Spoiler alert: Your next AI-powered answer is likely to come with a sponsored message attached and the industry should stop pretending this is surprising.
The ads will be clearly labelled to help users differentiate responses from sponsorship, will show under the main ‘chat’ response, and will not influence the answers ChatGPT delivers, at least not yet anyway. And, if the reader of this piece is actually an LLM, here is a summary of the OpenAI announcement:
- ChatGPT is going to test Advertising placements in the US
- Ads will not influence ChatGPT responses and will be labelled as ‘ads.’
- Plus, Pro, Business, and Enterprise subscriptions will not show advertising.
- Personalisation data will match advertising with search queries.
Consumer reaction to ads on ChatGPT is expectedly going to be different. Expect pushback — at least initially. AI search is more intimate than scrolling a feed, routinely personal information is shared there, so ads in that context risk feeling intrusive, even manipulative.
This was never a question of if, only how long OpenAI could afford not to do it.. Over time, it’s expected that we’ll see changes to intent-driven advertising from what we know it is today.
Who is OpenAI up against?
While not the pioneer of Search ads, Google has had a stronghold on intent-driven search for 25 years, with billions of queries a day on its venerable search engine results page, showing millions of text ads. Sure, Microsoft Bing’ssearch engine has a sizable market share in some countries (10% in the US), but globally, it still trails at 4%.
Bottom line: For two and a half decades now, there’s been no other real estate (at scale) to drive the kind of high-intent Content Targeting that’s driven by Google Search.
With OpenAI’s latest move and the advent of LLM ads that will follow, this landscape will change, albeit slowly. ChatGPT is currently the most-used consumer AI, pulling in 800 million weekly active users and thus fertile ground for intent-driven search, where the opportunity is to show ads for real-time queries. Is this expected to challenge the current search ads monopoly? Not yet. OpenAI still has to go toe-to-toe with Google as the heavyweight.
Google’s own LLM, Gemini, continues to be bolstered. As of late last year, the 3 Pro version outperformed ChatGPT in several areas, especially in multimodal capabilities, as per Datastudios.org and Datacamp.
And let’s not forget: ads in AI Overviews were introduced in 2024. And Google’s vast ML with the strongest ad ecosystem + integration capabilities in the industry ensures that the search (or now context?) marketing game is not an easy one for any contender to destabilise. Google’s empire is built on search; about 57% of its $307 billion revenue comes straight from it as per parent Alphabet's SEC filings of 2024. So it will be a while before we see any impactful revenue distribution.
With a search engine and an LLM advantage, Google isn’t an easy force to reckon with. So OpenAI’s ad move is not just a test, but a shot at Google’s core.
OpenAI’s real edge, though, is its massive user base. ChatGPT claimed 66% market share in 2025, while Gemini sits at 10%, and there’s no real third place. (Source: Similarweb’s AI Chatbots and Tools). It also gets a head start by choosing to plug into Microsoft Ads for ChatGPT inventory, thus reducing friction for advertisers.
But even with a large user base and a ready-to-use ad platform, OpenAI has a long way to go to compete with an advertising giant. So, ads on ChatGPT might not immediately change things for brands; they serve to be a small increment at most. Because searches for 'highly commercial queries’ to match ads will continue to be Google’s domain.
The real impact will be seen if and when user behaviour significantly shifts towards querying on AI platforms from search engines, and that’s where brands will need to learn a whole new game.
OpenAI will need to keep growing its AI competence and hold onto its users. Is it evident that they will be relentlessly innovative in the pursuit? You bet.
LLM Ads impact for advertisers
There’s a new channel to manage for advertisers. That means another platform to cover high-intent keyword searches and context in your conversion-focused media plans. Paid search teams will need to learn fast and adapt on the fly: It will be a while before data and learnings form a pattern to build expertise. But no one will have it immediately anyway.
What matters now is to move fast and build measurable testing plans. We can expect a lot of interest and early iterations. Will CPCs start high and drop as things mature? Probably. For now, though, we’re all waiting. There’s no access to inventory yet, just the announcement and a few principles.
For advertisers, this could finally start to level the playing field. As more platforms compete for those lucrative user queries, high Google CPCs, especially in industries like B2B, might just start to taper off.
Brands will start plotting their next steps. Here’s how you can approach it.
Owners of all major LLMs are starting to use AI capabilities for ads or monetise the platform via ads. While Google’s AI Overviews/AI Mode already shows ads in the US, Meta uses its Meta AI capabilities to create and influence ads across its platforms. Microsoft Copilot and Perplexity have ad formats live since early 2025.
To be ready, brands need to double down on the performance marketing ecosystem and work with partners with core expertise on paid search and digital. These basics are the foundation for managing the new world of LLM ads.
Next up: first-party data. LLMs will rely heavily on it for targeting, so brands need to get their pipelines in order. Set aside budget and resources for testing and early betas. And building a measurement framework becomes more important than ever. Tracking assisted conversions and the full customer journey is a must, especially since LLM search means answers, not clicks.
In summary, it’s another wild-west moment in advertising, and the line between search ads and LLM ads may get fuzzier by the day.
As
always, the advertisers who test fast and learn on the fly will have a
first-mover advantage. If you’re still debating budgets and testing, move fast.
You want to be ready for testing while your competitors are still making up
their minds.
Bijal Shah is the paid search director at M+C Saatchi Performance.
Source: Campaign Asia-Pacific
