Advertising on ChatGPT: Get in on the Ground Floor

OpenAI recently announced an advertising pilot in ChatGPT in the United States. Ads will appear on the free version and the low-cost Go tier, but not for Pro, Business, or Enterprise subscribers. For marketers, this is a genuinely new channel — and the ground floor is open right now.

Why Ads in ChatGPT were Inevitable

Ads in all types of media become necessary eventually. Almost 20 years ago, social media platforms were struggling to turn big audiences into profit. The answer was targeted advertising — tailoring ads to what users click on and pay attention to. This model became the dominant revenue source for Facebook, Instagram, LinkedIn, and more. Google took search behaviour into account to deliver meaningful ads on its platform.

These platforms reshaped their services to maximise user engagement, deliver results, and earn a profit.

Large-scale AI, such as that powering ChatGPT, is costly. Training and running advanced AI models requires huge data centres, specialised chips, and constant engineering support. Despite rapid user growth, many AI firms still operate at a loss. OpenAI alone expects to run at a US$115 billion loss over the next five years.

Companies cannot absorb these costs forever. For most AI providers, a dependable revenue source is necessary. Targeted advertising is the clear answer — and for most firms, it is the most reliable way to earn profits from their large user bases.

The Power of Chatbot Advertising

Chatbots are more potent than social media or traditional search. People use them in more personal ways — seeking advice, comparing options, making decisions. These interactions may make it seem as if advertised products and services are connected to the content served by ChatGPT, even when the ads are presented separately, making people more likely to act on them.

That trust amplifies persuasion in ways social media and traditional Google ads do not. Even with formal separation from responses, ads appear in a private, conversational setting rather than a public feed.

People tend to use ChatGPT to explore options, compare things, and make decisions. An ad served at the moment of a decision is more likely to be acted on than one seen while passively browsing.

OpenAI positions ChatGPT as an assistant available to help with everything from decorating advice to finances to fitness to health. That provides advertisers with an opportunity to tailor their ads to fit this personal and intimate environment. While ads may be separate from the main ChatGPT content, they should be positioned in a way that makes them feel like a continuation of a conversation — distinct from the more transactional nature of ads on social platforms or Google.

How ChatGPT Serves Up Ads

ChatGPT determines which ads to show based on the topic of a conversation, past chats, and historic interactions with ads. For instance, a user who frequently chats about recipes might see ads about meal kits, restaurants, and food delivery.

Ad opportunities do not influence the answers provided by ChatGPT — they align with conversation context in a separate, clearly labelled space. Chat content is not passed through to advertisers; it is kept private and used only by OpenAI to select the most applicable ad content.

Advertisers must demonstrate care in developing ad content. Users are allowed to dismiss advertisements, share feedback, find out why they are being shown an ad, and delete ad data. These controls will directly impact how and how often your ads are served. Good behaviour in this novel environment will be key to establishing a solid brand reputation on the platform.

OpenAI's Privacy Promises: The Caveats

OpenAI says it will separate ads from answers and vows to protect user privacy. These promises rest on vague, easily reinterpreted language.

The company proposes not to show ads near sensitive or regulated topics like health, mental health, or politics. The issue: there is still considerable debate about what "sensitive" means and how broad the definition of health should be. Most conversations in ChatGPT are outside these topics anyway. OpenAI has not provided details on which advertising categories will be included or excluded in their non-ad policy.

What's concerning is that ads positioned near highly personalised guidance could seem more compelling than they would be in more neutral settings — a dynamic that is structurally different from ads appearing in a Google search results page.

Similar protections were promised in the early years of social media. There is a long history of self-regulation weakening under commercial pressure — this benefits companies while leaving users exposed to harm. Eventually, platforms become less trusted by their users. Advertisers who build good practices now will be better positioned if and when the regulatory environment tightens.

What's Next with Ads in ChatGPT

Advertising through OpenAI is in its infancy. The platform will monitor performance during the test period to refine how ads are selected and displayed. But if promotional history is any guide, ads on ChatGPT are only going to evolve and expand — likely to more geographies, more conversation contexts, and eventually to richer ad formats.

Early movers on emerging platforms tend to benefit from lower CPCs, less competition, and more room to learn what works before the channel matures. The time to build familiarity with ChatGPT advertising — and start testing creative approaches suited to the conversational format — is now.