Google's AI Mode has crossed 1 billion monthly active users, and on its July 28, 2026 earnings call the company used IHG Hotels & Resorts, Booking Holdings and Expedia to show investors where that audience meets its advertising, cloud and transaction businesses.

Retail and finance still drive the majority of search ad revenue this quarter, according to Google's commentary. Travel entered the script as a showcase: Google executives argued that travel queries — dense with dates, budgets, destinations and amenity preferences — feed Gemini and AI Overviews with structured intent other categories cannot match.

What does Direct Offers change for hotel distribution?

The Direct Offers pilot will soon surface IHG promotions inside AI-assisted trip planning, joining Booking Holdings and Expedia as the third major lodging partner. Google is simultaneously extending its Universal Commerce Protocol into hotel booking, the technical layer that lets merchants expose inventory and checkout inside a conversational surface rather than via click-out.

For hotel chains, the open question is where the transaction lands. Google has not disclosed whether a booking made through AI Mode completes on Google's surface or routes to the brand's own site. That distinction shapes who owns the guest relationship, who pays the take rate, and which marketing database absorbs the booking signal.

IHG, for its part, is hedging. The group already runs a ChatGPT app that searches across more than 7,000 hotels, and Booking Holdings is powering agentic reservations on OpenTable. The posture: keep inventory visible wherever travelers ask for it, rather than concentrate on a single platform.

Why travel carries weight in the AI pitch

Travel searches carry more usable detail than most other categories. A single query typically surfaces dates, budget, destination and amenity preferences — four structured fields that retail or finance rarely supply at once. Google executives framed this as the reason travel can demonstrate ad matching, cloud services and transaction infrastructure in one storyline.

The convergence matters for sellers of travel. A paid offer surfaced inside a Gemini response behaves differently from a text ad on a results page, and Google has not published click-through rates or travel-specific revenue figures. The disclosure gap leaves hotels, OTAs and tour operators to weigh the cost of losing visibility on Google's conversational rail against the cost of surrendering more direct bookings to a third-party surface.

What IHG and Booking bring to the table

• IHG joins Booking Holdings and Expedia in the Direct Offers pilot, with hotel promotions to appear inside AI Mode.
• Booking Holdings is working with Google Cloud on agentic transactions, an arrangement the company has cited as a model for revenue outside the traditional metasearch click.
• IHG's inventory already surfaces in OpenAI's ChatGPT, signaling a multi-platform distribution posture rather than a single-platform bet.

What sellers of travel should watch next

Google declined to break out travel-specific ad revenue or booking conversion on the call. The next datapoint will be whether IHG's Direct Offers placement requires travelers to leave AI Mode to complete a reservation, and how that affects the share of bookings IHG attributes to its own direct channel versus Google's surface.

Until Google publishes conversion economics for AI Mode travel queries, hotel revenue teams should treat each Direct Offers placement as a margin experiment rather than a guarantee of incremental demand.