Does ChatGPT Actually Have A Higher Conversion Rate Than Google Traffic?, AI Traffic Is Not Being Tracked Accurately, How To Actually Spread AI Adoption Throughout Your Company, AI Is Slashing Headcount — Fast (Here's What To Do)

In this episode #2988, Eric Siu and Neil Patel discuss how ChatGPT is changing user behavior and conversion rates compared to Google. They explore the rise of AI assistants in search, the cost efficiency of AI tools, and the need for AI fluency and cultural shifts within organizations. The episode wraps with insights on Google’s recent workforce changes and strategic moves in the AI era. TIME-STAMPED SHOW NOTES (00:00) ChatGPT vs Google: Conversion Rates and User Behavior (02:57) The Evolution of Search: AI Assistants and Analytics (05:58) Cost Efficiency in AI: The Future of User Services (08:56) AI Fluency in Organizations: Embracing Change (11:58) Cultural Shifts: Adapting to AI in the Workplace (18:11) Google's Workforce Changes: Buyouts and Future Directions To suggest a topic, go to https://www.marketingschool.io. For more content from Eric and Neil, check out Eric’s Leveling Up with Eric Siu YouTube channel and Neil’s Neil Patel YouTube channel. Connect with Us: Single Grain << Eric's ad agency NP Digital << Neil’s ad agency X @neilpatel, @ericosiu Instagram @neilpatel, @ericosiu Drop Us a Review If You Enjoyed the Episode!

• 0:00Speaker 00

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• 0:35Speaker 00

  So does ChatGPT actually have a higher conversion rate than Google Traffic? Because a lot of people recently have been saying, "Oh my god, it converts way higher." "Oh my god, you know, ChatGPT is the future." So I bet Neil has actually done a study on this. So Neil, what have you seen?

• 0:52Speaker 01

  So we see, when you look at analytics and visitor to conversion rate, yes, it is higher. What analytics is not reporting is when you ask people their journey and when they go through ChatGPT to make a decision and then purchase, the amount of times they interact with the brand before they visit the website and do their research is much more higher. So instead of someone searching on Google, going to your website, doing research, then going to another link, doing research, then going to another listing on Google, doing research, and then deciding which site to buy, they're doing this research on ChatGPT, so you're not seeing the visitor count. When you look at true impressions to conversion rate,

• 1:35Speaker 01

  we don't think it's higher. I don't have exact data because they don't provide it. But we don't think it's higher because people are interacting with the brand way more often than they're actually clicking over to a website and then buying. Typically, they're doing their research on ChatGPT. Then when they're ready, they're clicking over and buying, but they've already done a lot of the research and they don't even have to go to the website to finish their research in many cases.

• 2:00Speaker 00

  It's interesting because I saw these numbers this morning, but it took

• 2:04Speaker 01

  Chat G P T about four years to get to a billion queries a day and then Google took much longer, right? But the caveat is there wasn't an L L M in the past. The way now we're asking a lot more questions. So naturally, there's going to be more queries, right? So it's not exactly apples to apples. It was just like, um, threads was the fastest app to

• 2:23Speaker 00

  Yeah.

• 2:23Speaker 01

  Was it a million or a hundred million signups?

• 2:25Speaker 00

  Yeah, a hundred million in like a week or two weeks. But it's like, dude, no, you just piggybacked off the distribution you already had. And so, but in this case, it's like, no, the search behavior actually changed. And so it's not apples to apples. But again, like, we're not saying we don't love Chat G P T. We do. But, um, you know, Google's not exactly dead yet.

• 2:43Speaker 01

  No, Google's not dead yet. And Sundar even, let's say Chat G P T is getting a billion queries a day. All right. Google's at thirteen point seven billion a day. And that was last year. During the Google I O event, Sundar said, search has already grown like more than ten percentish or something like that because of A I?

• 2:59Speaker 00

  No, their search, their, their, uh, I don't know if we're talking about the same thing, but their coding velocity has increased ten percent. So actual productivity in their organization, it's not just like metas, like Mark Zuckerberg is like, oh, we're thirty to forty percent more code. Sundar is like, what's more productive for us? It's actually looking at engineering velocity. Uh, that's a ten percent that I remember.

