As the advertising landscape evolves, understanding these changes is important for businesses looking to capitalise on emerging trends and technologies.
Historical Context of Advertising
The historical context of advertising spans centuries, from early print ads to radio and television.
From Radio to Television
In the early 1900s, as radio became a household staple, advertisers quickly recognised its potential. The first radio advertisement aired in 1922, costing just $50 for a 10-minute slot. The advert was promoting the virtues of living a carefree life at the Hawthorne Court Apartments in Jackson Heights, Queens, NY.
As television emerged in the 1940s and 1950s, it ushered in the "Golden Age of Advertising," with the first TV commercial airing on July 1, 1941. This groundbreaking ad was for Bulova watches and featured a simple yet effective message: "America runs on Bulova time," displayed over a map of the United States.
The commercial was just 10 seconds long and cost Bulova a mere $9 to air during a baseball game between the Brooklyn Dodgers and the Philadelphia Phillies. If you haven’t seen Mad Men and happen to build your career in marketing you have missed a treat.
The Digital Revolution
The 1990s saw another major shift as the internet gained popularity. The first banner ad appeared in 1994, achieving a remarkable 44% click-through rate! This success sparked a rapid evolution in online advertising, with innovations like keyword-based ads and pay-per-click (PPC) models emerging by 1995.
The Pattern of Advertising Costs
Here’s the key point of my post: In the initial stages of a new advertising medium, costs tend to be relatively low as innovators experiment with formats and strategies. Early TV advertisers benefited from lower competition and costs compared to established print media for example.
As more advertisers enter the market, costs inevitably rise. This pattern is clearly visible in the digital advertising landscape and at Push we have been through this journey handling spends of over $100m across clients each year on different platforms.
A Practical Example
The best example I can give? Hair Transplants! (Yes I know I have not taken advantage of this service …sigh)
When we first started a campaign on Google for a hair transplant clinic the typical costs per click were well under £1. Nowadays that same click is over £6 for the top positions on Google.
Importantly, the client was only able to keep their acquisition costs low by continuously testing and adopting new advertising methods. Push helped them become the first clinic of their kind advertising on Facebook for example. We also introduced remarketing Ads as soon as they became available after Beta tests in 2010. No new channel was left untested.
The client scaled from one clinic to over 50 clinics in multiple countries.
Large Language Models as Emerging Platforms
As new platforms emerge, such as the large language models like ChatGPT, Gemini and Perplexity, we can expect this pattern to repeat. At first the platforms will be ‘Ad free’ to draw in new users. Eventually though they will look at the commercial opportunity for advertising.
Any advertising on a new platform will see early adopters benefit from lower costs and less competition.
As of February 2025, several large language model (LLM) platforms have begun testing or implementing advertising:
- Perplexity is the first LLM search engine to experiment with ads, introducing a non-intrusive format featuring sponsored related questions.
- Microsoft's Bing Chat (now Copilot) has started serving advertisements, with Microsoft's terms of service allowing ads in machine-to-human conversational interaction.
- Google's Gemini (formerly Bard) is integrating advertising, leveraging existing online behavioural advertising platform.
- Quora's Poe chatbot uses chat history to personalise and display advertisements
While not currently advertising, it's worth noting that ChatGPT, the leading LLM platform with approximately 300 million weekly users, may potentially introduce ads within the coming year to significantly increase its revenue.
Perplexity's Advertising Programs
As of February 2025, Perplexity offers two main advertising programs:
- Sponsored Follow-up Questions
This program is currently in beta and includes advertisers like Indeed, Whole Foods Market, Universal McCann, and PMG. While there's no public signup process yet, Perplexity is likely to expand this program in the future.
- Perplexity Publishers Program
This program is designed for content publishers and media organisations. It offers revenue sharing from ads, access to Perplexity's APIs, and other benefits. The Independent Newspaper in the UK has joined this programme.
The ad formats include:
- Video Ads
Positioned at the top of related questions, these ads aim to capture users’ attention right from the outset.
- Sponsored Questions
These will appear alongside organic results and will typically feature branded keywords, clearly labeled as “sponsored.”
- Display Ads
To ensure visibility across devices, display ads will be present both on desktop side screens and mobile interfaces.
Conclusion and Future Outlook
In summary, the evolution of advertising is closely tied to technological advancements and audience migration. As new platforms emerge, early adopters will have opportunities to capitalise on lower costs and less competition.
It's important for advertisers to stay informed about emerging trends and technologies to remain competitive in the ever-changing advertising landscape.
