• by Laurie Sullivan  @lauriesullivan, September 23, 2024

Perplexity, which has been planning an advertising model tied to its artificial intelligence (AI)-powered search engine, reportedly is in talks with brands such as Nike and Marriott.

The report by the Financial Times during the weekend cited internal company executives who said Perplexity has held discussions with top brands.

The AI company, which is backed by Nvidia and Jeff Bezos, wants to fundamentally change and overhaul auction-based ad systems pioneered by Google, where companies bid to have a sponsored link placed against keyword queries based on historic searches, clicks and views.

Perplexity has been working on this type of advertising service since the beginning of the year. The Financial Times reported that brands will have the ability to bid on a “sponsored” question, which features an AI-generated answer approved by the advertiser.

"We are exploring potential advertising options inside of Perplexity, but we would only incorporate them in a way that still preserves the promise of unbiased answers," Perplexity Chief Business Officer Dmitry Shevelenko wrote in an email to MediaPost in April. "Our principles ensure we remain focused on delivering a best-in-class user experience as we introduce advertising solutions."

Perplexity’s effort in advertising is part of a wave of new competition as search — both organic and paid — undergoes a radical shift.

Jim Yu, BrightEdge founder and a longtime industry insider, technology and search engine optimization expert, last week told MediaPost that this is the most dramatic shift he has seen in years.

Yu identified the fundamental change through his company's data. He could not recall a time when the industry has seen so many new entrants into the search industry. And they are building a strong presence.