• 3:17Speaker 01

  There was also, you could be right, but I thought I saw some stat that he was saying search. Oh, cool. Uh, A I O V is driving over a ten percent increase in usage for the type of query. So they're seeing a ten percent plus increase in usage on Google.

• 3:31Speaker 00

  And what do you see on, on, on X now? Oh, oh, my God, Google is stealing our traffic. Da, da, da, da, da. It's like, what are you gonna do about it?

• 3:38Speaker 01

  But let's just use rough numbers. If they're at thirteen point seven billion a day and you got a ten percent increase,

• 3:44Speaker 00

  Mm hmm.

• 3:44Speaker 01

  You're at another extra

• 3:46Speaker 00

  One point three seven.

• 3:47Speaker 01

  billion

• 3:47Speaker 00

  Yeah.

• 3:47Speaker 01

  searches a day.

• 3:48Speaker 00

  Yeah.

• 3:49Speaker 01

  Which is kind of crazy to think about.

• 3:50Speaker 00

  Yeah.

• 3:51Speaker 01

  It's just like, oh, our A I just helped us increase our search volume by roughly the amount that Chat G P T gets on a daily basis.

• 3:58Speaker 00

  This is also interesting. Uh, uh, so Patrick Stokks, this, uh, product advisor, technical S E O guy, Brad Ambassador at A trust, he wrote this post on how A I systems are breaking web analytics and hurting their future. So the premise of this post, and it's a, it's a six minute read, but his, his whole premise is, look, search Just moving from traditional search engines to AI assistants, but traffic from many of these sites isn't being tracked properly in your analytics. And it's not necessarily your fault, it's um it's their fault, right? So he was just saying, look, you know, their L L M filter in A trust web analytics noticed some common AI assistants missing from the list. They're in our filters, but we aren't seeing any data from their sites. I see C chat G P T Gemini, whatever. And it talks about the invisible traffic problem comes from these systems stripping the referral value. So I think this is a minor problem for right now, but just keep in mind that we're still very early days right now.

• 4:43Speaker 00

  Even the the CEO of AMD yesterday said we're very early innings of AI right now.

• 4:47Speaker 01

  Yeah, so just keep in mind this stuff evolves, but Google didn't become what it became like overnight. No, and I do believe that I do believe that when you look at Google and AI and everything that's happening. But with chat G P T, I think eventually they'll catch up to Google with a lot of the data and the analytics and the reporting functionality. Cause they announced that they're doing ten million dollars or ten billion in A R R. And they are trying to hit uh huh and they're trying to hit or open AI. And they're trying to hit a hundred and twenty something billion by twenty twenty nine.

• 5:17Speaker 00

  Dude, it's crazy because a couple of years ago it was like two and then three and then now it's like ten. And so it's compounding pretty quickly.

• 5:24Speaker 01

  Yeah, I don't know if it went from two to three. I think the numbers.

• 5:27Speaker 00

  I'm sorry, that number that number comes from anthropic. That's actually anthropic, two to three. That's recently.

• 5:31Speaker 01

  Yeah, but but chat G P T's numbers is growing at a rapid pace. All they got to do is release more features, ads and all this kind of stuff. And then boom, I actually think it'll grow much faster.

• 5:40Speaker 00

  Yeah, so open AI's revenue through the years, oh, here's AI overview. Oh, this is helpful AI overview. Look at that. Um twenty twenty three point five million, twenty twenty four, three point seven billion. Okay, twenty twenty five projected to reach ten billion in annual recurring revenue and eighty two percent increase. They expect to generate twelve point seven billion total revenue uh for the year. And then twenty twenty nine to year point, open A aims for one hundred twenty five billion in revenue.

