WPP forecasts AI search ads to become fastest growing channel in advertising

While the category will account for just 1.9% of search ad revenue this year ($301 million), that’s set to rise to 39.2% by 2031, according to its regularly published forecasts, which include AI search estimates for the first time. Total search revenue will make up 21.8% of total global ad revenue this year.

Though more conservative than OpenAI’s prediction that it could net $100 billion in revenue by 2030, WPP Media’s global president of business intelligence Kate Scott-Dawkins said advertisers would likely transfer both “traditional” search spending and e-commerce budgets into generative AI ad options.

“It might capture a larger share of incremental growth than other channels, because it’s new and it’s exciting,” she said. “Some of it transitions from traditional search. Some of it potentially contributes to a deceleration within commerce. All of those together are going to help build that race to $100 billion.”

WPP Media’s estimate is subject to several variables, most related to how Google develops and evolves its search business. Currently, there’s no way for brands to buy only ad space adjacent to AI Overviews, for example, or for them to exclude the format. “It’s an exercise in modelling an abstraction of reality. But it’s a good line in the sand,” said Scott-Dawkins.

The U.S. currently dominates AI search, accounting for 60% of global AI ad spend. But as more consumers adopt AI tools, and OpenAI and Google bring their ad-supported AI experiences to more markets (ChatGPT ads have been available in the U.K. for a fortnight), investment is expected to pick up further, she added.

“Appetite for paid advertising in the generative search space is certainly there — brands are as equally keen to stake a claim in ‘new’ digital real estate before their competitors do as they are to find sources of incremental revenue,” said John Barham, managing partner at performance agency Roast.

Another forecast, also published today by media consultancy Madison & Wall, estimated that search would account for 9.3% of growth in global ad revenue this year, rising to $298 billion, making it the third-fastest growing channel behind social and commerce. The consultancy estimated that spending on television, audio, direct mail and publishing would all decline this year.

“For advertisers, the appeal is context. AI search can understand far more than a traditional keyword query: the conversation, the user’s intent, the decision criteria and, over time, potentially broader personal-agent signals,” said Andy Arnett, head of search at Incubeta, a media agency currently running campaign tests on ChatGPT. “That should make each impression more valuable, because ads can be more relevant, more useful and closer to the point of decision.”

In broader strokes, WPP Media forecasted that global ad revenue would climb 8.9% in 2026; Madison & Wall estimated 8.3%. Neither estimate registered a significant downturn or fall in spending associated with geopolitical concerns.

“It’s not totally irrational,” said Luke Stillman, managing director at Madison & Wall. “But it’s still surprising that every marketer is just ignoring all the potential headwinds out there and spending.”

Despite rosy predictions for ad spend growth this year, Madison & Wall project a gradual slowdown in annual growth — to 5% by 2028, compared with the 10% estimated in 2025 — into the next decade as key channels mature. “We expect the whole market to slow over the next few years,” said Stillman.

Arnett cautioned that generative AI search spending was not guaranteed to grow, especially once marketers get used to ChatGPT’s new car smell. “A major scandal around unsafe AI answers would slow spend quickly,” he said. “For OpenAI in particular, the challenge is proving that advertisers can track, optimize and scale performance without compromising brand safety or user trust.”