Yext CEO Reveals How To See Your True AI Ranking

0:00Every marketer I know is saying, I'm seeing less traffic from Google. Why? And the answer to that is pretty simple. 12 months ago, if we asked ChatGPT, where's the best place to get a double cheeseburger near me? It was going to tell you, look, I don't know. Ask Google. Now you're starting to see that they're delivering their own map views. They're delivering their own citation built answers to these questions. And they're making it easier to unpack. Why did I show up as the answer? Because they're publishing the citations below. Tell the audience a bit about Yext. What do you all do? What are you building?

0:29You give me any business that you want anywhere in the United States of America. and I will analyze that business. Let's do anthropology. All right. Wow. We have countless AI agents who are now at this moment virtually going to the location of the store, asking Google, Chachi BT, and other AI about the brand. And also they're asking unbranded questions about women's clothing in general. And just like that, we actually have a report. Anthropology here, not ranking particularly well on Google, ranking quite a bit better actually in AI. This business is doing well in terms of overall review count.

1:07This stands out. We tend to say, we need more reviews. I can tell you virtually certainty for this location. The last thing you need are more reviews. Look at their review count relative to the review count of their competition. It may be that the best tactic here when it comes to reputation is not get more reviews, but just get better reviews. Is there anything else people should be thinking of when it comes to structuring everything they put out there?

1:33Hey, everyone. Welcome back to Marketing Trends. This is your host, Stephanie Postles. And today I am thrilled to be welcoming Michael Walroth to the show. He's a CEO of a company named Yext. And I'm very excited for this conversation. Mike, welcome. Hi, Stephanie. Thanks for having me. So I want to actually start with like a timeline, a lay the land. This is a unique conversation because you used to work at Yahoo. I used to work at Google. And now you're building a company for the future of marketing, being found, digital presence, which you will explain all of that later. But I would love for you to highlight this timeline of where were we, what happened in the Google magical era and where are we now?

2:14Yeah, that's like you're just immediately poking into the wound, right? Like, you know, thank you for pointing out that like you got the fun part being at Google, they're taking over the world and dominating and like, who are they beating up on, but Yahoo, where I had, you know, I had sold Right Media, which was the sort of digital ad exchange pioneer to them, thinking I would go there and work on stuff like that, which I did. But they also asked me to take on kind of running the search marketplace pretty quickly once I got there in late 2007. And that was really quite the assignment because Google was just killing us.

2:52But it was a really interesting situation because we were, I think Yahoo was 6 billion in revenue at that time and like a billion and a half of it was search. And we had three or four ads on every search results page and Google had like one or none and was just completely crushing. I think financially because they had better algorithms, they had better organic search, they had better paid search. But also just from consumer experience standpoint, it was like Google was magic and Yahoo felt like a company that was trying to catch up with a company that was way ahead. You know, without disrespect, because I think what Google did was just so, you know, it was such a leap forward that it felt like there was this sort of very real dilemma inside the company.

3:35Do we monetize this thing at the expense of the consumer experience? Or do we attempt to deliver a consumer experience that's closer to what Google was delivering, knowing that it's going to cost the company hundreds of millions or billions of dollars? And that's kind of the world we lived in every day. The company ultimately decided, I think, correctly to harvest the cash out of the business because they really weren't going to catch up to Google. Okay. So fast forward to now the era we're in. Now I'm the one who's being wounded looking because I obviously am a little biased. I did love Google, but I look at them now.

4:09And I mean, a while ago, I sold many of my shares in the company because I was like, uh-oh, they're in trouble. So what do you see happening now? Yeah. So first of all, I always start with this. I don't think Google's in trouble. I think their search business is challenged. So when I look at that and people always say, oh, so I should short it. And I think the answer is absolutely not. From my point of view, Google has an amazing amount of things going on. It's got YouTube, it's got Waymo, it's got a$200 billion search business. But I do think when you get under the covers a little bit that they're in a comparable position to the position that Yahoo was in and other search kind of first generation search experiences were in, in that, you know, kind of 2005 to 2015 timeframe, which was someone else is delivering a more magical consumer experience.