• 6:04Speaker 01

  So I was talking, I was talking to a guy named Daniel George and Daniel created this startup, Sequoia backed or Sequoia Scout backed, I don't know what you want to end up calling it. It's called twinmind.ai. Here's an interesting stat for him, okay? They have a lot of users, they're growing virally, just mainly through word of mouth. It's never forget anything, it's pretty much your second brain, that's their model. So it can listen on everything that you're doing, create AI notes, to-dos, answer, answers before you've been asked during meetings, lectures, conversations, it can pretty much help you with anything they're doing in multiple languages, it's free. When you look at this company, they're leveraging OpenAI's API and Gemini and some of these other players.

• 6:48Speaker 01

  Their cost per user, I believe was roughly thirty dollars a month when they first rolled out. Now their cost per user is around three dollars.

• 6:58Speaker 00

  You're talking about it just costs a good sold really?

• 7:01Speaker 01

  Costs.

• 7:02Speaker 00

  The service of user.

• 7:03Speaker 01

  The cost for all the APIs.

• 7:04Speaker 00

  Okay, yeah.

• 7:05Speaker 01

  So it's gone down around ten X in like a year, year and a half.

• 7:08Speaker 00

  Yeah.

• 7:09Speaker 01

  What's the cost gonna be?

• 7:10Speaker 00

  That's ninety percent.

• 7:12Speaker 01

  Yeah, what's the cost gonna be in another year, two years? Because these models are getting more efficient, they're buying their own energy, nuclear power plants and the chips are getting more efficient. So it's like, what's the real cost gonna be?

• 7:25Speaker 00

  You know, every two generations, it basically goes down like a hundred X, something like that. Every two generations for these models, yeah, like what used to be really expensive two years ago is now like sense.

• 7:35Speaker 01

  Well, let's go back here, what do you mean by two generations?

• 7:38Speaker 00

  In terms of like. Like models, like it's like, so right now we have O three Pro, right? And then you had O three and then you had four one and you had four O, right? But then you had ChatGPT three, three before, right? Those, those, the cost for tokens used to be way more expensive. And to your point, they're dropping like ninety percent, ninety nine percent, right? And then you have DeepSeek come out, this ninety nine percent drop, right? From these, these tokens and so to your point, it's becoming a lot cheaper. And they, they call this, remember we talked about Jevon's paradox, the more something gets used, it actually proliferates even more. And so the costs are coming down, the, you can see a lot more queries, a lot more energy being used, a lot more compute being used.

• 8:13Speaker 01

  And to go back, when you're saying every two generations, you know, like there's four, there's four mini. Is that considered, do you consider that another generation?

• 8:21Speaker 00

  Like four, three, from going from three to four would be one generation.

• 8:26Speaker 01

  Okay, so you're not considering all the like subvariations?

• 8:29Speaker 00

  Yeah, yeah, no.

• 8:29Speaker 01

  Okay, that's still, you know, crazy thing about, I don't know when they're coming out with five. Chat GPT.

• 8:37Speaker 00

  They say they're holding off a little bit, I remember.

• 8:40Speaker 01

  Oh, mid to late twenty twenty five.

• 8:42Speaker 00

  Yeah, so they're holding off a little bit, like they're pretty close already, but Sam Altman said like they're gonna wait a little bit because it's that amazing.

• 8:48Speaker 01

  Chat GPT five is expected to be a significant upgrade, potentially surpassing the capabilities of four point five.

• 8:53Speaker 00

  Have you used O three Pro?

• 8:54Speaker 01

  I don't know which version I'm using.

• 8:55Speaker 00

  So.

• 8:56Speaker 01

  I just know I paid two hundred dollars a month.

• 8:57Speaker 00

  So you have O three Pro, so they just came out with this like two days ago, right? And what it does is, O three is a really good reasoning model, but O three Pro, here's what I did, I was like, okay. Tell me what are the highest leverage things that I can do with this model? That I cannot do with O three or any other deep research, whatever other model out there, right? And then it basically talks crap to me in the beginning, it's like, you ask very like, the things you ask me are like how to do things, right? It's like, no, here are the highest like twelve leverage, uh, highest, highest, highest leverage prompts. And uh, this must be your kids.

• 9:28Speaker 01

  No, they're yelling at your kids.

• 9:29Speaker 00

  They're calling for me. Oh, they know you're here.

• 9:31Speaker 01

  Uh huh.

