Is the baton of cross-border e-commerce going to be handed over to ChatGPT? First Etsy, then Shopify, followed by Wal Mart eBay， Within just one month, ChatGPT’s e-commerce circle of friends has rapidly expanded.
At the end of September, OpenAI announced the launch of instant checkout functionality on ChatGPT, allowing merchants from Etsy and Shopify to access it; Later, Wal Mart also announced that it has reached a cooperation with OpenAI, and ordinary consumers and Sam members can directly purchase Wal Mart products through ChatGPT; EBay revealed during its earnings call that it will explore the possibility of AI e-commerce in depth with ChatGPT.
ChatGPT is becoming a new entry point for e-commerce.
Several service providers in the GEO field (Generative Engine Optimization) have told Yibang Power that in the past, companies willing to invest budgets in GEO were concentrated in industries such as cross-border finance and apps; Now, more and more cross-border merchants and overseas brands are emerging, and budgets are shifting from traditional SEO to GEO.
This is a brand new window of opportunity. Although at present, ChatGPT only exists as a traffic entry point, and the backend fulfillment is still left to e-commerce platforms and independent websites. The migration of user habits may also need to be done on an annual basis, but the huge user base and potential value of AI e-commerce have already demonstrated the possibilities brought by the “new entry point”.
More than a decade ago, in the field of product search, Amazon played a leading role and constantly stole traffic from Google.
Now, the new generation of succession has come to ChatGPT.
Stealing traffic from Amazon and Google, independent websites welcome another spring?
A report by market research firm eMarketer in 2018 showed that in 2015, Google accounted for about 54% of product search entry points, while Amazon accounted for about 46%; And by 2018, the numbers of these two had “basically reversed”, with Amazon surpassing Google. At that time, a key factor why consumers preferred Amazon more was that it gathered a massive number of genuine user reviews, making it easier for consumers to compare, judge, and make decisions.
Nowadays, consumers prefer to receive a directly usable answer.
We have found that from the perspective of users’ purchasing journey, in the past, people may have searched on Google first, but now users increasingly need to directly obtain reliable answers. For example, if a user wants to compare the advantages and disadvantages of 5 or even 10 products in the same category, AI can directly provide answers, which means that 70% -80% of the purchasing journey has already been completed on AI, which has a significant impact on traditional e-commerce platforms. ”Nick, CEO of CBD (CrossBorderDigital), the exclusive strategic partner of SEO tool service provider Semrush in China, said, “We also found that the conversion rate of AI traffic is about 4.4 times that of Google’s traditional SEO. ”
EMarketer predicts that ChatGPT will have 77.1 million US users this year, accounting for nearly 66% of GenAI users. Adobe data shows that 53% of consumers plan to shop through GenAI this year, and most consumers are turning to GenAI for product research (55%) and recommendations (47%).
The first to reap the benefits may be cross-border merchants who operate independent websites.
Yang Yizhou, the overseas operations manager of GEO service provider Zhitui Era, stated that the brand’s independent website holds a considerable weight in ChatGPT’s sources. Its logic is to first search for information on your independent website/official website, obtain the content, and then search for verification information across the entire network
OpenAI’s announcement also shows that ChatGPT’s recommendation logic for products will be based on the “relevance” of the products, and the displayed product sequences will be natural rankings, unrelated to advertising, and will not charge merchants for search or recommendation related fees. Only a certain fee will be charged after the order is completed. When facing different merchants selling the same product, ChatGPT will consider factors such as inventory, price, quality, and whether they are the main sellers to rank them.
In the collaboration between Shopify and OpenAI, Shopify also stated that it will provide support for product discovery through real-time data such as pricing, inventory, images, variants, etc., enabling billions of products to be presented in formats that AI can understand. The merchant’s store name will be displayed on the front desk, and corresponding user data will also be provided to the merchant. In addition, merchants can also choose to accept two payment methods: GPT internal payment or transferring to an independent payment station.
The value of independent websites will continue to increase, “Nick said.” Compared to other e-commerce platforms, the content assets of independent websites are completely controlled by merchants, and there can be countless introduction pages, FAQs, brand stories, all of which can be understood and referenced by AI, giving brands more space to showcase their talents. ”
But Yang Yizhou believes that the possibility of “GEM” (Generative Engine Marketing), which refers to advertising flow within AI platforms, cannot be ruled out in the future. Nowadays, various AI platforms want to take the path of commercialization, and GEM will be an essential stage in the future. GEO and GEM will coexist, just like SEO and SEM today. ”He said, ‘Perhaps one of the six answers to a question is sponsored advertising.’ Recently, OpenAI also stated that it is considering introducing advertising.
Alliance marketing has become an important “source” for AI e-commerce
From an operational perspective, GEO’s strategy is not fundamentally different from SEO, and there are even some similarities.
Yibang Power has learned that whether it is the original SEO or the current GEO, there are several advantages in terms of content:
1. High quality content, whether it is Google or big language models, is committed to providing high-quality content that meets user needs and preferences, which is still relatively scarce;
Structured content, such as product specifications, specifications, materials, compatibility, certification documents, etc., need to be presented within a structured framework;
When generating deterministic answers, AI will prioritize reliable sources for high weight media and information sources;
4 originality, unique and scarce content is more easily cited by AI.