4:58And the cost of going there broadly is too high. Yes, it's a complicated time period. I know when I was on Google the other day, it was the first time I kind of had the ick where I was like, ah, so many links. It's trying to do so many things. I think it's trying to do AI, but I actually don't really trust this overview it's giving. What are the incentives behind it versus let me just get back over to chat GPT for many of my searches. Maybe if I'm trying to find local things, Google still best because they've got maps and a whole geo department and they've gotten good at that. But when it comes to almost everything else, it just feels like I feel like I slightly understand the game that it's just good information being presented to me on these LLM search results and not just depending on who's paying for it.

5:40That's how it feels at least. I think that's right. And I think a year ago, OpenAI and others weren't even trying to deliver the local information. So 12 months ago, if we asked ChatGPT, where's the best place to get a double cheeseburger near me? It was going to tell you, look, I don't know, ask Google. They have a huge index of local information, go ask them. Now you're starting to see that they're delivering their own map views. They're delivering their own kind of citation built answers to these questions. And they're actually disclosing whether they're doing it on purpose or not. They're making it easier to unpack, like, why did I show up as the answer to this question in this AI?

6:20Because they're publishing the citations below. So we've sort of always inferred that, like, you know, the first 10 or 15 or 20 links of the organic search results on any kind of localized query are the citations that Google is using to confirm that the answers that they're giving are the right ones. Language models are cool because you can actually just ask it. Why did you choose this place? And it'll tell you, well, we referenced these reviews and we referenced this website, which is the website or it's TripAdvisor or Yelp and things like that. And so it'll actually show you, it'll kind of give you a pretty good mosaic of like how it's determining what the answer to the question is, which is pretty neat.

6:59So before I start digging into how you all are thinking about being found and how you would advise marketers to think about this, I actually want you to tell the audience a bit about Yext. What do you all do? What are you building? Yeah. So the history of Yext is really interesting. So Howard Lerman, Brian Distelberger founded the company 2007. I met those guys shortly thereafter. It was a pay-per-call marketing engine. So it was nothing like what we do today. It was super clever. They were driving traffic to local phone numbers that were effectively routed through their servers so that they could transcript phone calls.

7:34And they were selling things like leads to auto body shops where they would say, look, you know, an oil change lead is worth$10. But if someone calls up and they need a transmission rebuild, then you're going to pay $200 for that. So they're like basically pulling the context out of the transcript and charging on a super cool, clever, really neat, like kind of early sort of voice transcription stuff, but it wasn't a business that scaled. And so that's the business I invested in in 2008. And then around 2010, we pivoted the company aggressively towards this idea of syndicating local information.

8:09And that was driven based on the fragmentation of the consumer experience using the mobile device. So in effect, after the iPhone and ultimately Android started to gain traction, every application on every one of those devices became like a geo aware directory. And so you no longer had to say, even though I learned how to speak search, best burger near me, 11954, you didn't have to do that anymore because the device was in your hand and the device knew where you were. That really launched the company because it was the first fragmentation of the consumer search experience that we had seen in a long time.

8:46Google had been consolidating share on the traditional search experience and all of a sudden apps became the way we found stuff increasingly. And so the company developed a really smart way to structure data and then deliver that data out to hundreds of different endpoints to make sure that you had total sort of data fidelity and consistency in the world about your business. And that included everything from like name, address, phone number, menu items, hundreds of other attributes that you wanted to make sure as a marketer were visible, consistently visible across the world. Do you do anything for companies who aren't as local focused?

9:23I'm just imagining my audience being like, well, I don't care. I don't have a restaurant. So does this matter for me? So I think that's what comes next, right? So historically, the company has worked with anybody who has a localized footprint. So that includes, it started with retail and hospitality. Those were our biggest verticals that caused a lot of problems during the COVID period. We have a lot of customers in financial services, wealth advisory, retail banking, commercial banking things like that because those are you know kind of very localized businesses health care providers dentists doctors you know all those things they need to be found it's it's a very localized market and then now there's a lot of you know you have a lot of service area business type things as well so what we found is that businesses in a funny way with you know sort of the global internet business has become even more localized because you want to work with people who are local you want to work with businesses that are local where i think this goes next, and this is really, you know, we're skipping a big chunk of the story here, but eventually what's going to happen is brands are really going to want to understand their visibility and brand sentiment at hyper-local levels, even if they're not location-based businesses.

