How ChatGPT's Search Algorithm Works, Is ChatGPT the New Distribution?, AI Recruiters vs. Humans, Does Traffic Even Matter Anymore?

0:00Why don't we move over to how to rank highly, how ChatGPTD search algorithm works. Do you want to know how ChatGPT's algorithm works? I kind of already know, but yes, let's talk about that. But before we go into that, I started integrating ads into my YouTube based on your feedback. How's that going? Remember, we were talking about our podcast a few weeks ago or a month ago, and you're just like, dude, we get a lot of leads for single grain and carrot by me just mentioning, you know, in the middle of the recording, hey, if you want us to do this for you or you want us to do X, Y, and Z, just go to single grain.

0:33So we started doing it. I have no data yet from it because only one video. I believe the perplexity one has it. That one's doing well. Yeah, it's doing well. And then the next one that comes out next week has it, of course, as well, because all of them have it now. But by the time we record next week, I should have more data free. Yeah, I guarantee it will be a good outcome. And plus, even if it's a small lift, it doesn't matter because you're making the content anyway. Yeah, it's free. Small lift is better than no lift. Yeah, yeah. I'm curious to see what the data looks like. Okay, so guys, I want to talk about how ChatGPT's ranking model works.

1:08And then this, I'm going to share a screen here. So Chris Long shared this. He's actually a pretty good curator. So how ChatGPT's re-ranking model works. And so I think what's worth calling out here is it says, at the heart of ChatGPT's retrieval system is a re-ranking model with the cryptic name RETRR SkySight. And it's a sophisticated post-processing layer that takes initial search results and completely reorders them based on quality signals. So number one quality signal here is freshness is king. So perhaps the most significant finding for content creators is this setting. Use freshness scoring profile equals true.

1:42And so there's a bunch of other findings, but we've kind of been talking about this where I think AirOps cited that 95 % of chat GPT results have been refreshed in the last 12 months or so. It's still kind of traditional SEO, right? And then this guy shared it over here. So you can see this. Use freshness scoring profile is true. And then he cites some other stuff. And then you have all this other stuff here down here. Configuration reveals a sophisticated filtering pipeline with multiple checkpoints, enable query intent, source filtering. But I think probably the thing that's worth calling out, I'm not going to go through all this other stuff, is the freshness piece.

2:16What's your take? Yeah, the freshness piece, we've seen it as well. Freshness is very important, and people miss that with chat GPT and even Google. We're seeing freshness be a super important metric. But the problem that we're seeing with freshness is marketers are looking at it as, oh, let me just change one sentence and update the timestamp and I'm good to go. That's not what they consider fresh. What they consider fresh is you updating it and making it valuable to what a consumer would ideally want to see in today's world. But on the flip side, if you have a piece of content that's performing well and you want to update it two months later to keep it fresh, we're just going to change a sentence because there's nothing really that you need changed and it's already good to go and as up to date as it can be.

3:04You don't need to update it for the sake of it just to change the timestamp. Yep. So speaking of ChatGPT, by the way, remember Brian Belfort from Reforge? So he did a podcast on Lenny's podcast. I was listening to it when I was at the gym last week. But the question is, is the new distribution channel ChatGPT? And before we even answer that question, when you think about Facebook back in the day, organic, anything you posted on Facebook would get a lot of views, right? And then eventually you'd have to pay for it. LinkedIn, now it's kind of trending in that direction. Strong organic reach is kind of moving into paid, right?

3:37So you always get really strong organic distribution in the beginning, and eventually you have to pay for it. And I remember talking to an executive at Microsoft, and he even said that, hey, we're actually considering being able to pay for some results inside of like an LLM, right? Now, for the moment with ChatGPT, sure, with all searches, Google is still 42 % and ChatGPT or LLM, I think is only like 0.19%, but it's growing quickly. The question is, is the new distribution channel ChatGPT? and I would argue that I think it's a strong new distribution channel for people to consider and there probably is good organic reach to think about right now but eventually you're going to have to it's going to become more pay to play and same thing with Snap in the very beginning or when stories launch on Instagram they tend to favor these new features and so I think that it's definitely worth paying attention to and eventually it's going to kind of whittle down but it's in the early stages of growing really quickly It's still small, but it's growing quickly.

