Mondelēz, Samsung and Toyota are testing, or ready to test, Google Demand Gen.
Google’s latest artificial intelligence ad push is expected to generate even more demand from marketers. The company rolled out Demand Gen campaigns widely last week, and the ad product already has top brands on board, including Mondelēz, Samsung and Toyota.
Demand Gen has the potential to appeal to major brands that have yet to adopt Performance Max, according to advertisers, referring to Google’s first mainstream AI ad product that was launched widely in 2021.
Demand Gen appeals to social media advertisers geared toward finding new customers by targeting specific audience groups and “lookalikes,” people who share traits with existing customers. Unlike PMax campaigns, Demand Gen ads are not targeted by keywords. But the campaigns do use AI to configure the optimal ad and refine the targeting.
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PMax is an AI-based ad campaign that is an evolution of traditional search advertising, only it puts those ads across Google properties. The marketers import their creative assets and copy and then the ads run through Search, Gmail, YouTube and Discover. The ad product has been mostly adopted by retail and e-commerce brands, marketers with goals of driving direct outcomes from every click. Google’s AI takes over many of the search marketing tasks that the advertisers used to control, such as managing thousands of keywords.
“Demand Gen is a game-changing thing for brand marketers,” said Jon Halvorson, global senior VP, of consumer experience and digital commerce at Mondelēz International. “It’s the pistol start to the AI race.”
Mondelēz, which owns brands such as Oreo, Ritz and Sour Patch Kids, is getting ready to turn on Demand Gen campaigns in the coming weeks, Halvorson said. Mondelēz has yet to adopt PMax as part of its traditional search marketing strategy, but it is piling into Demand Gen. Some top brands and ad agencies have dabbled in PMax campaigns, but they also have been reluctant to hand over too much power to Google’s AI for their search campaigns, according to marketers.
“There is some hesitation on PMax despite some really convincing numbers [from Google],” said Vincent Spruyt, global chief AI officer at Kinesso, IPG’s performance marketing agency. “Demand Gen is a much easier story for brands.”
Last week, Google updated PMax to start allowing some keyword controls following advertisers’ feedback.
Demand Gen differs from PMax in that it is not for search campaigns. The ads run on YouTube, YouTube Shorts, Gmail, as well as Discover, which is a mobile feed that serves up content to users, like a personalized, multimedia search platform that doesn’t require search queries from the consumer.
Google first revealed Demand Gen at the Cannes Lions International Festival of Creativity in June. The product competes with TikTok and Meta, where brands already are set up to run campaigns with content that is similar to what they would run on YouTube Shorts.
Demand Gen represents a shift within Google and the broader industry as marketers adapt to AI-powered ad platforms, where machine learning makes many of the big decisions in targeting and measurement. Google, Meta, Amazon and TikTok have all been moving toward AI ad products, especially for campaigns with direct response goals, where marketers want to drive sales, website visits and downloads. Meta has been pushing an AI product called Advantage+, which is now on pace to generate $10 billion annually, according to Meta’s latest earnings call. Last year, TikTok launched what it called “smart shopping campaigns.” These are all AI products, including PMax, that have appealed to direct-to-consumer brands and retailers.
Google’s Demand Gen appears to be going after brand marketers with broader awareness and consideration goals, such as Mondelēz. During an earnings call last week, Google’s Chief Business Officer Philipp Schindler said that Samsung and Toyota tested Demand Gen in recent months. The AI campaigns were “designed for the needs of today’s social marketers to engage people as they stream, scroll and connect,” Schindler said. “It combines video and image ads in one campaign, with access to 3 billion users across YouTube and Google.”
"Performance Max is a goals-based campaign and can be used as a complement to Search. Together, Search and Performance Max help advertisers maximize conversions across all of Google,” a Google spokesperson said in a statement to Ad Age. “Implementing Demand Gen then helps advertisers broaden their funnel strategy and drive purchase consideration."
“When it comes to Demand Gen that is much more an awareness and consideration type of play similar to how it works in social,” Kinesso’s Spruyt said.
Demand Gen will give brand marketers a way to explore the new AI landscape, Halvorson said. The reason that’s a big deal is because it reframes the way brand marketers have traditionally thought about advertising, he said. Brands must now evolve their playbooks to work similarly to DTC brands and retailers, Halvorson said. The AI can turn a consumer package good brand into more of a DTC-style marketer. Brands can upload their product images, ad creative and marketing copy into AI-run libraries, so that the machine can experiment with campaigns. AI mixes and matches the creative assets, tests against a variety of audiences and learns what works.
“This is how brand marketers can perfect performance marketing,” Halvorson said.
Google’s Demand Gen gives some levers to brands and agencies by letting them set ad targeting parameters, according to Jim Tomanchek, VP of global partnerships at Sprinklr, a customer experience management platform that works with brands to plan paid and organic social media campaigns.
Earlier this month, Sprinklr announced it would support Demand Gen ad campaigns, the first paid Google ad format that the platform offered. Sprinklr typically works with brands on paid TikTok, Instagram and other social media ads. The inclusion of Sprinklr as an ad partner is another indication that Google positioned Demand Gen as a social ad product.
“Google wanted to get in and have an offering specifically for a lot of the buyers that buy primarily on social,” Tomanchek said.
