Introduction: A New Era for Search and Advertising
The digital search landscape has entered uncharted territory. Google has officially integrated advertisements into its AI-powered search features, placing them inside AI Overviews and within AI Mode on desktop. For small and medium businesses in Canada and the United States, this change is more than just another update to search results. It represents a fundamental shift in how visibility, engagement, and customer journeys are shaped. As AI begins to influence not only the information users receive but also the ads they encounter, brands must rethink their search and advertising strategies.
What Changed in Google Search
In May 2025, Google expanded the presence of Search and Shopping ads by weaving them into AI Overviews. These AI-generated summaries now appear above traditional results and, in AI Mode, guide users through multi-step conversational searches. Unlike standard keyword-driven ads, placements inside AI Mode rely on signals such as intent, sentiment, and the natural flow of a conversation.
This marks a significant break from search as we have known it. No longer is a single query the key to ad targeting. Instead, the broader dialogue between the user and Google’s AI determines what ads are shown, when they appear, and how they align with the evolving context of a search.
Opportunities for Small and Medium Businesses
Early Visibility in the Customer Journey
For small businesses, this new environment opens the door to visibility at earlier stages of a customer’s decision-making process. Imagine a user asking Google, “how can I build a cost-effective website for my small business.” Ads for website services may now appear right alongside AI-generated guides, placing SMB offerings in the spotlight when users are actively exploring options.
Engagement Beyond Keywords
Agencies and advertisers have reported that, in many cases, ads appearing within AI Overviews meet or even outperform traditional benchmarks for impressions and top-of-funnel engagement. The businesses that benefit most are those prepared with well-structured product feeds, strong brand profiles, and ad creative designed for conversational environments.
Building Authority
AI-powered search tends to reward expertise and context. Small businesses that produce educational resources, tutorials, or thought leadership content stand to gain visibility as their authority feeds into the AI-driven conversation. For SMBs, this provides a strategic advantage: invest in knowledge-sharing content and watch it drive not only organic trust but also ad placements in AI Mode.
Risks and Challenges in an AI-Driven SERP
The Decline of Click-Through Rates
Despite these opportunities, research confirms that the arrival of AI Overviews is hurting click-through rates. Studies have shown position one CTRs dropping anywhere from 15 to 35 percent when AI Overviews appear. Organic listings for informational searches have seen traffic fall by as much as 70 percent, while paid ads can see CTRs cut in half.
For small businesses that rely on organic reach and paid campaigns alike, this creates a new challenge: visibility does not always translate to clicks. With AI delivering complete answers, users are increasingly satisfied without ever leaving the results page.
The Rise of “Zero Click” Searches
The phenomenon of zero click searches is now accelerating. Users ask questions, receive thorough AI-generated answers, and leave without engaging further. While impressions and visibility remain, the traditional pathways to conversions are disrupted. For SMBs, this means diversifying beyond Google to ensure consistent lead generation and brand presence.
Limited Control and Measurement
Advertisers also face concerns about brand safety, transparency, and data clarity. With little control over when or where ads appear within AI Overviews, businesses worry about context misplacement. At the same time, Google provides minimal reporting on ad delivery in AI environments, leaving SMBs with limited ability to evaluate ROI or fine-tune strategy.
The Canadian SMB Context
While adoption of AI among Canadian SMBs is still in its early stages, the landscape is shifting quickly. Only about 27 percent of Canadian small businesses report using AI today, but the integration of advertising into AI search will force rapid adaptation. As Google’s rollout expands from the United States into Canada, SMBs must begin preparing for a search experience where AI dominates visibility.
This is not simply a question of advertising budgets. It is a question of readiness. Businesses with clean product feeds, accurate Google Business Profiles, and localized SEO will be better prepared to navigate the shift. Those who delay risk losing visibility to competitors who adapt quickly.
Best Practices for Navigating the New Search Reality
Optimize for AI Discovery
AI-powered placements depend heavily on data accuracy. Feed hygiene, structured product information, and detailed business signals are now prerequisites for inclusion. SMBs should maintain product feeds that are regularly updated and ensure all business profiles are clear and complete.
Embrace Brand Authority and Contextual Content
Search in an AI-driven world is not about keyword stuffing. It is about providing genuine, authoritative value. Educational resources, tutorials, and context-driven content signal expertise that AI is more likely to highlight. Brands should view content creation as a long-term investment in authority rather than a short-term tactic for clicks.
Leverage Local SEO and Direct Actions
Local search remains one of the most resilient areas in this transition. Queries like “dentist near me” or “Toronto roofing company” are less likely to be overshadowed by AI Overviews. For SMBs, the fundamentals of local SEO—optimized Google Business Profiles, community engagement, and hyperlocal content, continue to drive results.
Rethink Metrics and Performance
Traditional metrics like CTR and cost per click may no longer capture the full value of search campaigns. Google has hinted at future measurement models focused on impressions, engagement within conversations, and overall brand presence in AI dialogues. SMBs must adjust their perspective, focusing less on immediate clicks and more on long-term brand positioning.
Diversify Digital Channels
Relying solely on Google is no longer a safe strategy. To maintain customer reach, SMBs should experiment with social platforms, community-driven marketing, and direct outreach while continuing to invest in Google’s evolving environment. A diversified approach ensures resilience in the face of declining CTRs and unpredictable AI dynamics.
The Road Ahead for Marketers and SMBs
Marketers remain cautiously optimistic. On one hand, AI-driven advertising creates entirely new inventory and opportunities for early visibility. On the other, transparency and ROI measurement are still unclear, and the decline of clicks poses real revenue challenges.
This is not the end of traditional search advertising, but it is a transformation. AI will continue to define user experiences, reward contextual expertise, and prioritize conversational engagement. Businesses that build authority, focus on community-driven SEO, and adopt new metrics will stay relevant as the environment evolves.
Adapt or Fall Behind
Google’s integration of ads into AI Overviews and AI Mode is more than an experiment. It signals the beginning of a new era in search and advertising. For small and medium businesses across North America, success will depend on agility, strategy, and a willingness to evolve.
The message is clear: visibility is shifting, click-throughs are declining, and AI is rewriting the rules. The businesses that thrive will be those that embrace brand authority, invest in contextual content, and proactively adapt to an AI-driven advertising ecosystem. Those who hesitate risk losing ground in a landscape where search no longer belongs only to keywords, but to conversations.
