OpenAI has initiated advertising services on ChatGPT for dozens of advertisers. Unlike Google or Amazon, the company is initially charging based on impressions rather than clicks.
According to reports from The Information, the first ads are expected to appear in early February. OpenAI has asked advertisers to commit to spending less than one million dollars per person during the multi-week testing phase. The company currently lacks the technology to allow advertisers to book ads independently, although this feature is under development.
This pricing model breaks from industry norms. While Google and Amazon typically charge per click, OpenAI is following the lead of social media platforms like Meta by charging for impressions. It remains unclear whether this will change after the testing phase begins.
The decision to adopt a CPM (Cost Per Mille) pricing model may indicate that AI chatbot users click on external links less frequently than traditional search engine users. Perplexity uses a similar model. For advertisers, CPC (Cost Per Click) is often more attractive as it provides greater certainty about what they are paying for and makes it easier to measure ad performance.
Advertising Revenue Could Fuel OpenAI's Massive Fundraising Efforts
The rollout is strategic. OpenAI aims to generate revenue growth through advertising and shopping without alienating users who might find ads in a chatbot intrusive. Simultaneously, a successful advertising business could strengthen the company's position with investors. OpenAI is currently attempting to raise up to $100 billion—an unprecedented amount for a private company.
Reports indicate that advertising agencies and brands are interested in placing ads on ChatGPT. With approximately 900 million weekly active users and personalized chat content, ads could be particularly effective.
Initially, these ads will be shown to free-tier ChatGPT users in the U.S. and to new $8-a-month subscribers. The advertising business is led by OpenAI's Chief Operating Officer, Fidji Simo, the former head of Instacart.