But the difference is that the purpose of SEO is to make users see and click on links, in order to retain users on the page; The purpose of GEO is to provide more accurate and clear answers, allowing AI to retrieve, understand, and apply information.
“In China, there is a ‘vassal separatism’, and each AI application has its own preferred source of information. For example, Doubao likes to catch Tiktok and the content of today’s headlines. ERNIE Bot is the Baijia account and Baidu Encyclopedia, and Yuanbao is the official account and video account. ”Yang Yizhou said, “But ChatGPT is different. Its sources are more scattered, including independent websites, Wikipedia, Reddit, LinkedIn, etc. ”
ChatGPT does not favor a single channel, but instead uses cross validation algorithms to collect information from different types of libraries, websites, and even some communities. Multiple different sources point to the same result before giving a definite answer. If all the sources verify the same result, the AI can confidently say that even in this situation, there will be a significant improvement in conversion rate. ”
From the perspective of source cross validation, affiliate marketing has become a more suitable scenario for GEO.
For example, the downstream ecosystem of affiliate marketing is extremely rich, with some being internet celebrities who cooperate with brands in the form of commission sales to increase sales. There is no clear external link pointing to independent websites, which has little value for traditional SEO and cannot directly elevate the weight ranking of independent websites. However, the recommendations and endorsements of internet celebrities themselves can serve as one of GEO’s “sources”; In addition to internet celebrities, media and community KOLs with high AI citation rates are often an important part of alliance marketing, which is also where GEO needs to focus on layout.
When everything is saying the same thing, for AI, this is the fact, and it will give these as a definite answer to the user. Therefore, the value of affiliate marketing is actually higher than in the SEO era. ”
At present, GEO’s ROI can be monitored to a certain extent.
Yang Yizhou stated that currently, ROI monitoring in GEO tends to be done at a later stage, that is, based on the comparison of traffic before and after brand independent sites. Generally, after two to three months of GEO, the number of active registrations on the official website will increase significantly; In the future, the commercialization of ChatGPT will continue to advance, and even after being directly “towed”, ROI can be monitored in real-time. Just need to constantly emphasize a specific AI only link to GPT, which does not exist in other promotional links, to complete monitoring.
Is it the Matthew effect of big brands, or the curve overtaking of small brands?
When AI starts recommending products, another question facing businesses is whether it will exacerbate the Matthew effect in the industry?
Compared to traditional SEO, ChatGPT is more friendly to top brands and will exacerbate the Matthew effect in the industry. ”Yang Yizhou pointed out that on Google, even some long tail keywords that are not on the first page can still gain some traffic. But ChatGPT usually only recommends about 6 brands, and more than 10 are rarely recommended. Therefore, competition from the top will intensify, and if you cannot appear in the first six answers, your traffic in AI applications will be equal to zero. ”
However, the winner takes all era does not mean that small and medium-sized brands have completely lost their market space. Nick believes that GEO has instead given some small and medium-sized brands the opportunity to overtake on the curve.
AI is relatively decentralized. In other words, you can find some websites that do not have particularly high weight scores but are heavily referenced by AI, which are the sources of corpus that AI values. ”Nick said, ‘As long as you focus on vertical segmentation and produce high-quality original content, there is still a high chance that these will be cited by AI.’. ”According to official research data from Semrush, ChatGPT even heavily references content ranked after 21st place on Google.
This is the advantage of GEO over traditional SEO. In Nick’s opinion, many giant companies have accumulated rich SEO assets, which are difficult for newcomers to surpass, and small and medium-sized brands have instead gained opportunities in the new environment. The next six months to a year will be a period of dividends, and the brand that takes the lead in laying out GEO is likely to establish an initial advantage. The key is whether the decision-makers of the enterprise have the awareness of doing GEO. ”
The search behavior of users is also changing. In the era of SEO, users often search for one or two keywords, which have a lot of room for extension; In the context of AI, it is a layered stacking of constraints, and AI will also filter based on this. From this perspective, verticality and segmentation are the key to breaking through the situation for small and medium-sized brands.
It’s like a drum, not afraid of a hammer, but if you prick it with a needle in a niche field, there’s a high probability of it standing out, “Yang Yizhou pointed out. In some comprehensive categories, small and medium-sized businesses find it difficult to compete with top brands. As more and more top brands pay attention to the role of GEO, more and more budget will be allocated from SEO to GEO, forming a certain degree of bidding – each top brand wants to rank first in AI answers.
But there is no doubt that building a brand is more important than ever before. If in the past, many players were able to survive well in the white card market by relying on investment and purchase volume, then the next era will be brand first.
The Matthew Effect does not mean that small brands have no opportunity, but without a brand, there is no opportunity. When users request ChatGPT to recommend products, it will not recommend a particular product without telling you what brand it is. This forces all manufacturers to do business with brand logic, focusing on reputation and brand value. ”Yang Yizhou said.
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