Google is poised to once again change the way most people find information online. This time around it’s trying to reap even more of the benefits for itself.
Last year, Google began rolling out a new generative AI-infused version of Search. This so-called Search Generative Experience (SGE) is still an experiment but it gives a glimpse into how the company sees the future of its most important product.
The evolution of Search has significant ramifications for thousands of businesses that rely on Google for traffic and ads to show up prominently in results. This part of the company generated at least $150 billion in revenue last year, and has been dubbed the world’s most profitable online business by some analysts. To say there’s a lot at stake would be putting it mildly.
AI to the forefront
Google has long used AI in the background. SGE brings AI to the forefront, attempting to generate more direct answers to your queries at the top of the page before you reach the familiar list of blue links.
Ask it to summarize a historical battle and SGE may serve up a short summary and list of key moments, sourcing the data from various websites it deems authoritative, using its AI engine to produce a legible (and hopefully accurate) composite response.
It’s still early days, but Google is being pushed to move fast due to heated competition from Microsoft, OpenAI and other startups like Perplexity. A recent study by Gartner predicted the use of traditional search engines like Google will drop 25% by 2026 as people embrace AI chatbots and other digital agents. Google is under pressure to reconfigure its core moneymaker, but it has to do so in a way that appeases both users and the businesses that have come to rely on Google to drive consumers their way.
Search versus SGE
Since December, Business Insider has plugged the same queries into Google’s traditional search engine and its generative AI version to see how information is presented differently.
The differences are dramatic and will likely alter the way billions of people access online information. A Google spokeswoman noted that SGE is still evolving but that the company has so far barely scratched the surface of how it can use generative AI. She declined to comment on whether SGE will be made a default part of Search in the near future.
Mark Mahaney, a top internet analyst at ISI Evercore, has been testing SGE alongside generative AI rivals like Perplexity and OpenAI’s ChatGPT. He said there are many online search functions — quick answers, directories, deep research — that can be better served by AI summaries and nascent AI agents, which he says generally offer “more robust” results that answer a person’s query directly, instead of serving up various web links to possible answers.
“Can someone package this all in one place?” Mahaney said. “Google can do this, and it will lead them to even more market share and an increase in user activity. But it is possible that someone else will figure it out first.”
Summaries > Links
Some of the differences between SGE and traditional Search are more obvious than others, but all point toward Google finding a middle ground between producing ChatGPT-style summaries and a more traditional list of links.
In BI’s tests, SGE often delivered multi-paragraph summaries of information, with links much less prominent — and sometimes not shown at all. The Google spokeswoman countered these findings by saying that SGE shows users more links than the classic version of the search engine. She also said the company is prioritizing driving traffic to publishers.
Any limitation or sidelining of links to third parties in favor of Google AI summaries is likely to upend digital business models that rely on traffic from the company. Adweek recently reported that web publishers could face annual ad revenue losses of up to $2 billion as a result of SGE.
“This will force companies to rethink their marketing channels strategy as GenAI becomes more embedded across all aspects of search,” Alan Antin, a vice president analyst at Gartner, told BI.
A Lady Gaga query
From tracking Google’s SGE developments over the past few months, it’s clear there’s some attempt to balance how often Google will demand or encourage users to click through to websites as it deploys SGE.
In December, Google’s SGE turned up AI generated summaries in response to various queries without citing any sources for the information at all.
When we asked about Lady Gaga’s marketing deal with Tiffany’s, for example, Google’s SGE responded with a summary that said Gaga “has been” a Tiffany spokesperson, failing to mention that she still works with the brand. SGE also gave tangential detail about a Tiffany necklace she wore on the red carpet that seemed to be pulled directly from promotional material. The response included a red carpet photo of the pop star with a watermark indicating it was from The Cut, part of New York Magazine. However, the photo was not a link to The Cut story — clicking on it only opened up a larger version to the photo in a sidebar.
When BI tested the same query at the end of February, Google’s SGE result was more thorough. The summary made clear that Gaga is still a spokesperson for Tiffany and noted her first appearance as such. The results page included two links to outside information. Although the query had been substantially answered in the SGE summary, three more links were made available in a sidebar, too.
BI recently tested the same Gaga query for Google’s traditional Search service. The results showed several links first, but in the form of Image cards. Below that were prompts for additional search phrases. A user had to scroll below that to see the classic blue hyperlinks.
The Google spokeswoman pointed BI to comments from CEO Sundar Pichai during a recent earnings call in which he noted user satisfaction was improving with SGE getting people answers “for more conversational and intricate queries.”
SGE results with fewer links
Other December searches using SGE also returned summaries of information that did not include any links to further information in the body of the text.
Some queries included no more than three links in a separate sidebar, with no links below. Other queries using SGE showed additional prompts a user may want to try, in a chatbot-style way, where links would previously be expected to appear. On a typical computer screen, the first page of what an SGE user saw in December was essentially the company’s summation of online information, and little to nothing else.
Ads with SGE results
One exception seemed to be for specific companies that pay to advertise on Google, thus receiving “sponsored” link treatment. A December search using Google SGE for GitHub, the developer platform, turned up a paid link to its website first, then directly underneath was an AI-generated summary of the platform and a list of its features.
The Google spokeswoman said the company has found that users find it helpful to see ads above or below an SGE response.
“Many site owners are terrified”
Perhaps where things are most sensitive right now is in how much traffic Google is sending to websites through SGE. The fabric of the modern internet has been built on Google’s classic “blue links” system, where users type in a query and Google spits out links to the websites it deems most authoritative. While this system has evolved over time, the core mechanics have remained largely the same for more than 20 years. And it’s allowed Google to build the biggest digital advertising business of all time.