• 9:32Speaker 00

  Okay, so going back to three versus four, when you're talking about, I, I thought when we're just using the interface on the website, we're just using the latest four model or whatever it has. No, so it, it by default, you're on four, right? But I keep switching it to O three Pro, I wanted to see how good this is, let me read you some of the prompts, right? So here's what it said, it's hard truth, unless you push the model beyond straightforward tell me what to do request, you will keep getting answers you could have stitched together from me, O three. Plus a few hours of Google Chat GPT and Excel. The O three Pro tier only earns its keep when you force it to synthesize large, messy, multi-domain inputs, run deep quantitative or algorithmic reasoning. And deliver personalized decision-grade output that you struggle to reproduce manually. So let me give you two prompts and then we can, we can move on, so.

• 10:14Speaker 00

  The exact question to ask, ingest these five years of single brain and care at P and L's, plus my personal spending and create a Monte Carlo forecast runway of A runway, B probability of hitting 200 million ARR by 2030 under three hiring plans. Should a top three level levers that shift the distribution greater than or equal to 10 percentage points? I dropped this in a thought for 20 minutes and then it gave me an answer. I'm gonna give you one more. So write Python that optimizes my LinkedIn ABM pricing tiers using historical close rate data and price elasticity curves. Recommend the three highest EV price points and expected churn impact. So highest EV would be expected value. And then you would ingest data here, your preload data from your like your close one loss data, your pricing and usage metrics.

• 10:59Speaker 00

  And so this stuff just getting a lot better. You're a data guy. Imagine all, so I just take all of these prompts and I just, I have them all running at the same time, thinking about these 12 things and they're all right, like thinking for 15, 20 minutes, taking all the data you have. You have, it's an even smarter strategist in your pocket now.

• 11:16Speaker 01

  Yeah, and I think it's just gonna get better and better. I'm just curious to see what five is gonna do.

• 11:21Speaker 00

  Yeah, we'll see.

• 11:22Speaker 01

  But it's already really good.

• 11:24Speaker 00

  Yeah.

• 11:24Speaker 01

  I do believe it hallucinates.

• 11:26Speaker 00

  For sure.

• 11:27Speaker 01

  And I have that in one of the topic sheets, because I was just in Calgary and I asked everyone in the audience, how many times or how many of you has to use chat GPT or any AI model and seen that just the answers are just really off? And I forgot what percentage in the room raised their hand, but it was something significant like 40 ish plus percent.

• 11:46Speaker 00

  And I think the rest are lying. I mean, it's, but it's like humans, we're wrong all the time.

• 11:49Speaker 01

  Yeah, but even the ones that are hallucinating, I asked them, you know it's hallucinating. How many of you still use it to do research, figure out what products to buy and get help? And almost all of them still raise their hand because they're like, we know it hallucinates. You double check it. The value it provides outweighs the times it hallucinates.

• 12:06Speaker 00

  Right. And the only things, the only two things that are certain in life are death and taxes. So, you know, nothing else is certain. Even if you have a genius computer, who cares? Like, it's just never that 100% right. That is true. Death and taxes are certain, but depending on where you live, because some countries have no taxes. Yeah, but they'll find a way to tax you some way, shape or form. Something else in your life will tax you.

• 12:26Speaker 01

  Inflation will tax you. Something else in your personal life might tax you. You never know. You're always taxed in some way, shape or form.

• 12:32Speaker 00

  Did you see the inflation numbers that came out?

• 12:35Speaker 01

  No, no, what was it? What was it?

• 12:36Speaker 00

  Was it down?

• 12:37Speaker 01

  It was down. Yeah, less than expected.

• 12:38Speaker 00

  But but see now, now the narrative is like, oh, well, wait till the terrorists kick in and wait until this and that.

• 12:43Speaker 01

  Dude, that is what they actually said. They're like, well, we feel that the terrorists will kick in in the next few months and then go from there.

• 12:49Speaker 00

  I don't know. The world's unstable, man. It's like, so my, our mutual friends, Syed and Yanniv came in yesterday. Once they left, I'm like, oh, we got, so, so, country got attacked, right? I'm like, what is going on? So, yeah, anyway, not a politics show.

