Artificial Intelligence may account for only 1% of the global search market, but it has triggered a seismic shift in search behavior.
- Users are increasingly favoring AI-generated summaries over SERP, which has resulted in a 50% decline in online traffic.
- Websites that land in the first position are no longer assured of receiving 40% of traffic, as AI has reduced clickthroughs by 34%.
Businesses are scrambling to adjust their SEO strategies and adapt to the disruptions caused by AI, despite fewer than 1% of users clicking on links included in AI-generated content.
However, there’s one area of SEO that responds differently to AI search: Local SEO.
Local SEO isn’t only surviving the onslaught of AI
It’s thriving.
Why Is Local SEO Still Relevant And Important In 2026?
Local SEO is the process of enhancing the search engine visibility of local businesses that have brick-and-mortar locations.
Implementing local SEO strategies can help the brick-and-mortar store acquire organic traffic from searches performed within its proximity.
Examples of local SEO strategies include:
- Creating a business profile in an online business directory, such as Google My Business, Yelp, Bing Places, Yellow Pages, and Foursquare.
- Optimizing content with location-based keywords.
- Collaborating with non-competing businesses.
The Key Performance Indicators (KPIs) of local SEO in 2025 prove it remains a relevant and important strategy in 2026:
- 80% of consumers perform local search once a week.
- 32% of consumers search for information about local businesses multiple times a day.
- 88% of consumers who perform a local search visit the store within the week.
- 20% of the store visits resulted in a sale.
- 76% of consumers who include the keyword “near me” in their search visit the store on the same day.
Why are we confident that these KPIs for local search will continue in 2026 despite the emergence of Artificial Intelligence?
A 2025 study by Search Engine Land showed that the performance of local SEO hasn’t been affected by the emergence of AI as a search tool.
Search Engine Land tracked the performance of various AI search tools, such as AI Overviews and ChatGPT, and how this technology has impacted search behavior.
Here is the graph detailing AI’s effect on SERP organic traffic:
(Source: Search Engine Land)
Note:
- Purple line: Total number of impressions
- Blue line: Total number of clickthroughs
As you can see, website clickthroughs are declining despite an increase in impressions.
While AI search has diminished the influence of SERP on users, the same can’t be said about local SEO.
(Source: Search Engine Land)
In contrast to organic traffic from search engine results pages, local SEO consistently shows an increase in click-through rates, regardless of fluctuations in the number of impressions within a channel.
From the graph, we can see that local SEO isn’t just surviving, but thriving, in the age of Artificial Intelligence.
Why Local SEO Responds Differently to AI
Let’s do a Google search.
On your phone or PC, type:
“Italian restaurant near me.”
Google’s search engine will present a directory of restaurants that serve Italian food near your place.
There’s no AI summary.
If you click AI mode (AIM), Google will also present a list of restaurants near you.
However, you’ll notice a few things about the listing:
- The restaurants on the list aren’t near you.
- The phone numbers and precise address aren’t indicated.
- The information is inadequate and reads as if it were lifted from a review website.
You get more valuable information from the SERP than from AIM.
So why can’t AI search deliver comprehensive results for local SEO as it does for traditional organic search?
1. Generative AI Has Limited Location Capabilities
When you switched to AIM, did a message pop up on the screen asking for your precise location?
If so, what did you do?
Did you click the button and give AI Mode your precise location, or did you ignore the request and continue with the search?
Many users have privacy concerns and are reluctant to share their exact location with Google.
Without knowing your precise location, AIM cannot provide accurate results or responses.
For “Italian restaurants near me,” AIM will produce an online listing of restaurants it believes are located within the area where the search query originated.
AIM will pull the information from Google My Business (GMB).
However, unlike the SERP, the list will have incomplete information. Details such as business address, email address, phone numbers, website URL, business hours, and a location map may be omitted.
What is the reason for the discrepancy in the level of detail in local search information?
A 2025 white paper by LocalFalcon theorizes that AI responds differently to the type of local search query.
2. Generative AI Doesn’t Prioritize Location-Based Searches
According to the study, local search queries including location-specific details appear only 35% of the time in AI Overviews, compared to 46.1% for non-location-specific queries.
Information-related queries for businesses offering services, such as laundry, bookkeeping, and consultation, account for 58% of AIO appearances on local searches.
Commercial and navigational queries collectively account for only 27.7% of total local searches.
One theory for why many local service searches lead to an AIO summary is that these queries are primarily informational, typically characterized by greater detail and often phrased as questions.
In contrast, a commercial or navigational query is focused on finding businesses that are nearby.
Navigational queries tend to be brief and straightforward, lacking extensive information for the AI to process.
Let’s put the theory to a test.
Launch the following informational query:
“Can you find the best PC repair technician who can do home repairs in Tempe, AZ?”
