Algorithmic Bias
AI algorithms can unintentionally reinforce societal biases or those present in the training data. This can lead to discriminatory targeting, excluding certain demographics, which is particularly problematic when trying to reach multicultural or diverse audiences.
Data Privacy and Compliance
AI-driven personalized ads often rely on extensive user data, which raises serious data privacy and compliance concerns. The strict rules of GDPR, CCPA and other privacy regulations can limit the data available to AI and potentially degrade its targeting accuracy. Observing the rules in ways that respect privacy without hobbling ad campaigns is a crucial aspect of responsible AI use.
The Bottom Line: Even with automation, human oversight remains essential. Marketers need to understand how AI operates and be prepared to adjust strategies when automated recommendations don't align with business goals. There's a learning curve involved in effectively leveraging AI and understanding its outputs.
Google Ads
In 2025, changes to Performance Max (PMax) and the addition of AI Max services to Google Ads have expanded the influence of automation. PMax consolidates campaigns across Search, Shopping, Display, YouTube, Discover, Gmail, and Maps. It leverages Google's AI to optimize bidding, budget allocation, and ad serving in real time.
For our clients, this means less manual optimization than in previous search eras and more time and resources devoted to a strategic approach.
PMax Improvements
Google has continued to roll out significant improvements to Performance Max campaigns this year. We see more control with negative keywords at the campaign level and crucial brand exclusions for Search text ads. This helps preserve your branded traffic. Expanded options for demographic and device exclusions are in beta, alongside improved reporting that offers deeper insights into channel-level performance and search terms.
This improved reporting is huge. Previously, PMax campaigns were part of “Google’s black box.” That is, Google used this campaign type to send out ads through all of its network channels but returned little insight into how well its attempts worked in each channel. We had to use complex spreadsheets and connectors just to get insights on this campaign type. We’re excited about the prospect for PPCs to more reliably see what our campaigns are really doing (other than overly retargeting on YouTube, which PMax campaigns are known to do).
It’s more important than ever to focus on high-quality creative for your ads. The system thrives on a diverse range of images, videos, headlines, and descriptions, which it dynamically combines for various placements. This demands a consistent input of fresh, engaging creative to keep your brand at the top of mind for prospective customers.
Demand Gen
Demand Gen campaigns (which evolved from Video Action campaigns) are gaining traction. These visual-heavy campaigns, similar to Display, broadcast across YouTube, Discover, and Gmail. They aim to generate new demand and drive upper-funnel awareness, and thus complement PMax's conversion-focused approach.
Search Ads
Google's AI Mode/AI Overview is transforming paid search advertising. As AI-generated summaries become more prominent in search results, it’s important to compete for prime real estate on the search page; you want your ads to appear alongside these summaries. Your ads must clearly differentiate and offer a unique value proposition that goes beyond what the AI can provide. Trust becomes an even bigger factor. If users trust the AI, they must trust your ad as much or more, and they must trust it immediately.
AI Max
Google's AI Max is a suite of optional AI-driven features added to “boost” Search campaigns.
AI Max uses advanced broad match and pushes for "keywordless" searches. It leverages Google's AI to understand user intent. This means your ads can appear for highly relevant, conversational queries you might otherwise miss. It connects you with new, valuable audiences.
The system also dynamically generates and customizes headlines and descriptions in real time and tailors them to specific user queries. Using AI, this tool selects the most relevant landing page on your website to improve user experience and lift conversion rates.
AI Max offers some level of control and reporting. You can still use brand inclusions and exclusions, specify locations, and gain deeper insight into which search terms triggered your ads, what headlines were used, and which URLs performed best. This helps address the "black box" concern by providing more visibility into the AI's decisions.
Although this sounds exciting, experienced PPCs know that relying so much on Google’s algorithm could be costly and less effective. Continuous monitoring and strategic human oversight remain essential to ensure it aligns with your business goals and maintains brand consistency. We could see this tool evolving over time to become more useful, in the same way PMax became a staple in paid strategy.
To learn more about recent Google Ads changes, we recommend checking out Google Marketing Live 2025.
Social Media Ads: The Visual Revolution and Privacy Pivot
Paid social advertising continues its evolution, driven by highly engaging visual content, seamless commerce, and Instagram’s more Google-friendly makeup.
The Power of Video Ads
According to Associated Press, video is 53x more likely to generate search rankings compared to plain text. This makes video marketing impossible to ignore. Short-form video, popularized by platforms such as TikTok, Meta Reels, YouTube Shorts, is even growing on LinkedIn.
Users gravitate toward quick, digestible content. Advertisers know this, and they’re mastering the art of the short-form video. YouTube is holding its spot as the second largest search engine, so the reach of video through paid ad platforms such as Meta, LinkedIn, and Google (YouTube) will continue to grow.
Shoppable Ads
The rise of shoppable ads is blurring the lines between social browsing and e-commerce. Brands are creating seamless buying experiences directly within social apps, allowing users to discover, learn about, and purchase products without leaving the platform. This makes the path to conversion incredibly efficient. It leads directly to your bottom line.
Instagram on Google
The recent integration of public Instagram content directly into Google Search results is a significant development for paid social advertising. Historically, paid social excelled at demand generation and audience discovery within Instagram. Now, organic Instagram content can appear for search queries and thus competes directly with paid search ads. This necessitates a heightened focus on SEO, through leveraged keywords in captions and alt-text.
Paid social strategies must adapt. This could mean shifting budget from high-intent searches — now possibly met by organic Instagram content — to top-of-funnel awareness or retargeting. Insights from Instagram's organic performance in Google Search can refine paid social targeting and creative for a more cohesive, full-funnel approach across both search and social channels.
The Digital Journey Ahead
2025 is proving to be a pivotal year in digital advertising, but the overarching message is clear:
- Be alert to updates on automation and AI.
- As always, stay vigilant and check the data behind findings before making moves.
- Prioritize data privacy.
- Create highly engaging, relevant content.
Here at Northwoods, we're committed to help you navigate these complexities with confidence, ensuring that your digital advertising strategy keeps your business competitive and growing.
What emerging trends are you most excited (or perhaps a little concerned) about in the digital advertising landscape? If you're looking for a data-driven digital marketing agency that understands market trends and how to leverage them for success, contact us to speak with our digital paid advertising experts. And download our Ultimate Guide to Leveraging AI in Your Digital Marketing and Advertising.