What We Learnt Testing ChatGPT Ads for the First Time

Today OpenAI's ad business has gone from launch to a billion-dollar annualised run rate in under two hundred days, with tens of thousands of advertisers already buying inventory. Unusually for Australians, we were one of the first geographies outside the US that was able to run ads. So we did what we usually do with a new channel: we put a small amount of money through it and paid attention.

We Started Small

We kept the budget deliberately small. Small enough that the numbers below are directional, not conclusive, and we'll be upfront about that throughout. A single short campaign cannot tell you whether a channel converts. It can tell you how the machinery works, where the constraints are, and what a bigger test would need to look like.

Treat everything here as an experiment and initial findings, we will come back and update this post with more data and information as time goes on.

Our Initial Findings

CTR was OK, not Amazing: We saw roughly 0.8% click thru rate. For a brand-new platform and ad-formats, it wasn't terrible. Also, since CTR is often determined more by the ad assets themselves rather than the platform, we will need to investigate and test more about what messaging and creative style works best.

CPCs were very reasonable: We ran 2 campaigns for two different businesses and had average CPC of $4.15 & $2.72. Considering what keyword bidding costs for the same industries, it was a minimum of 50% cheaper than running the equilevant ads on Google Ads. The insights and data around the targeting and how and when each ad appears is vague at best, but we assume that will only improve over time.

Onsite Engagement was Low: Visitors arriving from ChatGPT engaged with our site around 30% less than visitors arriving from organic search. We were measuring engagement based on GA4 metrics of bounce rate, time on site, on-page event clicks and number of pages viewed. Organic search has always been seen as a leading indicator of intent and engagement and for ChatGPT ads to only be behind 30% is promising. If this remains a focus of OpenAI and they develop the tools and functionality their ad platform to match the established players - it could become a standard part of the paid advertising mix.

We recorded no conversions: At our sample size, this isn't a huge concern as there are so many factors. We're reporting it because conversion for many organisations is the primary KPI and metric that determines success of a paid media campaign.

Constraints You Should Be Aware Of

In Australia, you can only target the whole country.: This is the big one for local businesses. State, city and postcode targeting exist on the platform — but only for US advertisers, who got state, DMA and ZIP-level controls in May. We would definitely recommend organisations that have a national footprint run campaigns, rather than just your local or regional business.

Minimal Creative Control: You get an advertiser name, a favicon, a title, body copy, a landing page and an image. That's the unit. The platform also tells you plainly that not everything you write will necessarily be shown. Especially when it comes to ad copy - write short and punchy. Basically the opposite of how ChatGPT responds to you. Don't worry, the irony is not lost on us either.

Paid Users Don't See Ads: Ads aren't shown to Plus, Pro or Business subscribers, and they aren't shown to accounts identified as under 18. So you are not advertising to "ChatGPT users" as a population — you are advertising to adult users on the free tier. Because of that, probably B2C is a better option than B2B.

Should Your Company Try ChatGPT Ads?

Yes, if you can answer yes to these:

• Your offer and company works at a national level, or you're comfortable paying to reach the whole country
• You are willing to spend on learning and awareness rather than engagement and conversions
• You can have your ad copy be really punchy and to the point
• Primarily in B2C rather than B2B because most businesses are paying for a subscription.

If some of those are a no, or not yet, definitely make a note to follow up in a few months when the tools have been updated and added new functionality that might be appropriate.

For those that answered yes to the above, reach out to us at CORSZA today and we will help you setup your first ChatGPT ad campaign.