AI-powered answer engine Perplexity is diving into the advertising world, introducing ads in the form of “sponsored follow-up questions.” The ads will be shown to users in the United States to start.
This move is aimed at creating a sustainable revenue model that supplements their existing subscription service.
The ads, positioned alongside search answers and labeled as “sponsored,” will still allow AI-generated responses that remain unbiased and objective, according to the company.
Perplexity ad format example. Image Credits: Perplexity
Key Points:
Perplexity has started experimenting with ads in the U.S., introducing “sponsored follow-up questions” as part of the ad format.
Brands such as Indeed, Whole Foods, Universal McCann, and PMG are participating in this program.
Perplexity’s goal is to generate additional revenue for a sustainable revenue-sharing model with publisher partners.
Unlike competitors like OpenAI, Perplexity sees advertising as essential for revenue growth alongside its current subscription service.
Ads will not alter AI-generated answers, ensuring accuracy and objectivity, as per Perplexity’s statements.
The company emphasizes that advertisers will not have access to users’ personal data.
Key Quotes:
“Ad programs like this help us generate revenue to share with our publisher partners. Experience has taught us that subscriptions alone do not generate enough revenue to create a sustainable revenue-sharing program. Advertising is the best way to ensure a steady and scalable revenue stream.” — Perplexity’s blog post.
“Answers to Sponsored Questions will still be generated by our technology, and not written or edited by the brands sponsoring the questions. We intentionally chose these formats because it integrates advertising in a way that still protects the utility, accuracy, and objectivity of answers.” — Perplexity’s blog post.
“While brands are keen on understanding how their companies appear in AI answer engines like ours, we will avoid duplicating the SEO industry where people are implementing arbitrary tactics to improve their rankings at the expense of user utility. We would rather give brands a transparent way to advertise through Perplexity that — rather than attempting to manipulate answers — encourages users to express their curiosity about a brand.” — Perplexity’s blog post.
Perplexity’s adoption of ads marks a significant shift in the AI-powered search landscape, where monetization has been a challenging area. While Google and Microsoft have explored similar strategies, their approaches have not always been met with success.
Perplexity is emphasizing user experience by maintaining unbiased AI-generated answers, potentially making it an appealing platform for brands that want to reach an educated, high-income audience.
However, concerns remain around scalability and plagiarism issues, which could influence advertisers’ decisions moving forward. As Perplexity continues to expand its offerings and attract investment, balancing growth, user trust, and publisher relations will be crucial for its success.
