The DTC Podcast
The DTC Podcast

Ep 646: Neil Patel: Why Your Leads Are Down 40% and Your Revenue Is Up

3d ago38:327,535 words
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https://directtoconsumer.typeform.com/DTC-Brand?utm_source=podcast-646&utm_medium=podcastTo Subscribe to DTC Newsletter - https://dtcnews.link/signupnpdigital.comEric told Neil Patel that Pilothouse i...

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Navigating the LLM Shift: Generative Engine Optimization, Long-Tail Creators, and Retention-First DTC Growth

The short version

This episode explores the impact of Large Language Models (LLMs) on DTC acquisition, noting a shift toward lower lead volume but higher revenue due to pre-qualified user intent. It emphasizes Generative Engine Optimization (GEO) through third-party digital PR, the superiority of long-tail creator networks over mega-influencers, and the necessity of prioritizing retention metrics and product bundles over vanity metrics and straight discounts to protect lifetime value.

Synthesis of podcast conversations. Speaker claims are not independently verified.

01The takeaway

LLMs and Search Fragmentation Alter Acquisition Funnels

Consumer search behavior is shifting toward LLMs and fragmented platforms like TikTok and Instagram. While this reduces overall lead volume and website visits, it increases conversion quality and revenue because users pre-filter options within the LLM before visiting the final site.

Transcript evidence

What the speakers said

Patel notes his agency's leads dropped 40% year-over-year while revenue increased, with 30% of referrals coming from ChatGPT as users filter options internally.

02The takeaway

Generative Engine Optimization Relies on Third-Party Digital PR

Unlike traditional SEO which values historical domain authority, GEO relies heavily on recent third-party mentions and positive sentiment. Securing spots on high-quality listicles and building publisher relationships is critical for LLM visibility.

Transcript evidence

What the speakers said

Patel states that positive external website mentions increase the likelihood of LLMs showcasing products, emphasizing that GEO cares primarily about third-party coverage from the last 30 to 60 days.

03The takeaway

Long-Tail Creator Networks Outperform Mega-Influencers

DTC brands achieve better scaling and amplification by building massive networks of long-tail content creators on a sliding compensation scale, rather than relying on high-cost mega-influencers.

Transcript evidence

What the speakers said

The speaker cites Frost Buddy utilizing 13,000 creators and Legion Athletics using over 1,000 influencers at reasonable rates, noting this approach yields better results than paying top-tier celebrities.

04The takeaway

Product Bundles Protect LTV and AOV Better Than Straight Discounts

Relying on straight discounts trains customers to wait for sales and erodes lifetime value. Offering product bundles provides perceived value and increases average order value while protecting margins.

Transcript evidence

What the speakers said

Patel's data indicates that over-reliance on discounts reduces LTV, whereas brands using bundles for first purchases increase average revenue per user for a similar acquisition cost.

05The takeaway

Retention and Conversion Metrics Trump Social Vanity Metrics

Founders often overvalue social media views and follower counts. Sustainable e-commerce success requires tracking and optimizing core metrics like conversion rates, repeat purchase rates, and customer lifetime value.

Transcript evidence

What the speakers said

The speaker identifies social views as an overrated metric and highlights conversion rate, repeat purchase rate, and LTV as highly underrated metrics that most e-commerce companies fail to accurately track.

From listening to doing

Ideas to test

Suggested experiments, not proven results. Choose what fits your brand.

  1. 01

    A/B test product landing pages to feature direct, concise answers to top customer FAQs at the top of the page to align with LLM content extraction preferences.

  2. 02

    Launch a digital PR campaign targeting high-authority 'best of' listicles and measure the subsequent 30-day lift in LLM-referred traffic and conversion rates.

  3. 03

    Test a first-purchase acquisition offer comparing a straight percentage discount against a bundled product offer of equal perceived value, tracking differences in Average Order Value (AOV) and 90-day Lifetime Value (LTV).

  4. 04

    Launch a sliding-scale micro-influencer affiliate program and compare its blended ROAS and LTV against a traditional campaign utilizing macro-influencers.

  5. 05

    Run a 90-day A/B test in email and SMS campaigns comparing human-edited AI copy against purely AI-generated copy, measuring long-term engagement and unsubscribe rates.

