AI-powered search engine Perplexity says it’ll begin experimenting with ads on its platform starting this week.
Ads will appear in the U.S. to start, formatted as “sponsored follow-up questions.” (E.g., “How can I use LinkedIn to enhance my job search?”) Paid media will be positioned to the side of answers, and labeled as “sponsored.”
Brands and agency partners participating in Perplexity’s ad program include Indeed, Whole Foods, Universal McCann, and PMG.
“Ad programs like this help us generate revenue to share with our publisher partners,” Perplexity writes in a post on its blog. “Experience has taught us that subscriptions alone do not generate enough revenue to create a sustainable revenue-sharing program. [A]dvertising is the best way to ensure a steady and scalable revenue stream.”
Perplexity asserts that answers to “sponsored questions” will still be generated by its AI — not written or edited by the brands sponsoring the questions. Advertisers also won’t get access to users’ personal info, the company says.
“We intentionally chose these formats because it integrates advertising in a way that still protects the utility, accuracy, and objectivity of answers,” the blog post reads. “These ads will not change our commitment to maintaining a trusted service that provides you with direct, unbiased answers to your questions.”
Perplexity’s embrace of ads stands in contrast to OpenAI’s decision not to launch its AI-powered search tool, ChatGPT Search, with ads. But rival Google has similarly piloted ads in its AI search experience, AI Overviews — recently bringing ads to mobile in the U.S. for certain queries.
Perplexity is said to be marketing its ad products as a premium alternative to Google’s, emphasizing its platform’s ability to reach educated, high-income consumers. But some analysts have expressed concerns about the scale, reach, and targeting capabilities of ads on Perplexity.
Illustrating the challenge of incorporating ads into AI-generated content, Microsoft only briefly explored putting ads in the responses given by its chatbot on Bing. It quietly withdrew the sponsored results after a few weeks.
Perplexity’s plagiarism accusations are another potential advertiser deterrent. News Corp’s Dow Jones and the NY Post have sued Perplexity over what they describe as a “content kleptocracy.” Many other news sites have shown evidence that Perplexity closely replicates their content — just last month, The New York Times sent the startup a cease and desist.
Perplexity, which recently said it’s serving 100 million search queries a week, claims it has made changes to how its platform cites sources and continues to expand its revenue-sharing program for publishers. But the company has also argued that publishers wished its technology “didn’t exist” and would prefer that “publicly reported facts are owned by corporations.”
There’s pressure on Perplexity to ramp up monetization. The company is reportedly in the final stages of raising $500 million in funding at a $9 billion valuation, but has only one revenue stream: its premium subscription service, Perplexity Pro, which adds additional features for $20 per month or $200 per year.
