Ep 61: Amazon’s Buy with Prime; AI content & the future of the internet, What content drives SMB research?

Part 1 Video start 0:13 - Amazon’s new Buy Prime looking to push Prime across much of e-commerce

Part 2 Video start 10:01 - What is the future on-online content? Will it be AI generated?

Part 3 Video start 18:12 - What content works best for SMB research when buying SAAS products?

Reference Articles:

1. Amazon targets rival Shopify with a new ‘Buy with Prime’ service
2. Google Says AI Generated Content Is Against Guidelines
3. A.I. Is Mastering Language. Should We Trust What It Says?
4. Bredin Report: What Content Works Best for SMB Research?

Transcript Ep 61:

Greg: Welcome back everybody to the Near Memo with David, Mike, and Greg, where each week we bring you three items or more, sometimes, that pertain to the world of search, social and commerce with a kind of local flavor. And as always, there's a ton of stuff to talk about that we draw from headlines and from our newsletter and from more in-depth pieces on the website.

Um, and today we're going to be talking about a, kind of a range of, of disparate things. I'm not talking about. Netflix which is kind of interesting. Um, and CNN. Yeah. Right. So that's, that's a wacky, like they gave it a month and they're killing it. You know, that's a kind of a wacky thing, but I guess they had high expectations and they were radically disappointed, but we're going to start off today with Mike talking about the extension of prime shipping and other associated functions to non-Amazon merchants.

Mike: So it does require that. So it's called Buy with Prime. I think it's really an interesting move by them and requires simple JavaScript be put onto a merchant website. It allows that merchant to offer all of the benefits of Prime like service. It's actually is, you know, fast shipping from Amazon warehouses, free shipping, all the things that Amazon is known for obviously including easy returns and all the other stuff.

And it is just a fascinating push from Amazon of both their logistics, their payment and their brand, their customer relations, reputation out to the rest of the e-commerce world. And in the article, I just thought it fascinating that they noted specifically that retailers will receive shopper order information and email addresses for customer orders, both sort of as if that's a benefit.

I mean, obviously they have those things. Now I think the flip side of that is that Amazon is now going to be seeing the email address and customer information for orders they weren’t previously seeing. So there's certainly a double-edged sword there. The article pointed out that this positions them very forcefully vis-a-vis Shopify who has been attempting to, to create a delivery network, not particularly successfully.

And from what you said and what I've seen, Shoppify is trying to buy this company called Deliverr to for some sort of. To there

Greg: to do two day shipping

Mike: today's show company. And it's just a fascinating move given, given how it's very ostentatious in some ways, it certainly is one that will raise the eyebrows of antitrust regulators because it pushes Amazon further into the e-commerce ecosystem and also the local ecosystem.

I wonder how much, I wonder what type of retailers would agree to do it, and how much it's going to impact Shoppify, but also it's interesting to me because it really impacts to me in my mind, UPS and FedEx, because it intervenes into the order process in a way that excludes them from ever possibly delivering orders that they're currently delivering.

So I think the big impact is also going to be there. So I'm just curious, like what retailer would agree to do this, why? And then what's going to happen to Shopify in this and then FedEx and UPS.

Greg: Yeah, there are a lot of, a lot of fascinating dimensions to this. I mean I read a statistic that said 60% of the sales on Amazon now are from third-party sellers.

And this, in one sense, it's an extension of that outreach to third parties. You know, they're moving from Amazon sort of only inventory to what we have today, which is a marketplace. And then they're extending that reach into the entirety of the ecommerce Web, hypothetically my

Mike: My read is that it is Capitol non-intensive for them and very margin rich.

Greg: Well, except, except for the logistics piece of it. I don't know what the cost implications are there, but I mean, if it's wildly successful, then they've got more trucks and more people running around delivering stuff on behalf of others. I would guess that major retailers are not going to bite at this because they want to have more control.

I was talking to somebody from Sephora the other day about Google real-time inventory on Google. And she was telling me this was all just very informal. She was telling me “no, we don't participate in that. We're not involved in that” because there's, I think an inherent suspicion of these big platforms by major retailers, especially around data who owns the data.

What kind of data are they seeing? Can they use it to compete against me? Smaller retailers, the ones that don't have the capacity to meet consumer demands for two day shipping are the ones I think that are likely to do this or medium, you know, sort of medium and small, maybe not the true mom and pops, but medium and small, that would be my instinct.

David: I would agree with that.

Mike: amazon will extract their pound of flesh

David: Yeah. But, but if you're sort of, you know, a nascent, if you're a nascent e-commerce brand, I think you're probably more eager to drive growth and anything that would help increase conversion during the checkout process would probably be worth the trade-off at an earlier stage or smaller stage company.

