ChatGPT Has a Big Problem

ChatGPT has a big problem. ChatGPT is burning through billions of dollars just to keep 800 million users chatting for free. Even with roughly 20 million paying users, it's still not profitable. So, OpenAI's next move is turning those chats into a trillion-dollar shopping gateway.

I'm Neil Patel, founder of NP Digital, an award-winning ad agency. And in this video, I'll show you how ChatGPT is rolling out instant checkout with Etsy and Shopify, hiring the masterminds behind Facebook and Instacart's ad empire, and why this creates a once-in-a-decade chance for brands to cash in before the crowd shows up.

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Most people think AI search is still years away from eating into Google's market share, but ChatGPT is already redirecting shoppers away from traditional search engines. And the brands who realize this early are printing money. Here's what's happening right now.

According to Similarweb, ChatGPT drives 20% of Walmart's referral traffic. Over 20% of Etsy's and nearly 15% of Target's. Again, this is referral traffic, not total traffic. And 10% of eBay's. These aren't projections. This is live traffic data from September 2025.

And there's one massive player completely missing from this list. Amazon. Amazon blocked ChatGPT's crawler entirely. They updated their robots.txt file to tell AI bots to stay out. The result, the referral traffic from ChatGPT dropped from 18% month-over-month to under 3%. That means 600 million Amazon products are now invisible to ChatGPT, while their competitors are getting free discovery every single day.

Why would Amazon do this? Because they see the writing on the wall. If AI becomes the new search bar, Amazon's $56 billion advertising business crumbles overnight. Every time someone asks ChatGPT, "Best wireless headphones under $150," they're seeing Walmart, Target, eBay, everyone but Amazon. This is the first time in 20 years that Amazon isn't the default answer for product searches, and it's creating the biggest opportunity for brands and retailers since Google invented search ads.

If you sell products online, your competitors are already showing up in ChatGPT results while you're invisible. The window to get ahead of this is closing fast. Within 12 to 18 months, this won't be an advantage. It'll be the new normal.

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But driving traffic is one thing. What OpenAI just launched takes it from discovery to transaction in a single conversation, and it could make ChatGPT the fastest-growing marketplace in history. OpenAI launched instant checkout powered by something called the Authentic Commerce Protocol that they built with Stripe. US users can now buy from Etsy sellers directly inside the chat. No links, no tabs, just an in-chat payment experience. And over 1 million Shopify merchants. Brands like Glossier, Skiims, Spanx, Fiori are coming next.

The stock market responded immediately. Etsy stock jumped 16% the day it was announced. Shopify rose 6%. But here's the part that was overlooked. This isn't just a ChatGPT feature. The Authentic Commerce Protocol is open-source. That means any AI assistant could adopt it. Claude, Gemini, Perplexity, even TikTok's AI. They could all use the same rails to let users shop within their chatbots.

For the first time in two decades, the foundation of e-commerce could fundamentally shift. Google and Amazon's grip on online shopping, the idea that you start on their platforms, that assumption is being challenged right now.

And here's what you need to understand. ChatGPT needs structured, detailed data to recommend your products. The brands feeding the richest information are the ones getting surfaced. Some brands are already providing more details to ChatGPT than they publish on their own websites because they know this is where the attention is moving. If you're not optimizing your product feeds right now, whether it's clean descriptions, updated pricing, even structured availability data, you're letting your competitors own this new channel while you're stuck playing the old Google SEO game.

Now, here's where it gets really interesting. OpenAI publicly said they have no plans for ads back in December 2024. Then four months later, internal documents leaked showing that they're projecting $25 billion in ad revenue by 2029. So what changed? Sam Altman, OpenAI's CEO, called ads "uniquely unsettling." He said they were a last resort and that he "kind of hates ads." He even said he likes that people pay for ChatGPT because it means the answers they're getting are not influenced by advertisers.