Context & limitations
  • The claim that leads are down 40% but revenue is up is specific to the speaker's agency and media company, and may not universally apply to all DTC e-commerce brands.
  • Search market share percentages and the 80/20 overlap between SEO and GEO are presented as rough heuristics based on the speaker's specific definitions, which may differ from traditional marketing analytics.
  • The speaker's reference to a study on AI content traffic drops lacks specific methodological details, so long-term traffic penalties may vary significantly by industry and content quality.
  • There is a contradiction in the source text regarding Reddit: one section highlights it as critical for LLM discovery, while another advises avoiding it due to hostility toward self-promotional brands.
  • Anecdotal examples like Frost Buddy's 13,000 creators may not be directly replicable for brands with different profit margins, product types, or operational capacities.

Transcript

EN

The more external websites that mention you and talk about your products posi...

Search is not only on multiple channels, the journey has gone with the messy the funnels no longer linear.

โ€œGoogle's a popular search engine, but so's Instagram has 6.5 billion searches a day. So it's chatGP with the billion plus YouTube has over 3 billion searches a day.โ€

The Amazon has over 3 billion searches a day. Tiktok over a billion searches a day. Google has 13.7 billion a day roughly 5 trillion a year. They are roughly 27% of the market share pretty much had to optimize for the majority. The majority, the 73% is not Google. This episode is brought to you by TripleWail, the AI operating system for e-commerce.

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โ€œAlright, let's jump right in. I'm here with my friend Neil Patel. We go way back to my affiliate world days. Welcome back to the DTC podcast. Neil, how you doing?โ€

Doing good. Thanks for having me. We were just talking a little bit. You are probably in one of the fastest changing corners of the internet right now. And I was just actually going over some of your great content you've been producing on Twitter about obviously how search is changing. How discovery of products is changing so rapidly. What in your mind has changed most in the past like I don't know three months about LLMs and how they're helping people discover. I don't think much has changed in the last three months other than their usage has gone up. Now, you could say, you know, new models have come out, we know with Claude and you know, open AI.

But for most searchers, it doesn't make that much of a difference. And when I say that is your searching for a question or and you're getting a answer to your question. There are algorithms have updated. If you look at the instances some instances of Chad G, but he's pulled more from external websites. One version of their algorithm or one flavor of their, you know, release whatever you want to end up calling it algorithm flavor because I know they name different things. But we're looking at insight content roughly 20% of the time like from your own website. And we've seen the pendulum swing in either direction. But the big thing that stayed consistent over the last three months is the more external websites that mentioned you and talk about your products positively the more mentions you're going to get.

And assuming their positive mentions on external websites, the more likely the LLMs are going to showcase your products in a positive sentiment. And I was just talking about the situation with pilot house and D to C. So D to C, the media company that we spun up to help grow the agency. It's become a company in his own right, essentially. But what we're finding is now in the past six months, I'd say it's balloon to about over 30% of our referrals coming in for people looking for services are coming from chat to BT.

Their close rates are much higher, their average deal size is much higher. And I was wondering I was going to ask you how much of that is can we credit to a platform like D to C where we've been talking about the gospel of pilot house now for six years across thousands of newsletters and hundreds of podcasts.

Has that played a critical role would you guess it has paid a critical role, but people in this stake quality from LLMs being higher for something that they're not taking into account.

โ€œSo I guarantee that your leads are down overall. Would you confirm or disagree with me? I think I think they're flat or down. Yes, overall. We were actually just seeing this.โ€

We're making more from fewer leads down. It was about 40% from last year our leads are down, but our revenues up. Yes, because traditional what would happen is someone would do Google search. They see 10 blue links. They make click on six of them do research fill out their information for six of those sites or four or five of them. Scream phone calls figure out what they want to do learn more and then decide who they want to work with. Now people ask LLMs a question.

They get responsive of companies.

It then helps you select one or two and ideally one and then you then go to the website whether it's from a link that you got from the LLM or you Google the website and you go to it and then you fill out a lead.

You're much more likely to close because you did a lot of your research through the LLM versus before a human would do it and then pick which agency to go with.