Uh, so Greg, I agree. I think that's, that feels like the most natural uptakers of this offering. The flip side of that is if you are a major brand and you already have a store on Amazon, I mean, I'm not embedded deeply in any major e-commerce client, but you know, it'd be curious to know what percentage of someone likes Sophora don't know if Sophora has an Amazon store, but what percentage of their sales are already coming through their Amazon sort of channel and if it's already a substantial percentage, I mean, are you really losing that much by increasing conversion on the remaining 20 or 30% of your customers? So I don't know. Um, I think it's a really interesting offering. I think it should raise all kinds of antitrust red flags, but smaller merchants are probably more likely to take advantage of then larger ones.

Greg:. So Sophora is in fact on Amazon. And I think that's a very, I think that's a very good point. If you, if you're already invested in Amazon, does this really matter? I think there's data that show consumers have been conditioned now to expect fast shipping. That's one of the number one or number two things that they want from e-commerce and a lot of merchants just can't deliver it.

There are a couple of companies, at least, dedicated to duplicating PRIME-like shipping speeds you know, off Amazon..

David: Yeah I would say fast and free. I mean, if I have a hundred dollar apparel order from some local merchant and shipping ends up being $18, like that adds a substantial amount to my overall card.

And it makes me think twice about ordering an item that really, you know, theoretically, I could get a similar item from Amazon with free shipping. So if the free part is part of this offering, I think it amps up the increase in conversion that you might get from this as an independent brand.

Mike: So according to the article I read it is part of the part of the offering.

Greg: So do you have to be a prime member as a consumer to get to use it? Or is this just available to anybody who's buying on these third-party sites.

Mike: That's a good question. I don't know.

David: I assumed you have to be a Prime customer already. That you'd have to OAUTH through Amazon to tell the merchant that you are eligible for this offer.

Greg: Yeah. Um, probably so in which case that, that becomes a another recruiting tool for more, you know, I mean, Amazon's got like some massive number of US  households now in Prime, but it's not a hundred percent.,

David: So they have  to convince you Greg to pay the increase in membership dues this year.

Greg: I payed it because I'm lazy. I just let my credit card get charged.

Mike: Yeah, but are you going to let your Netflix subscription go?

Greg: No. No. We'll talk about Netflix and other time and ads, but I, it, I think, I think it is an antitrust issue. I mean, although it's, it's not manifested, right. It's not like they're buying a big competitor.

Who's now going to take competition out of the market. This is a very different,

David: complete benefit consumers. I mean, you know, the free, free shipping is a huge consumer benefit, so

Greg: right. And this is, and it's what consumers repeatedly say they want. And so, and so this kind of old antitrust lens, which is, is it going to increase prices? Is it going to harm consumers really doesn't apply at least in the near term here. Now in the long-term, it might, if you're diminishing different kinds of options and making everybody totally dependent on Amazon, but,

Mike: well, I think it was in the Washington, DC attorney general claimed that the free that Amazon controlled pricing, they prevented resellers from having a lower price, any place else, and it included free shipping. So it effectively did drive consumer prices up because they control both sides of that equation. So there is an argument that on the table that does go to pricing.

Greg: Yep. Okay. Well, we could talk about that for a very long time and it would be fascinating, but in the interest of time, let's move on. And one thing among several that were really interesting to me this week was. There were two things that happened. So there was a John Mueller who's um Google, I don't know what his title is.

He's like a webmaster. Yeah. So he was in it. He was, he does these webmaster office hours and people ask questions. He responds to them. And one of the questions was. About AI generated content or auto-generated content as Google calls it. Um, is this, how, how is Google treating this? And he said, Mueller said this is against our webmaster guidelines, which I think is a good position.

Uh, I think if you read the guidelines, it's not as clear. And of course Google is using auto-generated content itself in places like Gmail. And now in Google docs to create summaries of doctors. Um,

David: and it Google business profiles, as we talked about last week, which I send from the marketing o'clock team, highlighted the inherent contradiction there of Google violating its own guidelines and Google business profiles.

So, right,

Greg: exactly. So, so I mean, I think there'll be sort of creep that, that, you know, Google is concerned about quality more than the source of the content and they say in their webmaster guidelines, so simply posted it. Auto-generated content without human editorial oversight is a violation, but what it implies is if a human touches it in some way or reviews it in some way, it might be fine.

There was an an article in the New York times magazine. I saw it online, but I assumed that it showed up in the magazine by Steven Johnson, who is an author and was involved in a local startup years and years ago, which whose name? I can't. But anyway, so he wrote this lengthy article about open AI and the increasing sophistication of AI content, language, understanding, and its ability to generate content.