SGE is turning those mechanics on its head, which is why SEO experts, online businesses and others are tracking the new tool so closely. Some SEO experts are frantically trying to keep up with the changes so they can advise clients how to prepare for an AI-powered Search future.
“Many site owners are terrified,” said Lily Ray, an SEO strategist for marketing agency Amsive. Ray described Google SGE as the “shiny object in the room” for agencies trying to calm anxious website owners who don’t want to be left behind. “If we’re doing pitches for SEO right now, the thing that will make your SEO agency win is if you’re the one that can come up with the shiniest answer to how to optimize for SGE,” she said.
Ray noted that there have been promising changes to SGE results lately, including an increasing number of links that point users to the sources of information SGE is drawing from.
“They are doing different things to elevate the articles that they’re referencing directly in the answers in many cases,” she said. “But in many other cases they’re not.”
Ray has spotted answers in SGE results that are not sourced from websites that rank in the top 100 positions for that query in traditional Search results. Typically, Google will rank websites higher if they meet certain criteria, such as hitting the correct keywords, getting linked to by other websites (a signal of authority), and not spamming visitors with pop-ups.
A study of 100,000 keywords
SE Rankings, a company that tracks changes on the web and offers SEO advice, has also been closely following SGE developments.
It ran a study in January analyzing 100,000 keywords over 20 topics that are often searched for, such as politics, travel, education, and cars. The analysis found that 64% of keywords either responded with an SGE response or gave the user the option of generating one.
Some of the results were more encouraging than others. For example, the researchers found that 86% of SGE snippets linked to one or more domains that appeared in the top 10 links below, suggesting that Google may be getting better at keeping low-ranking results out of SGE. They also found that — in order of frequency — Quora, Google Maps, Wikipedia, Investopedia, and LinkedIn were the most linked-to websites in SGE results.
Getting better with sources
Mark Shmulik, an internet analyst at Bernstein, has also been testing SGE. He said the tool has “gotten a lot better with sourcing” over time. “You know where to go if you want more than just a generative answer. I think it does quite well there,” he added.
He also said he was encouraged by the fact Google wasn’t bringing in a generative AI response for every type of query. Google has to be particularly careful with certain topics where getting the answers wrong could have disastrous effects. For example, SE Rankings found that SGE was less likely to show up on certain topics like news and politics, which demand thorough fact-checking. BI tried searching “Covid” and “flu” via Google’s SGE. Neither query produced any sort of generative AI response — although a search for “common cold” did.
The Google spokeswoman told BI that sometimes a generative AI response does not show up because there is not enough information deemed reliable, and SGE is designed to not provide an answer in those cases. SGE is also designed to not respond to queries on explicit or dangerous topics, including self-harm.
Improving results
Google SGE now includes more links to outside sources of information — links that actually work — compared to December. Recent results often show three links in a carousel sidebar, and there are also three links (often the same links) in a carousel style arrangement directly below the AI generated summary. The overall look is less directory and more homepage.
The SGE summaries are also shorter and more conversational now, essentially getting to the point of a user’s search more directly.
For example, a February SGE search for “Susan Orlean drunk tweets” returned an AI summary that started with “In July 2020, writer and journalist Susan Orlean went on a Twitter spree of drunken tweets. The Tweets began with the word ‘drunk’ and ended with ‘i am goi f to sleep.'” It then noted Orlean’s reaction to her tweets from two years later, giving a simple answer that felt correct and complete, before delving into some further context in following paragraphs.
In December, the same SGE query returned a more robotic summary that gave the exact date of Orlean’s initial tweets, explained how they were “described” at the time, and what prompted her to write them, informational beats that are commonplace in generative AI responses. In other words, the SGE results are getting better.
SGE sometimes goes missing
For several weeks now, even if a person has opted into using the SGE version of Google Search, it does not show these AI-heavy results automatically.
Often, it now asks if you’d like to “get an AI-powered overview for this search?” before it creates one. Other times, it does not give the option at all, even when SGE is enabled. A total absence of SGE seems to occur for more controversial or overtly political queries.
Links are still core
Regardless of what changes Google makes in the near-term, links within Google Search remain the core purpose of the tool and crucial to its business, ISI Evercore’s Mahoney said. Meanwhile, features such as AI chat and AI agents are more “incrementally additive” to search, he explained.
“Most people want to search for something like ‘skiing near me’ and get a directory of responses,” Mahaney said. “That is where you get heavy commercial intent, and it’s hard for me to see anything displacing Google doing that kind of business.”
“The path of least resistance”
It’s not clear when Google will launch SGE to the masses. The latest Gemini AI chatbot drama has given the company good reason to move carefully, but Google is also under pressure to maintain its reputation.
“My view is they don’t need to rush to get this out because we’re not seeing a material hockey stick like inflection and adoption of generative search,” said Bernstein’s Shmulik. “They feel an urgency to get this out for everybody quicker if only to say, ‘look, you see, we are an AI leader.'”
Right now, Shmulik says he’s encouraged by what he’s seeing with the SGE developments and, like Mahaney, he thinks Google is coming from a position of strength.
“Google’s go-to-market is probably the easiest. They’ve already got billions of people using Chrome and using Google search,” Shmulik told BI. “It’s the path of least resistance.”
A lurking threat
However, there is a threat lurking ahead for Google, said Shmulik, as SGE’s success also “depends on us all using the internet the same way.”
Google’s bigger problem may be users moving to other platforms for information, such as AI voice assistants, or chatbots from OpenAI. ChatGPT is already able to search the internet using Bing, the search engine from Microsoft.
“That’s where some of this risk could really emerge,” Shmulik said. “Not to say Google doesn’t have a horse in the race, but I think now the playing field becomes a little bit more open.”