AI Recommendation Control (ARC)

Digital Advertising Costs and AI-Mediated Discovery

This evidence synthesis report examines external evidence on digital advertising costs, zero-click interfaces, AI-mediated discovery, paid and intermediated demand dependency, and customer acquisition economics. It reviews evidence on advertising-market growth, platform cost-per-click trends, zero-click traffic effects, attribution uncertainty, OTA and portal intermediation, and advertising effectiveness under AI-assisted decision-making. The report explicitly distinguishes Descriptive Industry Evidence, Company-Reported and Commercial Benchmark Evidence, Academic Evidence in Specific Contexts, Established Economic Relationships, Economically Plausible Mechanisms, and HomeSelf Hypotheses Requiring Validation. It introduces the Persuasion Compression hypothesis and the Advertising Marginal Influence framework as testable propositions. The report examines implications for CFOs, CMOs, hospitality operators, real-estate firms, and boards, connecting CAC, paid dependency, contribution margin, inference burden, customer-care costs, internal AI operating costs, and representation quality. This is an evidence synthesis companion to Volume XIII (The Balance-Sheet Economics of AI-Mediated Demand) and does not introduce a new theoretical layer.