Google is celebrating 25 years in advertising this month as the company navigates its evolution at the intersection of AI and ads.
With parent company Alphabet sporting a $3 trillion market cap today versus $23 billion when Google went public in 2004, needless to say, things have changed.
Google VP of Global Ads Dan Taylor has been at the company for 19 of those 25 years and originally joined from radio to help guide a short-lived effort aimed at linear television known at that time as “Google TV.” Since then, his role has evolved into global ad product strategy on the sales side where he reports into Google’s Chief Business Officer Philipp Schindler.
Mr. Taylor spoke to tipsheet yesterday on a range of topics including:
- Google’s 25 years in advertising
- Connecting Google ads “genesis moment” to today
- Highlights at Google for Mr. Taylor
- Contextual and AI
- Agentic advertising opportunity
- AI in programmatic and the RTB auction
- Publishers and Google’s AI strategy today
- The new traditional Google Search paradigm
- Ads in a chatbot: AI Mode and the Gemini app
- AI innovation meets creative
- On CTV advertising evolving due to AI
- Antitrust trial impact on Google’s AI and innovation plans
- On marketers allocating budget to automation
- Google’s advertising vision for the next 5 years
Scroll down for the interview which has been lightly edited for clarity.
TIPSHEET: Why celebrate the 25 years Google has been in advertising?
DAN TAYLOR: It’s in our culture to recognize milestones across the company that celebrate our history and evolution. You see it in our Google Doodles, for example. It gives us also an opportunity to reflect what came before and what we’re excited about ahead – same thing we do on personal milestones.
YouTube turned 20 this year. We’re a long way from the “Me at the zoo” video to being the epicenter of culture. From an ads perspective, starting from a novel keyword-based bidding model, and 25 years later, building on that, the tools have really changed and embraced consumer shifts. Whether it’s video, mobile, connected TV and now this profound shift with AI – it’s good to reflect back and celebrate the tools that we brought to businesses to help them grow and the advertising model that surrounded that. So, ads is an important part of Google, and we wanted to celebrate the milestone.
Can you talk about the “genesis moment” of ads at Google? Is there a connection to what’s happening today at Google?
I joined a little bit after Google Ads started, but for a little bit of the folklore —our founders really insisted on an approach to advertising that was relevant and useful, rather than intrusive and annoying. And so that was sort of the “Product Requirements Document” (PRD), if you will, for the ads business.
We started to build what that model could look like. For instance, a search ads pricing model based on user engagement — someone only pays when you click on their ad that creates an incentive for Google and for advertisers to only bring forth ads that are interesting enough to engage with… So that’s like a self fulfilling business model which is good for the user.
Thinking back, search engine marketing used to be bought on CPM, which is pretty wild to think about…
We doubled down on that over the years with things like quality score and ad rank —which is not only what you’re bidding, but how relevant your ad is to the query. Advertisers really put a lot of work into making their ads more relevant versus just bidding more. I think that had a great effect.
And even thinking about YouTube and introducing skippable video ads, it creates a model where if the user doesn’t find the ad relevant, they can skip it, the advertiser doesn’t pay. So it’s a good user experience, and the advertiser focuses on creative that really resonates.
To bring it to today, I see where AI experiences are reinventing search. It’s creating these new opportunities for brands to be discovered, often even earlier in their discovery and purchase journey.
And the conversation remains the same as it was 25 years ago: How do we do that in a way where these ads don’t smack you in the face and are intrusive, but rather, are really additive to the experience? And that’s what we’re trying to get right. And we’ve seen some great results with AI Overviews —and that’s what we’re testing now with AI Mode.
So some of the same initial “genesis” hallway conversations that started the ads business, they’re still resonating today.
You’ve been there at Google for 19 years. What are some highlights at Google that you’ve personally experienced? Also, what was the Dan Taylor “genesis moment” in Google advertising?
I joined Google from a broadcast background, I was in the radio advertising business, national sales. I was attracted to Google both because I could see consumer time shifting and advertiser dollars starting to flow online overall. Also, the accountable nature of the medium was of interest. Advertisers could measure what’s working and adapt in near real-time.
