Ads in Chatbots Have Arrived. Here’s What’s Working—and What’s Not

Judgment

Anthropic keeps Claude ad-free, so the tradeoff shifts to OpenAI, Google and niche chatbot apps: they must decide whether ad revenue is worth the user-trust and privacy cost, while Claude's roughly $112 billion in investor cash sets the price of opting out.

Basis

Koah Labs CEO Nic Baird told WIRED that machine-crafted ads, composed partly by AI, generate double the clicks of fully human-written ones, and that Koah sees users clicking about 3 percent of ads — roughly on par with Google's mature ads system. The mechanism is context: Koah generally receives a user's entire conversation up to the ad request, and chatbot prompts run at least double the length of Google queries, so it can target on the AI's response, not just the prompt (spa ads after prompts about "stress"). Scale is still lopsided: OpenAI has over 100,000 customers advertising in ChatGPT since February, Google extended AI Mode ads to 10 more countries beyond the US, and Koah markets ads to over 200 apps with a tenth of OpenAI's advertisers. Baird adds that regulated advertisers such as drugmakers keep human control and get weaker results.