Are you ready for AI-assisted search paid advertising?
Whew … a lot of buzzwords in that one question.
That’s the concept pitched by Perplexity, a search-focused generative AI platform. Its new advertiser pitch deck shows how the platform will win the hearts and minds of marketers by making them the prioritized answers to queries, all for a negotiated fee.
If that sounds like classic search advertising, it’s not exactly. Classic search advertising allows advertisers to pay for ads based on their position. If you want the top spot, you pay more than you would for the second or third spots.
In a world of AI-assisted search, though, only one answer is provided to a query. So, how would that pricing model work? And what about brand safety?
To get the answers, we went to CMI’s chief strategy advisor, Robert Rose, for his take. Read on or watch this video:
What will it cost to be the only advertiser?
Google has started integrating the AI message and functionality into Google Ads. But it’s mostly relegated to creating more relevant copy for search ads, optimizing performance by helping to create bid amounts, and, of course, analyzing landing pages to help you create a richer conversion experience.
But in regards AI search result ads, what I and most marketers think about how do we pay for the privilege of being THE answer at the top of the results. What would that look like? What would we be buying?
For example, I typed “who is the best content marketing strategist” into Google. Its AI Overview names a few folks, many of whom I know well. Good to see Neil Patel (like he needs more publicity) and folks like Scott Abel and Barry Feldman. But I’m not sure that’s the list I’d go with for content marketing strategy services. And yeah, I’m not there, though they do cite one of my articles (from 11 years ago) as the source of this knowledge, so that’s interesting.
Maybe I could buy an ad on that results page for the right article to cite.
Next, I went to Perplexity because it’s been giving Google a bit of a run for its money as an AI-related search engine. It markets itself as the platform “where knowledge begins.” Surely, it must have a better set of results for that query.
It returned a better list, which includes my pals Ann Handley, Joe Pulizzi, Michael Brenner, and Jay Baer. That’s a fine list. But I’m not on that list either, and I’m not bothered by that. (Pardon me while I weep in the corner for a moment.)
But what if I could buy a spot on that result screen?
Which one would be for sale? The priority spot on the citation list or the actual answer? We’ll just have to wait and see.
OK, the point to all of this is that Perplexity is already pitching the idea of integrating ads within the answer to the searcher’s query. According to the slide deck viewed by Digiday, the feature could appear as soon as October. Though it doesn’t detail pricing, a source said the plan is to charge north of $50 CPM (1,000 impressions).
Wow, that seems expensive. Of course, no data exists on the expected performance of those ads, and much may depend on the queries purchased.
But consider this. A classic Google search ad hovers in the $38 to $40 CPM. So, Perplexity would charge a 25% premium. If it didn’t just pull that figure out of the air, it must have good vibes that the performance of its AI search ads will be strong.
The Digiday article says Perplexity plans to launch more than a dozen categories for its AI ad product, including technology, health and pharma, arts and entertainment, finance, food and beverage, sports, science, and travel. It will also include B2B, internet, telecom, home and garden, beauty and fitness, retail, and shopping. I can’t think of a category they missed. I mean, maybe politics, but they seem to have everything else covered.
But deep in the article is another interesting tidbit.
Why is Perplexity partnering with traditional publishers?
Perplexity is building publishing partnerships, already inking deals with Time Magazine, Der Spiegel, Fortune, Entrepreneur, and Automatic. I’m struck by how many of those fit the B2B category, and apparently, the pitch deck details how marketers can buy inventory that will appear on pages from their third-party publishing partners.
It raises some interesting questions about how the integration between generative AI and these publishers will take shape. Will they be a classic ad network, like Google Ads and its publisher partnerships? Or will they merge the AI within the content pages under the publisher brand? Would they create, for example, a custom site driven by Der Spiegel “knowledge” with original content generated by Perplexity, all sponsored by a big brand?
That will be interesting — custom content hubs using proprietary learning sets of content and sponsored by brands. What about a small business content hub where all the content is generated by Perplexity using Entrepreneur magazine’s content as its learning model and sponsored by a relevant brand?
Pay attention to these developments because these new opportunities won’t just influence your paid media budgets. They can impact where, how, and why you’re putting money into original content.
Content marketing is getting AI’d, too, and you’d better be ready to pay to play.
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Cover image by Joseph Kalinowski/Content Marketing Institute