And so now you can get paragraphs paragraph upon paragraph jet generated with simple prompts that apparently operate at the level of high school writing proficiency, which is pretty impressive and that'll get better and stronger. And. It's semi instantaneous and it's cheap at least sort of at scale.

So it makes me wonder about what the future of search results will be the future of content on the web, the future of news. You know, there's already new sites that are using AI to generate sort of simple stories like weather reports and things like that. So are we facing some tsunami of machine generated content and as Google sort of the last line of defense?

Against a future where machines are, you know, kind of responsible for much of the content that shows up online. That's, that's kind of the question in my mind.

Mike: Some content lends itself better to this than others. For example, a summary of a ball game. Yes. There's a certain format to it with strict parameters and numbers involved than others.

But I would assume that that low-hanging fruit maybe has already been being driven by.

David: Yeah, I certainly in the fantasy sports world, we've had these automated write ups that have been getting better and better and better over the last decade of, of my participation. Anyway. So.

Greg: I was going to say to

David: Mike, I think the ball game is kind of a perfect a perfect example here. I could actually see a the combination of you know, of artificially curated, 30 to 62nd video summarizing the game with clips with an automatic text summary being actually much more valuable than most of the summaries that you get on a.

Typical ESPN, you know, $10 an hour beat writer I'm actually putting out. So I think that that's a, it's a reasonable use case. I think when it get, when you get into more. Y

Mike: you should get plastics.

David: Yeah, exactly. Hairy areas that are a little bit more in the your money or your life situation. I think that those are just going to be harder to fake generally, and that lower quality content is, is going to have a whole bunch of bad user signals that Google's not going to like.

Greg: Well, I'll raise two points. Um, one is the point that you sort of implied a second ago, which is, does it really matter? I mean, this sort of is speaking out of the other side of my mouth. Does it really matter if the content is good? If it does what it's supposed to do? Does it matter if a human generates it or somebody in a developing country that's, you know, paid very little or or.

That's I think that's, I think that's an interesting philosophical question, but I I'm reminded, I was immediately reminded of the whole era of content farms in the sort of mid to late two thousands. I don't know what to call the decade. The arts, right? Yeah. When, when, when you know, there were a lot of companies, demand media and others that were paying these.

Teams of writers to crank out E how and all these, all these sites that were just trying to flood the syrup with content to rank. And then they were showing display ads and it was a kind of you know, it was, I dunno, it's not exactly arbitrage. In some cases, maybe there was some arbitrage, but it was really all about getting display impressions and just generating article after article after article.

And this would seem to be another way to do that sort of thing. And so I'm hopeful that Google's You know, holds the line on this. So we don't, we don't have lots and lots of crap and more noise and nonsense than we already do in the SERP.

Mike: You have one area where I think it would be useful is helping to generate, for example, responses to reviews, where it provides the business with.

A unique response that the business could then modify, but then at least the business might be able to take the time to actually do it. I think there are use cases where it makes totally

Greg: good. Well, that's, that's a little, that's a little bit different, but I think you're right. And I, I do think that people are already using templates.

So, you know, I think this is the next step is just to create a more personalized. Response and customer service is another area for better, for worse, which is going to see a lot of this. I mean, you've got, you've got bots currently that are basically just, you know, regurgitating FAQ's and with something like this, you'll have much more sensitivity and much more personalized responses.

And so that could be a good thing. Or it could be just a rage inducing thing, you know, depending on how.

Okay. So

David: Mike, that you, you know, you bring up a really good point. I mean, I think we it's sort of, um self-evident at this point if you fit in the industry long enough, right? That small businesses are terrible about writing about themselves. Um, you can't set up a small business down in front of a keyboard and expect them to come up with four paragraphs of content about a particular service, but you can get them to record a 22nd video where they're explaining their service.

And maybe you can run that transcript through AI and actually build out a much more useful. Uh, you know, consumer friendly description of a particular service that a business is offering. So I see it as, I mean, it's definitely a double-edged sword. You don't want the e-health thing to proliferate, but it could give time strapped sort of, you know, non-professional writer, SMBs a leg up in actually promoting doing a better job of promoting

Greg: themselves.

So I think that's an excellent point. More likely than not what you'll see as agencies and third parties acting in an agency capacity using those tools to do that kind of thing. On behalf of the small business customer. I see. Mike, you were going to say something. Well,

Mike: I just think there's, it's just for good business ideas in this last 15 minutes.

Greg: Well, so that's an article, let's turn it into a, into a PR piece. That's a, that's an interesting article. Um, and so, so for our final installment or segment today, yeah, we'll be, we'll be hiring Chris Wallace. Who's now going to be out of a job for our, no, I'm kidding. Anyway. Is he a CNN plus guy? Yeah.

