Have you noticed the change in how Google sponsored Ad results display recently? This new design seems to be in beta (testing) as not all users are seeing the new format (even between different browsers I am seeing two different formats). The screenshot below is an example where there is an ‘Ad’ button clearly defining that it is an Ad. The same search result using the keyword search of: 'Gyms'
So why the change? My thoughts here are purely speculation, but the new format could be for two reasons:
Google often comes under pressure from regulators as to the different ways they advertise. The old format with the subtly coloured background was not always clearly visible, especially on some monitors more than others.
As Google search is much more restrictive for Google on such a small device, we may find that Google will be displaying sponsored Ads very differently in the near future. If we take the same search below on a Mobile, you’ll notice only one Ad showing at the top. As Google is so driven by Ad revenue from sponsored results, less paid Ads in this type of format could significantly effect Google’s Ad revenue. With Ads being more obvious, Google could move away from the traditional top and bottom Sponsored Ads to scattering them in between Organic search results on smaller mobile devices, which is similar to Facebook's approach for sponsored Ads. If this occurs, it will be interesting to see if this improves click through rates and conversions, or increases bounce rates. But as with so many of Google’s tests, we’ll have to wait to see if the new Ad format rolls out, and how it will be completely used.