Marissa Mayer Proposes a Potential Business Model for Ad-Supported AI Chatbots

Marissa Mayer has really good insights into the promise and problems with online advertising. She was instrumental in the early days of Google Search and spent several years as Yahoo's CEO.
Marissa Mayer Proposes a Potential Business Model for Ad-Supported AI Chatbots

Marissa Mayer has really good insights into the promise and problems with online advertising. She was instrumental in the early days of Google Search and spent several years as Yahoo's CEO.

Today, Mayer is the CEO of her own company, Sunshine, which is creating apps to do things like share photos among groups more efficiently, clean up your contacts, and remember your friends' birthdays. While none of these apps has taken off yet, Mayer's background makes it worth considering her opinion as it relates to online advertising.

On Wednesday at the Cerebral Valley AI Summit in San Francisco, Mayer was asked how she envisions advertisers responding as AI tools change expectations from consumers about what information is available and how it's presented.
 Her answer: Advertisers will be compelled to turn over more data than ever before in order to give consumers the most precise and detailed answers possible.

She says concert tickets are an example of how things used to be in the early days of Google Search.

"One of the classic examples we used to talk about how ads make search better was concert tickets.". When people are out searching for concert tickets, in and of itself that someone's an advertiser there with tickets to sell them and is willing to pay to be in your search results is actually a signal of quality, and it's also where the searcher is actually happy-they don't want these articles about the concert they want to see; they actually want tickets to purchase. And so there's a nice meeting of expectations on both the advertiser and searcher side."

In the AI era, Mayer is envisioning when people inquire about tickets for a particular concert, "they actually want to see exactly what seats are available, where they are in the stadium, the pricing. They want that information synthesized in much the way they see it synthesized in generative AI.". So I think that means that advertisers are going to have to partner even more closely with Google and other search engines to allow their wares to really be showcased and synthesized with the answer.

When interviewer Max Child asked Mayer if companies like StubHub or Ticketmaster would be willing to give over enough data to Google to provide this level of detail, she noted, "I think that it's pretty clear if you look at where search ads were 10 years ago versus where they are today, and certainly where Google Shopping is, there are a lot more advertisers that are giving full information of their inventory and a lot of different aspects and facets of the data, and so I think that trend is ultimately going to continue.

Although Mayer was speaking specifically about search, it's also an interesting hypothetical business case for pure-play AI providers like OpenAI and Perplexity. One can imagine here advertisers partnering with these companies to give sponsored answers to particular kinds of queries especially when the answers actually do match up with what the user is looking for.

As computa­tion costs to AI technologies keep going through the roof, AI companies would definitely look for other sources of income as well.

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2024-11-23 18:01:47