The Advertising Potential Of Google’s Visual Search Innovations
Contributor since 2018 / 1056 Followers
Summary:
- The ability to initiate image-based searches shortens the journey towards finding the desired product, thereby conceivably improving conversion rates for relevant product ads.
- Google is certainly not the only platform to offer image-based searching functionalities, as Pinterest, Instagram and Amazon also offer their own image-search tools.
- Google will need to step up the speed of its AI innovations to keep up with competition; Pinterest introduced multi-modal search capabilities before Google.
- The integration of Google Lens with Google Maps can enhance the appeal of its advertising solutions; improves discoverability of merchants’ stores right when customers need them most.
- The enhanced ability of Google Lens to connect users’ queries with the most relevant web content also improves discoverability for high-quality publishers, improving advertising potential through Google Network partners.
JHVEPhoto
Google (NASDAQ:GOOG) (NASDAQ:GOOGL) strives to continuously enhance the search experience through various AI innovations. A key search format Google has been investing in over the last several years is image-based searching, through its Google Lens feature. Advancements in image-recognition technology create easier search experiences, enabling better targeted advertising potential. The multi-functionality of Google Lens offers advantages, but competition in this space is tight as various social media platforms offer similar capabilities, requiring Google to step up its innovation efficiency.
Google Lens
Visual-based search and engagement is becoming increasingly prevalent among younger users of tech platforms, leading to the rise of social media platforms like Pinterest and Instagram. To keep up with these user engagement trends, Google introduced Google Lens in 2017, and over the years the company has been persistently striving to broaden its applicability to deeply imbed it into people’s daily lives.
Google Lens enables people to take an image of an object they see using their camera phone, and initiate various different types of searches, depending on their intention. They could initiate a search to learn more about something, or look for similar products to purchase. Google Lens can also identify products in images on the internet, and enable users to search for similar products to buy across the web.
Google Lens essentially strives to capitalize on people’s impulses, inducing them to initiate product searches more easily when they see something they like. Describing a sought-after item using words can often be challenging, and may require the user to refine their search multiple times, or browse for a while before they finally find what they were looking for. In this process, they may come across various irrelevant product ads. Conversely, the ability to initiate image-based searches eliminates the need to describe an item, and shortens the journey towards finding the desired product. As a result, it improves Google’s ability to show more relevant product ads, conceivably improving conversion rates.
Additionally, in April 2022 Google introduced ‘multisearch’ through Google Lens, enabling users to combine image and text searches. For example, one could search an image of a particular shirt design, and then add the text ‘blue’, to find a similar shirt in that particular color. This functionality is enabled by Google’s Multitask Unified Model (MUM), an AI advancement facilitating multi-modal tasks.
The tech giant has been striving to induce greater e-commerce activity through its platform, as the recurrence of high-intent shoppers augments the appeal of its advertising solutions to digital merchants. Google Lens is a key tool to encourage people to start their shopping journeys through Google. However, Google is certainly not the only platform to offer image-based searching functionalities, as Pinterest (PINS), Instagram (META) and Amazon (AMZN) also offer their own image-search tools to encourage greater commercial activity through their platforms. Therefore, people with shopping intent have various other platforms to choose from to initiate their image-based searches.
Furthermore, while it could induce people to start their shopping journeys through Google, the visual search results can consist of relevant product links across all websites, which includes competitor websites like Amazon, Facebook and eBay. Hence while search journeys could start through Google Lens, the actual shopping activity may end up occurring on rival e-commerce platforms if users click through those product links.
On the last earnings call, CEO Sundar Pichai proclaimed that “people now use Google Lens to answer more than 8 billion questions every month using just a photo or an image”. Though it is unclear how many people use it to initiate shopping searches as opposed to other types of searches, such as translations and generic searches to learn more about something. In Q3 2022, ‘Google Search & other’ ad revenue grew by just 4% year-over-year, while Pinterest ad revenue grew 8% over the same period.
Despite Google’s advancements in image-based searching, it may not necessarily be the first platform/ tool that people think of to seek shopping inspiration. For instance, social commerce platforms (particularly image-centric platforms) tend to have various popular influencers creating content on their sites/apps. This makes them more exciting destinations to explore products and gather styling ideas, giving social media platforms like Pinterest and Instagram an edge in inducing people to initiate their image-based searches. Google does not have an image-centered social media platform, but it could potentially leverage the appeal of YouTube influencers to induce more commercial searches through Google Lens.
