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Yext CEO Reveals How To See Your True AI Ranking
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If you’re still optimizing for traditional SEO, this one might sting. But if you’re ready to win the AI search wars, welcome to your new bible.
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- [00:00]
Michael Walroth
Every 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.
- [00:26]
Stephanie Postols
Tell the audience a bit about Yext. What do you all do? What are you building?
- [00:30]
Michael Walroth
You give me any business that you want anywhere in the United States of America and I will analyze that business.
- [00:35]
Stephanie Postols
Let's do anthropology.
- [00:37]
Michael Walroth
All right.
- [00:39]
Stephanie Postols
Ow.
- [00:40]
Michael Walroth
We have countless AI agents who are now at this moment virtually going to the location of the store, asking Google, ChatGPT 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, Anthropologie 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. This 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.
- [01:27]
Stephanie Postols
Is there anything else people should be thinking of when it comes to structuring everything they put out there? Hey everyone, welcome back to Marketing Trends. This is your host, Stephanie Postols 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.
- [01:48]
Michael Walroth
Hi Stephanie. Thanks for having me.
- [01:49]
Stephanie Postols
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?
- [02:14]
Michael Walroth
Yeah, that's like a. 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. 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. But it was a really interesting situation because we were, you know, I think Yahoo was 6 billion in revenue at that time and like a billion and a half of it was search. And you know, we had three or four ads on every search results page. And Google had like one or none and was just completely crushing, you know, I think financially because they had better algorithms, they had better organic search, they 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, sort of. It was such a leap forward that it felt like there was this sort of very real dilemma inside the company. Do 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 was, you know, that's kind of what 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.
- [03:59]
Stephanie Postols
Okay, so fast forward to now. The era we're in now. I'm the one who's being wounded looking. Cause I obviously am a little biased. I did love Google, but I look at them now and I mean, I. A while ago I sold many of my shares in the company because I was like, oh, they're in trouble. So what do you see happening now?
- [04:17]
Michael Walroth
Yeah, so first of all, you know, I always start with this. I don't think Google's in trouble. I think their search business is challenged. Right. So when I look at that and people always say, oh, so I should short it, right? And I think the answer is absolutely not right. Like, you know, 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, that they're in a comparable position to the position that Yahoo was in. And you know, 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 and the cost of going there broadly is too high.
- [05:03]
Stephanie Postols
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 ChatGPT. For many of my searches, maybe if I'm trying to find local things, Google's still best because they've got maps and a whole geodepartment 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. That's how it feels.
- [05:41]
Michael Walroth
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 I mean, 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, they have a huge index of local information. Go ask them. Now, you know, you're starting to see that they're delivering their own map views. They're delivering their own, you know, kind of citation built answers to these questions and they're, 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? Because 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 on the, of the organic search results on any kind of localized query are the citations that Google's 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, why did you choose this place? And it'll tell you, well, we, you know, we reference these reviews and we reference this website, which is the website or is 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. Which is pretty neat.
- [06:59]
Stephanie Postols
So 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?
- [07:11]
Michael Walroth
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 a super clever. They were driving traffic to local phone numbers that were effectively routed through their servers so that they could transcript phone calls. And 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. And 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 like, you know, I learned how to speak search, you know, best burger near me, you know, 11954, you didn't have to do that anymore because your, the device was in your hand and the device knew where you were. That really launched the company because it was a. The first fragmentation of the consumer search experience that we had seen in a long time. Google 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.
- [09:20]
Stephanie Postols
Do you do anything for companies who aren't as local focused? I'm just imagining my audience being like, well, I don't care, I don't have a restaurant, so does this matter for me?
- [09:29]
Michael Walroth
So I think that's what comes next. Right? So, 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. Healthcare 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 business has, 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. So 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, 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, 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, your, your marketing dollars in order to change the sentiment or change the visibility of your brand in those areas. And, and that's something that I think technology is allowing us to advance really quickly towards having a view on things like that.
- [11:18]
Stephanie Postols
Yeah, we actually did a lot of geotargeting for Salesforce. They're one of our clients and they did, 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.
- [11:36]
Michael Walroth
So yeah, some of the great examples of this are like you have brands like, if you take a brand like Western Union, right? They, in certain markets they actually may not have any competition, right. But they spend a lot of money. Brands like that spend a lot of money on branded search terms. So they, they, they're quite literally buying Western Union near me in markets where there's no other alternative. So you know, 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, paid. Now 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 lat long level and understand your brand visibility at that, at that level of granularity and what the competitive environment looks like.