4:36Go ahead, Neil. Yeah. I'm just curious to see what will happen over time. But yeah. And then I think everything, just like you and I have seen, it all becomes pay-for-play models. These guys all try to push you because it monetizes that way. It's just like Google AI mode. They're just pushing, you know, their whole goal is to push ads through it. It's launched recently in 180 countries. but all anything that's good in marketing if it keeps or anything that's good from an engagement usage perspective all these platforms will eventually figure out how to push you towards a model where it monetizes and it does really well for them it doesn't mean organic's dead it just means you gotta pay to play yeah organic eventually becomes paid that's just not it yeah because even SEO you know so many people hit us up and be like yeah I wanna do SEO because I'm not paying for it it's free and it's in my best benefit to be like, yeah, it's free, but I don't want to lie to people.

5:32And I'm like, technically, yes, from a perspective of not paying Google per click, but you are paying people, whether it's in-house or an agency to help you get rankings and not going to lie, you got to maintain it and keep doing more or else people outrank you. And that does cost money. So even though you're not paying the platform directly, you are spending money on it. Anything good has a price. Okay. So by the way, remember we talked about the 8 ,000 bots versus 8 ,000 people versus one chatbot. So there's a study here on how AI recruiters crush human recruiters. And this is from an AI researcher, I believe.

6:10And so AI and HR, in an experiment with 70 ,000 applicants in the Philippines, an LLM voice recruiter, so this is the AI recruiter, beat humans in hiring customer service reps with 12 % more offers and 18 % more starts. Also better matches. So 17 % higher one month retention, less gender discrimination and equal satisfaction. And then it says down here, the break-even point, including all software and inference costs was 8 ,500 interviews. And you can see over here, we're looking at the graph right now, the AI interviewer in the blue bar graph versus the human one in the gold, let's call it that.

6:48Fraction receiving job offer, it was higher for the AI interviewer. And then fraction started job, higher for the AI interviewer. and then fraction meeting one month retention rate higher for the AI interviewer. And look, this part is the most interesting to me. So when offered the choice, 78 % of applicants chose the AI recruiter. And we find evidence that applicants with lower test scores are more likely to choose AI. What do you think about that, William? Yeah. Yeah? That's right. Do you prefer the AI or the human? Human. No, you're supposed to prefer the AI. Why? That's okay. William has a heart.

7:30Yeah, Bugatti. Daddy's working right now to try to get you the Bugatti. Bugatti. I need 10 more years. Can Daddy finish this? You can finish seven cars. Okay. That's how I get to work. He says I can work for a Bugatti. Yeah, Neil's working hard for a Bugatti. There's always a purpose, guys. That's right. Yeah. What's your take on this? Because remember, we did the one on the HR bot, the 8 ,000 people versus one HR bot. And in this case, AI recruiter. And 78 % of people, the applicants, prefer the AI recruiter. You're talking about the IBM story, right? Yeah, yeah, yeah. In the past. That did really well on your Instagram, by the way.

8:07It did. It's funny how that works. I'm with you on this. I think AI can do a lot of this stuff better than humans. I think in some cases, AI is better and in some cases, humans. But in this case, yeah, I see the value in it. Although on your HR one with IBM, people started leaving comments about the long-term effects and how the company's not looking at that and they're being more short-sighted. I'm not saying that's true. People are always going to say stuff like that. So I don't know. Yeah. Yeah, I take it with a grain of salt. Yeah. All right. So that's that. We got one more to do, and then we'll be on our way.

8:47So let's see. Oh, here's one. You know, I know we're talking about the profound traffic increase or decrease. And I know people have had similar issues for Google over time and whether there's increases or decreases. Everyone's talking about their traffic increases or decreases, but I don't know about you. Very few people start correlating it with their revenue going up or down. Like you see all these posts online. Oh, look at my Google traffic. Look at my chat GBD traffic. I don't even look at my traffic anymore. Do you? No, technically my team does, so I don't have to. and I get a weekly report.

9:19But it's all correlated on our end. Our data analytics team correlates it to revenue. Because I'm just like, who cares if your traffic went up double, but you didn't make any more money? And who cares if it went down half and you didn't lose any more money? I care on what traffic and what visibility is actually causing revenue to go up. And I want more of that. And if it starts going down, I want to fix it. But I'm not talking about the traffic part. I'm talking about the revenue part. And I think marketers got it all wrong. for some reason, none of them really focus on revenue. They all want to look at traffic and that's cool.

9:52But if traffic in most cases, and you and I know this when it comes to content, it's not a one-to-one going up doesn't mean you're going to make more money and going down doesn't mean you're going to lose money. If you've ever built a website, you know how tough it can be to keep a strong design while ensuring site performance is fast. That's where Framer comes in and it totally changes the game. Framer is the design first no code website builder that lets anyone ship a production-ready site in minutes. I recently built a custom landing page in just a few hours. Animations, fast load times, responsive layouts, all without writing a single line of code.

