If you watched anything close to as much football over the weekend as I did, your brain is swimming with images of Jake from State Farm, the GEICO gecko, and so many more insurance mascots. Sing after me, "Liberty, Liberty, Liberty... Li-ber-ty."
But a stat and some analysis from an article last week suggests strongly that their heyday may be, if not ending, then at least diminishing. Brands not backed by hundreds of millions of dollars of advertising may suffer even more in the age of AI search.
Companies need to rethink how they market online.
Let's have a look.
The stat that caught my eye relates to retail. BrandRank.AI tracked 4.3 million AI recommendations across the major AI models from January to July and found that the share captured by major brands fell from 97% to 94.3%, while private label, retailer own-brand programs, and generic ingredients gained those 2.7 percentage points of the share of recommendations.
But I think the finding also relates to insurance. So does the founder of BrandRank, who, as it happens, I interviewed about insurance marketing a year a half ago. The founder, Pete Blackshaw, told me:
"AI is becoming the new purchase funnel.... Everyone is going to AI for everything now - what product to buy, how to use products. This has massive implications for businesses.
"Search 1.0 is a $250 billion industry, and Gartner predicts that by the end of 2028, half of it will shift into what I call the answer economy, based on AI-based search. Even if only 10% shifts, that's a massive change.
"For brands, it's critical to understand what shows up when you type in your name and why. Who's getting exposure? What are the consequences?
"It's very tricky, because companies spent 25 years trying to figure out how to become one of 10 blue links in Google searches. If you didn't like the results, you could buy an advertisement. Now search provides one blended response.... Either you're in the response the AI prepared or you're not, and most of the time, you're not."
This June, Riv Arthur wrote for us about AI search's impact on marketing and, in his distinctive way, said:
"The question is whether your business is legible to the machines that will increasingly decide who gets recommended, who gets trusted, and who gets the transaction.
"Most businesses, if they're honest, are not legible.
They're running on claims systems from 2009, CRM platforms that don't talk to each other, PDFs that contain institutional memory no one has ever indexed, and tribal knowledge sitting in the heads of people who are 18 months from retirement....
"An AI agent deciding which carrier to recommend, which doctor to surface, or which vendor to integrate is going to favor organizations whose operations are coherent, structured, and machine-readable. It has no patience for ambiguity. It won't retry. It won't call customer service. It will simply move on to the competitor whose data makes sense.
"Which means a structured operational model isn't just an IT project anymore. It's the difference between being findable and being invisible in a world where the searcher is a machine with no tolerance for mess.
His analysis doesn't leave much room for marketing through building a brand through cute advertising, does it?
Earlier this month, Kevin Walsh provided us some research from his firm, Brainspan AI, that shows that, in his words, "a new decision layer is forming" above the traditional sales funnel. He wrote:
"Buyers, agents, brokers, and business owners increasingly ask AI platforms to compare carriers, explain coverage, and recommend providers.... A carrier can remain commercially large, rank well in traditional search, and still be absent when an AI system constructs the shortlist. Its legacy presence has not disappeared—but it can be bypassed at the moment of consideration....
"Farmers illustrates the downside. In Auto, the carrier held roughly 3.6% of the real market, according to NAIC data, yet registered approximately 0.05% of measured AI visibility in [Brainspan's] study—functionally absent relative to its commercial position. Amica illustrates the opposite pattern. Its Home AI visibility reached 7.6% against approximately 0.7% real market share, an overrepresentation ratio of about 10.8 times."
The AI engines are just making recommendations, not doing the actual purchasing — at least for now — so there's still room for those ear worms from TV ads to influence buying, but the online marketing competition is clearly changing.
If my Steelers lose to the Brownies on Thursday night, I'll probably boycott football next weekend, but even if I subject myself to another onslaught of insurance ads, the cute branding bits will keep making less of an impact on me and everyone else in the age of AI search.
Cheers,
Paul