Google will also need to step up the speed of its AI innovations to keep up with competition. While Google’s executives like to proclaim their AI prowess, they are not necessarily always ahead of competition. For instance, the aforementioned multisearch functionality on Google Lens only recently launched in April 2022, though this hybrid search feature has been available on Pinterest since 2017.
The availability of similar capabilities on more apparent shopping destinations, like e-commerce and social commerce platforms, subdues Google’s ability to induce more shopping searches/ activities through its own platform, particularly when they are lagging on innovation. Subsequently, this undermines its ability to augment the appeal of its advertising solutions through Google Lens.
Google’s opportunities
While Google is still establishing its e-commerce potency, it has various levers to pull to induce greater use of Google Lens.
As a multi-service platform, the tech giant is well-positioned to encourage usage of Google Lens by integrating it with other products and services, such as Google Maps. On the last earnings call, Pichai mentioned: “we are supercharging our visual search capabilities to help people find what they are looking for at businesses nearby”. This is a valuable integration to help people when they need to purchase something instantly, enabling them to check whether an item is in-stock at local stores when they can’t wait for shipping, or need to buy something from a store nearby when they are travelling or engaging in outdoor activities. Therefore, the integration of Google Lens with Google Maps can enhance the appeal of advertising on Google Maps to improve discoverability of merchants’ stores right when customers need them most. Enhanced discoverability potential also encourages more merchants to list their businesses on Google and share inventory data, subsequently improving Google Maps users’ ability to find more products nearby, and thereby inducing a network effect.
Furthermore, another functionality built into Google Lens is ‘Translation’, enabling users to point their camera at text in foreign languages, to receive instant translations into their preferred language. On the previous earnings call, Pichai proclaimed “Google Lens…can now blend translated text seamlessly into the background of images, like menus or street signs in just 100 milliseconds, shorter than a blink of an eye”. These advancements augment the usefulness of Google Lens, and enhance Google’s ability to deeply imbed the tool into users’ habitual activities. Travelers would undoubtedly find it useful in foreign lands when visiting restaurants or looking for tourist hotspots. Newly arrived immigrants in foreign lands can also find it valuable to support their process of settling down into the new country.
Google Lens can also be used to learn more information about something, such as pets or particular landmarks. Google benefits from being a well-established search engine, a place where publishers list their websites, enabling it access to a wider pool of information to inform its users when they are looking for specific information instantly. Image-based searching improves users’ ability to find the most relevant content quickly without having to browse through other irrelevant web pages. The ability to learn about something more easily through Google Lens further enhances Google’s ability to deeply imbed it into people’s routinely activities.
Moreover, the enhanced ability of Google Lens to connect users’ queries with the most relevant web content also improves discoverability for high-quality publishers, bringing more engaged web visitors to their websites. This enhances the appeal of listing on Google (as opposed to other search engines/ platforms) for publishers, and improves the likelihood of users visiting multiple web pages within websites to learn more about a subject of interest from high-quality publishers. Subsequently, this would boost the number of ad impressions, and thereby improves advertising revenue-generation through the Google Network partners, particularly AdSense which allows website publishers to offer ad spaces to advertisers.
The overarching point is, the multi-functionality of Google Lens enhances its user acquisition potential. Competitors like Pinterest and Instagram are not able to offer these aggregated services to the extent that Google can, making it a vital competitive differentiator. Broadening the applicability of Google Lens and deeply imbedding it into users’ daily activities improves the likelihood of them also initiating their commercial/ shopping searches through Google Lens, as opposed to competitors’ services, enhancing Google’s advertising potential.
Summary
Google’s advancements in visual search through Google Lens indeed eases the search experience, improving the company’s ability to show more relevant ads. Though the tech giant needs to step up the speed of its AI innovations to keep up with competition, as similar functionalities are also available on e-commerce/ social commerce platforms like Amazon, Pinterest and Instagram, which are adept at rolling out AI innovations before Google. The multi-functionality aspect of Google Lens does offer competitive advantages in user acquisition, and Google will need to prudently develop its monetization strategies to optimize advertising-revenue generation.
Any buying or selling decisions in Google stock should take into consideration all business divisions, such as YouTube and Google Cloud. Given that this article focuses particularly on Google Lens, a neutral ‘hold’ rating will be assigned to the stock.
Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.