ChatGPT Ads: The Good, Bad, and The Ugly
Hey there, folks! It’s Tyler Williams here. If you don't know me, I’m the guy behind Mammoth Marketing for Plumbers. Usually, I’m talking about how to get your brand so big in your local market that people can’t help but think of you when their water heater decides to turn their basement into an indoor swimming pool.
But today, we’ve got some big news in the tech world that’s going to ripple all the way down to the local service bay. ChatGPT ads are officially a thing. That’s right—after a long time of saying, "No, no, we’d never do that," OpenAI has pulled a classic internet move. They have the attention, and now they’re selling it.
As a plumber or a home service business owner, you might be wondering: “Tyler, do I need to care about this? Is an AI bot going to start selling drain cleanings?” Well, there’s some good, some bad, some ugly, and a whole lot of opportunity. Let’s dive into the pipes of this new ad platform and see if it’s worth your hard-earned cash.
They Finally Did It: The Birth of ChatGPT Ads
It was only a matter of time, wasn't it? Everybody sells attention. It’s the oldest trick in the digital book. If you build a platform where millions of people hang out all day asking questions like, "How do I fix a leaky faucet?" or "Why is my toilet making a demon noise?", eventually, you’re going to want to charge someone to put an answer in front of them.
OpenAI has officially announced they are rolling out ads. For a long time, they played the "we're different" card, but at the end of the day, running those massive server farms is expensive. You’ve got to make money somehow, and selling eyeballs is the most reliable way to do it on the internet.
For us in the home services world, this is a massive shift. We’ve spent years mastering Google LSA, PPC, and Facebook ads. Now, a new player has entered the arena. But before you go trying to find a login for the ChatGPT Ads Manager, we need to talk about the "how" and the "why" behind this rollout.
The Targeting Gold Mine: Why LLM Ads Are Different
Let’s talk about the "Cool Part." Why should we even care about advertising on a Large Language Model (LLM) like ChatGPT?
It boils down to one word: Intent.
When someone goes to Google and types in "plumber near me," that’s high intent. But when someone is having a 20-minute conversation with ChatGPT about the specific symptoms of their failing tankless water heater, the amount of data that AI has on that user’s specific problem is staggering. The targeting potential here is a literal gold mine. Because we feed these models so much information about our lives and our specific needs, ChatGPT should—in theory—be able to find customers with a degree of accuracy that makes Facebook’s targeting look like throwing darts in a dark room. Imagine being able to show an ad exactly when the AI realizes the user's DIY attempt just failed and they need a professional right now. That’s the dream, right?
The $200,000 Elephant in the Room
Now, before you get too excited and start reaching for your credit card, we need to talk about the elephant in the room. And it’s a big, expensive elephant.
Right now, ChatGPT is... well, it’s pricey. Like, "sell your spare service van" pricey.
They are reportedly setting their CPM (the cost per 1,000 views) at $60. To give you some context, the average CPM for a local market on Facebook is around $6. That means ChatGPT wants to charge you 10 times the amount for the same amount of visibility.
But wait, there’s more! (And not in a good, late-night infomercial way). They are also reportedly requiring a minimum spend of $200,000. I don't know about you, but most of the mom-and-pop plumbing shops I work with don't just have 200 grand sitting under the seat of the truck to "test" a new ad platform. This creates a massive barrier to entry. Right now, this isn't a game for the local hero; it’s a game for the massive national brands.
A Quick Word From Our Sponsor (Me!)
Before we get into why they’re charging so much, I want to take a second to talk about the sponsor of this article: Mammoth Marketing.
That’s right, I’m paying myself in "digital real estate" to tell you that if you’re a plumber looking to dominate your market, we’re the crew you need. We help you build a brand that’s bigger than just a logo on a truck. We make you the household name. If you want to see how we can help you grow without needing a $200k ChatGPT budget just yet, head over to MammothForPlumbers.com.
Alright, back to the expensive AI stuff.
Why Is ChatGPT So Expensive? (The "Bleeding Money" Factor)
Why the high prices? It’s simple: ChatGPT is bleeding money. It costs a fortune to run those GPUs. OpenAI needs big contracts, and they need them fast.
By setting a $200k minimum, they can land a few "whales"—think Coca-Cola, Progressive Insurance, or national plumbing franchises—and get a massive influx of cash without having to build out the complicated self-serve tools that small businesses need.
They’re basically building the "ad inventory" (the space where the ads go) before they build the "placement tools" (the dashboard where you and I would actually buy the ads). I saw this same thing happen with Hulu years ago. It starts with the "Big Boys," then it trickles down to DSPs (Demand Side Platforms), and finally, it becomes a self-serve option for the local plumber.
The Future: When Can the "Little Guy" Jump In?
I don't think OpenAI is ignoring small businesses forever. They’ve seen Google’s bank account—they know that Google’s empire was built on the backs of millions of small business owners spending $1,000 to $10,000 a month.
They want a piece of that pie. But for now, we’re in the "Super Bowl" phase of ChatGPT ads. You’re going to see national brands first.
My prediction? I hope to see a self-serve platform within a year, but it might be longer. However, once those floodgates open, it’s going to be a race. When the other LLMs like Claude, Gemini, and Grock see ChatGPT making money, they’ll all launch ad platforms too. Eventually, we'll have software that lets us buy ads across all of them at once.
How Plumbers Should Prepare Right Now
So, if you can’t buy an ad today, what should you do?
Watch the Market: Keep an eye on how these ads look. Are they helpful? Are they annoying?
Stay "Ads Forward": I’m a big believer in paid advertising because it guarantees visibility. Don't wait for the phone to ring—make it ring.
Pounce on the Auction: When ChatGPT (or Gemini) finally opens up to small businesses, it will likely be an auction-based system. In the beginning, those auctions are cheap because nobody is there yet. That is your window of opportunity to get high-intent leads for pennies on the dollar before the rest of the industry catches up and ruins the prices (looking at you, Google).
The landscape is changing, but the goal remains the same: get your brand in front of the person with the leaky pipe.
Want a Game Plan for Your Business?
The AI world is moving fast, and you’ve got a business to run. You can't spend all day reading tech whitepapers while you're elbow-deep in a main line repair.
If you want the Tyler Williams crew to take a look at your current marketing and show you exactly what you need to focus on to grow your business—and where you should be placing your bets for the future—I’d love to chat.
Click here to schedule a consultation at TylerWilliams.net and let's get your business moving toward "Mammoth" status.
Talk soon!
