Potential Meta AI Search Engine Could Disrupt Online Ad Market

Meta is reportedly working on an AI-powered search engine that will crawl the web for information, a move that could disrupt how advertising is sold online.

Currently, Meta’s AI chatbot gets information about news, sports, stocks, and other current events from Google and Bing, a situation the company is looking to change, according to a report appearing Monday in The Information.

By cutting outside search engines out of chatbot interactions, Meta hopes to sell hyper-targeted ads that it can sell at premium prices.

Total control of the chatbot interaction is also likely to keep a user on a Meta app longer, so it has more time to feed them more ads.

“By Meta entering into the AI Search arena, more of the data they are acquiring will be happening from first-party data without relying on reporting and third-party data from other sources,” explained Amanda Robinson, CEO of The Digital Gal, a digital marketing agency in Toronto.

“I see that this has the potential to replace tracking methods of the past like Pixels on websites and can shift us closer to more relevant ads being shown to the right people,” she told the E-Commerce Times. “This is a win-win for both the users and the advertisers.”

It would also be a win for Meta. “Ad rates could go higher,” said Ross Rubin, the principal analyst with Reticle Research, a consumer technology advisory firm in New York City.

“Today, you know something about someone doing a search because of their previous search history, but you could understand a lot more about a person with AI, depending on how they engineer their prompts, how they follow up, and other things that they’re doing,” he told the E-Commerce Times.

Conversational Advertising

If a Meta search engine made Facebook or Instagram more sticky, that would allow it to reach more online users, explained Chris Ferris, senior vice president of digital strategy at Pierpont Communications, a public relations agency in Houston.

“Google Ads work as well as they do because they are driven by people conducting searches with high intent,” he told the E-Commerce Times. “Facebook and Instagram ads are based on assumptions about what a person likes. If I like a bunch of soccer content, I see ads for soccer cleats. But I’m 55. I don’t play soccer anymore. If Meta can layer search data on top of their other information about their users, that could be very powerful.”

However, he added: “Color me skeptical that Meta is good at developing new technology. I suspect this will go the way of their mixed reality headsets: a lot of money spent with very little return.”

Kaveh Vahdat, founder and president of RiseOpp, a fractional CMO agency in San Francisco, noted that Meta’s development of a search-enabled AI chatbot signals a potential shift in online advertising and search dynamics.

“Unlike Google’s fact-based search model, Meta’s AI aims to deliver conversational answers that integrate current events with personalized recommendations,” he told the E-Commerce Times. “This approach could alter user engagement and possibly shape online ad spending as businesses adopt a more dialogue-centric advertising model. By integrating AI with existing social data, Meta could target ads more dynamically, making ads feel less intrusive and more part of users’ online journeys.”

“While Google has a stronghold in search with around a 90% market share, Meta’s entry could challenge this dominance, especially as user preferences shift towards conversational and integrated search experiences,” he added. “Meta’s AI could leverage real-time data from its social platforms to generate highly personalized and targeted ads — something traditional search engines don’t currently offer in the same way.”

Google Search Dominance Will Continue

As formidable a challenge as Meta could pose to Google’s search dominance, it’s unlikely to do so. “Meta’s foray into search is a long shot, and I don’t see it changing the industry in any meaningful way,” said Jordan Stevens of Jordan Stevens Digital Marketing, a consulting practice in Toronto.

“Consumer behavior is behind Google’s massive lead, and that’s hard to change,” he told the E-Commerce Times.

Malik Ahmed Khan, equity analyst for technology at Morningstar Research Services in Chicago, pointed out that the reported search functionality is geared toward people searching within Meta’s ecosystem. “I don’t believe Meta wants to or has a long-term vision of making a standalone search product,” he told the E-Commerce Times.

“Could this mean lower search volumes as people engage with more search within Meta’s FoA [family of apps]? Sure,” he continued. “We don’t see this as a significant threat to Google’s dominance over search, however.”

“The primary case we’d make for this is that search as a stand-alone product is still responsible for the vast majority of searches online,” he said. “It is unlikely that Meta’s search product — whenever it is rolled out, which, by the way, could be some time away — could take a material portion of monetizable searches away from Google.”

“Building a Google Killer isn’t really the goal here,” added Dev Nag, CEO and founder of QueryPal, an enterprise chatbot in San Francisco.

“It’s about making their platforms more capable and self-sufficient while reducing dependency on potential competitors,” he told the E-Commerce Times. “The real battle isn’t for traditional web search, but for being the primary interface through which people discover and interact with information in their digital lives.”

Prelude to Everything App?

Development of a web crawling engine could be the beginning of a larger scheme by Meta, contended Baruch Labunski, CEO of Rank Secure, a website development and search engine optimization firm, in Toronto.

“It is an open secret the larger social media platforms, namely Meta and X, want to dominate the web with ‘everything platforms,'” he told the E-Commerce Times.

“That means you would go there to search, use the chatbot, go onto social media, buy and ship products, and do all sorts of transactions,” he said. “It could even evolve into a financial system for each platform with crypto as the primary exchange. Such a development would greatly cut into Google’s share of the internet pie as people wouldn’t need it anymore.”

“Google could become Ask Jeeves unless it offered something more to get customers to stay on its search,” he added.

Anthony Miyazaki, a professor of marketing at Florida International University, in Miami, argued that Google might be wise to give up market share purposely to avoid government intervention that could destroy its dominance.

“This is where Meta comes into play,” he told the E-Commerce Times. “Meta’s search functions on Facebook and Instagram have been substandard for years. In fact, the impressive search capabilities of TikTok are what seemed to have recently awakened Meta to its search deficiencies now that TikTok is the primary search platform — over Google even — for younger audiences.”

“Zuckerberg starts with an advantage because AI integrations into search have already been tested by Google and Bing,” he continued. “Starting with AI as the base for search will create a more connected search experience that likely will appeal to Meta’s Instagram and Facebook audiences.”