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Google Testing Suggests Artificial Intelligence Experiences To Accelerate Decline Of Website Traffic And Monetization

Google Testing Suggests Artificial Intelligence Experiences To Accelerate Decline Of Website Traffic And Monetization

artificial intelligence

Photo: Magno Dias, https://www.flickr.com/photos/ciqueira/ https://creativecommons.org/licenses/by-nd/2.0/

Google’s demonstration of its new artificial intelligence-fueled search engine suggests that less traffic will go to publishers, hastening the decline and fall of web pages, where publishers made most of their money and which are now long out of date, according to an article in The Rebooting, Brian Morrissey’s newsletter about what’s next in the world of publishing.

Faced with muted revenue growth after almost 20 years of consistent and rapid expansion, Google is now staring down a possible recession. Advertisers have cut online marketing budgets, hurting Google, Facebook and others, CNBC reported. Paid search advertising conversion rates have decreased this year across most industries.

For all its shortcomings, the web page “has been good to publishers, a reliable workhorse that provided a palette that allowed for the several forms of monetization,” The Rebooting wrote. As Google eliminated the competition, search became a mostly reliable distribution channel with publishers making money from ads that often ran through Google’s ad stack.

“That’s breaking,” The Rebooting reported.

Many publishers see up to half of their traffic coming from search.

Google Bard is an artificial intelligence chatbot launched in February, similar to Microsoft-funded ChatGPT and powered by a language model to converse with users. Google sees Bard as a complementary experience to Google Search, which just got its own huge AI upgrade, according to Tom’s Guide, an online resource for product reviews.

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Google’s demos make it clear that less traffic will go to publishers, according to The Rebooting: “The move from links to ‘citations’ should scare publishers, and the visitors that do arrive at publisher sites will expect different, more dynamic experiences than the current static pages cluttered with overlapping display ads, autoplay videos, pleas to sign up for newsletters, register, subscribe and allow desktop notifications.”

The Rebooting writer predicts that generative artificial intelligence will replace the majority of static content over the next few years. “Audiences will begin to expect all content to be curated and dynamic with embedded intelligence. Artificial intelligence will lead to new formats that are more gamified, more personalized, and more interactive.”

The webpage will not go away but it will be radically changed, undergoing “a secular decline in importance, as search enters a new phase,” the writer adds. “More publishers will seek to center their strategies on safer grounds in audio, video, events and direct delivery vehicles like email. More publishers will become content providers to platforms.”

The advertising industry is facing one of its toughest challenges in years, with ad revenue plummeting to its lowest levels in the last five years — worse than the lowest low during the peak of covid pandemic restrictions, according to Monetize More.

Ad-tech industry experts are freaking out, publishers are scrambling to find ways to stay afloat in the “ad apocalypse” recession. Surging inflation, recession fears and a market downturn have prompted companies to slash their ad budgets.

This isn’t the first time the demise of web pages has been predicted.

In 2013, Gerry McGovern, a worldwide expert in web content management, wrote in CMSWire about the continued decline of the homepage. “Google is your new homepage,” he wrote. “We must think beyond the traditional homepage.”

McGovern cited these expert views:

  • “As more and more traffic comes from search and social, the homepage as the entryway into a site’s content is increasingly obsolete,” Ann Friedman wrote for Columbia Journalism Review in 2013.
  • “The value of the homepage is decreasing,” a leaked New York Times report stated in May 2014. “Only a third of our readers ever visit it. And those who do visit are spending less time: page views and minutes spent per reader dropped by double-digit percentages last year.”

AI is expected to play an increasing role in digital content monetization, most notably through the optimization of advertising, Marcin Frąckiewicz wrote for TS2 Space, a telecommunications service provider for satellites.

AI-powered algorithms can analyze vast amounts of data to identify patterns and trends, allowing advertisers to target their audiences better. By leveraging artificial intelligence, marketers can ensure that their ad sreach the right audience at the right time, increasing the likelihood of conversion and boosting ad revenue for content creators.

AI is also being used to enhance the overall user experience, Frąckiewicz wrote. For example, AI-driven recommendation engines can analyze user behavior and preferences to curate personalized content feeds, ensuring that users are presented with content that is most relevant and engaging to them. This increases user satisfaction and encourages users to spend more time on a platform, increasing the potential for ad exposure and revenue generation.

Google parent Alphabet could monetize the use of AI in search and YouTube, which together account for 80 percent of the overall revenue, through advertising, according to Gene Munster, managing partner at the hedge fund Deepwater Asset Management.

Munster said he sees the potential of large language models or LLMs — AI algorithms that use deep learning techniques and massively large data sets to understand, summarize, generate and predict new content — to hurt ad models in the long term, Zenger News reported.

“… fewer eyeballs at Alphabet Inc.’s Google Search could mean less ad revenue,” Munster said.

With Bard, Google has a first-mover advantage, but dozens of startups and developers have their own AI applications already, Leaders Media reported. “Startups may have an easier time navigating this new economy than larger and slower corporate entities.”

Google has approved plans for using generative AI, fueled by large language models, to automate advertising and ad-supported consumer services, according to internal documents, CNBC reported on May 17.

On May 23, Google plans to introduce new technologies for advertisers at its annual event, Google Marketing Live. The company hasn’t offered specifics about what it will be announcing, but made it clear that AI will be a central theme.

“You’ll discover how our AI-powered ads solutions can help multiply your marketing expertise and drive powerful business results in today’s changing economy,” the website for the event says.