AI-powered search engine Perplexity said it will be introducing ads on its platform starting this week. Initially, the site will run ads in the U.S. in the form of “sponsored follow-up questions” (e.g., “How can I use LinkedIn to improve my job search?”). These ads will be placed next to answers and marked as “sponsored.”
Brand and agency partners participating in Perplexity’s ad programs include Indeed, Whole Foods, Universal McCann and PMG.
“Such ad programs help us generate revenue that we can share with our publishing partners,” Perplexity said in a blog post. “Our experience has shown us that subscriptions alone do not generate enough revenue to build a sustainable revenue sharing program. [Ads] are the best way to ensure a stable, scalable revenue stream.”
Perplexity asserted that the answers to these “sponsored questions” continue to be generated by AI and are not written or edited by the brands answering the sponsored questions. Advertisers also do not have access to users’ personal information, the company said.
“We intentionally chose these formats because they allow us to integrate advertising while protecting the usefulness, accuracy, and objectivity of answers,” the blog post read. “These ads do not change our commitment to maintaining a trusted service that provides direct, unbiased answers to your questions.”
AI Platforms: To show Ads or Not?
Perplexity’s use of ads contrasts with OpenAI’s decision not to serve ads on its AI-powered search tool ChatGPT Search. Rival Google has also conducted similar ad tests on its AI search engine, AI Overviews, and recently ran ads for certain search queries on mobile devices in the United States.
Perplexity reportedly markets its ad products as a premium alternative to Google’s, highlighting the platform’s ability to reach educated, high-income consumers, according to CNBC. But some analysts expressed concerns about the scale, reach, and targeting of Perplexity’s ads.
To illustrate the challenges associated with incorporating advertising into AI-generated content, Microsoft briefly explored the possibility of displaying ads in chatbot responses on Bing. The “sponsored results” were quietly withdrawn a few weeks later.
Perplexity is under pressure to monetize. The company is reportedly in the final stages of raising $500 million in funding at a $9 billion valuation, but it has only one revenue stream: its premium subscription service, Perplexity Pro, which provides additional features for $20 per month or $200 per year.
