear. Like I’ve said before, I’m confident they’ll figure it out, even if that means changing their business model.
That said, if your business depends on Google in any way, whether it’s your business profile, reviews, SEO, or products like Ad Manager to drive traffic, you needddddddddd to pay attention to what’s happening.
In today’s article, we’ll dive into what’s going on with Google and how it impacts you. I’ll also walk you through how we got here and what the future may hold, as well as share three things you can do to prepare.
If you’re new to my work, my name is Lester, but feel free to call me Les. I’m a founder with a successful exit, currently the executive chairman of a group of ecom brands, and an award-winning performance marketer.
My team has adopted AI to develop internal tools that allow us to stay ahead in a highly competitive space. We operate more like a tech and data company than a typical ecom brand, which gives me a front-row seat to how AI is reshaping the world of online business.
If you’re finding it hard to keep up with AI and want insights and opportunities in this crowded space, check out my free newsletter, No Fluff Just Facts. I share what’s working, what to watch for, and the AI innovations that are worth your time.
But enough about me. We need to talk about why Google losing its grip on search could be detrimental to small businesses.
Understanding the landscape
Before we jump into it, we need to understand why Eddy Cue spilled the beans on what’s happening with Google’s core business of search.
The Department of Justice and several states are suing Google’s parent company, Alphabet, arguing that its exclusive deals with companies like Apple are anticompetitive and potentially monopolistic.
Basically, Google is paying billions to be the default search engine on Apple devices, effectively shutting out any real competition. The ruling in this case could break up their reported $20 billion-a-year agreement.
On the stand, Apple’s Eddy Cue revealed that, for the first time in over two decades, Google’s search traffic on Apple devices actually dropped last month as users started turning to AI instead. Cue also mentioned Apple is considering revamping Safari’s search feature to incorporate more AI features … Yikes.
promise I’m not trying to be that guy, but the DOJ is about 10 years late. The reality is that AI is already changing the way people search for information organically. Search habits are evolving on their own, whether or not there is a courtroom battle.
Google’s position as the default search engine is starting to feel like a moot point when users are pivoting to tools like ChatGPT and Perplexity. It’s kind of like going after Blockbuster today for being a video rental monopoly.
The world has already moved on.
What does this shift mean for you?
Long story short, the way people discover, research, and choose businesses is changing one AI update at a time, but it’s essential to note that people are still searching, just not in the same places they used to. That nuance is critical to understanding your next move.
As more users turn to AI tools like ChatGPT and Perplexity for answers, traditional search engines are no longer the only gateway to your business. This shift in behaviour over time will result in less traffic to your product or service. If you are buying traffic from Google in the form of search or shopping ads, you can expect those ad rates to increase.
However, if you are selling traffic to Google in the form of Google AdSense, you can expect your ad revenue to decrease unless Google and others quickly overhaul how search integrates AI.
So, not only will these changes compress your margins when it comes to paid traffic, but they’ll also affect your revenue as your business gets less visibility overall.
But it’s not just traffic and margins on the line. Data is disappearing, too.
What’s also not discussed enough is that if users are going directly to AI to answer their questions, online business owners will lose insight into which keywords customers are using to find them. Even worse, we lose the ability to do competitor analysis since we can no longer see what’s working for them.
Find out what words you should avoid searching on Google
We all use Google to answer the looming questions in our heads. But there are apparently some things we should avoid using the search engine for.
From searching symptoms we are experiencing to finding out the latest movie release, Google is certainly a handy tool when it comes to easily accessing information.
However, the top search engine in the world also has some sides to it that we should seek to avoid.
Most of us do internet searches every day, but there are some things it’s best not to know (Getty Stock Image)
Regular users of the search engine will be used to using Google Images. However, no matter how innocently motivated your search may be, some of these images should not be glanced at and are hard to leave your mind easily.
Unfortunately, Google Images does not come with trigger warnings, so consider this article a friendly warning before you decide to search any of the following five terms on Google.
In fact, these terms are so stomach-churning that they have been compiled in a report by It’s Gone Viral in 2023.
Try to remember that while it may seem harmless to Google health-related terms, if you have any concerns about your health, prioritize consulting a medical professional above searching for answers online.
Anyway, let’s proceed with the specific words you should avoid searching…
Larvae
The first word we highly recommend you avoid searching is Larvae.
According to the Oxford Dictionary, it is defined as ‘the immature form of an insect or animal that has hatched from an egg but has not yet become an adult’.
While this may seem like an innocent search, you could stumble across a condition of the same name.
According to WebMD: “Mouth larvae are parasites that hatch and live inside the oral cavities of human and animal hosts. These pests can cause a dangerous infection known as oral myiasis.”
