Advertisers are unhappy with Google and Microsoft: Here's why
What's the story
Google and Microsoft have been busy incorporating generative AI into every part of their business. The two tech behemoths' AI experiments have reached the lucrative ad space too. However, some of their buyers are not thrilled about the forced transition to AI. A few have even held off their ad spending due to this. Let's see why advertisers are unhappy with Google and Microsoft.
Context
Why does this story matter?
Search has long been a major advertising opportunity for Google, Microsoft, and advertisers. However, with search in an evolutionary phase due to the advent of generative AI, advertising is also staring at a new age. With generative AI making search more conversational than ever, questions are being asked about ads' place in the new model. A transition can be tricky for everyone.
AI experiments
Google and Microsoft are adding ads to AI experiments
Last month, Google unveiled its AI-based version of its search engine called Search Generative Experience (SGE). The company has announced its plans to place existing search ads in SGE's search results. It is to fend off any competition from Microsoft in the search ads market. Meanwhile, the Redmond-based company is testing ads in its Bing AI chatbot.
Irked
Advertisers do not have the option to opt-out
Both Google and Microsoft have not given advertisers an option to opt out of the AI experiments. This is what irked them. While the tech giants are in the early stages of testing ads in generative AI results, advertisers feel they have lost control over the placement of their ads. This is expected to result in further pushback from the ad industry.
Ad placement
Advertisers are wary of inappropriate/unsuitable AI-generated content
Advertisers typically like to choose where their ads are placed. They are not on board with allocating their marketing budgets to place ads in features that only a few can access. There is also the issue of AI generating unsuitable or inappropriate content. No advertiser wants their ads to be in any way associated with such a thing.
Pushback
Some advertisers have pulled spending from Microsoft
It seems neither Google nor Microsoft sought the consent of brands before experimenting with new ad placements. As a result, the ad industry is pushing back against the tech giants. Some large advertisers, including Wells Fargo, have already pulled their ad spending from Microsoft. This is part of the larger tension between advertisers and tech platforms about control over ads.