Google’s AI Overviews are changing the layout of the local SERP, and potentially the path customers take to find your business. While many marketers have speculated on what this means, the team at Local Falcon decided to measure it. They published a whitepaper at the end of May covering a research project where they analyzed over 60,000 simulated Google searches across more than 4,400 local businesses in 20 countries. I reviewed the full research, and it’s the first large-scale data project I’ve seen focused entirely on AI Overview inclusion for local businesses. Anecdotally, many of their findings are supported by our own internal research data on this subject.

Study Overview

White Paper Title: “A Whitepaper on AI Overviews in Google Search”

Research included:

• Over 60,000 Google search simulations
• 4,423 businesses tested
• Location-based scans across multiple cities in 20 countries

Using their grid-based scanning approach, Local Falcon was able to detect which businesses appeared in AI Overviews, when, and make assumptions as to why.

Example queries used by the research team:

• Can anyone recommend the best fitness classes for beginners in Lockport, IL that offer flexible schedules?
• Can anyone recommend a top-rated nail salon that offers gel manicures and pedicures?
• Can someone suggest popular dessert spots in Philadelphia that are known for their refreshing frozen treats?
• Can anyone recommend the best computer repair services in Sparkman, AR that are known for quick turnarounds?

Here’s what the data reveals and what it likely means for your local SEO efforts

1. AI Overviews Appear in just over 40% of Local Business Searches

In total, Local Falcon found that AI Overviews were triggered in 40.16% of the searches they ran. That means for nearly half of all tested queries, Google displayed AI-generated content before any map pack, local organic, or site links.

If you’re only tracking your GBP or organic rank, this new layer of visibility might already be diverting your traffic and you wouldn’t know. Though most likely any traffic you are losing at the moment is at the top of the funnel as we’ll discuss later.

2. Proximity Still Matters in Local AIOs, But Not as a Direct Ranking Signal

The research shows that proximity is a gatekeeper, not a ranking signal. When the simulated search was near a businesses location that business was only slightly more likely to appear (72%) than when a few miles away (68.5%).

This means Google’s AI still respects physical closeness—but probably uses it as a filter rather than a ranking factor inside of the AIO. Put another way, according to this research a searcher needs to in the same rough area as your business like the same city but you won’t win more business simply by being in a centroid or placing your business near a population center.

3. Topical Content Authority is More Important for AIOs Than User Proximity

Local Falcon’s study found a “near zero correlation” between the location of a searcher and the businesses included in the AI overviews (see the above point). They theorize that this likely points to Google’s AIOs using content authority metrics instead of proximity metrics for rankings and/or inclusion.

While your business needs to be roughly in the area the user is searching for (i.e. city or neighborhood) the rank order then comes down to content as with most other LLM-derived signals / ranking systems.

4. Informational Queries Trigger More Overviews

Not all local searches are treated equally by AI.

Local Falcon tested a mix of informational, commercial, and navigational queries. Here’s how often each triggered an AI Overview:

• Informational: 58%
• Commercial: 17.02%
• Navigational: 10.5%

If your local business isn’t creating content that targets how-to or problem-solving phrases, you might be invisible in this new part of the SERP should the AIOs stick around and this ranking system stays largely in place.

The researchers feel like this is a deliberate strategy by Google to take over top of the funnel queries (TOFU) while keeping traditional search for middle of funnel, bottom of funnel, and post purchase queries.

AIOs are still fairly new and these appearance rates could change dramatically as Google works to battle their new AI rivals and use this as an excuse to take more of the web’s traffic for themselves.

5. Adding a City Name to a Query Can Lower Inclusion Odds

One surprising insight: Including a city name in the query (i.e. “roof repair in Richmond”) actually reduced the odds of AI Overview display by around 11%.

That feels counterintuitive, but it might be explained by how Google’s AI determines context. Specific city names could be limiting the query’s ambiguity, causing Google to default back to the local pack instead of AI generation. Or it is possible that Google has internal data showing that in certain instances when a city name is added to a query that users are better served by the Map Pack and standard SERPs below it.

Joe’s Note: In our internal research we’ve discovered that fat head to mid-tail keywords like “Dallas dentist” or “best dentist in Dallas” never trigger an AIO. However if you turn these keywords into longer tail queries or questions like “who is the best dentist in Dallas” or “list of the best dentists in Dallas” you almost always get an AIO above the map pack. This applies no matter the size of the city. Trying those exact same keywords with “Allen Kansas” instead of “Dallas” a city with a population of 160 and no dentists and you’ll get the AIO every single time.

These are patterns worth keeping an eye on and if consumer behavior tips towards longer tail it could impact your businesses greatly due to the AIO appearing instead of the map pack.

6. Some Industries Dominate—Others Disappear

Service-based industry queries had the highest rate of local AI Overviews appearing with some categories showing AI Overviews in excess of 60% of the time.

• Cleaning services – 65.0%
• Legal services – 62.1%
• Creative professionals – 61.8%

There doesn’t seem to be a specific reason for the lack of uniformity in appear rates across business categories. However, one reason might be that Google has strategically determined which categories a consumer might need more context than others tp help in finding a provider.

7. Geo-Grid Rank Tracking Is Now A Requirement

The report makes one thing very clear: Where a user searches from massively influences what they see in AI Overviews, just in different ways than typical Finder Pack / Map rankings.

If your business is still using single-point rank checks, it is probably time to upgrade. Tools like Local Falcon, which scan results using a grid of GPS points, could now be essential to understanding your true search footprint.

This is especially important when AI Overviews are involved, as inclusion is not consistent across locations or devices.

Bias Note: It should be noted that Local Falcon is a Geo-Grid rank tracking / local SEO heatmap provider and so they would have some bias in making the above assessment. You don’t have to use Local Falcon for this service either there are other providers such as Whitespark and Local Viking. We have a full list of these tools in our education section on local seo rank tracking tools here.

Optimization Recommendations Made by the Research Team:

1. Make sure you have location pages for every service you offer in each location
2. Keep primary SEO efforts focused on commercial and transactional queries
3. Create FAQ content that is locally relevant
4. Ensure your Google Business Profile is highly optimized
5. Structure your content to be clear
6. Keep track of queries that trigger AI Overviews frequently
7. Create comprehensive local service guides if possible / applicable
8. Create content that positions your brand as a local expert, highlighting experience and expertise
9. Create multi-media content to showcase your local services
10. Build out direct / owned marketing channels
11. Broaden your local marketing beyond local SEO
12. Consider running ad campaigns on high-value keywords that frequently trigger an AIO

Final Thoughts

Local Falcon’s team deserves all of the credit for conducting what I believe is the first large-scale analysis of AI Overviews in local search. You can read their full whitepaper on their blog here: Whitepaper: The Impact of Google AI Overviews on Local Business Search Visibility

The key takeaways from their data:

• Proximity is still a key signal, but it’s used differently than standard map-based ranking systems.
• Informational content and query ambiguity trigger more visibility.
• The AI layer is volatile. Inclusion is binary. And it’s blind to your GBP if your broader entity profile is weak.

If you’re doing local SEO in 2025, you now have to optimize across two completely different systems inside of Google: the traditional map pack and the generative AI created AI Overviews layer that’s growing above it.

Don’t assume you’re visible just because you do well in normal Local SEO, measure it.

Let me know if you’re running tests on this data, doing other Local SEO / AI / AIO research, or want to collaborate on follow-up research.

Need a local SEO company that knows how to rank your business inside of Google Maps, AIOs, ChatGPT, and more? Please reach out and lets talk about your needs.

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