You get AI Mode… You get AI Mode… everybody gets AI Mode… That’s essentially the Oprah moment that Google sparked at this week’s I/O keynote. It has brought the transformative and AI-centric search paradigm from open beta (Google Labs) to widescale availability, at least for U.S. users.
This move raises the stakes for AI mode. It was already game-changing in its concept and potential, but carrying it out from behind the curtain brings that potential to life and scales up its impact. It brings AI mode from an experiment with an uncertain future to something that’s really happening.
To better characterize that impact, let’s dive into AI mode and what it represents. In short, it turns search from a keyword-query and SERP design to something that’s more conversational. It includes natural-language queries and a continuous/progressive exchange that resembles a human conversation.
For example, AI Mode lets users ask complex and multipart questions with follow-ups. One could ask for a step-by-step guide to painting a fence, then follow up to ask what kind of roller brush is best for a cedar surface. Google does this with a custom version of Gemini 2.0 with an advanced reasoning model.
Stages of Acceptance
Going deeper, AI-Mode results include generated descriptions that link to source material, similar to AI overviews. This maintains a semblance of Google’s paid search model (more on that in a bit), and engenders credibility by disclosing sources. That last part is critical in AI’s early stages of acceptance.
Google also reports that queries are 2x the length of regular searches in early tests, and 25 percent of users ask follow-ups. But these data only reflect initial usage: It’s likely that as users untrain themselves from caveman-like keyword search (e.g., “food, near me”) query length and nuance will evolve.
All the above caught our eye when AI mode was first unveiled in Q1, because we’ve speculated on this concept before. More accurately, giving credit where it’s due, we were introduced to the idea by Yext Chief Data Officer, Christian Ward. He was talking about AI Mode before it was called AI Mode.
Specifically, the concept of progressive/continuous search has been top of mind in Ward’s research and stewardship of Yext’s quickly evolving data strategies. It’s all about “conversational memory,” he says, simulating how humans converse with each other. This creates a more natural UX among other things.
“The most compelling aspect of this release is how it transforms the traditional search experience into an ongoing conversation,” said Ward of Chat GPT’s similar December announcement. “Unlike conventional searches that start and end with each query, [it] maintains context throughout the interaction.”
Quality over Quantity
Stepping back, where is all this going? Many rightly speculate that if Google goes down this path, it will disrupt its own business model. Indeed, more refined and intelligent search involves one correct answer. That means that traditional SERP inventory – ten blue links preceded by sponsored results – goes away.
But Ward theorizes that though there might be less ad inventory – one result versus several – it could be an opportunity for sponsored results that carry much higher premiums than a typical cost per click. AI-driven dialogues with a user can infer deeper levels of intent and thus higher-value leads for businesses.
Those leads – when delivered RTB-style – can carry higher premiums to the point where the value offsets the erosion of the current SERP model. This is aligned conceptually with the “cost-per-qualified lead” model that was recently theorized in our discussion with SearchMAS co-founder Juan Pablo Nieto.
Altogether, it boils down to a quality versus quantity tradeoff. In other words, Google can counterbalance a diminished quantity of ads with higher-quality (read: costlier) ads. Given deeper conversations with users, it can hyper target ads. More importantly, it brings Google towards offers as opposed to ads.
“This combination of conversational memory with search capabilities opens up new possibilities for how people discover and interact with local businesses and their communities,” said Ward.
