Google Launches AI-Driven Marketing Tools in India Following ‘Google Tax’ Repeal: What It Means for Marketers

Google has just introduced a range of AI advertising tools in India, building on the suite it launched in the U.S. last May. This move comes after the Indian government repealed its 6% levy on digital ads, which had been a point of contention. By removing this tax, India has become a more appealing market for tech giants like Google, Meta, and Amazon.

Dan Taylor, Vice President for Global Ads at Google, shared that these new tools aim to simplify ad management. For instance, the “Generated for You” feature identifies content opportunities from shopping catalogs and creates images and videos using AI. This allows merchants to easily publish attractive ads across Google platforms.

Another innovative feature is Smart Bidding Exploration, designed to enhance search campaigns. Built on existing Smart Bidding technology, it focuses on finding new, qualified leads that merchants might typically miss. These advanced tools leverage real-time data and learning to optimize ad performance.

Early testing shows success; Cashify, a platform for selling used electronics, reported a 15% increase in conversions and a 12% drop in customer acquisition costs after using AI Max for Search Campaigns.

Google’s expansion in India also includes shoppable ads on YouTube. With YouTube being the most-watched streaming service in the country, these ads are likely to reach a wider audience. Roma Datta Chobey from Google India noted that an impressive 87% of Indian consumers engage with YouTube or Shorts during their shopping journeys.

The digital advertising market in India is booming. Recent reports predict it could grow over 20% year-over-year, reaching nearly $7 billion by the end of 2025. This growth is fueled by the increasing number of internet users in the country.

Chobey emphasized the vibrant digital ecosystem in India, saying, “We have the largest number of users actively trying and testing our products.” This dynamic environment is why innovations are being rolled out here ahead of other markets.

As Google tailors its new features to local needs, including language support in Hindi and targeting options for urban and rural audiences, it’s clear that India remains a crucial market. Google’s ad revenues in India have also been climbing, with gross revenue reaching ₹312.21 billion ($3.6 billion) in fiscal year 2024, marking an 11% increase year-over-year.

These developments signal a significant shift in how businesses will approach digital advertising in India, harnessing AI to engage consumers effectively.

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