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ChatGPT ads: OpenAI cuts prices to court small business

OpenAI is accelerating its ChatGPT ads business. According to The Information on October 16, it is cutting ad prices, targeting small and midsize businesses and hiring from Meta's ad organisation.

By: Mikola Máté Patrik · · 2 min read

OpenAI: Our approach to advertising and expanding access to ChatGPT
Image: OpenAI · Screenshot · Screenshot of official page · Source

What is happening

The Information reports that OpenAI has cut its published ad rates and is going after small and midsize advertisers (The Information). Specific rates and hire names are behind the paywall (AI Weekly).

The Neuron's roundup says the ads team has grown to about 140 people, nearly half of whom joined between July and September. One agency said clicks for some business-software clients cost about $5 on ChatGPT versus $30 to $50 on Google, though results vary by advertiser (The Neuron).

How big it is

In early October New Street Research reported, based on an OpenAI and AppsFlyer presentation, that ChatGPT Ads had passed 60,000 advertisers, up from more than 20,000 in late August (tipsheet.ai).

What analysts say

New Street Research analyst Dan Salmon wrote that OpenAI looks on track to pass 100,000 advertisers by year-end and is likely already in the advertiser range of Pinterest, Snap and Reddit, calling the speed of the ramp the most impressive part. He also noted that OpenAI's measurement and bidding tools suggest it is competing for Meta's performance budgets, not only Google Search spend.

Key takeaways

  • OpenAI is cutting ChatGPT ad prices and targeting small businesses.
  • It is hiring from Meta; the ads team is about 140 people.
  • Over 60,000 advertisers, roughly triple in two months.
  • Analysts see competition for Meta's budgets as well as Google's.
  • For advertisers: clicks may be cheap now, but measurement is limited, so start with small test campaigns.

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