10:33So Delta Airlines should want to understand how is my brand being perceived at the zip code level in order to identify how do I deploy marketing in a way that drives more ROI. So in areas where, you know, presumably around, you know, Atlanta, Georgia, where Delta is sort of, you know, headquartered and is the, let's say, you know, they're big hubs, they may not need as much marketing dollars because they're sort of, you know, top of mind and people choose it. But you get further afield and it may be that that's where you should be deploying your marketing dollars in order to change the sentiment or change the visibility of your brand in those areas.

11:10And that's something that I think technology is allowing us to advance really quickly towards having a view on things like that. Yeah, we actually did a lot of geotargeting for Salesforce. They're one of our clients and they wanted something similar. I think all that tech was not available when they wanted us to do it at a podcast level. But yeah, it was because certain areas also, we wanted to market to them differently based off if they were in Southeast versus Northwest. Yeah, some of the great examples of this are like, you have brands, if you take a brand like Western Union, in certain markets, they actually may not have any competition.

11:48But they spend a lot of money, brands like that spend a lot of money on branded search terms. So they're quite literally buying Western Union near me in markets where there's no other alternative. So whether that query is branded or unbranded, there's not going to be someone conquesting your brand by buying your own brand search term. If you can understand that from a visibility standpoint, you can massively streamline your paid, Google won't like this, but you can massively streamline your paid search spend into areas where you have competition versus areas where you don't have competition. And so there's a million versions of that story that I think, you know, start to light up when you can gather the data at basically a long level and understand your brand visibility at that level of granularity and what the competitive environment looks like.

12:39Okay. So you guys are a software company though. So how are you thinking about standing out in this new era? I'm sorry, what we were just talking about is how are you thinking about showing up in those experiences? So we help our customers deal with that, right? So part of the interesting part of the X journey is the company was a hyper growth company when top of mind for marketers was, whoa, like I need to have all, I need a strategy for making sure that my information is correct at all these endpoints, all these mobile apps, all these directories, all these web services, all these, all these things.

13:13When we started the listings business in 2010, which was really about syndicating data, I think Yelp was like 65 % of all online reviews. Something, something crazy like that. I'll get the numbers a little bit wrong, But it was like, effectively, Yelp was the only place where anybody went to get reviews and they're a dominant player. You fast forward like 10 years and there are a small minority of the reviews and Google has completely monopolized that. There's others, but your Google reviews is one of the biggest drivers of your brand visibility on Google. And so we kind of went through this phase of like fragmentation.

13:52And then we went consolidated down to a very stable monopoly, Google, in terms of where does my traffic come from? And what do I need to influence in order to drive that traffic and my brand visibility? It was really all about Google. Now what we're seeing, and we've been seeing this over the last couple of years, but I think it's becoming undeniable, is that we're entering an era of refragmentation of the consumer experience. And this is, I believe, an unstoppable force. And if you fast forward two, three, four, five years, as a CMO, you're going to have to think about, I don't know if it's 10 or if it's dozens or if it's hundreds of endpoints where consumers are seeking information and where I have to make sure that my brand is delivering the information in structures and formats that all of those AI-driven experiences are.

14:46are demanding in order to make sure that I'm optimizing my brand visibility. So the wave for Yext was really easy selling market, then really hard selling market. And I think what we're starting to see now is that you're back at like 12 years ago, we were in every C-suite talking to customers about this all the time. And they really wanted to talk about it. Three years ago, it was really hard to get with the CMO. Because you'd walk in and you start talking about like, hey, if you do this right, you structure your data right. You distribute to all the endpoints that you don't get traffic from that influences your position.

15:19It's all wonky SEO stuff. And the CMO is just like, their eyes would start to cross and they'd be like, go talk to my SEO guy. That's who you talk to about this wonky stuff that doesn't matter, right? I'm being a little hyperbolic. So now I think what's happening is every CMO and a lot of CEOs, they want to understand what happens if the traffic is all being distributed. And what happens if it's not even coming to my curated web experience anymore? How do I make sure that my products still sell and that my services still sell and that I'm still discoverable? Yeah. Okay. So what does it look like?

