// auction mechanics

All signals tagged with this topic

Sep 9

Six Months In, ChatGPT Ads Lacks Basic Transparency for Advertisers

OpenAI's ad product operates without auction data, reliable CPM standards, or audience insights. Advertisers face CPCs ranging from pennies to $22 and cannot optimize or compare performance against competitors. The transparency gap mirrors early Google Ads friction but with a key difference: Google built an ecosystem of third-party measurement tools. OpenAI has released neither the infrastructure nor the data needed for advertisers to move beyond guessing. Until OpenAI commoditizes performance visibility the way search incumbents did, ChatGPT Ads remains a testing channel rather than a predictable media buy.

theme-consumer attention economy auction mechanics bidding behavior

Aug 11

Why Winning Bidders Always Overpay for Attention

Source: Seth's Blog

Seth Godin identifies a structural problem in attention markets: the winner's curse means that whoever secures ad clicks through auction bidding has necessarily paid more than the market's median valuation of that attention, since all other bidders rationally dropped out at a lower price. This reframes digital advertising efficiency—the supposed advantage of real-time bidding and programmatic auctions—as a system that systematically incentivizes overpayment for a commodity whose actual conversion value remains uncertain at purchase time. Brands chasing visibility through auction-based platforms pay premium rates for attention that the market itself deemed worth less.