The site adds: “People can develop oral myiasis by eating larvae in their food. Flies can also enter the mouth and lay eggs in wounds.”
The searches might seem innocent, but could end up scarring you (Getty Stock Image)
Degloving
Another word to avoid Googling is degloving.
WebMD defines degloving, also known as avulsion, ‘happens when a large piece of your skin along with the layer of soft tissue right under it is partially or completely ripped from your muscles and connecting tissues’.
Sounds incredibly unpleasant, right? Well so are the images so don’t dare to take a look!
Krokodil
While Krokodil may sound like crocodile, you won’t see anything near the reptile if you search that on Google Images – so beware of any typos when searching for crocodile images!
Instead, what you’ll be shocked to discover is that Krokodil has different meanings in different languages.
However, the particular definition defined in the It’s Gone Viral report refers to the opioid drug desomorphine.
A Time magazine report from 2013 dubbed it as ‘The World’s Deadliest Drug‘.
It started when doctors in Russia discovered ‘strange wounds’ on many drug addicts.
Later, it was discovered that they’d been injecting a new drug known as ‘Krokodil’. This was later dubbed as a ‘flesh-eating zombie drug’ in a report from CNN.
Definitely not the type of visuals you want your eyes to witness, right?
Some of these searches will leave you a lot more horrified than this (Getty Stock Image)
Fournier
While Fournier is a popular French name, it can also refer to an ‘acute necrotic infection’ of the genital area, according to the National Organization for Rare Disorders (NORD).
WebMD warns: “Fournier’s gangrene gets worse quickly and can kill you, so it’s always an emergency.”
Harlequin ichthyosis
The final word you should avoid Googling is Harlequin baby syndrome, also known as congenital ichthyosis.
Healthline defines this as a ‘rare condition affecting the skin’, which is a ‘type of ichthyosis, which refers to a group of disorders that cause persistently dry, scaly skin all over the body’.
The site clarifies further that the skin of a new-born with this condition is ‘covered with thick, diamond-shaped plates that resemble fish scales’.
Babies with this condition should be treated immediately.
Google added QR codes that you can give your customers to quickly leave you a review for your business on Google Search and Google Maps. This can be accessed in your Google Business Profiles under the reviews section.
You can access this on desktop by searching for your business, then clicking on “Ask for reviews” or by going to your reviews and clicking on “Get more reviews.”
Here is what it looks like:
It says, “Give customers a link to review your business on Google, Reviews build trust and help your Business Profile stand out to customers on Search and Maps. Get your own Google QR to receive customer reviews.”
This was shared by Lisa Landsman from Google on LinkedIn who wrote:
[Just Launched] Create QR codes for reviews directly within your GBP
We all know how critical reviews are for your business’ reputation. Now you can create easy-to-scan QR codes that take customers directly to your Google Business Profile, encouraging them to leave more reviews. Rather than having to take the link from GBP and put them into a QR code generator, you can do this all in one place!
Here’s how: On your desktop, go to your Business profile and click on “ask for reviews”. Follow the instructions to generate a link or a QR code. Voila!
This is kinda of new, I mean, it is new here. But Google had QR codes since 2009, I embedded a video of how slow it was to scan a QR code back then. Then in 2010, Google let you print your own QR code and then 2011 Google removed it.
Anyway – we have had Google re-up its QR code game recently.
Fed up with Google’s results? Perplexity could be just what you’re looking for
There’s no denying that Google has been a core part of the internet for decades (for better or for worse), but it’s also fair to say its search product is hardly at the peak of its powers anymore.
Clunky AI overviews that are often incorrect, too many sponsored results, and giving low-quality sites more of the limelight has left many scrambling for an alternative. Where it often felt like one would never come, now Perplexity AI offers a genuine rival.
Naturally, an AI search engine comes with the usual caveats: it’ll get some things wrong, but with the state of Google at the moment, there’s perhaps never been a better way to try something new.
With that in mind, here’s why Perplexity AI might be your next search engine of choice, and how to change it.
Why Perplexity AI could be your next search engine
The big draw of Perplexity AI as a search engine is that it’s not just a search engine. Let me explain — Google has piled more and more on top of its existing search product, and while some of it has undoubtedly been useful, it’s started to feel as though the whole thing is creaking.
In many ways, Perplexity AI’s search function is just a bonus to a very good LLM that’s pretty great at research.
You can Google when, say, the iPhone 17 is launching, but that’s it. After that, you start a fresh query, and the process begins again, whereas Perplexity lets you ask a follow-up question like “How many models will there be?” or “How many days is that?”.