15:52How? What do I do? Yeah. Well, I mean, there's a lot of things you can do. The first thing is, I think, understanding why this is going to be such a big shift. We've spent trillions of dollars as an industry building these beautiful, curated human web experiences. Take any consumer website, whether it's a big financial institution or a large healthcare institution or take Chipotle or Wendy's or something like that. They have these beautiful websites that are really heavy with pretty images of the food and drop-down navigation boxes and nutritional information and menu information and just all of this information.

16:34But they're heavy human built experiences. And so to render that website is like, it's megabytes and megabytes, it's just tons of data. Most of that data is in the form of these images and these navigation fields and things. If you just take the structured data from that website that includes all of the hours of operation and addresses and open stores and closed stores and locators and all the menu information and nutritional information, all that stuff, and you put it into a structured text file, it's probably 25 to 50 kilobytes. Wow. Right? So it's effectively nothing, right? Today, we live in a world where Google and Bing and others have built these indexes.

17:19And so they have effectively structured the kind of heavy human web into an index of structured data. And those are fairly proprietary. And that's where our search results come from. We believe strongly that in the future, the compute required to do that is going to be enormous. And so what you're going to need instead is you're going to need ways as a marketer, what the AI driven consumer search experience is going to want is pure data. Give me your structured data. I don't want your images. I don't want your navigation menus. I don't want this big, heavy website. Just constantly update the structured data, like basically straight into my veins so that I never have to wonder whether I found it correctly.

18:06And that changes everything about the way that we market because it puts data at the center of everything that we do. And we need to have a living, breathing mechanism to gather all of the truth about my brand into structured data and then be able to port that data to all of these experiences as they develop and evolve. So fascinating. I mean, it also seems like now more than ever, there's going to be a convergence of the IT org and the marketing org trying to work together to make sure whatever marketing is wanting to do, IT can also make sure it's structured in a way that these AI agents and LLMs can read.

18:41Yeah, that's right. And I think it's a huge shift, right? And it's going to be a deep partnership between those organizations because marketers historically have built really beautiful things, right? And often what happens, and I think this is normal, is that the page that you take any business, just take a business with locals. They have stores or they have advisors or something like that. And historically, marketing has said, look, these pages need to be beautiful. They need to have images. They need to be perfectly structured. They need to be pixel perfect. That's something you hear a lot in the marketing world, right?

19:18And by the way, I think all of that is true. But often what gets left behind is the actual data structure of that page and the way that it's built to be consumed by non-human bots and crawlers and AI agents. And so what we need is we need to live in a world where you can do both, where you can have the human experience and it's pixel perfect. But underneath that and potentially living side by side with that is the data version of that page, which is perfectly structured. And today, this is a lot, you hear people talk about like schema and sort of how it's structured. And that's really about how Google consumes it.

19:51And I think what's going to get really complicated here is that open AI may want to consume it a little bit differently. And whoever Apple partners with or uses, they're going to want to consume it all a little bit differently. And so you're going to wind up in this world where whether it's some version of MCP or APIs or connectors or whatever it is, where you're basically replicating your human web experiences into like, you know, it's the matrix, it's all data. And then you're just distributing it through those things. And that all starts with having, with two things, having your data correct all the time so that you're never wondering, is my core data distribution engine wrong?

20:34My hours of operations change on a holiday weekend. I need to make sure that nobody is sent to my store when I'm closed because that's a horrible customer experience. And then the second thing that you have to do as a marketer is you have to start thinking of every piece of marketing content that you create as pure data. So every social media post, every comment, every review response, every photograph that you or a consumer posted, it's all consumable data for these AI experiences. And I think when that lens shifts, then what happens is we wind up with sort of the next wave of the digital transformation where we're rebuilding the web in a way where both kind of the humans and the machines can use it together.