Well, I think they're, I think they're going to be, I think they're going to bring some of those folks into the main, the main shows, but anyway, enough with that. So David, you, you were interested in talking about some of the findings of a recent breeding study about small business software buyers, content preferences.

And what did, what did that. Yeah,

David: so breaking stuff. And so this is where the segue sort of plays in. Uh, so breeding's done a lot of these these types of surveys of small businesses who are buying from various SAS companies. And there's been an overwhelming preference. If we, as we've talked about in previous near memos, overwhelming preference for sort of self-research self discovery, not the sort of outbound sales model, it's much more particularly for smaller and medium-sized companies.

Um, they. Rely on a salesperson. They want to do their own research. So this most recent survey from Breeden was asking, okay, well, if you do want to do your own research, you know, what are the content types that are most likely to catch your eye or induce you to buy? I forget exactly how they phrased it.

Um, and they did some interesting Cohort analysis, segmentation of the survey, they looked at how professional services folks reacted to a very various set of content types versus manufacturing versus retail. And then they also broke it down by the generation of the respondent. So gen Z, millennial boomer, you know, et cetera.

And, you know, there were, there were. Th there were some sort of outlier responses. Uh, for example the, the one that struck me 43% of gen Z or millennials was most likely to use Facebook posts as their preferred. Content format that they came across something from a software vendor compare that to only 10% of boomers.

So, I mean, that's a substantial difference, but by and large, I mean, the types of content that they were asking about Facebook posts, podcasts checklists, or worksheets tweets, email newsletter. To me, there was not a huge, like there was sort of the same level, a very similar level of interest in, in coming across content in many of these different types of formats.

And so to me, it speaks more to the difficulty of content marketing these days, that even if, you know, you have a very specific, you know, target buyer of. They, you know, an older millennial at a manufacturing company, you kind of still need to have a pretty holistic content strategy because you don't know what's actually going to catch the, be most likely to catch their attention.

So and this is where I think the segue hits. If there's a way for artificial intelligence machine machines, to help me scale out a blog post into all of these different formats or scale scale up a. You know, a social post on Facebook into a longer form piece that somebody that, that a boomer in manufacturing is expecting to see then that might, you know, that might be a huge benefit for marketers, even if the goal is not necessarily to rank better in Google or to spam spam the world with all this content, but just to help me.

Reach my consumers in the format that they prefer the most. Cause I think that that, to me, it was the biggest takeaway is that there isn't one sort of dominant format that everyone is hoping to come across your content.

Greg: So, well, I mean, as somebody who is uh, a content marketer in my previous job, it's just really challenging to, to, to deal with all the, by the funnel stage.

And the personas and the different channels, it's kind of an overwhelming thing. You know, there's just, it's just, it's not humanly possible, which brings in the idea of, you know, some sort of AI aided approach. And I suspect that's what we'll see, you know, we will, we will see what you envision hap happened to some degree and, and you know, for scale content is expensive.

Content teams aren't getting larger, but the expectations are so I, I suspect.

Mike: I was just wondering if maybe it's the problem with the expectations that you should have personas and multimedia, and maybe the expectation is wrong. Not the actual output. The

Greg: expectations are kind of crazy, but this is what they are, right? I mean, this is what, this is what they're full of shit. Well, this is what CMOs, this is what CMOs and, and market, you know, C-suite folks expect is they, you know, there's a kind of.

Uh, conventional wisdom here about you know, you've got to have content and it's got to cover all these bases and if you're, and if you combine, so I'll just not to disparage my former employer, Uber all, because I liked them very much. And I like all the people there. Um, but we, but we had, we had multiple languages and countries.

We had funnel stages. We had, you know buyer profiles and, and, and we had verticals to some degree, you know, and it just, you know, it was like five people or four, four or five people. So it was just, it was just impossible. There was kind of an inherent impossibility about trying to generate content, to meet all of these categories and needs.

And I think that a lot of companies are in that same boat. I mean, if you're in a single market and a single vertical, you know, us and you're doing. Plumbing or whatever it is or, or, you know, HR software or something it's, it's much easier for you.

David: Yeah. But even in the verticals, I mean, that's what I thought that maybe the most interesting piece of this was the, the, the age-based, you know, generational differences.

So even in HR software, you probably have millennials who are sort of moving into the leadership roles and you still have silent generation folks and they have various. Preferences on where they want to be to not

Greg: probably not silent generation. Those people are probably not in the workforce. You never know

David: inflation being what it is.

Yes, I guess that's true.

Greg: I guess that's true. But okay. I think we've come to the end of another exciting episode, episode 61. And this is we're recording this on earth days. Um, you know, take shorter showers, use less energy, buy fewer things. Uh, don't use single use plastics, all of that kind of stuff. Um, and we'll see you next time.