ChatGPT Ads could make as much money as TikTok in just four years.
Starting from zero.
New Street Research built 3 scenarios for ChatGPT Ads in 2030:
• Bear case: $24B
• Base case: $54B
• Bull case: $110B
So, if things go well, but not exceptionally well, OpenAI could make $54B from advertising by 2030.
TikTok made an estimated $33B last year.
Over the past 5 years, its advertising revenue grew at a 71% CAGR.
By 2030, it could reach around $60B.
TikTok would have taken roughly 10 years to get there.
OpenAI could do it in 5!
The bull case assumes an explosion in the AI search advertising market.
WPP estimates that the entire generative search ad market will surpass $100B by 2030.
• Base case means OpenAI captures roughly half of it.
• The bull case means OpenAI captures all of it, and more 😂
But everything depends on the definition.
Does WPP’s estimate include Google AI Overviews and AI Mode?
Probably not. Otherwise, the math does not really add up.
Google Search alone made $225B last year.
Some of that already coming from ads in AI Overviews and AI Mode. And that share will only grow.
So, by 2030, the total addressable generative search advertising market could easily reach $300B.
OpenAI could capture a big chunk of it.
The bull case says roughly one third. Is it crazy? maybe not.
Especially if CPMs and CPCs remain high.
Higher prices mean higher revenue per user.
New Street estimates that OpenAI’s advertising revenue per user could get close to Reddit’s by 2030.
Still far from Meta.
But unlike OpenAI, which has so far focused on large clients, Meta did not rely on large advertisers alone.
It attracted millions of small and medium advertisers.
OpenAI now appears to be following the same playbook:
Self-serve platform, conversion tracking, custom audiences, etc
Basically,
we’re witnessing the rise of a new advertising giant.