Same with products. You would go to a lot more websites. Do your research read the reviews and then figure out which one you want to buy at the end of the day. Look at the different prices shipping return policies. Now you do that all inside of LLM. So what you're finding is the visitor is still likely to buy similar intent as before. It's just they don't have to actually go and visit six or seven websites to figure out which solution they want. The LLM is helping them and they're asking all the fall questions inside the LLM instead of having to actually go to a website.

โ€œThat's the big difference. So that's why you're seeing less traffic less leads but higher quality. The quality is because it's the same customer. They have the same intent.โ€

They just didn't need to go to six websites to learn all the information. They did it inside the LLM and they went to you after in most cases they made up their mind.

I feel like the old paradigm was like marketers trying to approximate what the users intent was and they were trying to like setting up these signposts to try to catch them as they went in. Whereas it's kind of shifting because people don't search with keywords anymore. They search with 10 minute rambles about every detail they might want to think about. So it's like it's shifting away from where the marketer can be clever and just shifting towards like serving the customer, which is going to be better in the long run.

To LLM. I liked what your quotes. It said search didn't die it multiplied. Can you dig in on that a little bit? Yeah, if you look at the buyer journey now, it's in the messy middle. You may discover product on Instagram. You may go and check out Reddit reviews. Then you go into chat GPT and ask questions and watch a YouTube video because chat GPT recommended three different solutions. Like, oh, here's another two. Let me go watch some YouTube videos. You go read some more reviews and then all of a sudden boom, you go to the website that you already decided which part to buy. You go to their website and then you just purchase.

Search is not only on multiple channels, the journey has gone with the messy. The funnels no longer linear.

And what we're finding is Google's popular search engine, but so's Instagram has 6.5 billion searches a day. So it's chat GPT with the billion plus YouTube has over 3 billion searches a day.

Amazon has over 3 billion searches a day. TikTok over a billion searches a day. Google has 13.7 billion a day roughly 5 trillion a year. They on roughly 27% of the market share pretty much have to optimize for the majority. The majority, the 73% is not Google. Now, you could count YouTube as Google which would inflate their percentage, but we look at all the channels separately because YouTube is different than Google's. What are we seeing? I've just heard some headline numbers about search revenue. And, you know, now almost every search I conduct on Google is answered for me in the pretext.

โ€œAnd so what is that actually doing? Is that is that impacting Google's search revenue negatively? Or are they just making it up in higher conversions by actually serving you the result that's going to get you to convert faster?โ€

So you're saying is Google making up their revenue? Yes, or by having higher because it is I guess they're experiencing the same thing. We are their their number of clicks might be going down, but because the searches are going up more people. Okay, Google. So one from three trillion searches from the previous latest number they posted to the latest one is five trillion searches a year and a of views and answering questions directly for those steps of queries. A quick 10 percent lift for those query types and it bitches even bigger now, but more people are skipping the results that people are paying for and just staying in the in the, you know, the answers that are given up top.

Not necessarily it depends what if you're talking about paid results right because I'm assuming you're talking about revenues you're talking about specifically paid and not organic. Look at from the paid perspective most of queries people type in don't have paid results that was similar before there are ads in AI overviews right so they have been rolling out ads. There's still a lot of sponsored links a still sponsor shopping a lot of the purchase type queries bottom of the phone type queries that had ads before still have ads and don't have a ton of AI overviews.

Makes sense more so the informational queries that got affected not necessarily the direct revenue generation queries that makes sense.

โ€œI was just going over your post that you made I think yesterday that was specifically about a Reddit post and how it changed how you're thinking about AI and business about a cloud found because anyone.โ€

The most to produce a product now is so low anyone can kind of produce a product out there that's going to cause a you know a lot of competition in the space how I guess how to stand out is the question.

So the way you stand out is you build a solid brand you go above and beyond y...

It is actually harder what we're finding is you've always had competition it's always been hard to stand out there's no difference on how you stand out.

โ€œIt's just harder now because more people can create businesses and pop them up you know and I'll give you a prime example of this.โ€

There's a software company that's leveraging AI growing super fast that's amazing we use that ourselves is called high level so I don't know if you've heard of high level yes okay great product. They make it easier for any business especially S&Bs and the reason I say especially S&Bs because they have less money to get out there get started and create something and launch it super fast even run advertising. Even help you with the follow up sequences and help you close the revenue they have voice AI the straight up will call your leads pre qualifying and help you close them and it's really effective we know so many people that use it including ourselves and we've seen the results.