It’s also great at doing, well, LLM things. Ask it for a summary of the news today, and it’ll condense it for you. Ask for a recipe for banana bread, and it’ll put its digital apron on, and even let you ask for potential replacements for ingredients you may not have in the house.
The whole thing is more conversational, and it’s remarkably easy to set up — even in Chrome, which has long been Google’s home turf.
How to make Perplexity AI your default search engine
The following instructions work on any Chromium browser, and some will let you log in on multiple profiles so you can flick between Google and Perplexity based on your context.
Open Chrome on your device
Click the three dots in the top-right corner, then click Settings.
On the left-hand sidebar, click Search engine, and then Manage search engines and site search
To add Perplexity to the browser, use the following information:
Typing the ‘perp’ shortcut will trigger Perplexity, but you can also set it as Default if you’d prefer.
Using Firefox? It’s just as simple.
Open Firefox on your device
Open the Firefox Add-Ons storefront and add the Search Engines Helper Extension
Open the extension, and then enter https://www.perplexity.ai/?q=%s for the Search URL, which will auto populate the rest of the list.
Right-click the address bar in your browser and click Add “perplexity.ai” and you’re done.
How to use Perplexity on your phone
(Image credit: Future / Perplexity)
Switching to Perplexity on your phone is as easy as installing the Perplexity Ask app.
Doing so gives you a sort of ‘live ticker’ of news before you even get started.
Perhaps my favourite thing about Perplexity is that it attempts to put sources front-and-center. Asking “what’s in the news today?” will give a series of stories, as well as tappable citations so you can expand a story.
(Image credit: Future / Perplexity)
There’s also a handy set of ‘Related’ options you can tap, with each expanding the context of the day’s biggest stories.
Paid subscribers can even get the news (or any other searches) delivered via audio recording.
Finally, I particularly appreciate the way you can quickly share a screenshot via a built-in share sheet — ideal for sharing fun or surprising results.
Will you be switching to Perplexity AI as your browser? Let us know, and don’t forget you can always switch back to Google if you’d prefer.
Amid the rise of ChatGPT, and conversational search more broadly, Google is losing ground as the key discovery platform on the web.
Well, by “losing ground”, I mean that its share of the search engine market dropped below 90% for the first time in a decade last year. So it’s still by far the dominant discovery tool, but the AI shift is having at least some impact on its core business.
As you can see in this new chart, created by the team at Visual Capitalist, while Google has lost ground slightly, Bing has increased, which is presumably due to Microsoft’s partnership with OpenAI, which has led to Bing’s integration of more AI elements (while ChatGPT also displays Bing results).
Indeed, back in 2023, after Microsoft announced the integration of ChatGPT results into its Bing search engine, Bing downloads increased tenfold as a result.
Long considered the “other” search engine, generative AI has made Bing more relevant, though Google is working to counter that with its own AI elements.
Which, presumably, will ensure that Google remains the leader in online discovery, but it is interesting to note this shift, and to consider what the AI shift means for discovery moving forward.
Alphabet’s year included product mishaps, layoffs, changes to processes and divide among the workforce.
As Google faced some of the most intense pressure its experienced since going public two decades ago, so too did CEO Sundar Pichai, who took the helm in 2015.
The challenges led many staffers to question Pichai’s vision for the company.
Google’s blowout earnings report in April, which sparked the biggest rally in Alphabet shares since 2015 and pushed its market cap past $2 trillion for the first time, tempered fear that the company was falling behind in artificial intelligence.
As executives enthusiastically talked about the results with Google’s employees at an all-hands meeting the following week, it was clear that Wall Street viewed things differently than the company’s workforce.
“We’ve noticed a significant decline in morale, increased distrust and a disconnect between leadership and the workforce,” one employee wrote in a comment that was read by executives at the meeting. “How does leadership plan to address these concerns and regain the trust, morale and cohesion that have been foundational to our company’s success?”
The comment was highly rated on an internal forum.
“Despite the company’s stellar performance and record earnings, many Googlers have not received meaningful compensation increases” another top-rated employee question read.
That meeting set the stage for what would be a year of contrasting takes from the company’s vocal workforce. As Google faced some of the most intense pressure its experienced since going public two decades ago, so too did CEO Sundar Pichai, who took the helm in 2015.
Pichai oversaw a steady stream of revenue growth this year in key areas like search ads and cloud. The company rolled out ground-breaking technologies, rounded out its AI strategy despite a slew of embarrassing product incidents and saw its stock price rise more than 40% as of Thursday’s close, ahead of the S&P 500 but trailing rivals Meta and Amazon.
Over the course of 2024, many staffers questioned Pichai’s vision following product mishaps in the first half of the year as well as internal shake-ups and layoffs, according to conversations with more than a dozen employees, audio recordings and internal correspondence.
