Google announces AI-powered ad features ahead of holiday season

Google has announced a series of updates to Google Ads, introducing AI-powered tools aimed at helping retailers prepare for the upcoming holiday season.

The company said the move comes as consumer behaviour shifts, with impulse purchases in the U.S. declining from 30% to 26% last year. Shoppers are now spreading purchases over three months, from October to the New Year, to manage expenses.

Among the key updates is an expansion of AI in Search. According to Google, more than 5 trillion searches are made each year, and over 60% of shopping queries are now broad in intent, often framed as conversational questions. To address this trend, Google is testing features such as AI Overviews and AI Mode, which surface contextual responses alongside ads. A new tool, AI Max for Search campaigns, has also been rolled out globally in beta.

On YouTube, advertising features are being expanded to capture omnichannel shoppers who move between online, in-app, and in-store channels. Demand Gen campaigns can now optimise for sales across these touchpoints, while local offers enable retailers to promote nearby deals. The company also said that the YouTube Masthead is now shoppable and that a Creator Partnerships hub will allow brands to collaborate with content creators.

Additional updates include AI-driven insights in Google Merchant Centre to track demand trends and new creative options in Product Studio and Asset Studio, with asset generation soon to be supported by Imagen 4. On budgeting, Google is extending campaign total budgets across Search, Performance Max, Shopping, Demand Gen, and YouTube campaigns. Advertisers will be able to set a start and end date, along with a total budget, for periods ranging from three to 90 days, with AI adjusting spend to meet peak demand.

The company is also introducing loyalty-focused features in Performance Max and Standard Shopping campaigns, enabling retailers to highlight member-only pricing and shipping benefits.

Google said the updates are intended to help retailers respond to changing consumer behaviour and evolving shopping patterns during the holiday season.