There's so many companies that like high level that are making things easier it's making it more competitive we've always had competition.

โ€œThe key is is you just got to go above and beyond like you used to go above and beyond and sometimes you'll struggle to separate yourselves and you won't win and sometimes you'll figure it out.โ€

It could be a product feature or customer care and I'll give you a prime example of this. Zopples sold shoes for ages so does Amazon why did people go to Zopples over Amazon and eventually Amazon bought Zopples Zopples had amazing customer care it wasn't that you couldn't get the shoes on Amazon or somewhere else sometimes you'd buy online and instead of sending you ground shipping even though that's what you paid for. They would second day air the shoe for you and surprise you and just say okay we just wanted to get it to you quicker thank you for being a little customer right I had a buddy who calls apples and they ordered shoes.

And his name is Jason and Jason calls up Zopples and says oh I ordered these shoes that thought they're going to come faster it says they're going to come in a week they're like oh sorry about that.

I don't know if I did anything you do the help and Jason's like I'm going on a date in three days and I'm hoping it can get sent out faster. And the person's like oh we have them in stock it may be tough you know I don't know if we can understand you and Jason's like come on please help me out. I want to start this new relationship on the right foot he's using a pun right because apples is selling shoes the person starts cracking up Jason starts cracking up the person sends them the shoes within.

โ€œTwo days so he had time to work for his date that's how you build trust that's how you build trust.โ€

And I'm putting story Jason's much more funnier than I am than what he's delivery and the way that the pun is. Yes, I give the really quick a bridge version he had like a five to ten minute call with Zopples support back in the day. But back to my question about so we're now seeing it pilot house about 30% of our of our leads coming in are from chat GPT and we're trying to figure out why it has grown so much and one of my major the high policies is that chat doesn't really know that we're actually the same company that did to see and pilot house or the same company so we basically spun up this media company that you know features pilot house references pilot house praises pilot house were appropriate.

And now we're seeing this huge increase in LLM traffic and I'm wondering how much value you know spinning up this media company has had in referencing do you think. Do you think chat knows that we're the same company or doesn't matter. Some LLM will know someone not and I don't think it matters that much and here's why I say that a lot of people publish these articles on their own website again that that's it's your own properties but you're talking about two different domains a lot of people publish on their own domain name and they still do really well although I think the algorithms will change within six months to year and there'll be much more strict on this.

But if you look at your revenue I think you said earlier about 40% is coming from chat roughly at this point 30 yeah so large chunk and I bet you that number over time we'll get up to over 50% actually you're upstream to enterprise it'll probably go back down as you get larger. I'm not saying you guys aren't large I don't know how many people you have maybe have a hundred two hundred or five hundred I don't know but once you start getting more and more enterprise your biggest channel will be word amount to see me you do good work your second and I'm assuming you are.

Your second biggest channel is going to be typically employees people work with your employees other agencies they're happy with them they left they came to you they'll reach out to them when they need work that causes more business your third one will be marketing. For brands they're listening as opposed to agency because that's mostly who are audiences they want to be featured more in these conversations obviously read it I know is a big besides what's on your page and making sure that you're building.

You're content out to actually answer questions G2 crowd. What about list of words right would you tell us not much that's all sad read it does Wikipedia can help YouTube helps tracking the YouTube's use quite a bit.

What I was being told I don't know how much that really helps with e-commerce...

You're a phone being number one on the list assuming you're a cell phone carrier and you cell phones are those high trust sites or those sort of like spun up fly by night listicle style pages does that does that matter.

โ€œThe fly by night listicle pages are doing well as long as they're human right in their quality and they're from good sources and they're not a ton of crap.โ€

I think they're going to work in the long run with people just spamming I think they're going to work in the long run if you do it right and you get digital PR you build trust you're not buying them you're convincing people like I think it'll work wonders. In your video that you posted yesterday you kind of you put together a bit of action plan for people to kind of maybe audit how they're showing up now and a few steps to improve how you show up in the future could you maybe walk me through some of your thinking around that.

So there's a few things the first is you got to audit where you are so you can use tools like uber suggests which breakdown where you are and does visibility report shows you where you are.