As the second half of the year progressed and Google rolled out a number of eye-catching AI products, Pichai’s standing improved, though some scepticism remains, sources told CNBC.
Google DeepMind chief Demis Hassabis (L) and Google chief executive Sundar Pichai open the tech titan’s annual I/O developers conference focusing on how artificial intelligence is being woven into search, email, virtual meetings and more. Glenn Chapman | AFP | Getty Images
The AI race pressure cooker
After the introduction of ChatGPT in late 2022, the tech industry saw an influx of AI products from Microsoft, with its Co-pilot AI assistant, and Meta, which placed its Meta AI chatbot in the search functions of its apps, as well as from hot startups like OpenAI and Perplexity.
The popularity of those tools has eaten into Google’s grip on U.S. search. The company’s share of the search advertising market is expected to dip below 50% in 2025, which would be the first time falling below that mark in more than a decade, according to research firm eMarketer.
Google responded to the pressures from new AI tools with offerings of its own. The company in 2024 rebranded its family of AI models as Gemini and released a number of products that were well received. But in its scramble to play catch-up, the company also released a pair of AI products that initially proved embarrassing.
In February, Google launched Imagen 2, which turned user prompts into AI-generated images. Immediately after it was introduced, the product came under scrutiny for historical inaccuracies discovered by users. Notably, when one user asked it to show a German soldier in 1943, the tool depicted a racially diverse set of soldiers wearing German military uniforms of the era.
The company pulled the feature, and Pichai told employees the company had “offended our users and shown bias,” according to a memo. Google said it would take a few weeks to relaunch Imagen 2, but it ended up being six months before it was revived as Imagen 3 in August.
“We definitely messed up on the image generation,” Google co-founder Sergey Brin told a small crowd at a hacker house in March, in a video posted to YouTube. “It was mostly due to just not thorough testing.”
The launch of AI Overview in May caused a similar reaction.
That product showed users AI summaries atop Google’s traditional search results. Pichai hyped the product, calling it the biggest change to search in 25 years. Once again, users were quick to find problems.
When asked “How many rocks should I eat each day,” the tool said, “According to UC Berkeley geologists, people should eat at least one small rock a day.” AI Overview also listed the vitamins and digestive benefits of rocks.
Google responded by saying it would add more guardrails to AI Overview for health-related queries but said the mistakes weren’t hallucinations, and were rather just rare edge cases. Search Vice President Liz Reid told employees at an all-hands meeting in June that AI Overview’s launch shouldn’t discourage them from taking risks.
“We should act with urgency,” Reid said. “When we find new problems, we should do the extensive testing but we won’t always find everything and that just means that we respond.”
Jaque Silva | Nurphoto | Getty Images
Beyond its AI blunders, Google also saw its greatest regulatory challenges to date in 2024.
In August, a federal judge ruled that the company illegally holds a monopoly in the search market. The Justice Department in November asked that Google be forced to divest its Chrome internet browser unit as a remedy for the ruling
The DOJ’s request represents the agency’s most aggressive attempt to break up a tech company since its antitrust case against Microsoft, which reached a settlement in 2001.
The remedies are expected to be decided next summer, and Google has said it will appeal, likely dragging out the situation a couple more years, but the company faces more antitrust hurdles.
In a separate case, the DOJ accused the company of illegally dominating online ad technology. That trial closed in September and awaits a judge ruling. In October, a U.S. judge issued a permanent injunction that will force Google to offer alternatives to its Google Play app store for Android phones. After the ruling in October, Google won a temporary pause on the ruling, meaning it won’t have to open up Android to more app stores yet.
A search for vision
Amid the external pressure, Google notched some notable victories particularly toward the end of 2024, leading to a more positive sentiment from people within and outside the company.
Google successfully launched its most powerful suite of new Gemini models that underpin all of the company’s AI products, including its lightweight model Gemini Flash, which has been popular among developers. YouTube’s combined ad and subscription revenue over the past four quarters surpassed $50 billion.
In the third quarter, Google saw the fastest-growing cloud business across the big tech players, up 35% over last year, with operating margins of 17%. The company has also seen double-digit revenue growth for each of the past four quarters and launched Trillium, its powerful sixth generation Tensor Processing Units, or TPUs, which were also found to have powered Apple’s AI models.
Despite the blunders, AI Overview reached nearly 1 billion monthly users by the end of October. Demand for AI software has also driven consistent growth for the company’s cloud infrastructure. And Google launched an impressive video generation product, Veo 2, this month as well as an updated AI note-taking product, NotebookLM.
