The departure of Perplexity’s advertisements chief, Taz Patel, didn’t mark a pivot a lot as affirm a rigidity that’s been simmering for months. Reasonably than signaling a full-blown retreat from promoting, the exit underscores a broader id query the AI platform has but to resolve.
In line with three of the advert execs Digiday interviewed for this text, nobody actually is aware of what Perplexity’s technique is, or if it even is aware of itself. Patel’s sudden departure — with no speedy successor in sight — solely makes that murkiness tougher to disregard.
“He was the one one who had a clue [about Perplexity’s ad vision], and it wasn’t a lot,” mentioned an advert exec, who recounted their impression of Patel on situation of anonymity. “Given my perceptions of him and the interactions I and our group have tried to have with him on behalf of a number of purchasers within the final 90 days. Not spectacular.”
Perplexity’s head of communication, Jesse Dwyer, confirmed to Digiday that Patel is now not with the corporate. Patel didn’t reply to Digiday’s request for remark.
It’s a pointy flip from the optimism that surrounded Perplexity only a yr in the past. Again then, the corporate started testing advert placements in its conversational AI search expertise, producing buzz amongst entrepreneurs longing for a post-Google various. However that early pleasure has since cooled. The exams didn’t evolve into something significant — and now neither has the technique.
“We now have not heard something from Perplexity and we don’t have any insider data.,” mentioned a media purchaser at an impartial advert company, who exchanged anonymity for candor on the subject. “The final data I’ve gotten from our group right here is that they don’t name on us usually.” In different phrases, contact had been minimal.
To be truthful, Perplexity’s positioning remains to be a piece in progress. Not like conventional search advertisements constructed round efficiency and conversions, the corporate has pitched its early advert product as a brand-building alternative geared toward a tech-forward, early adopter viewers. To not point out, it launched a browser over the summer time, and is rumored to be an acquisition goal for Apple. It’s the kind of uncertainty that makes entrepreneurs cautious.
“We tried to work with him [Patel] on behalf of three completely different purchasers, virtually 4 months in the past and by no means bought a gathering with him,” mentioned one exec.
“I spoke to Taz about quite a lot of our world purchasers who wish to do good, data-driven artistic partnerships,” added one other exec. “However then he left and there was no handover. So now I’m making an attempt to reengage with another person within the enterprise.”
Holding corporations haven’t fared a lot better. Two execs from main holding teams advised Digiday they’ve struggled to get time with anybody on Perplexity’s advert group.
However the silence isn’t new.
As early as six months into its advert push, entrepreneurs had been already expressing doubts. Regardless of early fanfare, Perplexity hadn’t opened up a lot past a small group of launch advertisers. The window by no means actually widened. And now, the technique appears to have gone simply as quiet.
“I don’t know what he [Taz Patel] was doing, as a result of he hadn’t replied to our group both,” mentioned the advert exec. “I imply, to be trustworthy, they only may be ghosting the entire trade proper now as a result of they don’t have any clue. And culturally, once more, they’re clearly a product and tech firm, not a gross sales and advertising firm, and they also’re nonetheless figuring it out with a number of different large rivals round them, and some huge cash poured in that they’re not placing to a number of good use by way of constructing out a second income stream proper now.”
Responding particularly about Perplexity’s ambitions, Dwyer, advised Digiday the group has been clear that it will experiment with a small group of advertisers slowly over the approaching years to determine new methods of selling within the AI age the place customers have far more management and far increased expectations. He didn’t title particular manufacturers that had been on board.
“Nothing has modified in our plans or operations, and our experiments are persevering with as deliberate. Lower than 0.5% of the advertisers who’ve straight requested to promote on our platform have been allowed and that’s in accordance with this imaginative and prescient that we’ve all the time been unwaveringly clear on,” Dwyer mentioned.
Working an AI firm is one factor. Working an ad-funded one is one other. Perplexity isn’t the primary to battle with that rigidity — and it received’t be the final. However with $400 million in recent capital secured over the previous few months, in keeping with studies from The Info and Bloomberg, the clock is ticking. Promoting is probably not the core enterprise, however in some unspecified time in the future, even AI corporations like Perplexity must discover a path to profitability.
“I believe what they clearly don’t have is a monetization technique, they usually most likely don’t have anybody in place that has ‘been there, achieved that’, by way of launching an advert platform with an enormous tech firm,” mentioned a media purchaser at a digital company, who agreed to talk to Digiday anonymously in change for candor. “Possibly, that’s a part of the issue — that folks they’ve usually are not from that legacy media background.”
Nevertheless, talking concerning the firm’s income, Dwyer famous that promoting presently makes up lower than 0.01% of Perplexity’s nine-figure revenues. “For a corporation that’s youthful than my 3-year-old toddler, I believe we’re doing simply wonderful,” Dwyer mentioned.
The disconnect might assist clarify why holdco company companions like UM have been doing many of the heavy lifting, pitching advertisers on Perplexity’s potential whereas the platform itself stays largely hands-off.
“On the Perplexity aspect, I’m mainly driving a take a look at on the enterprise aspect, testing their software internally,” mentioned an advert company exec, who spoke to Digiday on situation of anonymity. “I’m additionally speaking to them about doing branded integrations for a few of our purchasers.”
Meaning approaching Perplexity from all angles: determining workflow, operational wants, and maybe most crucially, why advertisers ought to care within the first place.
To date, that reply stays elusive. The advert codecs aren’t interesting and neither is the platform’s attain. On the Bloomberg Tech Summit in June, Perplexity CEO Aravind Srinivas introduced that the platform had 22 million lively customers, and had processed 780 million search queries in Might — figures he believed had been a key milestone for the app.
You probably have any insights to share about Perplexity, or every other platform, or in the event you’re a present or former worker of any of the platforms, contact Krystal Scanlon securely utilizing a non-work gadget on Sign: @krystalscanlon.27, electronic mail: krystal@digiday.com or by way of LinkedIn.
