Ad industry grows frustrated with ChatGPT's advertising rollout

Summary

• OpenAI is concluding its pilot project for ads on ChatGPT at month-end, frustrating some in the ad industry with the slow pace of the rollout.
• Sensor Tower estimates show ChatGPT ads have reached about 5% of daily mobile app users, up from just 1% at the start of the month.
• Sources indicate OpenAI required an unusually high financial commitment for the test, as much as $250,000 per brand.
• The slow deployment of ad spend means brands are unlikely to use their full committed investment during the test period.
• OpenAI states the slow rollout is intentional and that they are "encouraged by early signals" from users and participating brands.
• Some industry insiders view the caution as a positive sign that OpenAI is building a sustainable advertising business model.
• The primary frustration stems from advertisers' eagerness to see performance data to plan their broader AI marketing budgets for the year.
• Partner Dentsu expressed eagerness to continue testing, highlighting the potential for relevance when user intent is precise.
• The long-term opportunity is considered massive, with Truist projecting OpenAI's AI ad business to grow from <$1B in 2024 to over $5B in 2028.
• OpenAI's measured approach may create a competitive opening, potentially advantaging Google in capturing early AI ad market share.