With over 100 million daily active users, Microsoft’s Bing AI chatbot has single-handedly brought Microsoft back into the browser wars. However, running an AI chatbot is still significantly more expensive than traditional searches. Therefore, to offset these costs, Microsoft has started incorporating ads within the Bing AI chatbot’s responses, linking to relevant products and services. Although the ads are currently appearing for a limited number of users, they may become common in the near future.
In a blog post announcing this decision, Yusuf Mehdi, Microsoft’s corporate VP for Search and Devices, acknowledged that they are exploring additional capabilities for publishers, including over 7,500 Microsoft Start partner brands. These capabilities involve placing ads in the chat experience and sharing the ad revenue with partners whose content contributed to the chat response. The company is also considering displaying additional links from an advertiser’s website when a user hovers over a link.
Besides ads, Microsoft is also considering adding rich captions from its Start personalized news feed publishers next to the Bing AI chatbot’s responses. This would provide users with additional context and potentially increase engagement with the chatbot.
“For our Microsoft Start partners, placing a rich caption of Microsoft Start licensed content besides the chat answer helps to drive more user engagement with the content on Microsoft Start, where we share the ad revenue with the partner. We’re also exploring placing ads in the chat experience to share the ad revenue with partners whose content contributed to the chat response,” reads Microsoft’s blog post.
Balancing monetization and the user experience
Microsoft’s decision to monetize its chatbot is not unexpected. As Mehdi notes, the chatbot has attracted a significant number of new users to Bing, presenting a valuable opportunity for advertisers. However, the company’s current implementation looks half-baked, as it’s not always clear what the chatbot is advertising.
In one example, it is unclear whether TrueCar is selling the car and paying for placement on searches for new Hondas or if it is just a reference or price-checking site that pays to be the preferred provider of car prices to Bing. We’ll have to see how this advances over time.
2023-03-31 15:10:14