The news: OpenAI will start pricing select ChatGPT ads based on clicks rather than impressions, according to an agency executive cited by The Information. The company also indicated future plans to debut ads designed to encourage users to take specific actions like downloading apps or purchasing products.

Addressing concerns: The updates directly tackle key issues advertisers have had with OpenAI’s ad pilot so far:

• The company was not offering enough information on ad performance beyond impressions.
• Limited performance data made it difficult to determine whether ads were driving specific business outcomes or user actions.
• Costs for OpenAI’s ad pilot were initially set at a $60 CPM, requiring roughly $200,000 upfront, without sufficient evidence to justify the investment.

The news comes on the back of similar updates OpenAI has made to its ad offerings. The company recently launched an ads manager to refine and simplify campaign optimization; it simultaneously reduced the minimum cost to participate in its ad pilot to $50,000.

Why it matters: Enhanced measurement that helps justify the cost of advertising in ChatGPT could persuade advertisers who remain hesitant about investing in genAI chatbots, but who are drawn in by ChatGPT’s massive share of genAI users.

New pricing options, improved measurement, and better targeting capabilities will also help OpenAI meet its ambitious ad revenue goals. The company projects $2.5 billion in ad revenues this year, a figure it says will reach $100 billion by 2030. Continued refinements to its ad offerings make OpenAI a more credible and established option for advertisers.

Implications for marketers: ChatGPT continues to become a more reasonable prospect for advertisers who are intrigued by the potential of genAI chatbot ads but wary of investing in a nascent format.

As OpenAI expands its measurement and pricing options, the platform may become easier for marketers to test and justify within performance-driven media plans. That could help move genAI chatbot ads from a speculative experiment to a more actionable part of the media mix.