Beyond AI, Google in December announced Willow, a chip the company calls its biggest step in the march toward commercially viable quantum computing. The Waymo self-driving car unit was also a bright spot, expanding its robotaxi service to three cities and laying the groundwork for even more expansion in 2025. The company has delivered 4 million fully autonomous rides this year, with plans to commercially launch in Austin, Texas, and Atlanta next year.
A Google quantum processor “Sycamore” is held up to the camera wearing blue gloves. In 2019, Google made a breakthrough in quantum computing. Peter Kneffel | Picture Alliance | Getty Images
But as Pichai approaches a decade running Google and starts his sixth year as CEO of parent Alphabet, questions remain about his ability to guide the company into the future.
Internally, employees routinely criticize leadership on the company’s Memegen messaging board, and some have aired their grievances publicly.
“Google does not have one single visionary leader,” a Google software engineer wrote in a LinkedIn post earlier this year that received more than 8,500 reactions. “Not a one. From the C-suite to the SVPs to the VPs, they are all profoundly boring and glassy-eyed.”
In October, Google announced it would shake up the leadership of its ads and search division.
The company replaced longtime search boss Prabhakar Raghavan with Nick Fox, a deputy of Raghavan’s and a career Google employee. Raghavan was given the title of “chief scientist,” but internally, he is now listed as an “IC,” or individual contributor.
Google also shifted the team working on its Gemini AI app to the Google DeepMind division, under AI head Demis Hassabis. Employees praised Pichai’s leadership shuffle, but some complained that the moves should’ve happened sooner.
Notably, some employees were perturbed when Raghavan addressed employees at an all-hands meeting in April, when he urged them to move faster, according to several people who spoke with CNBC. Raghavan noted that the staffers working to fix the failed Imagen 2 tool had increased their workloads from 100 hours a week to 120 hours to correct it in a timely manner.
Pichai has made efforts to get Google back to its nimble startup-like culture.
When addressing employees, Pichai often name-checked co-founders Sergey Brin and Larry Page to remind them of Google’s scrappy roots. He’s flattened the company, removing 10% of middle management, according to audio of a December all-hands meeting. And in the spring, Pichai greenlit a hackathon, allowing employees to build using Google products that have yet to be announced. Pichai has also personally joined meetings with Google’s Labs team and enabled them to move quickly on products like NotebookLM, one of the company’s hit AI products in 2024.
Google Co-Founder Sergey Brin speaks during a press conference after the third game of the Google DeepMind Challenge Match against Google-developed supercomputer AlphaGo at a hotel in Seoul on March 12, 2016. Jung Yeon-Je | AFP | Getty Images
After Brin’s hacker house appearance in March, some employees internally joked he should retake the helm, nostalgic for what they perceived as a visionary leader devoid of corporate speak.
Brin co-founded Google with Page in 1998, but he stepped down as president of Alphabet in 2019. Brin, who remains a board member and a principal shareholder with a stake worth more than $140 billion, began appearing more frequently on campus starting in 2023, as part of an effort to help ramp up Google’s position in the hypercompetitive AI market. Employees, particularly working in AI and DeepMind said they’ve seen Brin walking around the company’s Mountain View, California, headquarters throughout the year and have been able to ask him questions for projects they’re pursuing.
Despite Brin’s re-emergence, several employees told CNBC they’re doubtful he could adequately run what has become an increasingly larger and complex corporation.
Employees said that although Pichai didn’t strike them as particularly visionary or as a wartime leader, it’s hard to find someone better suited for the job, given all the complexities of Alphabet. The key quandary remains: move too early and risk widespread criticism; move too late and risk missing the boat.
Culture Clashes
Through the year, morale inside Google wavered. Efforts to cut costs across the company in order to invest more in AI resulted in some teams feeling bifurcated and created yet another challenge for Pichai.
Within the company’s AI and DeepMind divisions, morale is mostly high, according to employees, boosted by hefty investments. Elsewhere, the vibes have been marred by cost cuts, bureaucracy and declining trust in leadership, employees said.
DeepMind and AI teams have held off-sites, team-building activities, and have much bigger travel and recruiting budgets, people familiar with the matter said. In the spring, the company moved employees out of an eight-story office on San Francisco’s waterfront Embarcadero street and replaced them with AI and AI adjacent teams.
Google DeepMind co-founder and Chief Executive Officer Demis Hassabis gives a conference during the Mobile World Congress (MWC), the telecom industry’s biggest annual gathering, in Barcelona on February 26, 2024. Pau Barrena | Afp | Getty Images
A meme posted internally in November summed it up.
The meme featured a photo of the cast of “Wicked” actors, where one, labelled “execs” looked longingly at one fellow actor labelled “Gemini” while ignoring the other beside her, which was labelled as “users.”