- [12:40]
Stephanie Postols
Okay, so you guys are a software company though. So how are you thinking about standing out in this new era of search? What we were just talking about is how are you thinking about showing up in those experiences?
- [12:51]
Michael Walroth
So we help our customers deal with that. Right? So, so the part of the interesting part of the journey is, is the company was a hypergrowth 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. When 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, you know, reviews and they were a dominant player. You fast forward like 10 years and there are small minority of the reviews. And Google has completely monopolized that. You know, there's others, but your Google reviews is, is the biggest drive, one of the biggest drivers of your brand visibility on Google. And so we kind of went through this phase of like fragmentation and then we went consolidated down to a very stable monopoly. Google in terms of where does my traffic come from and what, what is, what Do I need to influence in order to drive that traffic and my brand visibility? And it was really all about Google. Now what we're seeing, and we've been seeing this over the last couple 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 2, 3, 4, 5 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 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 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. It's all wonky SEO stuff. And the CMOs just like the eyes would start to cross and they'd be like, go talk to my SEO guy. That's, that's who you talk to about this wonky stuff. That doesn't matter, right? I'm being a little hyperbolic, but so, so now I think what's happening is every CMO and every 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?
- [15:51]
Stephanie Postols
Yeah, okay, so what does that look like? How, what do I do?
- [15:54]
Michael Walroth
Yeah, well, I mean, there's a lot of things you can do. The first thing is, 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, right? Take any consumer website, whether it's a big financial institution or a large healthcare institution or scale. 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 you know, nutritional information and menu information and just all of this information. Right. But they're, they're heavy human built experiences. And so to render that website is like, you know, it's just, it's megabytes and mega, you know, it's just tons of data. Right. Most of that data is in the form of like these images and these navigation fields and things. If you take, if you just take the structured data from the, that website that includes all of the hours of operation and addresses and open stores and closed stores and locators and you know, all the menu information and nutritional information, all that stuff and you, you put it into a structured text file. It's probably 25 to 50 kilobytes.
- [17:08]
Stephanie Postols
Wow.
- [17:09]
Michael Walroth
Right. So it's, it's, it's, it's effectively nothing, right. Today we live in a world where Google and Bing and others have built these indexes and 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, just constantly update the structured data like basically straight into my veins so that I never have to wonder whether I, I, I found it correctly. And 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.
- [18:26]
Stephanie Postols
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.
- [18:42]
Michael Walroth
Yeah, that's right. And I think it's a, it's a huge shift, right. And it's, it's going to be a deep partnership between those organizations. Because marketers historically have, have built really beautiful things, right? And often what happens, and you know, this is, you know, I think this is, this is normal. Is that the page that, you know, you take any, take any business, just take a local, a business with locals, they have stores or they have, you know, advisors or something like that. And you know, 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. Right? That's something you hear a lot in the marketing world, right? And by the way, I think all of that is true, but often what, 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. And I think what's going to get really complicated here is that OpenAI may want to consume it a little bit differently. And you know, 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 kind of data distribution engine wrong? My 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, as pure data. So every social media post, every comment, every review response, every photograph that you or a consumer post, it, it's all consumable data for these, for these AI experiences. And I think when, when that lens shifts, then what happens is we wind up with a sort of the Next wave of the digital transformation where we're rebuilding the web in a way where both, you know, kind of the humans and the machines can use it together.
- [21:17]
Stephanie Postols
Yeah. 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. If someone. 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?
- [21:36]
Michael Walroth
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 put. If you take any sort of content article and you put 2025 into the content, it can be an article written five years ago, but 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, simply because they've been told bias towards more recent information. It's a trick. It's sort of a cheap trick for now. And the consumer experience is awful. Right?
- [22:15]
Stephanie Postols
Yeah.
- [22:16]
Michael Walroth
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 in the. You know, that's completely out of date. So 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, is understand that you're going to have access to much more, 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. 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. And 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, they made it look different and they're publishing that across all these different channels and it's flooding the zone with 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.
- [23:38]
Stephanie Postols
Yeah. Okay, so that brings up a question. Now this is 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, you 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?