The informational query is characterized by the following qualities:
- Contains 16 words including long-tail keywords: “best PC repair technician,” and “home repairs Tempe, AZ.”
- It’s phrased as a question, but composed using natural conversational language.
- Includes a specific detail to emphasize intent: “best PC repair technician who can do home repairs.”
The comprehensive informational query will initiate AIO, which will create the following summary:
The AIO summary organizes information that the user might find useful and relevant, including links to other websites, but there are no specific links to local service centers.
The AIO summary organizes the information into headers that the user might find useful and relevant to the query.
If you click on the links provided in the header “local stores,” you’ll land on an SERP featuring links to various web pages of the Micro Store website.
You won’t find a list of Micro Store branches near your current location.
If you click “Dive deeper in AI mode,” you’ll see the following information:
AIM will create a list of PC repair businesses within Arizona, but not specifically in Tempe.
Now, let’s do Google locational search.
Type: “Best Italian restaurant in tempe az.”
Six words, one long-tail keyword, location included, but no intentionality.
No AIO, but Google search will present a listing of Italian restaurants in Tempe, AZ.
Click “AI Mode” and you get the same list:
Compared to the SERP, the information is inadequate.
While the phone number is provided, vital information, such as operating hours, business days, email address, store address, and a directional map, is not included.
Another study by Ahrefs found the same results: Informational queries generate more AIO summaries than commercial or navigational queries.
(Source: Ahrefs)
Why does AI respond to local informational searches and not navigational searches?
The answer lies in its technology.
3. Generative AI Is Responsive to Conversational Queries
AI runs on three types of technologies: Machine Learning (ML), Natural Language Processing, and Language Learning Model (LLM). These technologies are developed to analyze the context, intent, and semantics of the query.
Conversational queries are more easily understood by AI It requires additional information to effectively find and compile relevant results from local search sources.
A study by Search Engine Land, revealed that AIM’s LLM program aggregates information from business listings such as Google My Business, Yelp, and Yellow Pages, Google Maps, and reviews when responding to local search queries.
If your online business profile contains complete and updated information, along with a detailed description of your products and services, it will be easier for the AI search algorithm to locate and index your content.
5 Reasons Why You Need To Optimize Local SEO For AI Search In 2026
Now you know how local SEO responds to AI search.
To summarize:
AI indexes and retrieves results only from informational local searches characterized by long-tail keywords, intent, and phrasing that resembles natural conversational language.
Now, let’s shift our focus to why you should adjust your local SEO strategy so that your business can be found by AI, regardless of whether users conduct informational or locational searches.
Here are five reasons why you need to optimize local SEO for AI in 2026… and beyond.
1. The Growth of AI is Inevitable
AI currently represents only 1% of search traffic; however, industry analysts such as Gartner predict that its continued growth will reduce the market share of traditional search engines by 25% in 2026.
Morning Score estimates that AI search will average a 35% annual growth rate beginning in 2025, and eventually control 14% of the global search market by 2028.
The growth of AI is inevitable. The search engines didn’t ignore AI’s influence on search when it was only at 1% of market share. Google rolled out its initial AI project, Bard, four months after OpenAI launched ChatGPT.
AI technology will continue to evolve and progress over the next decade. Google, Yahoo, Facebook, and other platforms will continue to invest in infrastructure that supports AI search.
We expect the AI search algorithm to broaden its reach for local searches.
If your local SEO strategy hasn’t been modified to accommodate AI search now, how can you keep up when its share of traffic volume increases in 2026?
2. Users Will Quickly Adapt to the Demands of AI Technology
People aren’t patient. They want immediate answers. The best option is the one that provides information the fastest.
Users will change their search behavior as they adapt to the demands of AI.
They’ll realize or perhaps learn from this blog 🙂 that AIO responds to detailed searches that utilize long-tail keywords.
Instead of:
“Italian restaurant near me.”
They’ll write:
“Italian restaurant centerpoint mall tempe az open 10 pm.”
Or:
“Italian restaurant rio salado parkway 5 star reviews open 10 pm.”
As AI developers adjust their programs to meet users’ needs, users will quickly adapt to the demands of current technology.
This means YOU have to adapt to the changes in users’ search behavior.
- Rewrite local SEO content to include long-tail keywords.
- Include product reviews, customer ratings, and positive mentions in your website, social media posts, blogs, and online business profiles.
- Update photos of your physical location and products.
If you’re unsure of how to optimize local SEO for AI, contact us NOW.
3. AI Search Will Require Comprehensive Information
You don’t have to worry about AIO’s effect on website traffic as long as your local SEO content features optimized, well-structured, consistent, and comprehensive information that highlights your business as a trustworthy authority in the industry.
Providing AI with complete and updated information embedded with high-ranking keywords is a win-win-win proposition because it covers all the bases.
- The AI search algorithm can find and index your local SEO content.
- Traditional search engines can find and index your local SEO content.