• 13:02Speaker 01

  No, not a politics show.

• 13:04Speaker 00

  Frictionless Growth Marketing hosted by Sonya Thompson is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Frictionless Growth Marketing hosted by Sonya Thompson shows how modern brands grow by removing the friction in their marketing and customer experience that pushes customers away every single day, often without leaders even realizing it. Each episode delivers practical insights, real brand examples, and conversations with marketing leaders, showing brands how to win with the new rules of growth, identity-driven marketing, cultural relevance, and frictionless customer experiences. Listen to Frictionless Growth Marketing wherever you get your podcasts. Here's another one that's really interesting to me. So we, I guess I'll experience share here. So you weren't here the other day,

• 13:44Speaker 00

  but I was gonna have you come to this, this founder's dinner where we went to eat hot pot at Haidilao. And with Syed, yeah, Syed was there. And then we had some other founders and we were just talking about AI. So one guy brought his head of AI. I brought my CTO. And the same thing, I don't know if this thread's happening with you right now. It's like, we don't really, I don't think anybody takes any joy in having to cut people. But we are looking for Ways to spread AI throughout our organization. So obviously, you, the founders will trumpet it from the top, but that's not enough, right? You have to look for people who are willing. And if you're willing, like I will teach you, right? But you're gonna have people in your org, like especially when you have, you know, thousands of people, you're gonna have people who are unwilling and resistant, right? And that's, that's the problem.

• 14:27Speaker 00

  And so our whole thing is, and Syed was actually the one that brought this up. It's like you wanna find, you wanna get people to the aha moment. Where like you start using chat G P or cursor, you realize you're all of a sudden you're ten to fifteen times faster. You just need to get people to that point and then, then they can activate on their own, right? But I think the problem is like, you know, the, the, the people that are kind of fighting against this. It's like, dude, it's like, it's the equivalent of saying like, oh, don't, don't use power tools to build a home. It doesn't make any sense, right? But I guess my question for you is like, how are you guys spreading AI fluency throughout your organization? Or are you even thinking about it?

• 15:01Speaker 01

  We don't think about it from that way of spreading AI fluency. We have a mandate, we tell people to use AI whenever it makes sense. It's a little tricky because quite a few of our enterprise customers don't allow us to use AI. So just some of them, we're not allowed to even use it contractually. And we, if we wanna use it, we gotta let them know what tools, get authorization, even if their data is not shared. And then there's also liability issues that we have to worry about on our end. If we use it, even if it is allowed by them with their notification. But we have quite a few contracts that are just saying you cannot use it.

• 15:42Speaker 01

  So on our end, the way we think about AI internally is if you can do things more efficient, by all means, use it when you're, we're legally allowed to use it. I know that sounds really crazy to think that way. But at size and scale, you also start to think about wealth preservation versus wealth generation. Because for us, it's more important to keep what we have. Yes, I wanna grow, but we first optimize for keeping what we have and not losing it. The way we really think about things is we have a team that's dedicated on disruption. And their goal is to just disrupt every single department through AI or any other forms of technology or efficiency or processes.

• 16:25Speaker 01

  And we found it, it's easier to have a team that focuses on disruption than it is to get every single department to try to disrupt themselves. That's just what we found internally. So, you know, that central team has been doing some really cool work. And then when they find some huge wins, we roll it wherever we can out legally.

• 16:45Speaker 00

  So, well, this is interesting. So, Yenive and I were talking yesterday and then we reached a friend of ours and they, they do well as a company. And he was just saying, you know what, like, I'm just hiring a lot of people who are 17, 18, 19 years old, right? And these people are very motivated, they're coming out of college, right? And some of these people sometimes they'll ask, they're so motivated with, because they're just trained on this stuff, they don't know any other world where there is no AI, right? And they're just like, hey, can I sleep on the couch? Like, they go to office and can I sleep? I'm like, dude, that's amazing, right? And, and so they're fully bought into this and they're kind of driving this world forward. And he's, in his mind, it's like, and in my mind too, I'm like, a lot of people I talked to from UCLA over here, like, I'd like to recruit more.

