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Google Launches Personalized Ads in AI Shopping Tools

AdTech

Google Launches Personalized Ads in AI Shop Tools!

Business Honor
14 January, 2026

New AI Mode feature lets retailers offer discounts, bundles, and free shipping to shoppers, competing with OpenAI and enhancing e-commerce revenue.

Google is introducing personalized advertising in its AI shopping solutions as it looks to monetize the millions of people who use its AI-powered chatbot for free while competing with OpenAI. With the new service, advertisers have the opportunity to offer special deals to people using the AI Mode of Google powered by the Gemini Model as they prepare to make a purchase.

This step, however, marks an important shift from Google’s usual sponsored search advertisements, which have long been a source of considerable income for the company but threaten to be overpowered by the rising influence of AI-based services. Vidhya Srinivasan, the Vice President of Google Ads and Commerce, commented, ‘The new effort enables retailers to offer value in the form of discount, bundle, or free delivery, all targeted precisely when it really matters – to convert the customer from browsing to purchasing.’

Google's AI Mode capitalizes on the search engine giant's enormous market share in web search, giving its Gemini chatbot exposure before an enormous user base. Though the standalone Gemini feature currently lags behind the popularity of ChatGPT, its inclusion on search pages gives Google an edge over its competitors in AI-fueled online e-commerce.

The new ads feature will utilize the conversational context to deliver offers, and AI will decide when to display these offers to the consumer. To begin with, discounts will be the main focus, and later other forms of offers will be included. Current retail partners also include Petco, e.l.f. Cosmetics, and Samsonite.

Interestingly, this announcement emerges at a time when rivals, such as OpenAI and Microsoft, are also developing shopping applications using AI, pointing towards the indispensable role of the intersection of AI, targeted advertising, and e-commerce. Google’s universal commerce protocol, designed along with Walmart, Target, and Shopify, also helps facilitate smooth search and purchase of products within the AI environment itself, marking a new dawn of shopping using AI.