But here's a reality. OpenAI expects to generate $12.7 billion in revenue this year. That's triple last year's $3.7 billion. Sounds impressive, right? Except they're still not a cash-flow positive business. They won't be until 2029. Only 20 million out of roughly 800 million users are paying for subscriptions. That's less than 3%. And Sam Altman recently admitted on social media, "Insane thing. We are currently losing money on OpenAI Pro subscriptions. People use it so much more than we expected." That's a CEO of a $500 billion company admitting they're losing money on their premium product. The math doesn't work. And when the math doesn't work at this scale, something has to change fast.

Internal documents from April 2025 show that OpenAI is planning for $1 billion in free user monetization starting in 2026. That grows to $25 billion by 2029. And there's only one way to monetize 100 million free users at that scale. It's advertising.

And OpenAI isn't just planning it. They're actively building it right now. Feiji Sumo, who spent over a decade at Meta, where she built Facebook's ad empire and ran monetization for the entire Facebook app, just got hired as OpenAI's chief of applications. Before that, she was the CEO of Instacart, where she turned the platform into a major retail advertising business. Now, she's at OpenAI. She's hiring an ads chief to build full infrastructure underneath her. OpenAI is also hiring growth paid marketing platform engineers to build campaign management tools, ad platform integration, and real-time attribution systems. These aren't vague plans. They are live job postings being filled right now.

The brands that master conversational advertising in the next 12 months will have the same advantage early Facebook advertisers had in 2007 and 2008. This isn't just another ad channel. It's a completely new format where ads are embedded into the answer itself, not plastered next to it.

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The rules of organic traffic generation are completely different now. SEO taught you to optimize for Google's algorithm. You learned to rank for keywords like "best laptop" or "affordable project management software." But AI search works differently. It's not about keywords anymore. It's about context and topics.

Traditional search looks like this: "Best wireless earbuds." Short, simple, keyword-focused. An AI search looks like this: "I'm a runner who sweats a lot, needs something waterproof that stays in during sprints, doesn't want to spend more than $120, and I've had bad experiences with ear pain from silicone tips. What are my best options for headphones?" See the difference? The second query gives AI your use case, your pain points, your budget, and your past experiences. Targeting moves from keywords to full conversational context.

Around 2% of all ChatGPT queries involve shopping. That's 50 million shopping queries per day. With 2.5 billion total prompts flowing through ChatGPT daily, even a small slice translates into a massive shopping intent. But here's a shift. ChatGPT doesn't just rank websites like Google used to. It recommends answers. It tells you what it thinks is best, with citations to back it up. If AI doesn't trust your content enough to cite it, you're invisible. If it doesn't trust you, you're not getting traffic, you're not getting endorsement, and you're losing out on revenue.

This creates a new game. You're not competing for rankings anymore. You're competing for citation credibility. Marketers are calling this AIO, GEO, or even AI SEO or AI Optimization. It's the successor to SEO. It's very similar in many ways, but of course, there are some differences.

And here's the data that proves why this matters. Our study of 300 businesses across different industries found that ChatGPT doesn't just dominate in volume, it dominates in value. ChatGPT drives 87% of AI traffic and 82% of AI-driven sales. Meanwhile, all the other platforms combined—Copilot, Perplexity, Gemini, Claude—account for less than 20% of actual revenue.

I want you to start creating content that AI can confidently cite. That means structured data, clear problem-solution frameworks, authoritative sources. The brands winning right now are publishing detailed product feeds, structured catalogs with rich descriptions, updated prices, real-time availability. So, ChatGPT has full context when deciding what to recommend.

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Now, let me show you the exact roadmap on how to drive traffic and sales with ChatGPT because there are three clear phases.

Phase one, something is happening right now from late 2025 through early 2026. This is the "train the models" phase, right now, before ChatGPT and Google's AI systems fully monetize. You're not buying placement yet; you're teaching systems why you're worth recommending. Make your brand machine-readable. That means rewriting your site, your bios, your product pages for semantic clarity. What you solve, why you're trusted. Use schema markup, FAQ schema, how-to schema, product schema, even review schema. Build authority signals that feed AI trust models. Earn press coverage. Get on podcasts. You want to build citations, get mentioned on Wikipedia, Forbes, TechCrunch, anywhere AI is already trusting, because AI models weigh those sources heavily when deciding who to cite. Create content that AI can confidently quote, not just listicles. End up explainer videos, comparisons, frameworks. Use language like, "If you're a small business owner trying to manage customer relationships without a big budget, here's what to consider." That trains the AI's reasoning layer. You're not marketing to people yet. You're marketing to the machine that will market you later.

