Google AI Overviews are fundamentally altering how local businesses get discovered online. For years, the local pack (the map with three business listings) was the most valuable real estate in local search. AI Overviews now appear above the local pack for a growing percentage of local queries, capturing user attention before they ever see the map results. Local businesses that don't adapt will lose traffic to competitors who do.
The Local Search Landscape Before and After AI Overviews
| Before AI Overviews | After AI Overviews |
|---|---|
| Local pack was the first thing users saw | AI Overview appears above the local pack for 40-50% of local queries |
| Users compared 3 businesses in the map pack | AI recommends specific businesses by name, reducing comparison shopping |
| Click-through went to GBP or website | Users get their answer in the overview; clicks go to cited sources |
| Reviews and proximity drove recommendations | AI weighs content quality, entity authority, and quotability alongside reviews and proximity |
| SEO alone was sufficient | [GEO](/blog/generative-engine-optimization-guide) is now required for full local visibility |
How AI Overviews Are Reshaping Local Queries
The shift is most dramatic for recommendation queries. When a user searches "best dentist in Dallas," the AI Overview now provides a curated answer: "Based on reviews, expertise, and patient ratings, top-rated dentists in Dallas include [Business A] known for cosmetic dentistry, [Business B] for family dental care, and [Business C] for emergency services." This changes the dynamic from "10 businesses compete for attention" to "3 businesses get named and the rest are invisible."
Local query types most affected by AI Overviews
- **"Best [service] in [city]"**, AI Overviews now name specific businesses instead of showing a list. Being named is everything.
- **"How much does [service] cost in [city]"**, AI synthesizes pricing data and often cites the source businesses. Having specific pricing content on your site is now a competitive advantage.
- **"[Service] near me"**, AI Overviews combine location data with content quality to recommend nearby businesses, giving an edge to businesses with strong GEO content.
- **"[Business A] vs [Business B]"**, AI creates comparison summaries and may recommend one over the other, making your competitive positioning content critical.
- **"What should I look for in a [service provider]"**, AI cites educational content from businesses, positioning the cited business as an authority in the user's mind.
The Click-Through Rate Impact
Studies of local search behavior show a bifurcated impact. Businesses cited in AI Overviews see 15-25% higher click-through rates from those SERP positions. Businesses that ranked in positions 1-3 organically but are NOT cited in the overview see 20-35% lower click-through rates. The local pack itself sees reduced click-through when an AI Overview appears above it, though the impact varies by query type.
“The local pack isn't going away, but it's being pushed down. For the queries that matter most, high-intent recommendations, the AI Overview is becoming the new 'position zero.' Local businesses need to be in both places.”
What Local Businesses Must Do Now
- **Invest in GEO**, AI Overviews are a generative AI product. Getting cited requires GEO content optimization: quotable statements, structured content, and entity clarity.
- **Complete your Google Business Profile**, GBP data feeds directly into AI Overview generation for local queries. Every unfilled field is a missed signal.
- **Build review volume**, AI Overviews use review signals to assess business quality. A business with 500 reviews at 4.8 stars is more likely to be named than one with 30 reviews at 5.0 stars.
- **Create location-specific content**, AI Overviews for local queries need location-specific data. Generic, city-agnostic content won't be cited for "best dentist in Dallas" queries.
- **Add structured data**, LocalBusiness schema, FAQ schema, and Review schema help the AI understand and cite your content accurately.
- **Maintain a dual SEO + GEO strategy**, You still need strong organic rankings (SEO is the entry ticket) AND AI-citable content (GEO gets you cited in the overview).
The Opportunity for Forward-Thinking Businesses
Most local businesses haven't adapted to AI Overviews yet. According to our analysis, fewer than 15% of local businesses have implemented basic GEO practices like structured FAQ sections, quotable pricing content, and comprehensive schema markup. This means the window of opportunity is wide open, businesses that invest in AI Overview optimization now will establish citation authority before their competitors even start.
Locafy helps local businesses dominate both the local pack and AI Overviews. Our Localizer product handles local SEO and the GEO layer needed for AI Overview citations in one engine. Book a free audit to see your current AI Overview visibility and where the opportunities are.
AI Overviews & Local SEO FAQ
Will AI Overviews kill the local pack?
No. The local pack remains a critical visibility surface for local businesses. However, AI Overviews are reducing its dominance by appearing above it for a growing percentage of queries. The businesses that win will be visible in BOTH the AI Overview and the local pack. This requires a combined SEO + GEO approach.
Do AI Overviews use Google Maps data?
Yes. AI Overviews for local queries incorporate data from Google Maps and Google Business Profiles, including review data, business categories, hours, and services. This is why GBP optimization is essential for local AI Overview visibility.
My business is already in the local pack. Do I still need to worry about AI Overviews?
Absolutely. AI Overviews appear ABOVE the local pack and capture user attention first. If a competitor is named in the AI Overview and you're only in the local pack, the user may never scroll to see your listing. Protect your visibility by investing in GEO to ensure you appear in both surfaces.
Written by
Jason JacksonChief Operating Officer, Locafy Limited
COO at Locafy (Nasdaq: LCFY). Builds and operates AEO systems for local businesses. Founded Growth Pro Agency before joining Locafy via acquisition.