- [24:15]
Michael Walroth
Yes, I think it is. I think it's, 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'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. Well, what that leads to is that leads us to expend a lot of energy on a broad based best practice. So if I, if I have 10,000 taco joints, I've been trained and taught as a marketer that like 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, 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, 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, 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 me, because the store manager isn't doing what they're supposed to be doing in the store. I could give you 100 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 4 stars in order to be the number one sort of visibility taco store in their market, you know, 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. Right. And so you start to get to this world of you need better tools and better ways of doing that. So, for example, marketers, brand marketers of local, with a local lens have long resisted the notion that we should put some of the control over this marketing into the hands of, like, store managers because it. Because we. We lose centralized control. And you don't really want your store managers writing the responses to the reviews because they are going to use different voices and things like that. But you do need to be responsive. And so there are ways where we can start thinking in terms of. Once I can identify across, like trillions of data points, what is the thing that I need to do in this specific store, I can start pushing tasks to that store manager. Hey, what I need you to do today is respond to these three reviews. The responses have been drafted for you. You just have to submit them. What I need you to do today is take a bunch of pictures of the store and post them to the Google profile or to these other. These other things. And all of that is a form of data content creation that winds up being bespoke to the individual. You know, it could be product, it could be service, it could be location, it could be any of those things.
- [27:41]
Stephanie Postols
So fascinating. I was just thinking as you were talking too. I'm sorry, I keep shifting back to B2B, but that is my world.
- [27:47]
Michael Walroth
So I'm like, yeah, no, that's our world too.
- [27:49]
Stephanie Postols
Yeah, yeah. So these. And I don't want to call names out, but it's just easier if I do. So, like the foresters the Gartners, the G2. What do you think? Like, that world, to me, I think could get very disruptive because there's gonna be so much data out there that is now pulled in very different ways. You can actually see if consumers are happy. You can see if things are getting used. You can see probably the sources of what's being used. And I wonder if these pay to play platforms that have thrived for a while aren't really going to be around because like they're just at least, I think it's hard to trust what they say. Like what they say anymore. Like, is that actually the best you you're in some Gartner thing. Do I care? I don't know. So what do you think about that?
- [28:30]
Michael Walroth
Yeah, I mean, I think it's going to get easier for marketers to understand the value they're deriving from all of these kind of software and services capabilities. Right. So when we think of, when I think about this, today you've got kind of the software market's a half a trillion dollars a year. And the services business, the services market, you know, X, like networking and things like that is like almost, you know, somewhere between one and a half and two trillion dollars a year. So companies are spending somewhere on the order of two to two and a half trillion dollars a year on some combination of services and software. And historically we've drawn really clear lines between services and software. And we've said, look, software companies shouldn't do services because it devalues the sort of pure software product. And services companies shouldn't do software because they need to be agnostic. Right. I think you can dynamite that whole notion and I think you can say in a world of AI where services become easier to deliver and more of it's automated, every marketer, every brand, every business should expect a blending of software and services that's really keyed around, like the job that needs to be done. The way we look at our mission is we sit with a marketer and we help them understand kind of the competitive data landscape for their brand, for their business. And then we will apply the right set of software technology services around making sure that the job gets done. And so we get out of the business of like buy a reputation management platform and just manage your reputation and go through the motions. And we'll give you some proprietary scoring mechanism that lets you declare victory and go down to like, that's one of a hundred tactics that you need to be able to deploy. And all of those tactics should be geared back to the core data set. I don't know what that does to the like sort of, you know, the, what I would call like the sort of endorsement community for these software and services. But I think it gets a lot more confusing and I think we're already seeing it. I think we're seeing the two sort of, you know, highest, two of the highest value software companies on the planet, Palantir and ServiceNow. Like we can't tell whether they're selling software or services. And this is, this is, you know, Palantir gets knocked for this because they're basically like, I don't know if they're selling services or they're selling software and yet they trade for 105 times the next 12 months revenue. So obviously people see, somebody sees value in what they're doing.
- [30:51]
Stephanie Postols
Yeah, I mean Palantir's got that long term thinking though that I think if more leaders could also encompass that kind of thinking, it'd be a very different world of taking longer term bets and not how do I think of what will I see within the next three months and am I seeing demand? Nope, not yet. Okay. Not yet worrying about that or I'm not going to worry about brand. So Palantir, watch.
- [31:12]
Michael Walroth
I think there's another vector to this whole thing that is just beginning to kind of hit the radar and that's this. There's a fundamental shift in this idea of context. The way I try to describe this is if you have, it might be your partner or your spouse or your longtime assistant, the amount of things that those people need to know about you to do something for you. I've been married for 25 years in October. My wife and I have been together for 31 years.