Phase two starts in 2026. This is as ChatGPT ads and Google AI Overviews go mainstream globally. Users will begin to trust AI assistants for purchase decisions the way they once trusted search results. This is when you test early ad formats, run experiments in conversational placements. For example, focus creative on problem-solution phrasing, not slogans, and test ad copy that reads like advice: "For small teams under $50 a month, here's what works." Start tracking AI visibility metrics. Tools will emerge that measure ChatGPT mentions and AI Overview inclusion rates and citation frequency. For example, you can do a lot of this with Ubersuggest for free. These become your new KPIs alongside traditional search rankings. This phase is about blending organic trust with paid amplification. You're building on the authority you established in phase one, now with the option to pay for guaranteed placement.

Before I go into phase three, if you need help making sure your business is showing up on ChatGPT and all the other LLMs and making sure that you're generating revenue over your competition, hit us up at NP Digital. This is what we specialize in.

Now, let's dive into phase three. This arrives between 2026 and 2028. By then, OpenAI will have its own ads manager, and Google's AI mode, which is already taking shape through a campaign type called AI Max, will be fully fused into search. Advertising won't interrupt conversations; it'll complete them. You'll buy answer slots and recommended placements. You'll measure success not in clicks, but in return on answered questions. You'll run memory-aware retargeting campaigns: "Last time we talked, you said you were hiring a designer. Here's a tool that helps teams collaborate." You'll do API-level sponsorships. You'll partner with AI-powered SaaS tools to become the recommended solution when users ask for help inside Mailchimp or even Slack. At this stage, ads aren't external interruptions anymore. They're embedded insights. They're the answer.

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But here's a paradox for tech platforms powered by ads. The same ads that could save OpenAI financially might destroy the user experience that made it popular in the first place. Users distrust ads, and a lot of people just scroll past these sponsored ads that dominate a lot of web pages. If ChatGPT's ads feel manipulative, the whole system collapses. If they're too obvious, they break the conversational flow.

Perplexity AI recently announced they're introducing ads, and they were completely transparent about it. They said, "Subscriptions alone don't generate enough revenue to sustain our publisher program and growth. Advertising is the best way to ensure a steady and scalable revenue stream." But here's what they're doing differently. They're focusing on sponsored follow-up questions that are still AI-generated. Sponsors pay for the products to be considered in the recommendation, but they don't control the answer itself. The AI decides what's best based on context.

This is the new value exchange. You get free access to incredible, powerful AI technology. In return, you see relevant recommendations that actually solve your problem. Trust will be the new currency. If ads feel genuinely helpful, not pushy, not manipulative, users may actually prefer them to random search results. The user experience of trust will determine the ROI more than bid prices or audience size. That means native, contextual, credible, first-party formats. No banners, no pop-ups, no interruptions. And we'll see completely new metrics replace clicks. Things like engagement in a thread: Did the user expand the sponsor suggestions? Adoption actions: Did they insert it into their plan? Memory-based conversations: Did this user eventually sign up after repeated sponsor nudges across multiple conversations? That's a post-click attribution model built into the conversation itself.

The brands that lead with education, clarity, and genuine problem-solving will dominate because their message fits naturally into the conversational context. This isn't about tricking the system. It's about being the best answer when someone asks for help.

Here's what matters right now. Most people won't realize what's happening until it's too late. And by then, the cost to show up in these AI experiences will skyrocket. This is your window to position your brand early, to start getting cited, and build authority. Even if ChatGPT hasn't officially launched these new ad features, you can actually start experimenting with Google's AI Max to get an idea of what may end up happening within search campaigns. Think of it as training your content and ads to talk to users the way AI does, recommending solutions and earning trust in real time. The brands learning this now will dominate when conversational ads become the norm.

And if you want to see how Google's already responding to OpenAI's next move, watch this video next because understanding how both sides are evolving will define who wins in the new era of digital marketing.