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12:03Go to shopify.com slash marketing school, Shopify.com slash marketing school. Do you want to know what is super irritating to me that's kind of like somewhat related to this is because I've been spending a lot more time on recruiting. So when people make it over to me and I'll talk to them, I'll just, one of the questions I ask is, what are two of the hardest problems that you've solved? Please share numbers, right? And I don't know why, maybe this is an agency world thing, but it's always like, oh, Neil, I increased the traffic by 400 % or I increased this by 200%. I increased revenue. Even if you increase revenue by 100 % or whatever, but on what?

12:40Like on$1? So is it$2 now? Like, I don't know what it is. I get so bad. Oh, I created 364 % growth. Okay, what was your baseline? Oh, we were doing$10 ,000 a month in MR. All right, that's not much of a growth for me. I'll tell you what, guys. You're listening to this right now. The hiring bar is going to continue to hire. If you're a founder, you have to continue to raise the bar more and more. And so when you're asking these people these questions, they have to report on a baseline and they have to have some type of numerical fluency. And we're constantly talking about traffic and how much percent they increase things by.

13:12You cannot afford to hire these people because they are not putting enough time to invest in themselves. And another question we asked Neil is, hey, Neil, how much are you investing out of pocket in AI right now? Even if someone tells me$20 a month for ChatGP Pro, amazing, right? But if you say$0 a month, we cannot hire you, right? Some people, by the way, remember I told you, some people in Brazil,$500 a month is a lot of money in Brazil, right? They're spending$500 a month out of pocket, their money on AI stuff, right? And that's how serious they are because they're looking to enhance themselves and just do better.

13:43Dude, I'm with you. But yeah, you and I have the same pet peeve when it comes to interviewing and talking to candidates. And I don't care where you are, whether it's Brazil or India, if you're not investing to improve yourself, then why would you try to improve the business that you get hired by? You probably won't care. You know, you can't have two types of cultures in your company. Someone's either AI forwarded or not. So if you hire a set of people and they're kind of anchors and they're not for it, and you have one group that are, they're going to fight each other the whole time. And then you're not going to be able to move in the right direction.

14:16Whereas if everyone's pointing in one direction, you're going to move in that direction, right? I was listening to Brian Armstrong from Coinbase. I think he was talking on the Stripe podcast. So that's actually a pretty good podcast, Cheeky Pint. So you had the Stripe founders interviewing the Coinbase founder, right? And he's like, dude, he was like, yeah, we were very serious. We said, if you're not into AI and we don't see our usage, we're going to fire you, right? And there's a group of people that didn't use it. So I think he had them come in on like a Friday or Saturday or something like that.

14:44And some people had legit excuses. Like some people were coming out from a vacation, but then he fired the rest. And so he was just saying that that was very heavy handed. But he's like, that's what's required. And keep in mind, Brian Armstrong back in 2020, he had the guts to say, hey, guys, we have one mission and we're focused on doing we're focused on pushing crypto forward. Like whatever politics you have, whatever you have on the outside, it's already hard enough to have one mission. We cannot afford to have this other stuff. And everyone was pushing back against. It's like, oh, my God, we're going to lose like half the company.

15:12Five percent of people quit. Right. So I think sometimes it's better. The stocks, you know, done well over the years. I know right now it's down a little bit compared to what it was a month ago. But who cares? Overall, it's growing in the right or going in the right direction. Yeah, but I think where we're landing the plane here is you have to have the guts to make a call when it's unpopular. And Brian Armstrong was okay doing it. Because it's funny, you had Google make a call like maybe a year ago. So it's saying we're not a political company. But that's already like years and years after Brian Armstrong did that, right?

15:39And it's years and years after Google has had videos where they laugh about political stuff and the videos get leaked. But think about it. How hard is it to already have one mission? But to fight on all sides, it means like people are getting distracted. And maybe don't have enough to work on or whatever. But if you're running a company or if you're a leader, that's what you got to focus on. Right, William? Yeah. That's right. That's right. You know, Uncle Eric's the one who gives you those cookies? The last time you ate cookies, it was from Uncle Eric. What do you say to him? Thank you. You're welcome, William.

16:10I got more cookies coming for you. But Neil will decide. Your father will decide how many you get. So it depends on how good you are. And Emma, two. All right. Two. Hey, I don't control. He's saying Emma, two. Emma too. Yeah, of course. Oh yeah, Emma too. Thank you. Talk to you later, William. Take care, everyone. We're done. Bye.