21:16Yeah. Are there any good resources right now out there showing good ways to think about structuring social media content, blog content? I mean, I've heard you need chunks. It needs to be kind of like answering people's questions. What would someone be asking for? Do you have a chunk for it to pick up on? But is there anything else people should be thinking of when it comes to structuring everything they put out there? I think in some ways, nobody knows, right? So there's all these, I mean, I'll give you a stupid one right now. If you take any sort of content article and you put 2025 into the content, it can be an article written five years ago.

21:53But if you put 2025 in the headline, you literally insert it into the text, you'll find that you'll see a significant increase in the kind of uptake or the visibility of that content inside language models, you know, simply because they've been told bias towards more recent information. Now it's a trick, right? It's sort of a cheap trick. And the consumer experience is awful, right? So I don't recommend it, but I think it's the kind of thing that like, everyone will figure out how to close that loophole because you know, the, the like, I'm asking for the best hotels in the Hamptons in 2025. And you're delivering me a 2018 article that happens to have 2025 and that's completely out of date.

22:31So this is going to evolve so fast that I wouldn't say that there's a set of best practices. But the best practice and the best thing that you can do as a marketer is understand that you're going to have access to much larger and much more granular competitive information than you've ever had before. And you need to start investing into understanding what's shifting and what's changing? Who's coming to get me? Why is some small competitor or some larger competitor suddenly surging when it comes to their brand visibility? And it'll usually come down to some combination of factors that if I'm gathering the data correctly, I can understand.

23:08And I can say, okay, what they've done is they've taken all their content and they've chunked it out and they've replicated it and made it look different. And they're publishing that across all these different channels. And it's flooding the zone with like what the AI sees as high quality content and they're doing a better job than I am of that. And so I'm watching my rank erode and their rank increase and my visibility erode and their visibility increase. It just becomes an arms race that you really don't have a choice but to participate in as a marketer. Yeah. Okay. So that brings up a question.

23:40Now this is just my own personal question for you. So when I talk to a lot of our clients, I do position what we do as we create content that goes everywhere. And we've got YouTube channels, clips, everything on LinkedIn, Apple podcasts, written. So our content goes everywhere and you want your brand showing up alongside actual thought leadership content. Oftentimes if a company is saying I'm the best, it's not going to be as heavily weighted as other conversations that your buyers are actually following and they're saying things are the best. Is that an accurate way to think about how to actually position being found from a content perspective is like being everywhere?

24:14Yes, I think it is. I think it's been a best practice, right? And so I think what's going to happen though, is that we're going to quickly move into what I would call like a post best practice world, right? So I, you know, I'll give you a different example, but similar, it has been, you know, sort of conventional, you know, sort of obvious that managing your reputation online, the number of reviews you have, the star ratings of those reviews, the commentary in those reviews, that has been a best practice for, you know, just about every business and particularly for any kind of local lens business.

24:49What that leads to is that leads us to expend a lot of energy on a broad-based best practice. So if I have 10 ,000 taco joints, I've been trained and taught as a marketer that I need to be constantly optimizing the reputation of each one of those 10 ,000 taco joints. That's best practice thinking, right? And it's been really useful because we've lacked the granular data to understand that probably there's some subset of those locations that actually need more reputation or better reputation, right? And that all comes back to the sort of granular competitive environment. So if I have a global chain of 10 ,000 taco restaurants, I need to understand which ones of those brand visibility are suffering because the star rating isn't high enough or because they don't have enough reviews, maybe because they're new, maybe because they don't solicit, maybe because the store manager isn't doing what they're supposed to be doing in the store.

25:46I could give you a hundred other versions of that same story. And what it comes down to is that best practices go out the window when you can deliver like really bespoke brand visibility optimization mechanisms across each of those individual stores. And that gets into a lot of operational detail about like, how do you actually do it? Right? So if I have 3 ,000 of the 10 ,000 stores desperately need to go from 3.5 stars to four stars in order to be the number one sort of visibility taco store in their market. As a marketing manager, that's a huge challenge because how do I get 3 ,000 stores? It was easier when it was like, look, I'm just going to improve the reputation across all 10 ,000 stores, but I spent a lot of money on 7 ,000 stores that don't need it.