The second thing you need to do is evaluate your technical SEO so like you're structured data your content how old it is most albums like fresh content look at what questions people type to find your pages you get some of the state or from Google search console or answer the public or uber suggests.

โ€œYou can you then need to make sure that your contents answering questions as quick as possible not only has it had to be fresh but it has to answer questions head on and quick as possible instead of rambling.โ€

Then you got to make sure you have really good reviews on the internet even if you have good reviews are you consistently getting new good ones every single month because if you have reviews at our five years old albums careful what's happening right now not five years ago so you'll notice that up in commerce can overtake you even if you're a much bigger company.

I'm going to start looking at digital PR how many people are mentioning you your products your services overall on a monthly basis how positive it is all these things really impact.

You know if you're going to show up how you're going to show up and what if people are going to decide to work with you.

โ€œYou referenced high level earlier I'm interested in their sort of sweet there offer I know that you've kind of announced a bit of a partnership with high level which is super exciting traditionally you've worked with like big enterprise brands.โ€

closely with Google and Amazon and all these things I'm curious why in why are you throwing your lot in with a website with that really focuses on SMBs.

If you look at the majority of advertising on platforms like Facebook is actually SMBs and it's not enterprises if you look at how much money SMBs spend globally on marketing and how many people they employ you know it's the backbone of a ton of countries SMBs really move their economy and almost all major countries. I think a lot of organizations take them for granted and we look at SMBs if you look at today's world with the technology that they have access to like tools like high level SMBs are actually much more able to compete with enterprise companies with a fraction of the budget than they ever were before.

If you think about commerce it used to be hard to launch a data with sea website and do well now not so much you can launch a data sea website and crank and compete with the competitors really well even if you don't have a big budget assuming you have a really good product that the market needs. Another me too product it's not that easy but if you build something special your probability of success without having to hire a ton of people assuming you're using the right tools is extremely high that wasn't the case years ago AI has really changed the game from that front.

But the issue with most D to C websites is they release me to products and there's nothing differentiated and in some cases they charge more than the competitors and they're like why am I not doing well. But I think the job if I came to the market many years ago with the idea of like arming the rebels right so you could take on these these enterprise clients you could build your own e-commerce store out and I feel like AI is again in the right in the right situation where you have a really good product really good product market fit AI is accelerating that further barriers to all sorts of different things to data analysis to maybe robotic media buying or anything like that is just like a few clawed prompts away so I can see how.

Could be leveling the field for the right kind of people correct totally agree with you. I think it's leveling it for a lot of people but most of them are not the right people most people we're seeing are using these AI tools and just creating crap mediocre products and they don't understand why it's not helping them create a real business. Q4 is coming and if you've ever run holiday ads you know that it's the most expensive quarter of the year to advertise and budgets get tight real fast.

The good news universal ads is giving way $30,000 to cover one lucky brands T...

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Even if you're not the winner every eligible brand that enters gets $500 in matched ad credits so entering is a win either way. Don't wait the clock ticking entered at universal ads.com/Q4-contest no purchase necessary see official rules for details. Where you live in the attention economy but we're also very much in the trust economy. I have a note here that you ran as trust study across a hundred businesses doing eight figures.

โ€œWhat's the biggest gap between those businesses what they thought built trust and what actually customers cared about?โ€

The big thing is is most businesses felt they had a lot more trust than they really did. People are looking at things not just like your price because everyone's like oh good price. That's what's going to cause people to get a sale. It's actually what is being said about them by influencers what is being said about them on social media. The reviews, the refund policies, how many years they've been in business all these other factors really play a big component to if someone buys.

And in many cases more than just I have a cheap price. And you also have a post recently about discounts. And you're saying that in a world where you're getting these like hand fed bespoke to your exact needs and your exact context recommendations from LLMs price becomes less of a variable.

โ€œWhat do you have to say about brands that are over reliant on discount?โ€

It actually reduces your LTV from the data we've seen.

The people who focus more on bundles to get the very first purchase of a customer versus a discount tend to do better.

And a bundle is a sort of a discount, right? But you're increasing the average customer spends or average revenue per user for a similar amount of cack. And what we find is when you try to offer more value even if you charge more. So that could be giving more products for discount, but it's a bundle versus just discounting all your items and someone can just buy one. We tend to see a higher LTV for commerce.