For example, prior to Google, I remember going out with a tier two dealership group after a big advertising buy had finished. I asked him, “How did we do for you? How do we drive results?” And it was a bit of a shrug. It was like, “We bought a lot of media, and car sales went up. I’m not sure how much you contributed versus the other guy.” So being able to do that successfully in digital advertising was really attractive to me, and why I joined.
My “genesis” moment at Google was actually trying to translate digital advertising buying tools and see if they could work on offline media in any kind of addressable way. We did some integrating with television broadcast buying to try and figure out how we could do ad insertion through Google AdWords
It was way ahead of its time (known as Google TV back then.).
But two things happened: 1) We learned what advertisers cared about in traditional media and 2) how to bring some of those value props to digital but in a more accountable way.
Also, if you look at where we are today with Connected TV and podcasts, those early learnings have paid off in how people are spending time today.
They were about a shift in consumer behavior and technology that changes how people consume digital. And then, how do we rise to this occasion?
With broadband and the rise of online video, there was this “a-ha” moment.
With YouTube creators, we started to realize that they were the new Hollywood and not just replicating the linear television model online —and investing a ton in the power of the communities that they built.
You hear YouTube CEO Neil Mohan talk about that every time he’s on a stage. That was an interesting moment because there was a time where we really had to get advertisers over the hump on this notion of user generated content.
And when you look at these content creators today, they’re as large or larger than broadcast networks. They have the power of a Hollywood studio with the digital tools that they’re using. And so that’s been wild.
The transition to mobile was certainly a big thing for us. And that one was not an overnight sensation.
Marketers felt the screens were too small, the ad formats weren’t fit for purpose, their buying tools didn’t work. There was a little bit of “If I ignore it, it’ll go away” for a little while.
But then investing in mobile websites, the whole apps economy that came along, developing cross device measurement, the initiatives like enhanced campaigns and other things that happened across the industry really helped marketers make the most of the opportunity. And it unlocked growth.
And then today’s shift with AI, I feel like I’m in another one of those really big shifts, and maybe even bigger than the mobile one. But the difference this time is advertisers are quickly embracing the new technology.
With AI today, it feels like context is more important than ever. Do you agree?
Well, I think contextual has always been the critical center of search engine marketing -understanding what a person is looking for in that moment. It’s one of the ways that we’ve delivered great value for consumers and for advertisers.
In the broader space, it feels more like a combination of understanding the context and the level of personalization.
One of the things that has been interesting to me is that increasingly consumers —when they’re engaging with AI— they expect a ‘context window.’ In other words, they expect to be able to do a follow-up query, and that the search engine or the agent that they’re using has an understanding. There’s a higher expectation for context than there was in previous environments.
Given Google’s focus on AI, does Google see an opportunity with agentic advertising, where buyers agents and sellers agents transact?
That’s a big part of the conversation, as you know, right now. I think the core tenets are really the same around connecting audiences to products and services.
But like with other platform shifts, the tools are definitely changing.
I think it’s early, but so far agentic is really additive -tools are helping businesses drive better results with less effort and helping people get stuff done.
Couple quick examples on the business side…
- At Google Marketing Live, we announced agentic capabilities to help advertisers set up campaigns, deploy optimizations – a little less hands-on-keyboard kind of work.
- At Google IO… we launched an agentic checkout feature to help people track prices, set how much they want to pay, and then buy the items when the price is right. One CMO I met with said, “I’m trying to use AI to minimize the mundane on both sides of the transaction. And I definitely see that that’s on a trajectory.”
So yes, I think in the future, AI agents could be a huge asset for businesses between buyers and sellers, and I think the real power lies in how that all comes together to create a more seamless path for discovery and for purchase and reducing the friction for consumers.
I think customers are embracing a lot of the AI tools to get their traditional ways of doing business done better. And they’re kind of dipping their toe in the water too: “If I took this current trend line to its extreme, what am I really optimizing for in the future and what’s possible?”
I talked to agency holding companies and they’re trying to figure out how to build an outcomes-based planning agent to not only generate the RFP, but it also spits out a media plan. If you go all the way to the extreme, you can see a lot of appetite to go in that direction. But, you can’t flip a switch and do that today.
