Perplexity ads coming using a CPM model + sponsored "related questions" -> In a pitch deck, AI search engine Perplexity told advertisers it plans to start running ads in Q4; a source says Perplexity's CPM prices will be $50+
"Advertisers will be able to sponsor “related… pic.twitter.com/teYooFrkIK
— Glenn Gabe (@glenngabe) August 22, 2024
Perplexity AI, a startup specializing in AI-assisted search, plans to start running ads on its app in the fourth quarter. The company has faced controversy over plagiarism allegations but has made changes to better cite sources in its AI-generated responses. Perplexity’s app has been downloaded more than two million times and answers over 230 million queries a month.
In April, the company raised new funding that doubled its valuation to over $1 billion within three months. Perplexity has introduced a revenue-sharing model that allows publishers to earn money through its search engine.
Those cpm estimates sound very high. I’d be surprised if the paid cpms exceed 5$ (specially in a cpm sold world with minimal targeting).
https://t.co/8pAnzsn3FN— Vivek Raghunathan (@vivek7ue) August 23, 2024
Media outlets including Fortune, Time, Entrepreneur, The Texas Tribune, Der Spiegel, and WordPress are among the first to join this “Publishers Program.”
Perplexity’s plans for competing in the ad world is now a bit less perplexing.
I wrote about @perplexity_ai’s new pitch deck that sheds light on the AI search startup's plans for ads in Q4. (Also looked back at how it talked about ads in April.) https://t.co/DPO0OuAeGS
— Marty Swant (@martyswant) August 23, 2024
Dmitry Shevelenko, Perplexity’s chief business officer, said the revenue-sharing feature has been in development since January, with the aim of enrolling 30 publishers by the end of the year.
Got my hands on the deck Perplexity is using to pitch advertisers, including new details on how two dozen brands and several top agencies are already discussing Perplexity's ad offerings with clients.https://t.co/8H2Pj9ozx2 via @Adweek
— Trishla Ostwal (@trishlaostwal) August 22, 2024
Perplexity’s new advertising model
If multiple articles from one publisher are used in a single answer, the publisher will receive multiple shares of the revenue. Perplexity plans to use the CPM (cost per thousand impressions) model for advertising, with CPM prices exceeding $50.
Advertisers will have opportunities to sponsor related questions below answers and buy display ads adjacent to Perplexity-generated answers. The initial key advertising categories will include technology, health and pharmaceuticals, arts and entertainment, finance, and food and beverage. Perplexity’s user demographic is notably high-income and educated, with over 80% holding an undergraduate degree, 30% in senior leadership positions, and 65% in high-income white-collar professions.
AI-assisted search continues to be viewed by investors as a significant opportunity, potentially transforming how consumers access information online. Companies like OpenAI and Google are also developing similar technologies, highlighting the competitive and evolving landscape of AI-assisted search.
Cameron is a highly regarded contributor in the rapidly evolving fields of artificial intelligence (AI) and machine learning. His articles delve into the theoretical underpinnings of AI, the practical applications of machine learning across industries, ethical considerations of autonomous systems, and the societal impacts of these disruptive technologies.