- [31:46]
Stephanie Postols
Wow.
- [31:46]
Michael Walroth
When I talk to her, you know, if she offers to bring me lunch, right. She's a restaurant entrepreneur, so she offers to bring me lunch. A lot. You know, our communication is would you like some lunch? And my answer is like, yeah, would love some. Right? And what arrives in front of me is going to be something I like. It's not because she's omniscient, it's because she's known me for 31 years and she knows that there are certain things, you know, on the menu of her restaurant or another restaurant that I, that I'm going to love and certain things I'm not going to love. My assistant, you know, knows things about the way that I want to structure my day the way that I want, you know, how I want breaks, things like that. It's all context. What we're evolving into as a world and it's if, if, you know, if you're listening to this and you haven't done it, go into your ChatGPT and explore the memory that exists inside your ChatGPT because that's, that's the context, right? And it turns out that actually it remembers a lot about what you talk to it about. And there'll be things in there that you'll be surprised. Like, wow, I never told it that. Right. But it's figured out that like I don't like to eat at places that use seed oil to cook or like I always ask about sort of nut free options because maybe somebody in my circle has a nut allergy. That, that's like, that's the, that's where we're headed. And what it makes is it makes every prompt and every query and every conversation completely bespoke. And I can teach it, I can tell it like, I like to do business with people who play golf because I like to play golf, right? And so if, if, and this, this goes back to that idea of like, what's the content that marketers are putting in the world. If I have a thousand or five thousand or ten thousand insurance agents, I want them to distribute through me as much individualized content as they can. So that inside that context window I can, you know, that helps the AI identify. Well, Mike likes to do business. He's looking for insurance and he likes to do business with people who play golf. Well, here's a guy who's across town who has, you know, who played college golf in his biography. That's a match. But I'm not writing a query that says I'm looking for car insurance near me, not more than 20 miles. And I want somebody who, you know, you're not telling it that. It's just nosy.
- [33:55]
Stephanie Postols
So what are some big bets you all are taking right now? Because you're operating, I think in a space and your company is pretty far ahead. And like you said, you've been kind of pitching this vision for a while and it seems like now people are definitely going to be betting in this. But what big bets are you taking within the company or with your team that also might look a little crazy from the outside?
- [34:13]
Michael Walroth
Yeah, so a couple things there. So it's really interesting. I think we have huge advantages in this world if this is the way that it plays out. I think we have one significant disadvantage, which is what it is, which is I think the history of the company is not as clean as the Pure Play startup That's saying, look, what we do is AI visibility optimization. And there's a bunch of those. And you're watching them get funded, you're watching them show up. The good thing for us is that we've been doing this for a lot longer. We'll have more R and D budget to spend than the sum total of those companies will have in revenue. So that's, you know, for a foreseeable period of time. So we can move really fast and we can. And then I think the biggest advantage we have is just our capacity to gather and store and utilize huge data sets. So we have a new product, it's called Scout. It basically is the most granular, in my opinion, competitive intelligence product ever built for traditional search and AI visibility. And what we're doing is, is effectively using an army of AI crawlers and bots and scrapers to go out and gather hyper granular data around rooftop level businesses. So I'm going to use my wife's store, Organic Crush. Organic, Very beautiful, healthy organic. She has five restaurants on Long Island. Yeah, so I'm plugging here. I am plugging, yes, I'm going. She brings me free lunch and I plug. But so you know her, what she cares about is our terms like healthy organic food near me, healthy lunch near me, things like that. This new product allows us to send this kind of army of AI into the world, do highly localized searches across traditional search and AI and pull back trillions of data points. So for every one of her five locations, every time we do this, we pull down her rank and her top 40 competitors or as many as are, as many as are delivered by the AI because they typically deliver less than the traditional search. And then we collect somewhere between 150 to 200 non performance attributes for every one of those. So you can imagine the data file on a single location. Single data poll is something like one store, 40 competitors by, you know, so it's, it's kind of 40 columns wide and 200 columns deep. And then we can compare all that data. So we can basically say for this store you are doing great on number of reviews. Your review response time is too slow, you don't have enough Google Photos. The schema on your page is, is suboptimal. You, you don't have your category or you know, in, in in the tags. Your page load speed is too slow. There's not enough words on the page and, and we're not just making those things up. This is how we move away from the best practice. We're actually looking at all your competition and how they're ranking and how their brand visibility is and we're showing it to you that way. And it's, you know, it's kind of mind boggling how much data is being gathered and stored and, and what's going to be really cool about this is being able to kind of time series all this over time. So for each individual store in a 10,000 or 15 or 20,000 network of retail stores or hospitality or financial advisors, you're going to be able to basically look at it over time and say what's changing about my brand visibility and all of my competition so that I can get away from best practices and into individual bespoke recommendations.
