Choosing an LLM these days is like the old iOS versus Android wars – tribal, passionate and often irrational. (Here at Kuration, we’re on Team ChatGPT. Fanbois to the core.)
But scrappy Perplexity AI is making noise we can’t ignore. So consummate ad tech pros that we are, it’s time to pay attention.
Perplexity AI biggest point of difference is (was?) the integration of artificial intelligence and real-time conversational search capabilities. Founded in 2022 by Aravind Srinivas, a former researcher at OpenAI and Google Brain, Perplexity quickly attracted high-profile investors, including Jeff Bezos and former YouTube CEO Susan Wojcicki. With a valuation of $14 billion, there are reports Apple is kicking the tires on the start-up.
Perplexity AI is essentially an advanced conversational search engine. Unlike traditional search engines that provide lists of hyperlinks, Perplexity uses artificial intelligence to generate concise, sourced responses directly in answer to user queries. Its user-friendly interface supports follow-up questions and provides transparent citations, allowing users to verify answers by accessing original sources. This transparency builds trust, differentiating it significantly from competitors when it launched. ChatGPT can now do the same, but Perplexity was first.
Perplexity utilizes large language models (LLMs) from providers like OpenAI (GPT-4) and Anthropic (Claude), combined with a proprietary retrieval-augmented generation (RAG) system. This technology ensures the AI’s responses are not just informed by pre-trained knowledge but enriched by real-time web data, enhancing accuracy and relevance.
Like its AI rivals, Perplexity operates on a freemium model. The basic tier offers unlimited quick searches with limited access to advanced features, while the Pro subscription tier ($20/month, same as ChatGPT’s Plus level) unlocks extensive functionality, including deeper search capabilities and multimodal AI tools. Enterprise customers get tailored offerings with enhanced security and data privacy features.
As of May, 2025, Perplexity claimed about 22 million weekly users. That’s just 6% of ChatGPT’s base.
Perplexity’s user base, primarily high-income professionals and decision-makers, makes it very appealing as a premium ad platform. So in another first to market, Perplexity recently started testing advertising in the US, integrating subtle, clearly labeled “sponsored follow-up questions” rather than traditional banner ads. The introduction of these sponsored follow-up questions could open innovative advertising opportunities. Brands can engage contextually relevant audiences in non-intrusive, privacy-friendly ways, targeting intent-rich user queries rather than user data. This shift aligns with growing concerns around privacy regulations and the vilified (and dying) cookie.
Traditional SEO and paid search strategies will evolve as users increasingly favour conversational and AI-generated answers over conventional search results (here at Kuration, we’ve replaced the majority of our Google searches with ChatGPT). For marketers, ensuring content visibility in AI-curated answers becomes vital (as it does in all AI chatbots), emphasizing the importance of credible and well-structured content that AI engines prefer to reference. (We will write much more on the rise this new brand of AEO.)
However, the blending of ads and AI-generated content also raises brand safety considerations. Consider, for example, that mental health support is one of the most common use cases for Chatbots. How’d you like to be served an ad for Jack Daniels when engaged in a chat about addiction? In response, Perplexity’s claims to be trialing proactive measures to maintain content credibility and unbiased responses are crucial to reassuring advertisers wary of associating their brands with unreliable or biased content.
Like many AI tools, Perplexity has faced controversy regarding its use of proprietary data. Publishers and media companies gripe about Perplexity scraping and summarizing their content without adequate compensation or explicit permission. High-profile publishers like the BBC have even accused Perplexity of copyright infringement. In response, the platform’s revenue-sharing initiatives with publishers attempt to mute those concerns and foster a sustainable, mutually beneficial content ecosystem. Or at least give it lip service.
Perplexity AI isn’t just another search engine; it’s a signal of a broader shift towards AI-driven discovery, advertising, and content interaction. Perplexity is yet more proof these AI tools could significantly reshape our search behaviours and content consumption patterns. And its potential integration into devices, namely the Apple iPhone, could take it from a niche player to a Google-fighter. For us propeller-heads in ad tech, these are exciting times!