What are the main differences you see with AI-enabled advertising today versus RTB-enabled programmatic advertising of the past 15 years, which has also included AI?
I think you’re right to draw parallels there. We’ve been embedding predictive and analytical AI into our ads tools for years – and so smarter bidding, app campaigns that buy across different inventory sources.
I think what’s different here is AI can do a lot more than just bid the right amount —a lot of the generative AI capabilities seem to be what’s fresh and exciting for everyone.
And so advertisers are increasingly providing a stronger data foundation to steer AI… What business outcomes are you measuring? What audiences are important to you? -and also things like landing pages, creative assets, product feeds, which give AI the ability to understand what product or service will resonate, where it will resonate, and deliver those ads.
There’s a lot more, well, intelligence behind the AI which is deploying more than just pulling an asset from a library of creative that’s been pre-produced and a set bid that you want to make on an exchange. It’s more expansive today. But it builds on the things we’ve done in the past.
How important are web publishers to Google’s AI strategy today and in the future?
Our core mission remains the same around making the world’s information accessible and useful, and that really starts with with publishers and content creators. We care really passionately, I’d venture to say —perhaps more than any other company— about the health of web publishers and content creators, which is the source of so much content. It’s why people come to the search engine in the first place is to find this great content around the web.
And so we’re prioritizing. We continue to send billions of clicks to websites every day, and with new experiences and things like AI Overviews, it’s changing how people are searching and discovering products. But, we’re really prioritizing and making sure that we’re providing people routes to dig deeper and find authoritative sources around the web. That’s still very front and center as Liz Reid works on the consumer experiences, and certainly we work on the ads ones.
We try to repeat the importance in how we think about that in every setting. So thanks for the question.
How is AI creating a new paradigm for traditional Google Search?
I think it’s fundamentally changing how people are searching and discovering, and then also how brands can connect.
What we’re seeing is it’s an expansionary moment where people are coming to Google to ask more, longer, more complex questions. They’re searching with their phone camera on Google Lens 25 billion times a month.
These are the kinds of searches that we would not have seen —and wouldn’t have been possible— a year or two ago to really answer well.
So, you have a combination of consumers asking more and different and complex things because they expect more from their technology, and AI is helping us deliver on those expectations.
We’ve seen really positive feedback —particularly from users in terms of AI Overviews. People are searching more: a 10% growth in queries that are showing them this year.
And when people do click on these links from AI Overviews, the links are higher quality, which we define as users are spending more time on the sites that they link out to, which means that they’ve gotten high quality results, and they come back for more.
So I think it’s changing the paradigm for a search engine marketer — the traditional tactics, aren’t working. “How do I how do I plan a search ads campaign around queries that are two to three times longer? How do I plan a search engine marketing campaign for people that are circling what they search — getting an address that they’re interested in— but there aren’t any inherent queries in there. All of that has accelerated the pace at which advertisers are embracing AI tools to meet these new experiences and capture this opportunity. So, it feels fundamentally expansionary right now.
Will AI Mode and the Gemini app get ads someday?
Well, we’re already testing ads in AI Mode.
Our research found that there is a gap between what users want from a chatbot and what they want from a unit from a traditional search engine.
And so AI Mode attempts to find that middle ground where consumers want to go a little bit deeper in their research. But, they’re also looking for authoritative sources. They want to be able to link out to the web – and there’s some commercial intent in there.
So we’re moving ‘at speed,’ but also right now, only testing ads in AI Mode in the US, because we want to get that user experience right. What’s the right moment? What are the right kind of user journeys, where it makes sense? Is this just an informational research query? Is there some inherent commercial intent in there?
In terms of Gemini, we’re not currently testing ads there. We don’t have anything to share there, but I think that AI Mode is a place where we’ll experiment with things in that direction.
Creative seems to be a key area of innovation with AI. Why?
Having been at Google for 20 some years, and the industry for longer, we’ve always talked about right person, right ad, right time.
I think we’ve gotten pretty good at finding the right audiences and finding the right ad placement. But we’ve really only scratched the surface of what AI can do for ad creative. We’re already a long way from dynamic remarketing ads that pull in from your product feed and show you the product that you were looking at on a website.