- [37:44]
Stephanie Postols
Yeah, I don't have a local company but if I did, I'm in. I would buy this. It sounds awesome.
- [37:50]
Michael Walroth
It's really neat. What's funny about it is like the worst reaction we get to it is wow, this is everything I've always wanted. I can see everything now. I don't know what to do about it. I don't know how I'm going to operationalize the, you know, you've shown me that I'm going to always have the ability to understand what's the key thing for each of the entities. Right. Or for my brand in this granular sort of minute locality. That's that other case. Right. Brand at the local level, how do I action it? Right. And that's where the AI story is going to be so good here because you can feed this data into AI and then ultimately, and you asked what differentiates us? It's, it's the fact that listings, social reputation, page content, social content, data, all these things, we have all the tools to take the action. So you fast forward. Eventually what we're going to be doing is we're going to be automating a lot of the endpoints and the action into the endpoints here and then being able to track the ROI over time. It's going to take a little bit of time to get to the point where like I think it'll be a little like self driving, like it's going to be safer before marketers are willing to sort of unfetter the machines to do more of the work.
- [39:06]
Stephanie Postols
Yeah, for sure. And in the meantime, I mean are you going to launch your services side of your business and bring the worlds together, help these people out a little extra?
- [39:14]
Michael Walroth
Yeah, look, actually it's funny, we're talking a lot about, we have really talented people who deeply understand this stuff and they're becoming Brand visibility consultants. That's the way we're approaching our customers and they can't. And our customers increasingly, you know, that's how you address this problem of like, you know, because, you know, it's kind of the, the best worst thing you can hear is like you, you're showing me a world of data, right? That now I can see the matrix, right. But like, I don't know, I don't have the ability to operationalize it. And that's where I think this, this software and services piece comes together because we will help you operationalize it, including. And this is the beauty of like, you know, you may need new, you may need tools and services and things that you haven't had before. White label mobile applications or APIs into your existing, you know, kind of corporate mobile applications. And all of that just explodes the world of like, how do we work together to create the outcome that you desperately need in a world where you're going to have less and less control over the sort of consumer experience with your brand?
- [40:13]
Stephanie Postols
Yep. I love it. Okay, in our last few minutes, I want to ask you a couple fun questions.
- [40:17]
Michael Walroth
Okay, great.
- [40:18]
Stephanie Postols
Okay. You're stranded on a desert island, but your business marketing brain is not quitting. It won't stop. So you're allowed to bring one book, one software and one CMO with you on this island. And it can't be a CMO at yext, it has to be someone else. What would your book Software cmlb.
- [40:38]
Michael Walroth
The book I'm bringing is not a business book, but I think it's one of the best business books ever written. It's called Deep Survival and it's a really well researched view of why some people survive in survival situations and some don't. And the most interesting piece without it's spoiler alert is that the amount of training that you have to survive in a survival situation is often inversely correlated to the rate of survival. Interesting, because you are overconfident and you are much less likely to understand the reality that you're living in. And so it's the story of the special Forces ranger who gets lost in the woods, but denies that he's lost in the woods until he slips down a cliff and breaks his leg and dies of hypothermia. Versus the little kid who's lost in the woods and knows they're lost and says, I'm going to climb inside that log, that hollow log. It looks a lot, it feels a lot warmer than out here. And they're rescued the next day because they identified the nature of their reality. And that would be really useful on a desert island where you're going to have to deal with the nature of your reality.
- [41:45]
Stephanie Postols
Yep, that's a good one.
- [41:47]
Michael Walroth
Book. What was the second thing?
- [41:49]
Stephanie Postols
A tool or software? Because your business brain is still running even though you're also trying to figure.
- [41:53]
Michael Walroth
Out how to survive a tool or software. Well, obviously I'm bringing my entire suite of YUXT data analytics products because as I populate that island with location based businesses, I'm going to need all this best in class technology.
- [42:12]
Stephanie Postols
Yep, I love it. Okay, and then what CMO or marketer would you bring with you either for inspiration, good company, or helping you build a raft or build your local centers?
