Project Magi: Google's Making Big Changes to Search

0:00Welcome to Marketing School, the only podcast that provides daily top-level marketing tips and strategies from entrepreneurs that practice what they preach and live what they teach. Let's start leveling up your marketing knowledge with your instructors, Neil Patel and Eric Su. All right, so we are going to talk about Project Magi, Google's making big changes to search. So I pronounce it Magi just because I played a lot of games and usually they're called Magi, but you can call it Magi if you want. But Neil, you go first. So New York Times released an article on how Google is getting worried. there's some rumors going around about Samsung potentially making Bing its potential default search engine, which would cost Google billions of dollars.

0:48I believe the New York Times said it would be around$3 billion. If the similar things also happened with Apple, it would cost them even more money. So Google's getting nervous, of course, because everyone's talking about AI and chat GPT and how Microsoft's integrating it. And when Google released Bard, it didn't have the best reviews out there and their stock price went down and they lost billions of dollars in market cap. So Google in essence is planning a new type of search engine. But in the short run, they have this Project Maggi or Maggie or however you want to end up pronouncing it. Project Maggi has around 160 engineers that are focused on it.

1:26And what they're doing is trying to make Google search more conversational. So for example, if Eric has questions on something, it would learn on the fly as well as learn from past experiences and modify the messaging and the results that it's showing Eric. And think of it like a chat GPT type of interface, but also being able to do transactions. So if Eric's looking for new running shoes over time, it will learn the size of the shoe that Eric wears. If he has narrow feet or wide feet, as well as allow him, and this is the big one, to do a transaction right there on Google without going to a website.

2:08So they're planning on releasing some of this stuff hopefully in the next few months. And when you think about this, this is going to have huge implications for both paid ads and SEO. Yep. So this is not just huge implications on the marketing side. It's huge implications across the board. So Neil and I were on the phone yesterday. We talked about 40 minutes or so. And we were kind of talking about the implications behind how this is going to affect jobs for the long-term. And actually, Jason Calacanis, one of the hosts of the All In podcast, he actually wrote a thread yesterday that did really well, basically saying that people don't realize this, but most jobs are going to be nuked.

2:47At least a third of jobs will be nuked, if not more. And the rate of innovation that's happening in AI right now, it went from, I don't know if you saw this, Neil, but the actual rate of investment of VC dollars going into AI in 2022 dropped a lot because, well, we weren't really sure what was happening in the back end. And then this chat GPT thing comes out last year. You know, people were talking about stable diffusion mid journey. But I really think the inflection point was chat GPT. And now everyone's looking at mid journey, stable diffusion. They're looking at runway ML, these text to video text to image editors.

3:20And we're seeing a lot faster innovation. And in the next episode, we're going to talk about how chat GPT is evolving quite a bit where this whole concept of prompt engineering that was starting to become a thing in the last one or two months is might not even be a thing anymore. Right. And so I think we're just going to see the rate of innovation increase because Google is not going to want to give up their market share. And then you have Satya from the CEO, Satya Nadella from Microsoft, the CEO. He's like, we're so excited to take market share because each percent is two billion dollars. I believe that's what it was.

3:52Right, Neil? I don't know the exact dollar amount, but it's massive. And a lot of SEOs are worried that, hey, this is going to take away traffic from a website. Well, if you look at what Google's done in the past with like weather, it used to be when you wanted to search what was the weather in Los Angeles, California or Las Vegas, Nevada, you would go to weather.com or Google will send you to a website. Now they end up showing you the weather and they made that change a long time ago. And there was many more changes with things like the knowledge graph that ended up changing how SEO was done.

4:24And people are like, oh, Google's just taking traffic away. But these things create a better experience and cause more people to use Google as well in the long run. And according to Danny Sullivan, who works at Google, Google has continually driven more traffic to websites each and every single year from an organic perspective. So I would see all these AI changes. I do believe it's going to reduce traffic going to websites, but I also do think it's going to cause more people to use Google, which can help counteract that. And this won't work for every single query out there. In addition to that, this is also going to change paid advertising.

