How this can ‘accelerate’ OpenAI’s advertising plans

In August, the tech giant named former Instacart CEO Fidji Simo as its new App CEO. Then in September, OpenAI has taken the first steps in agent commerce with Instant Checkout. Last week, Simo told Wired, “The important thing before we consider advertising is to make sure that our commerce experience is great…” For marketers, all signs point to the ad business and the upcoming holiday shopping season may be when the wheels start turning.

“This Black Friday, if all goes well, I think will probably accelerate its potential even faster,” said Digiday platform reporter Krystal Scanlon, who joined the Digiday Podcast to break down what OpenAI’s ad product will look like.

Below are some highlights from the conversation, edited for length and clarity.

Prerequisites for advertising business

[Simo’s comments in Wired] it definitely looks like they need to have three things in place before they can have an advertising business. The issue is around data privacy, because they have tons of data, and of course that’s what advertisers want. Their trading proposition must be fully captured and actually work well. Of course, once they get those things, they need material ideas [the person] to be able to sell the ad.

Learn from other people’s mistakes

They are consulting with many brands and advertisers at the moment. From a consulting standpoint, talking about their computing and trying to help them do better work behind the scenes, internally with their own teams. So, if they establish that relationship, they learn what that type of business wants if they ultimately want to sell to them. They won’t jump into it because they’ve seen how other businesses have been crushed and destroyed by it.

OpenAI rodeo circuit schedule

When I met them [OpenAI]they said they don’t do CES. Whether it changes again, as things seem to change, there’s a lot TBD [to be determined]. One place they say they are considering, and are already in talks is [Cannes Lions International Festival of Creativity] next year. I think you definitely want to have some form of product before you get out there.

Because if we compare it again with Perplexity, Perplexity was at Cannes this year, but it was very under the radar, the meeting was very quiet. There was one lunch. However, the message coming from these people is, “Advertising [are] isn’t really going to be a real money maker for at least the next five years. We are still conveying our feelings.” It’s unlikely that OpenAI will take that approach. They are doing all their basic, foundational work now.