Another one of your pieces recently, you talk about the increasing gap in sort of how people put value on impressions versus clicks. In a world where you're maybe seeing fewer leads or fewer clicks, maybe more impressions.

โ€œHow do you think founders should focus on the difference in value between impressions and clicks and how that's changed in the last little while?โ€

You don't need a click to generate a sale. A lot of people will go and see your brand buy on Amazon and never click over to the website.

What I would recommend is start looking as impressions as like branding kind of like how Nike kept running those TV commercials just do it and a lot of them are motivational. How many people keep buying Nike people could say Nike is done or their brands on his cool or have any more Nike is doing well. They've been trying to turn around the company. I think their last quarterly earnings was pretty decent. Don't quote me on that, but I'm pretty sure it was positive overall. And I'll actually look it up Nike stock. Let's see.

Oh yeah, they beat quarterly earnings estimate earnings per share by 53% and revenue beat by 1.13%. So like I said, their earnings weren't bad and they topped sales even though China, China sales dropped. So when you think about it, why does Nike do so all? It's at brand that's been out there for ages and they just keep pushing. Yeah. What do you think are some ways that D to C brands are wasting money in 2026?

The biggest ways they pay too little influencers too much money. They should go for a long tail. Legion athletics is a prime example of this. They have thousand plus influencers. They pay them a reasonable amount. It's a good deal for the influencers. They go for the long tail. It works way better than trying to pay a Kardashian to promote your product. Yeah, my friend runs Frost buddy and I think he added his peak. He said he had 13,000 content creators slash affiliates and they were all on a sliding scale of just content creator all the way up to affiliate or potential business partner.

And it's just revolutionized his business, especially on platforms like TikTok shop where you kind of need that those other voices to amplify your own. Another one who's done really well is fashion over the clothing company done extremely well by leveraging influencers and mass scale of interesting. And then the other thing I would say, D to C brands are e-commerce companies do really wrong is they focus on the sexy channels like email SMS super effective not sexy channels like what's up channels like GEO and getting a little them to mention your products super effective.

It's not as cool as posting some hip social piece of content, but you know what those other things drive sales and real revenue.

You mentioned in the in the sort of the world of 80 in GEO that at this point...

That probably goes against what I think a lot of people think that there's a very strong venn diagram overlap between what you're doing for SEO and what are doing for GEO.

But there's a difference by let's say like 20% somewhere around there and that 20% causes are algorithms to be drastically different. So like strong technical SEO helps you with GEO domain authority helps you with SEO. GEO doesn't care about your domain authority. GEO cares about most of what you've done the last 30, 60 days versus SEO cares about what you've done over the years and the reputation you built. So the factors that they're looking about are really different SEO the easiest way to think about it is more about what you're doing with your own website.

GEO is more about what are other websites saying about you. Makes sense. One of the things that came across in my research here was a bit of a reversal you've had over the past couple years on the idea of investing heavily into a personal brand. You're one of the people I know who's probably invested most time and money into the creation of a personal brand what has evolved in that strategy for you over the past year or so.

The biggest thing that I found from a personal brand is when you invest in it.

You can end up making money. But big companies aren't built on a individual they're built on a team.

โ€œAnd if you want to go enterprise similar to what you guys are doing at your agency, they don't want to hire Neil Patel they don't want to hire John or Eric or whoever it may be.โ€

They want to hire a team who's working on their account who's very knowledgeable and is going to do really well from. And those are the companies that also sell and it's also a trap because if you did find one that did want to work with Neil Patel then you have to then you then you try to give them one of your employees or someone else on your team. It feels like a lesser experience as well. So it's kind of a bit of a trap. Yes, I don't recommend building a personal brand. You can. It's not the worst thing in the world, but it doesn't help as much as one may think.

I rather have a big corporate brand than a personal brand. Look at high level.

One of the fastest growing marketing companies. Do you know any of the founders names?

No. And I don't mean that enough sense of way. No. That is the ideal way to run a company. I started it all over again. NP digital was built for the results of NP digital. We want performance marketing agency of the year by at age. One of the hardest awards to get for client results.