5:01And from a paid advertising standpoint, instead of a cost per click model, just imagine doing a CPA model, which is already similar to how it is right now. You're bidding per click, but you're backending it out to what's your cost per acquisition. And if you're just paying Google for that cost, it doesn't matter if someone goes to your website or not, all you care about is are you generating the sale and is it profitable? Whether they come to your website or not, as long as you can keep generating more sales, you should be happy because that means more revenue from you. And from an SEO standpoint, it'll change again from an SEO perspective.

5:36Maybe you're not optimizing as much to clicks to your website, but maybe you're optimizing for Google showcasing your product or service when someone's using their prompt to converse with to figure out what product or service to buy. So a couple of key takeaways here, Dan, I'm going to pull up the thread and we can work towards wrapping. But the bottom line is search in itself is going to change quite a bit, I believe, in the next five years maximum. It's going to be completely reimagined. And so I think you have this honeymoon period or not even honeymoon period. You have this period of time in the next year or two where you can really crank up what you're doing from what we've all known to be traditional SEO, wrap it up there.

6:14you have strong domain authority, ramp up the content, use the AIs to help you create more content that's high quality, and you can reap the rewards a little bit. But that's going to change very quickly. So you have to kind of balance when you're going to come off that ship and jump onto the new ship, the new kind of paradigm when it comes to search, because we believe it's going to shift. That's one piece of it. The second piece has not changed from what we've said about AI before. Those of you that have the data modes, those of you that have the data already, the proprietary data, you're going to have an advantage over others.

6:42So for example, let's say I took Neil's Uber suggests as an example, or his answer to public, I could then take that data and make really interesting content around that. And then I can sell that data to other people, or I can use that data for other purposes. Now there's a lot more that he can do with that, right? And so if you have that leg up, then, you know, go by all means, mine it. And now I want to share the Jason Calacanis post over here. And I'm going to read it to you that those of you that cannot see this on YouTube. And so JCal says, AI is going to nuke the bottom third of performers in jobs done on computers, even creative ones in the next 24 months.

7:17White collar salaries are going to plummet to the average of the global workforce and the speed at which the top performers can write prompts. And so I'm not showing you this to be alarmist. I'm showing you this to say, hey, this is where the world is going and this is what the possibilities look like. And just like with the industrial age, when a lot of people stopped farming and they moved into different non-farming jobs, we gain a lot more productivity. And I think that's what's going to happen here. so he also goes on to say if you're low to average at your job you need to get on these tools immediately learn how to augment yourself and invest massively in your ability to add new skills constantly companies are going to get dramatically smaller and more profitable like facebook twitter and others have demonstrated and then the top performers are already leveraging these tools to increase the distance between themselves and low performance it's getting polarizing 40 and 50 year olds who have been co-vetted performers their whole careers who ignored these tools are going to be retired from the workforce this isn't about phone operators farmers or dishwashers is about knowledge workers.

8:10Your knowledge has been commoditized. Your ability to be nimble and learn new skills is all that matters. So I'll stop it right there. Neil, any thoughts on that before we wrap it? No, pretty much spot on with it. Yeah. I mean, here's where I'll leave. I mean, this is getting a little, I'm digressing a little bit here, but bottom line is search is going to change. Marketing, as you know, it's going to change. The world, as you know, it is going to change. And so you have to adapt or die. And those of you that don't feel like adapting, well, I think that's probably a very small percentage because those that are listening are trying to learn.

8:39So that is it for today. Please don't forget to rate, resubscribe, hit us on YouTube as well, and we will catch you later. We appreciate you joining us for this session of Marketing School. Be sure to rate, review, and subscribe to the show and visit marketingschool.io for more resources based on today's topic, as well as access to more episodes that will help you find true marketing success. That's marketingschool.io. Until next time, class dismissed.

9:13We'll see you next time.