A Google spokesperson contested the idea that AI workers are receiving favourable treatment and said higher travel and recruiting budgets are not exclusive to AI teams or DeepMind.
“Most Googlers, regardless of team, continue to feel positively about our mission and the company’s future, and are proud to work here,” the spokesperson said.
A fewemployees say they’re no longer incentivized by the prospects of landing a promotion, which have become harder to achieve, and rather by the hope of avoiding layoffs.
Despite slashing 12,000 jobs, or roughly 6% of its workforce, in 2023, Google has continued eliminating roles this year. In her first public statements as Google’s CFO, Anat Ashkenazi, told Wall Street in October that one of her top priorities would be to drive more “cost efficiencies” across the company in order to invest more in AI.
“I think any organization can always push a little further and I’ll be looking at additional opportunities,” Ashkenazi said.
That month, Google posted a job listing for a “Central Reorg Support Team Partner.” The responsibilities of that fixed-term contract position would include consulting with local HR teams and noted the need for the support staff’s “ability to operate with empathy and diffuse/de-escalate challenging conversations/situations.”
“Hire the smartest people so they can tell us what to do,” one employee wrote on the internal forum in meme-style font atop the images of Brin and Page. “Hire a reorg consultant so they can tell us how to layoff the smartest people,” another said.
Google ultimately took the job listing down.
Pro-Palestinian protesters are blocked the Google I/O developer conference entrance to protest Google’s Project Nimbus and Israeli attacks on Gaza and Rafah, at its headquarters in Mountain View, California, United States on May 14, 2024. Tayfun Coskun | Anadolu | Getty Images
Touting its AI technology to clients, Pichai’s leadership team has been aggressively pursuing federal government contracts, which has caused a heightened strain in some areas within the outspoken workforce since the beginning of the year.
Google terminated more than 50 employees after a series of protests against Project Nimbus, a $1.2 billion joint contract with Amazon that provides the Israeli government and military with cloud computing and AI services. Executives repeatedly said the contract didn’t violate any of the company’s “AI principles.”
However, documents and reports show the company’s agreement allowed for giving Israel AI tools that included image categorization, object tracking, as well as provisions for state-owned weapons manufacturers. Earlier this month, a New York Times report found that four months prior to signing on to Nimbus, officials at the company worried that signing the deal would harm its reputation and that “Google Cloud services could be used for, or linked to, the facilitation of human rights violations.”
In an all-hands meeting in April, a highly rated question asked why employees who did not participate in the protests were also fired, which was reported and cited in a National Labour Relations Board complaint from affected employees. Chris Rackow, Google’s security chief, took the stage at the all-hands and rebutted those claims.
“This was a very clear case of employees disrupting and occupying work spaces, and making other employees feel unsafe,” a Google spokesperson told CNBC, adding that the company “carefully confirmed” that every person terminated was involved in the protests. “By any standard, their behaviour was completely unacceptable.”
That round of job eliminations underscored Google’s clampdown on internal discussions related to hot-button topics, including politics and geopolitical conflicts, which was encouraged by executives several years prior.
One internal meme that got more than 2,000 likes, compared Google to Star Wars’ Anakin Skywalker. The meme shows an image of a smiling childhood Skywalker, framed by one of the company’s original, colourful employee badges. The meme progresses Skywalker’s age in two later versions of the badge.
The final badge shows Darth Vader working for “Google,” spelled out in the font of IBM’s logo.
The tech giant’s tight grip on the search-ad market is slipping as competitors like Amazon and AI tools lure users and advertisers away.
While Google’s latest woes seem to centre on the DOJ’s antitrust efforts, the search-engine giant may soon face another — perhaps even greater — threat to its moat: losing its dominance in search ads.
In 2023, GoogleGOOGL $197.46 (0.30%) earned over $175 billion (or 57% of Alphabet’s total sales) solely from search advertising, where revenues are generated by people clicking on the sponsored ads displayed alongside search results. However, Google is gradually losing ground in the $300 billion-strong global market for search ads, as both users and advertisers shift to competitors like Amazon and AI tools, The Wall Street Journalreports.
According to data from eMarketer, Google’s share of the search-advertising market is forecast to drop below 50% next year for the first time since tracking began in 2008, with revenue growing at a modest 7.6% year over year. Meanwhile, Amazon’s search-ad revenue surged by 17.6% over the same period.
Indeed, users are increasingly turning to platforms like AmazonAMZN $222.71 (-2.15%) or TikTok for their shopping searches and general queries, according to WSJ. The seemingly inevitable rise of AI is also playing a role: a survey from New Street Research found that nearly 60% of US consumers used a chatbot to help them decide on a purchase in the past 30 days.