I rather have continually press about NP digital and no press about Neil Patel. I speak all around the world as so many conferences. I rather have as so my team can speak at all those conferences and not me. Now, I built a personal brand, which is helping me generate business and I appreciate everyone following me or a small chunk of people in the world following me. And I even appreciate the people who don't follow me. But when you look at it from that perspective, it's more scalable to not be rely on one person.

โ€œWas your agency always NP digital or was it Neil Patel originally and you just switched it to NP to be less about you?โ€

It was Neil Patel digital, like he said, and we switched it to NP digital to be less about me. Yeah. What is one overrated metric that you still hear founders bragging about? I'm going to give you an e-commerce one because I know most audiences e-commerce. And I still see them bragging about views on social.

So like, look how many people are checking out our stuff on social media following us, liking our stuff. But that doesn't necessarily cause sales. I know people in e-commerce don't do much social stuff organic. And they just want Facebook ads and they're really good at conversion optimization and they generate way more revenue. Can you think of an underrated metric? Underrated metric is your conversion rate.

Another underrated metric is your repeat purchase rate. Another underrated metric is your lifetime value of a customer. The number of times I've asked e-commerce companies these questions and they don't know the real numbers is almost all the time. This is something we're grappling with internally right now.

โ€œHow do you, maybe in the e-commerce world, if you can, or, I guess in the agency world as well, how do you feel about AI copy?โ€

Is AI copy something that, because we're marketers, we're overly sensitive to and so we can sniff it out right away. So we, do we're Sora? Sorry to cut you off, but we're Sora. Hey, down. Why? No one cares for AI content. You want to talk about an AI videos.

You want to talk about content? Who's creating a ton of content that's air related to that people love? Most people don't text-based content. It can do well on Google in the short run. And the longer it gets crushed, literally rated a study on this. I think it was like 60 websites or 100 websites or something like that. That all published a ton of AI content.

They saw increasing traffic in the short run long run. Not only did they lose a traffic, some of them wet lower than the baseline. So stay away. Stay away. It doesn't mean you can't use AI for ideation or to help you in the process or help you with ad copy. We just find for most things, it doesn't perform as well as people think.

Again, I'm not saying you shouldn't use AI for copy.

I think you should use humans combined with AI. But a lot of people most people in marketing just take the route of AI is just going to do it. And then this output is this crap. Here's, here's a random one.

โ€œWhat's the most expensive mistake you'll admit to on air?โ€

I'll admit to almost all of them. I, or actually, I would admit to all of them. I just don't remember. Uh, I can, I can name a few acquiring companies that I would have to clean up the management. And the structure, but they had to reach the clientele, the logos. It would have just been cheaper to build it from scratch.

And I learned just acquire growing companies that don't need much modeling with. This is why private equity goes that route as easier. Biggest marketing mistake running a ton of TV ads on like CNBC and Bloomberg thinking it was going to help us get the right type of clients. Got a ton of branding with finance people. Keep getting calls from potential wealth managers.

Uh, didn't really generate a look of business. Spin a arm and a leg on that. I don't know how much, but it wasn't like 100, 200 grand. Like it was way more than that. We were spending more than that just on TV ads, sometimes in a given week.

I think our commercial to produce it. I don't know how much it was. Call it 100 grand. But not not not when you'd repeat. Yeah.

Branding scraper branding to everyone in the masses is never a good thing.

Building a social falling for the masses. Never a good thing unless you're going. You know, be to see, but even be to see you need the right audience. I'm a big believer. Focus on building a big brand with your ideal customers.

Like really focus on your ICP even if you're in B to C. I should have started this with at the beginning.

โ€œBut just describe what is the Neil Patel universe right now?โ€

Like what does your what is your focus spent on on a day to day basis. Most just NP digital. I think it's all speaking our conferences, sales pitches, marketing content, meetings, business employees. The works.

What is NP's digital? I guess you're an omnichannel digital marketing agency at this point. But what what does the breakdown of like the services you provide most kind of look like? Most is paid ad management SEO genius like ranking on chat GPT or game. I'm to mention you conversion optimization.

I would say those are content marketing, social media marketing. Those are probably the biggest ones. Do you invest in brands like e-commerce? Yeah. Not our cup of tea.

I was going to say, what do you think of the e-commerce opportunity over the next couple years? I guess we mentioned merchants are really empowered. But what's your, yeah, what's your take on that?

