Perplexity abandons ads over user trust in AI

American search engine Perplexity has abandoned testing ads over concerns it risks undermining user trust.

The San Francisco-based company began testing sponsored placements in 2024, displaying ads beneath its chatbot responses. It was among the first AI search firms to bring in ads.

However, since late 2024, the company has been slowly pulling the plug on ads and has no plans to bring them back, the Financial Times reported.

Perplexity executives confirmed on Tuesday that they have no places to use advertising as a revenue stream and will continue to offer paid subscriptions as its business model.

The company said: “A user needs to believe this is the best possible answer to keep using the product and be willing to pay for it.”

The challenge with ads, the executive added, “is that a user would just start doubting everything… which is why we don’t see it as a fruitful thing to focus on right now”.

The move comes at a time when its competitors, namely OpenAI and Google are accelerating the push for ads on their respective search platforms.

For marketers, this has seen search marketing evolve at an unprecedented rate. It’s no longer about SEO and click-through rates, it’s about content and credibility.

A recent study by Receptional shone a light on why some brands are ranking higher on AI chatbots than others; and this move from Perplexity, could be a blessing and a curse for marketers in what is an incredibly volatile ecosystem.

AI in general continues to have a disruptive impact on marketing in betting and gaming, as well as on other industry disciplines and associated fields. The rise of AI content had a huge impact on affiliate traffic, for example, by impacting search results.

However, as Receptional’s study shows, there is an opportunity for marketers who know how to leverage AI in the right way. This is particularly the case as more and more consumers from the Gen Z and millennial demographics turn to AI chatbots for search purposes.