Are AI Overviews Quietly Reshaping Shopping Ad CTR and Impressions?

Shopping ad click-through rates are rising even as impressions fall — a pattern Mike Ryan, head of ecommerce at Smarter Ecommerce, thinks may be connected to how Google is now serving AI Overviews.

The pattern

Ryan had been watching Shopping CTRs climb in Smarter Ecommerce's own Market Observer benchmark data. Separate ecommerce data from Optmyzr showed CTR up roughly 17% year over year, in a similar range to the rise Ryan was already tracking. Rising CTR usually reads as good news — but if impressions are falling at the same time, ads aren't generating more clicks, they're just being shown less often, which pushes the ratio up mechanically.

The theory

Ryan calls it "experience switching." His hypothesis: Google may be more likely to serve an AI Overview for queries with a lower predicted likelihood of an ad click, while preserving Shopping ad placements for searches with stronger click propensity. If true, that would let two things be true at once — AI Overviews suppressing some advertising opportunities, while the Shopping ads Google does still serve keep monetising well.

It's the inverse of the "crocodile effect" already seen in organic SEO, where AI Overviews inflate impressions while gutting clicks. The name comes from what the pattern looks like plotted on a Google Search Console graph: impressions climbing like an open crocodile's upper jaw while clicks sink like the lower one. It describes the same underlying mechanism as here — a query surfaces an AI-generated answer on the page alongside (or instead of) a traditional result, both count as an impression, but the user often gets what they need without clicking through. Here, Ryan's data suggests the opposite shape for Shopping ads specifically: fewer impressions, comparable or higher clicks — consistent with Google routing some queries away from a Shopping ad slot into an AI Overview before the ad auction even runs, rather than showing the ad and simply losing the click.

Why this matters

If Google is routing queries between an AI Overview and a Shopping ad slot based on predicted click value, standard CTR benchmarks stop being a reliable signal of campaign health on their own — a rising CTR could simply mean your ads are appearing on a narrower, more commercial set of queries, not that they're performing better. Worth tracking impression volume and absolute clicks alongside CTR before drawing conclusions from Shopping campaign performance over the next few reporting cycles.

This is one analyst's hypothesis based on benchmark data, not a confirmed Google mechanism — Google hasn't commented on how AI Overview and Shopping ad placement decisions interact.

How to check your own accounts

Since neither Optmyzr's nor Smarter Ecommerce's benchmark figures are account-specific, the only way to know if this applies to your own Shopping campaigns is to pull impressions and CTR as separate trend lines in Google Ads, rather than reading CTR as a single headline number. If impressions are declining on a query segment while CTR climbs and absolute click volume stays roughly flat, that's the exact signature Ryan describes — and it's a materially different problem from an actual performance improvement, because it points to lost reach rather than better-performing ads. The fix, if the theory holds, isn't creative or bidding optimisation; it's recognising that some demand is being diverted to AI Overviews before your ad is ever eligible to show.

Sources

• Mike Ryan on LinkedIn — original analysis