โ€œYeah, I think the e-commerce opportunity is massive.โ€

You just have to create a really good product. I'm a B to B guy. If you look at all the businesses that I've created, they're pretty much B to B companies. I just stay in my lane. Yeah.

I don't think there's anything wrong with e-commerce just not my lane. Yeah, fair. What's the best money you've ever spent on yourself? If I had to say best money, just like myself, not family or anything like that. I would say probably things related to health and fitness, longevity.

If you sleep better, like you buy a nice mattress or you work out more, you know, you'll function better. I don't know how much my mattress costs. It's not the most expensive, but it's not the cheapest. It is expensive, but there's mattresses that go for 100 grand, 200 grand. I don't know how much my mattress costs.

Maybe 20,000 bucks or something like that, which I would say is expensive for a mattress. I could be wrong.

But you spend college a third of the day sleeping.

So why not make sure that you're energized that you work better? I want to know what this. Do you said 20,000 dollar mattress? How big is that bed? Does it king bed?

Normal king. Nice. Where do you see this whole, like, do you have any predictions? Obviously, you're on the cutting edge of, you know, LLMs and LLMs shopping. We're actually about to release and July.

A big report where we're surveying a bunch of consumers and a bunch of merchants about the state of AI discovery. And one of the things that I think is interesting is people are giving away more and more. Not they're using these tools more and more. And it's helping compress the middle of the funnel a little bit, where you're just getting really good answers.

But it might get to the point where you actually have sort of an AI and always on AI assistant who will even potentially make purchases for you.

You know, with just an OK from you or, or something like Jimmy predictions about where you see AI commerce kind of developing over the next couple years. Yeah, so what you said, but think of even more. Imagine you opening up your fridge and AI can read what you're eating on a regular basis. Like your vitals by, you know, doing a prick when you open the door, reading some diagnostics or weighing you or just looking at you or your posture or whatever it may be. And recommending new foods, recommending cheaper alternatives, recommending healthier alternatives, and then it just gets delivered to your house and stocking your fridge by a robot.

That is what I think the future of commerce is but for almost everything. I think things are offline will be really integrated with your online and that is how a lot more transactions will happen. If you think it will get to the point where if you don't take the advice of your AI, your taxes will go up.

No, you don't think that will ever get to the point like the other, well, who...

That is doing analysis on you every time you use it.

I don't know, but I would buy it. I think so. All right. Let's, let's get into business on this. Total has good toilets. What's one thing that brand owners who are listening to this podcast right now should do to improve their AI discoverability.

If I was a brand owner trying to improve my AI discoverability right now, I would try to figure out how to build relationships with other websites in my space.

Not e-commerce sites, but journalists six sites, publisher type websites, blogs, build relationships and try to get them to cover me and talk about good things about my product. That'll help with your LOM citations and getting out there and generating more sales. And then just on the reddit side, reddit to me is just such a, it's such a hard platform because if you, if you come across two sales, the on it at all, you're going to get eaten alive.

โ€œWhat do you, what do you recommend for how people should approach, read it?โ€

I imagine it's the same thing you'd say there. Make genuine relationships, make genuine value with the comments. The community help out before you be self-promotional when someone complains, try to help them out, but if I was at e-commerce, I wouldn't focus too much on reddit, I would focus on more so getting listicles on other people's websites. Generally like building relationships and having them want to write it and not offering them any money. That will produce more results than focusing on reddit.

All right, well, Neil, thanks for coming on to this was rapid fire value about all things LOM in the future.

โ€œAny closing words for the D to C listeners about where their attention should be with the rest of this year?โ€

On the ugly, the money's in the ugly, not the sexy. Stick with the ugly, like actually building great content, great products, great relationships. I'm looking for the hacks, I'm looking for the hacks. Yeah, there's no more silverable marketers, marketers want hacks. Yeah.

Gotta put in the work.

โ€œWell, thank you for taking the time today, Neil.โ€

Everyone go follow Neil on all his various platforms.

Always put in a value, thanks for coming in today.

No problem, thanks for having me. Thanks so much for listening to today's episode. If you're not a subscriber to our newsletter, you can do that right now at direct to consumeralloneword.co. I'm Eric Dick, and this has been the D to C podcast. We'll see you next time.

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