Google sets out AI-first future for ads & shopping

Google has outlined a series of changes to its ads and commerce products for 2026. Updates across YouTube, Search, and Gemini lean more heavily on AI-driven matching, new ad formats, and early steps toward agent-led shopping.

The plans were set out by Vidhya Srinivasan, Google's VP/GM of Ads & Commerce, in an annual industry letter. She framed the year ahead around three themes: creators, AI-powered discovery in Search, and what Google calls "agentic commerce".

YouTube creators

Google is putting YouTube creators at the centre of its approach to influence and shopping. It called creators "today's most trusted tastemakers" and linked that trust to faster purchase decisions.

Srinivasan said the next step is tighter connections between brands and creators. Google plans to use AI to analyse content and audiences, then use that analysis to match brands with creator communities.

The update reflects continued pressure on major ad platforms to prove measurable outcomes from creator- and video-led campaigns. It also suggests Google wants to make creator partnerships easier to plan and buy through its ad stack, rather than leaving much of the work to agencies, creator marketplaces, and bespoke deals.

Search changes

Search advertising is also set for revision as Google expands AI-driven experiences. Srinivasan said Search is becoming a "more powerful tool for discovery", with ad experiences that can "inspire and answer all at once".

Google has been testing new ad formats in its AI Mode experience. AI Mode already shows organic shopping recommendations that Google says are based on relevance to a query. Alongside them, Google is testing an ad format that displays retailers offering the products shown in those recommendations.

The placements will be clearly marked as sponsored. The latest test is US-only.

Overall, the shift points to ads appearing closer to AI-generated or AI-curated results, rather than alongside lists of traditional blue links. For advertisers and retailers, this may change how they compete for visibility-especially if the path from a query to a suggested product becomes shorter and more guided within AI experiences.

Agent-led shopping

A third strand centres on "agentic commerce", which refers to AI agents handling steps of the shopping journey. Srinivasan said the concept has moved into reality, with two goals: reducing what she called "gruntwork" for consumers and working with the industry on foundations for "seamless and secure" commerce.

Google linked the effort to the Universal Commerce Protocol (UCP), which it introduced recently to standardise connections between businesses and AI agents during shopping. UCP will now "power the ability for US shoppers to buy items from Etsy and Wayfair, right in AI Mode in Search and Gemini", described as a new US-only update.

The move puts Google alongside other large technology firms and payment players trying to define how AI agents authenticate users, retrieve product information, and complete transactions. It also raises questions about who controls the commercial relationship between retailers, marketplaces, and the platforms that mediate discovery.

Gemini ad tools

Google also highlighted Gemini's role in its advertising tools, with updates focused on creative and campaign execution. Srinivasan said Gemini-powered tools will drive business outcomes in 2026, with an emphasis on creative development and adapting campaigns based on performance signals.

On creative tools, Google pointed to Nano Banana and said Veo 3 is now available in Google Ads Asset Studio. It described the tools as part of a workflow that turns "imagination" into production assets, then places those assets in front of users when they are most relevant.

Google did not provide rollout details beyond US-only notes attached to some commerce and Search tests. It also did not say how these changes will affect reporting, measurement, or advertiser controls-areas that have drawn scrutiny as AI systems take a larger role in targeting and optimisation.

Trust focus

Srinivasan also addressed trust and safety, saying Google is grounding an "agentic, AI-first era" in principles that have "defined us for 25 years". The message appears aimed at reassuring advertisers and consumers as new formats and AI agents take on more responsibility in the buying journey.

Key questions include how clearly paid placements will be separated from organic recommendations as AI interfaces blend answers, suggestions, and transaction options in a single experience, and how much operational burden retailers and marketplaces will face as they integrate protocols and product feeds that enable AI agents to shop on a user's behalf.

Summing up the overall direction, Srinivasan described a broad push to reshape ads and shopping around AI-native interfaces across Google products.

"We aren't just bringing ads to AI experiences in Search; we are reinventing what an ad is." said Vidhya Srinivasan, VP/GM of Ads & Commerce, Google.

Google plans to continue testing formats in AI Mode and expanding agent-led commerce connections. Purchases from Etsy and Wayfair in AI Mode in Search and Gemini were positioned as an early example of how transactions could work inside its AI experiences.