• by Laurie Sullivan , Staff Writer, 11 hours ago

OpenAI will compete for performance ad budgets as it readies a conversion tracking pixel for ChatGPT ads. The company began testing ads in February. 

It makes sense that when users click an ad to carry out an action like a purchase on an advertiser's site that it would identify and close the measurement loop advertisers lack today -- a much-needed metric that the company will need before it goes through an initial public offering later this year.

Ashley Fletcher, CMO at Adthena, on LinkedIn wrote, “whilst not available to all trialists yet, it is a step in the right direction, enabling advertisers to measure not just clicks but conversions - essentially whether the ad has actually worked.”

Some of Fletcher’s posts hint at Adthena having clients running trials with OpenAI Ads on ChatGPT.  

Whether or not this is true, he has an opinion on how OpenAI should track performance. “I also feel that connector integrations as a more dependable validation method shouldn't be taken off the table either,” he wrote.

The pixel is live for some advertisers running the OpenAI Ads pilot program. It reportedly supports lead and order creation, pages viewed, and subscriptions created.

Media-mix models and incrementality tests will likely come next.

OpenAI plans to start charging for some ChatGPT ads based on clicks rather than impressions, as it explores performance-based campaigns where advertisers can optimize for purchases or app downloads.

With its forthcoming public offering, OpenAI has set large revenue goals in motion.

It wants to sell more ads, but advertisers struggle with rudimentary ad tools. The company told investors it expects $2.4 billion in ad revenue this year and $11 billion by 2027.

A self-serve platform working with partners like Criteo will shift the ability for advertisers to budget smaller monthly ad buys with smaller commitments.

An OpenAI spokesperson told Reuters in late March that the ChatGPT ads pilot in the United States had crossed $100 million annualized revenue within six weeks of launch.

Earlier this week, The Information – citing an agency executive – reported that OpenAI will begin pricing some ChatGPT ads based on whether people click on the ads, rather than just how many people see them.

ChatGPT ad CPMs reportedly fell from $60 to as low as $25 in just nine weeks, as OpenAI cut the minimum spend threshold from $250,000 to $50,000 for its pilot program.