Today's S'more: The wall between SEO and paid media just collapsed. Here's what it means for your budget.
Everyone's been waiting for ads in ChatGPT.
Meanwhile, the real story isn't that they arrived.
It's how they arrived.
And it changes the game for every marketer with a budget.
The Big Marketing Story
ChatGPT ads are officially live, and Expedia is the first brand spotted in the wild. The ads appeared this week at the bottom of a response to the prompt, "What’s the best way to book a weekend away?" .
This isn't a test. It's the beginning of a new era for search advertising. The ad unit, which features a prominent brand favicon and a "Sponsored" label, was triggered on the very first prompt. This contradicts earlier predictions that ads would only surface after a back-and-forth conversation, signaling a much more aggressive monetization strategy from OpenAI.
Why This Matters
AI assistants are now a paid media channel. What was once a pure, organic discovery engine is now a direct competitor for your Google and Meta ad dollars. The line between conversational AI and performance marketing has officially been erased.
• First-prompt ads change the user intent game. By showing ads immediately, OpenAI is betting that users will tolerate commercial results from the very start. This puts immense pressure on brands to craft ads that feel like valuable suggestions, not intrusive interruptions.
• The SEO and paid media wall is gone. For years, teams have operated in silos. Now, your AI search optimization (AISO) and paid acquisition strategies must be deeply integrated. The winning brands will be those who can make their paid and organic presence feel like a single, helpful conversation.
What Smart Marketers Are Doing
They're not just buying ads. They're mapping the entire conversational journey. This means identifying the commercial-intent prompts relevant to their business and building a strategy that blends organic visibility (getting cited in the AI's answer) with paid promotion (running a sponsored ad alongside it).
They are also treating their ad creative like a direct answer to a user's question, not a generic broadcast. The Expedia ad worked because it was a direct response to a travel query. Generic brand ads will likely fail in this new context.
🧪 Try This This Week
•Go to ChatGPT and ask 3-5 questions your customers would ask when considering your product or service.
•Analyze the responses. Who is the AI citing? What language does it use? This is your new keyword research.
3 Quick Signals
TikTok's engagement is exploding while Instagram's is slipping. A new Emplifi report shows TikTok brand follower counts jumped 200% YoY, with median engagement rates hitting 27.6%. Instagram's fell to 9.7% .
Google Ads is changing its budget pacing on March 1. For campaigns using ad scheduling, the system will now try to spend your full monthly budget (30.4x your daily budget) regardless of your schedule. Review your daily budgets now .
75% of marketers are using AI, but most are still sending generic campaigns. A new Salesforce report reveals a major disconnect: while most marketers have adopted AI, they're not using it for the two-way, personalized conversations customers expect .
Tool Watch
Meta's Marketing API just made it harder to manage Advantage+ Shopping and App campaigns programmatically. As of this week, these campaign types can no longer be created or updated via the API, forcing advertisers back into Meta's native tools . This is another clear signal that the major platforms are pushing marketers toward their own AI-driven automation, giving you less manual control.
Campfire Close
If your search traffic looks weird in a few months...
It's not an algorithm update.
It's that your competitor is having a better conversation with the AI than you are.
See you around the campfire.
