ChatGPT Ads is growing up
Whilst ChatGPT Ads are still in beta; in the past few weeks the platform grew a little.
OpenAI has now launched CPC bidding, expanded its self serve Ads Manager in limited territories (USA, CA, AUS & NZ) + confirmed integrations with four major agency holding groups alongside a growing list of ad-tech partners.
The holding company support is notable from Dentsu, Omnicom, Publicis & WPP as they do not typically commit resources to speculative side projects (I’ve worked in 2 of the top 5 media groups = personal experience). Nor do platforms like Adobe, StackAdapt, Kargo, Criteo or Pacvue integrate unless they believe there is a viable media ecosystem forming.
The actual mechanics are familiar (Google ad platform style plumbing) and involve: CPC bidding, conversion tracking, pixel measurement, campaign management, reporting infrastructure, role permissions + self serve buying.
The more interesting question is whether the economics work for broad advertisers.
Early discussion around ChatGPT Ads suggests CPCs ($3-$5 per click) may initially sit materially above what many% ecommerce brands are used to paying elsewhere. If that proves true, performance will likely depend on whether conversational traffic > ROAS (mix of cpc, cr%, aov, etc) converts in a “meaningfully fashion” Vs the likes of lower funnel ecommerce AI enabled PPC. If not its relevance will be more for higher AOV brands, considered purchases, SaaS, travel, education, premium services, etc.
…Interesting developments as OpenAI might not be treating advertising as a “side hustle” anymore. It could be building a “proper” media platform around conversational intent and if that’s the case we have a bigger shift taking place. Now.
sources: personal discussions with industry colleagues, Digiday, MediaPost, Search Engine Journal, PPC Land & The Next Web.