This shift means fewer users are clicking on Google’s ads, driving precious ad dollars away from the tech giant and toward its rivals. Advertisers’ spending on search engines like Google grew a modest 3% year over year in Q3… while spending on retail media like Amazon was up 28%, and social-media platforms like MetaMETA $610.88 (-3.07%) were up 5%, per marketing agency Skai’s latest report.
Google is the most popular search engine in the world, but its dominance over search ad revenue—and Gen Z’s vernacular—is losing steam.
According to a Wall Street Journal report, Google’s share of the $88.8 billion U.S. search advertising market is expected to fall to the lowest point in over a decade as a diverse set of competitors like Amazon, Perplexity AI, and TikTok deliver alternative search experiences.
Consumers are conducting product searches through Amazon and social media searches through TikTok, with targeted ads creating revenue for each business along the way. Perplexity is expected to infuse its AI search results with ads later this month.
Those rival offerings will push Google’s U.S. search ad market share below 50% next year and bring Amazon’s share up to about 25%, per the WSJ.
Moreover, Bernstein Research shows that Gen Z is barely using the term Google as a verb. Young users are “searching” through social media, Amazon, and ChatGPT; they aren’t “Googling,” Bernstein analyst Mark Shmulik wrote in a September note.
As of last week, Google’s AI Overviews now display ads with relevant products under a “sponsored” banner. According to a Google spokesperson, the ads will only appear under relevant searches.
Example of ads in Google AI overviews. Credit: Google
Even with AI rivals like ChatGPT, Google’s numbers remain strong. Its share of the overall search market has remained at least 90% so far. Bing, Yahoo, and other search engines have less than 4% each of the market.
Google ad revenue also increased from 2022 to 2023, rising from $224.47 billion to $237.86 billion.
Sherin Shibu is a business news reporter at Entrepreneur.com. She previously worked for PCMag, Business Insider, The Messenger, and ZDNET as a reporter and copyeditor. Her areas of coverage encompass tech, business, strategy, finance, and even space. She is a Columbia University graduate.
SearchGPT is already dubbed by some as the “Google killer.”
Arvind Jain, a former Google (GOOGL) engineer and now CEO of the enterprise A.I. search platform Glean, never saw Google’s approximately 90 percent market share in online search as overtly anticompetitive—after all, Google always had a superior search product, Jain said. In recent years, however, innovation seems to have given way to profitability. “The experience was getting worse, especially on mobile devices, where there are just way too many ads on the page,” the former Googler told Observer.
For the first time in many years, competition is ramping up. In July, OpenAI announced SearchGPT, an A.I.-powered search engine that many already dubbed the “Google killer.” Smaller players, such as Perplexity AI, are also gaining momentum in the search space.
“There is more serious competition than ever before,” Ashwini Karandikar, executive vice president of media, technology and data at the American Association of Advertising Agencies, an industry group, told Observer. Karandikar’s prescience is rooted in decades of industry experience, during which she witnessed digital advertising go from just 5 percent of a company’s advertising budget to practically 100 percent.
Technologically, answer engines powered by large language models (LLMs) have the potential to shake up the search and digital advertising markets, but Jain doesn’t think they’re not yet commercially ready. “Personally, as a user, I don’t feel comfortable going to these answer engines,” he said. That’s because most of them don’t provide the source of information from which they generate answers. Some chatbots are starting to cite sources, but this feature is still in the early stages. Ultimately, competitors will have to lean into a hybridized search solution, said Jain, which will combine plain search and plain answers for an optimized user experience.
That need for transparency has roots in the trust gap highlighted by consumer-facing A.I. products. The A.I. trust gap is “the sum of the persistent risks (both real and perceived) associated with A.I.,” Bhaskar Chakravorti, a business professor at Tufts University, wrote in a recent article for the Harvard Business Review. Common concerns around A.I. include deepfakes, hallucinations, data privacy and A.I.’s inherent black-box problem. Last year, Pew Research found that 52 percent of Americans feel more concerned than excited about the increased use of A.I., with people particularly torn about its application for finding accurate information online.
To establish public trust, companies like OpenAI, Google, Microsoft, Meta and Amazon are all prioritizing self-regulation. These companies are on a steering committee for a truth-seeking organization called C2PA, or the Coalition for Content Provenance and Authenticity. It’s an “open technical standard providing publishers, creators and consumers the ability to trace the origin of different types of media,” according to the coalition’s website.
Brand recognition will play a major role in trust, something Google simply has more of, said Andrew Frank, an analyst at Gartner. “People trust results because they see that they’re appearing on a search results page that they are familiar with,” he told Observer. “If you go to Perplexity, for example, as an alternative search engine, it has some powerful capabilities, but it doesn’t have that established brand trust yet that makes you feel confident that the results it’s giving you are unbiased and authentic.”
