For the past two years, the retail industry has looked at Generative AI as a productivity tool or a content engine. We’ve used it to write product descriptions, summarise meetings, and perhaps build a customer service bot.
But with OpenAI’s latest announcement, the other shoe has finally dropped. ChatGPT is no longer just a tool; it is now a media channel.
This month, Open Ai announced the rollout of ChatGPT Go, a simplified low-cost tier expanding to every country where the service is available. But the headline for retailers isn’t the expansion; it’s the monetisation. OpenAI has confirmed it will start showing ads to free and Go users, beginning in the US and rolling out globally.
The company has shared a glimpse of the format, and it tells us everything we need to know about who they are targeting. It’s not a text link. It’s not a banner. It is a visual, price-inclusive product card that appears directly in the conversation stream when relevant. Does that format look familiar? It should. It looks almost exactly like a Google Shopping Product Listing Ad (PLA).
The battle for the bottom of the funnel
For a decade, Google Shopping has been the undisputed king of bottom-funnel performance marketing. If a user searches for “Scanpan 32cm wok”, they have high commercial intent. Google serves them an image and a price, and retailers happily pay for the click because the conversion rate is high.
But search behaviour is shifting. A significant portion of that “I need a solution” traffic is migrating from the search bar to the chat window.
When a user asks ChatGPT, “I need a non-stick frypan that works on induction, is oven safe up to 260°C, and costs under $150,” they are exhibiting extremely high purchase intent. Until now, that interaction ended with a text recommendation. Soon, it will end with a clickable product card.
Google, Meta, or new money?
In the current economic climate, it is unlikely retailers will simply magically find a new bucket of cash for ‘AI Media’. It will be a reallocation game.
While Meta (Facebook/Instagram) is fantastic for discovery – finding customers who weren’t necessarily looking for you – ChatGPT acts much more like search. It fulfils an existing demand.
Therefore, the budget for ChatGPT ads shouldn’t come from your upper-funnel activity; it should likely come from your lower-funnel efficiency budget.
If your customers are asking ChatGPT for advice on the best cookware for a dinner party instead of Googling keywords, your media spend needs to follow them.
The agency challenge
This is where the friction will occur, and where you, as the client, need to drive the agenda.
Media agencies are creatures of habit. They have spent years building sophisticated tech stacks, reporting dashboards, and optimisation algorithms around the Google and Meta ecosystems. A new ‘walled garden’ like OpenAI represents a headache. It means new tracking pixels, new attribution challenges, and a new interface to learn.
There will be a temptation for agencies to say, “Let’s wait until the reporting is mature.” That is a mistake.
The first/fast mover advantage in media buying is real. The brands that cracked Facebook ads in 2012 or TikTok ads in 2020 reaped massive ROI before the auction prices normalised. The same will happen here.
Your checklist for the next monthly review
In your next WIP with your media agency, put these three items on the agenda:
- The monitoring strategy: OpenAI is still building its commercial presence in Australia. Is your agency actively monitoring the rollout timeline? Are they ready to ensure you are notified the moment the Australian inventory becomes available?
- The feed audit: Just like Google Shopping, these AI ads will almost certainly be powered by a product feed. Is your feed data structured in a way that a LLM (Large Language Model) can understand? Does it include the attributes people actually ask for in chat (e.g., “PFOA free”, “dishwasher safe”, “cooltouch handle”) rather than just standard keywords?
- The attribution plan: If a sale comes from a ChatGPT conversation, how are we measuring it? Does it fall into direct, referral, or are we preparing a new channel grouping in our analytics?
The verdict
We are witnessing the fragmentation of search. For 20 years, search meant Google.
Now, search is Google, Amazon, TikTok, and increasingly, ChatGPT.
The introduction of ads to the ChatGPT Free and Go tiers is the signal that the platform is ready to move from being a helpful assistant to a transactional engine.
Your customers are already there, having conversations about your category. The only question is, when they ask for a recommendation, will your product be the one that appears?
Retailers who push their agencies to prepare now will be the ones capturing the most efficient clicks when the floodgates open. Those who wait for the case studies will end up paying the premium.