• 17:28Speaker 00

  And so, because again, they, they come equipped with this. And so, again, I have no issue, and what we talked about at dinner is like, we have no issue teaching people who are willing is the issue where if the people who are unwilling, that means they, they don't align with, they don't necessarily align with maybe the future of where we're going. And that's going to become more and more of a thing. And so, I think my opinion is the founder has to keep trumpeting it from the top, but you need champions within the organization and people who will identify other people and kind of spread this positive virus throughout the organization.

• 17:59Speaker 01

  Yeah. Yeah. If you don't have a culture where people want to embrace it, I think it's going to be hard. There was a guy that we hired a long time ago, he didn't end up working out. He worked for one of the largest ad agencies out there, publicly traded, massive, call it 100 plus thousand employees. And his job, this is before all the LLM stuff that was really coming out, his job was to automate as many departments as possible and reduce headcount. So when he would go to the departments and try to help them automate and reduce headcount. No one wanted to help him out because it was just gonna cause

• 18:31Speaker 00

  This guy's gonna cause chaos.

• 18:33Speaker 01

  Yeah. So you gotta really have a culture that wants to improve and they wanna embrace this stuff, or I just think it's really hard to get things implemented. Like, we have a culture and a lot of people do wanna embrace their technology. We're just restricted in a lot of ways legally, or legally is probably the wrong word, contractually with many of our clients not allowing us to use uh this new modern technology.

• 18:54Speaker 00

  It's not even just that. I mean, you also have to make sure that from a security standpoint, things like we're talking like actual security in your company too. Like, it it you can't, it's not like if you're starting a company, you can kinda do whatever you want instantly. It's not like that. Uh, and that's what we were talking about yesterday too. It it was coming from a preservation angle, but how do you, how do you push, how do you push this on people who are willing? Again, so I, and I, I think, by the way, if, if you're listening to this and you work for a company, you know, you're hearing about all these companies, uh, okay, this company cut three hundred people over here. This company saved eight million in payroll. Google is paying people to leave. Microsoft just cut six thousand people, right? And so I think you don't, don't worry about AI slashing headcount. It's more so if you can adopt a willing mindset, and once you hit that aha moment where you, you, you've become ten X or a hundred X faster,

• 19:38Speaker 00

  that's all you really need to do. You just need to flip that mindset and you'll be okay.

• 19:42Speaker 01

  Yep.

• 19:42Speaker 00

  Yeah. So, but yeah, it's kinda great. Like, what was the deal with Google? What, what, what will they pay you? Do you know the terms?

• 19:49Speaker 01

  No, but I saw Google recently made a buyout offer for employees.

• 19:52Speaker 00

  Yeah.

• 19:53Speaker 01

  Google buyout. Uh, let's see, Google offers buyout for employees in search across, or to employees across the company, including search. Let's see, the bios are part of companies' effort to reduce headcount, which Google has continued to do in waves since laying off twelve thousand employees in twenty twenty-three. If, uh, some teams are mandating office, uh, returns for remote workers who live within fifty miles of an office, which is a lot of traffic, depending if it's in Northern California or where it's at.

• 20:20Speaker 00

  Or LA, LA's pretty far. Yeah, fifty miles is like two hours in LA.

• 20:24Speaker 01

  Yeah, but it's their way of saying come to the office or quit.

• 20:26Speaker 00

  Or else, yeah.

• 20:27Speaker 01

  Yeah.

• 20:27Speaker 00

  Yeah.

• 20:29Speaker 01

  Yeah, they, they're not, it's not sharing how much they're offering, but I bet you it's really nice.

• 20:34Speaker 00

  Yeah.

• 20:34Speaker 01

  From a severance standpoint, they can afford it.

• 20:37Speaker 00

  Yeah.

• 20:38Speaker 01

  And it makes sense. You just start buying off people, saying like, alright, you can leave.

• 20:41Speaker 00

  Well, that's it for today, guys. Please don't forget to rate, review, subscribe, and we'll see you tomorrow.