Chatbot ads are here, and early results show AI-written ads click better while privacy gets harder

Chatbot ads are no longer hypothetical. OpenAI says more than 100,000 customers have advertised in ChatGPT since ads launched in February. Google expanded AI Mode ads to ten more countries and claims users find them highly relevant, part of its push to offset lower AI search revenue (Google’s ad plan). Anthropic, flush with roughly $112 billion in investor cash and a Super Bowl vow, still omits ads even from its IPO filing, and its new finance tool is pitched as ad-free (Personal Finance). Niche chatbot apps need a model beyond venture subsidy; Koah Labs says it brings ads to more than 200 apps and works with brands such as Hims and UrbanStems.

Koah generally receives the entire conversation to pick an ad, then anonymizes and de-identifies storage in ways Baird won’t detail. People use chatbots as confidants, which is a different consent bargain than a search box. Drugmakers and other regulated advertisers keep humans in the loop and see weaker performance. DeepAI’s Kevin Baragona says ad revenue has been meaningful but “doesn’t feel right” on privacy and design: “I don’t think the ads are working terribly well for anyone.”

Agentic shopping complicates it. Mark Zuckerberg has pointed Muse revenue toward transaction fees more than ads, while early studies suggest ads can still steer agents. Baird wants sponsored recommendations obviously marked; trust dies if they aren’t. Answers are expensive, and ads are how the consumer internet paid for free. Anthropic can afford purity for now; most of the market can’t. Invasive conversational ads may train users to stop talking. More in our Anthropic coverage and marketing coverage.