Amazon starts selling ads inside ChatGPT

Amazon and OpenAI have agreed the most consequential advertising partnership of the year so far. Amazon advertisers will be able to extend campaigns into ChatGPT, with the chatbot’s ad inventory bought through Amazon’s demand-side platform as a managed service, Marketing Dive reported. The pilot is limited to the United States, with Delta Vacations among the first brands in.

The mechanics matter. Inventory sells on both cost-per-click and cost-per-thousand terms, Amazon’s team sets up and optimises the campaigns, and OpenAI keeps control of every delivery decision inside its own systems. Amazon gets a bridge into the most used AI product on earth. OpenAI, whose advertising business only launched this year and recently passed what the report calls an important revenue milestone, gets access to the demand of the world’s third-largest ad platform, one that took nearly 70 billion dollars in ad revenue last year.

For advertisers the pitch is conversational placement: adverts inside an exchange where someone is already asking what to buy, which is closer to the bottom of the funnel than search ever managed. For everyone else the questions write themselves. Nobody yet knows what disclosure, measurement or brand safety look like when the medium is a conversation that feels like advice.

There is also a certain nerve in the timing. Amazon is being sued by the FTC over how it allegedly ran its own ad auctions, and its answer to the scrutiny is to become the sales house for a new medium. UK advertisers are not in the pilot, but the direction is set, and the CAP Code has no chapter yet for adverts that talk back. We looked at where the technology is pulling the industry in our guide to AI in advertising.