- Users will value the comprehensive business information provided.
The priority is to get your business seen by AIO and have it included in the summary.
Keep Google’s acronym for creating high-quality content in mind:
- E: Experience
- E: Expertise
- A: Authoritativeness
- T: Trustworthiness
Creating E-E-A-T content builds credibility and effectively addresses users’ search intent.
4. AI Technology Favors Conversational Queries
2025 data shows that 20.5% of global users do voice search.
In the United States, 153 million Americans, or 49% of the U.S. population, rely on voice search.
People are turning to voice search because it is faster, easier, and more convenient than typing on a mobile phone.
Additionally, because voice search is conducted as a conversation, users can provide more details and therefore receive more accurate results.
The programs that power AI technology are designed to understand conversational queries more effectively than traditional search engines.
Instead of typing:
“Italian restaurant rio salado parkway 5 star reviews open 10 pm.”
A user can verbalize the prompt:
“Gemini, can you recommend an Italian restaurant located at Rio Salado Parkway that has five-star reviews and is open until 10:00 pm?”
Which search will yield accurate results?
If you review the text query, the search engine might analyze “open 10 pm” as an Italian restaurant that opens at 10:00 pm instead of one that closes at 10:00 pm.
Google Assistant supports GMB profiles and will handle voice search queries. To align with your local SEO strategies, ensure your website has voice search capabilities.
We’ll teach you how to optimize GMB for AI search in the next section.
5. Local Search is Motivated by Intent
AI search might only account for 1% of the global search market, but its conversion rate is comparatively higher compared to website traffic generated by traditional search engines.
A 2025 study by Microsoft revealed that the conversion rate from AI traffic is three times higher than the traffic generated by search engines, social media, and direct website referrals.
The conversion rate for local SEO from AIO is higher because it’s motivated by intent.
As a reference, 44% of local searchers click Google Local Pack against only 29% for SERP.
That’s why in the SEL study, clickthroughs for local SEO remained high despite fluctuations in organic search traffic.
Users are further down the sales funnel and have a strong intent to transact.
They want to buy NOW.
To fulfill their purchase need, they’re looking for the nearest provider of products or services.
If your business listing appears in the AIO summary, the probability of users clicking on it will be high.
What must you do?
Optimize your GMB profile for AI search.How To Optimize Google My Business For AI Search A 2025 study by LocalFalcon showed that businesses with optimized Google My Business (GMB) profiles appeared 42% more frequently in AIO. Follow our eight tips below to optimize your GMB profile for AI search.
GMB remains the primary reference of AI for local search because it accounts for 19.2% of Google’s search factors. |
Conclusion
AI enhances, not hinders, local SEO.
Your brick-and-mortar and online businesses will benefit from getting discovered by AI search.
You’ll limit your exposure by focusing only on SERP rankings. The numbers we presented in this article prove that users are slowly but surely shifting their search preferences toward AI-generated search results.
AI search has been shown to increase conversion rates because the users who click on its links are highly engaged and motivated to transact.
With local search, users are further down the sales funnel. They’re prioritizing proximity and are looking for an establishment they can visit NOW.
The adjustments you need to make to your local SEO strategy are minor. We can summarize the five non-negotiable adjustments as follows:
- Ensure complete, updated, and aligned NAP information across all online platforms.
- Provide comprehensive content, but write in an easy-to-read and conversational manner.
- Include long-tail keywords, product reviews, positive feedback, and FAQs in your content, and consistently respond to comments.
- Optimize your website, GMB, and other online business directory accounts for AI and voice search.
- Frequently post and update local SEO content, especially in GMB.
If you’re unsure, book a call with us. We’ve successfully managed local SEO projects for many clients.
We’ve been tracking the growth of AI for years. We have the experience and knowledge to ensure your business benefits from AI search.
Optimize your SEO strategies for AI search now, and be ready to face 2026 with confidence.
Frequently Asked Questions (FAQs)
1. What is local GEO, and how is it different from local SEO?
GEO is the acronym for Generative Engine Optimization. “Generative” refers to generative AI
Local GEO is the process of optimizing content for AI search programs, such as AIO, ChatGPT, and Perplexity. In contrast, local SEO is the process of optimizing content for traditional search engines.
2. How will AI affect local SEO in 2026?
AI will give local SEO a boost in 2026 because it delivers highly-engaged and motivated customers with a strong intent to transact with local businesses.
Businesses that adapt their local SEO strategies to meet the demands of AI search can capitalize on the technology’s ability to process and analyze conversational queries, which produce more accurate results.
3. What is Google Local Pack?
The Google Local Pack, also referred to as the “Map Pack” or “3-Pack,” is a feature that appears at the top of the search engine results page (SERP) when a user conducts a local search query.
This feature highlights three business listings that the search engine determines to have the most relevant information in response to the query.