- [42:22]
Michael Walroth
Yeah. So we have 3,000 customers and every one of them has great CMOs. So I will not, you know, make the mistake of calling anybody out by name here. What I will bring is a CMO who understands that like these moments of tectonic plate shifts are the opportunity that, you know, it's, it's. If you figured out how to do SEO in 2002 or 2003, you had a durable, probably 5 to 10 year advantage over your competition because you leaned into the change and you thought differently about how and you didn't shrink away from the fact that like kind of everything, you know to be true about how you create brand visibility is going to change if this plays out the way that I believe it's going to play out. And so I'm going to find the, the CMO who knows how to make a fire and knows how to catch fish, but also knows that like the environment's super dynamic and it's changing and if you shrink away from that, then you're just going to wind up, you know, you're going to be looking for, for a job and people who lean into it are going to be thriving.
- [43:24]
Stephanie Postols
Yep, that's a good answer. Okay, next quick question.
- [43:26]
Michael Walroth
How about that? I mean that was pretty depth to duck that, right? Yeah.
- [43:29]
Stephanie Postols
That was the first time I've actually ever done that. I was like, Mike's the perfect person to do this with and see how it goes.
- [43:36]
Michael Walroth
So I was happy to be a guinea pig. Hopefully I'm not going to get fired by any of our CMO customers for my answer.
- [43:42]
Stephanie Postols
I mean, I feel like they would have wanted been, they would have wanted to be name dropped. But it's okay. You can just tell behind the scenes I really thought of you and you and you.
- [43:49]
Michael Walroth
Next time I get that question, I'm going to name drop Whichever CMO gives me the biggest upsell this year.
- [43:54]
Stephanie Postols
So yeah, like whoever's in the pipeline, just pick them like closest to that big deal.
- [43:58]
Michael Walroth
Exactly.
- [43:59]
Stephanie Postols
Okay, the last question is if I gave you a million dollars to spend on one unconventional marketing bet with no strings attached, what would you do? $1 million.
- [44:11]
Michael Walroth
This is going to sound, you're going to think that I'm pandering here but I think this format that you know, to me and this drives my team nuts but I think that traditional media and the value of the PR hits and the article inclusion and by the way this will just become self fulfilling because after I say this, no one is going to want to have me on their TV show or in an article anyway. But this is the new way of communicating and I think it's. I spend workouts and car rides and probably two hours a day listening to deep in depth conversations of really interesting people. Whether it's business or sports or fashion or whatever it is, do have conversations. And it's like we've created a medium here and you're at the middle of it where we get to eavesdrop on really interesting conversations with candor. And so this isn't a hypothetical because I'm pouring marketing budget into how do we create both ourselves and co create with, with other creators of content? Really valuable, really interesting, really compelling content and I think over the course of years that you know, that increases the credibility of the company. I think it allows us to, to exchange ideas in a way that you can't do it with these traditional marketing mechanisms and it's much more trusted and it's much more authentic. So again I'm pandering to your business here, but I love it. I really think it's, it's the most powerful medium right now and it's why I spend a lot of my time talking to people doing these podcasts.
- [45:51]
Stephanie Postols
Yep, this is good everyone. Mike said it first. Listen to him come to us. We have a whole network of B2B podcasts. Get over here. Sponsor our things.
- [45:58]
Michael Walroth
Let's go.
- [45:59]
Stephanie Postols
Yeah, I love that. Well Mike, this was super fun as I knew it would be. I loved having you on the show and super excited about what you all are building at yext until next time, which I'm sure there will be around too. Where can people find out more about you and yext?
- [46:11]
Michael Walroth
Yeah, so it's hard to find out hopefully too much about me because I keep a pretty low profile so I don't maintain socials. I'm on LinkedIn and I check it about once every couple weeks.
- [46:21]
Stephanie Postols
So I'll just bring you back then. Don't worry.
- [46:23]
Michael Walroth
Yeah. Yex.com, all the platforms, all the ways, and we're pretty easy to find in that way.
- [46:31]
Stephanie Postols
Amazing. Well, thank you, Mike.
- [46:33]
Michael Walroth
Well, thanks. It was great to have a conversation with you. And I know you will have me back on to sort of undoubtedly throw all these stupid predictions I made in my face at some point. So I'll be happy to do that and own all the crazy things that I said today.
- [46:48]
Stephanie Postols
Yeah, that'd be good. Thank you.