However, as the competitive landscape in search and digital advertising inevitably evolves, the leading position is not set in stone. Google is currently facing multiple antitrust charges over its dominance in the online search market. “Whatever happens with the trials, we’re definitely looking at a situation where marketers, in particular, are going to have to diversify their approach and do a lot more experimentation and testing of new channels, new techniques, new strategies for search and discovery,” said Frank, adding that this push forward is “mostly because of the impact of generative A.I.”
As new competitors enter the arena, monopoly concerns are not entirely assuaged. OpenAI itself is backed by Bing creator Microsoft. Meanwhile, Google is keeping up with A.I. trends with new products like AI Overviews. It’s possible the competitive waters will just get muddied. Nonetheless, innovation is already responding, and a somewhat consolidated market is good, said Frank. “We don’t want to see the same kind of fragmentation that made digital media so difficult to deal with in the early days,” he said.
Feature Image Credit: Jakub Porzycki/NurPhoto via Getty Images
Maximize your marketing budget with effective Google Ads optimization strategies that prioritize performance and protect your brand’s interests.
The Gist
Beware of default settings. Make sure your budget is allocated to high-performing channels like search, not Google Display Network or Search Partners.
Question recommendations.Take Google’s rep suggestions cautiously, as they may prioritize Google’s profits over your brand’s needs.
Optimize what you control. Use advanced strategies like optimizing for revenue and integrating CRM data to guide campaigns toward desired outcomes.
I’ve worked with Google Ads for almost 15 years. When I started working in search engine marketing, Google was a great partner that cared about helping brands succeed.
Those were the good old days.
Today, there are countless stories of reps pushing irrelevant features, formerly helpful reps being laid off in the shift to AI-based “service” and Google Ads campaigns that essentially encourage advertisers to set a budget and leave the rest to Google. Google reps are now prioritizing revenue for Google above all else, brands be damned. (If you don’t believe me, check out Sundar Pichai’s commentary on Google’s Q1 earnings call.)
Now, effective Google Ads optimization is especially crucial to make sure your budget is allocated to high-performing channels.
How to Make Your Marketing Budget Work for You, Not Google
Unless you’re marketing for a huge brand and have a dedicated rep whose main goal is to retain your business, your brand is vulnerable to all this. Here’s a list of recommendations for making sure your advertising budget is working for you — and not just Google’s bottom line.
Check Your Default Settings
Multiple brands have come to us with default settings that allocate the majority of the brand’s budget to Google Display Network and Search Partners, with nothing going to search — which is an exponentially higher-performing channel. Last month, we did an audit for a brand that had just spent many thousands of dollars on the GDN and Search Partners, with zero conversions to show for it.
Take Every Recommendation You Hear From a Rep With a Grain of Salt
Remember that their goal now is to make money for Google’s shareholders, not your brand. Even if it’s a cool-sounding beta that might offer early adoption advantages, think critically about whether it’s the right strategic move for your brand before signing up. Prioritize strategies that support your Google Ads optimization goals.
Make Sure You’re Controlling What You Can Control in Your Campaigns
Let’s say you’re an ecommerce brand that has to use PerformanceMax campaigns, and you’re telling the campaigns to optimize for conversion goals. If you leave the rest to Google, they’ll optimize for the easiest conversions, which will probably be your lowest-cost products.
You can mitigate this by optimizing for revenue and using target return on advertising spend (ROAS). For B2B brands, instead of focusing on leads, make sure that you are segmenting and integrating your back-end CRM data as offline conversions to tell Google what kind of customers to look for — specifically, the customers who buy the kinds of products or services you want to sell.
If You Have a Helpful Rep, Do Your Best to Keep Them
If you don’t, ask for a new one. Eventually AI “support” will probably be your only option, but if you don’t speak up before that happens, you’ll be stuck with whatever Google gives you.
When in Doubt, Ask an Expert to Check Your Campaigns to See if There Are any Red Flags
This could be an agency or a consultant if you don’t have anyone in house, but the right party will justify your investment several times over.
Enhancing Your Google Ads Optimization for Better Results
It’s helpful to learn as much as you can about Google Ads and to keep up with its releases and their effectiveness.
Overall, make sure there’s someone on your team who can recognize and call BS, and keep your accounts optimized for your growth, not Google’s. A solid approach to Google Ads optimization will help you counterbalance any external pressures.
Tyler Jordan is CEO of Jordan Digital Marketing. Tyler founded Jordan Digital Marketing (JDM) in July 2017 after extensive stints working on both sides of the agency-client relationship.