So much of the predictive and analytical AI has massively helped with those things, but creative – the pace of innovation is immense. Obviously you’ve seen Imagine, you’ve seen Veo. A lot of the generative AI excitement right now seems to be around image and video generation. And putting those tools into the hands of advertisers has been game changing.
Marketers are using generative AI today to produce compelling ad creative at a tremendous scale where, even a year ago, it was a time and a budget impossibility. And so it makes makes past efforts look almost primitive by comparison.
I see a real incredible opportunity for brands to leverage these technologies to fuel their creativity and inspire new forms of storytelling. So I think that’s what makes it feel so big. The technology went from here to there so quickly and, historically, have been lagging behind the other technological innovations of advertising in my view.
How do you see CTV (Connected TV) advertising evolving due to AI?
Obviously, advertisers want to reach people where they’re spending time, and increasingly that’s on CTV. Some of the shift to streaming that took place a few years ago is permanent.
I think AI-powered tools here are helping marketers reach those audiences in ways that traditional linear couldn’t. I think the advancements we talked about regarding ad creative, accessible video production, better personalization… I’m excited about some of the shoppable formats — so when you see something, you can buy it right from your TV… those kind of things are expanding what’s possible.
A lot of what we’re seeing so far is applying some of the techniques that are working in Web, in-app on mobile devices, also extending into CTV.
How have recent court decisions like the ad tech antitrust trial played a part in Google’s AI and innovation plans?
First, I think it’s worth noting we disagree with the court’s decision on our ad tech tools, and we’re appealing. But the process there requires that we first work out remedies, which is the trial that just wrapped in Virginia.
So thinking about the ad tech trial, specifically, our commitment to partners and innovation hasn’t changed. We’ve been focused on providing those solutions.
One of the things I’ve told my team since the trial conversation began was that we need to focus on driving success for our customers. I don’t think we ever wavered from that or slowed down on our pace of innovation.
Is there a vision with with marketing at Google —that someday soon— the marketer will just allocate budget to Google, and Google will take care of the rest (from planning to creative to execution)?
I don’t know that that’s a Google-specific question, but I do think from a marketing perspective, we’re already seeing it to some degree today.
In Search, specifically, we’ve got AI-powered tools like Broad Match and Smart Bidding, and more recently, AI Max for Search campaigns where you provide your goals, your budget, your creative assets and a variety of landing pages, and then you let it go to work.
80% of advertisers are using at least one AI-powered search feature, many of them are using far more. So we see that happening there and with Performance Max.
As we continue along that trend line, there is more and more of an expectation from marketers and agencies that they want to use these AI tools to help them do their jobs better.
Whether or not that’s through tools that we provide at scale to millions of advertisers in Google Ads, whether that’s a bespoke solution that’s built on a cloud platform that takes in a MMM study and campaign data from across all the channels that they’re buying and spits out new ways to deliver better results… there’s definitely appetite for that and we’re making investments in trying to see how that future will go.
How do you see AI reshaping advertising over the next five years?
I’d say at a high level, we’re getting closer to achieving the right ad at the right time to the right person.
As I reflected back on the 25 years of Google Ads, I was doing some reading, and there was a speech that one of our founders gave that said the perfect search engine is going to understand exactly what you’re looking for and give you exactly the answer that you need. And with AI, we’re getting far, far closer to that vision.
Three things to watch in particular as I think about it:
- In search, how do we make it easier for people to engage with technology to get answers to their questions? We found that if you lower the barrier for people to search, they search more. Sounds obvious, but that’s a core principle for us.
- Creative AI is going to massively improve advertising’s ability to create relevant, high quality ads experiences. If I think about bidding, targeting, creative, inventory as the four ‘legs of a stool’ of delivering an ad campaign, the creative piece is going to really rise up and be a major performance lever – it’s going to be the biggest shift that we feel in the near term.
- And then agentic. AI agents are going to be a huge asset to business. Right now, there’s a ton of experimentation in two places. One’s on the consumer side: “how can Google or other AI agents get stuff done for me that I don’t want to do myself.” And then, “How can products and services and sellers of merchandise adapt to those changes and provide their own way to execute against those goals?” And so I think that’ll be a big space to watch too.