ChatGPT launches search feature, Reddit's growth is on 🔥 and TikTok dances the Brazilian samba 🇧🇷

Dear Marketeers,

What a week! The budget is out, the markets react, and Manchester United sack (and the hire) yet another manager. In this week’s edition of Franc Talking, we look at ChatGPT’s significant move into search, Reddit’s growth machine and TikTok’s explosion in Brazil.

ChatGPT flexes new search feature and turns up the heat on Google

On Thursday, ChatGPT announced in a blog post the launch of their new search feature within their current product - ChatGPT Search. I’ve been using ChatGPT to discover information, process data and to make up stupid poems to entertain my kids, so I was intrigued, especially given my background in search, to see whether the behaviour would change and type of output I get.

The growth of ChatGPT is phenomenal. It will likely come as no surprise that the website (alongside the old ChatGPT subdomain—Pi) is already beating traditional search engines in terms of monthly visits, with the past few months showing significant acceleration of usage:

Of course, they are miles away from getting the same sort of daily usage that Google enjoys.

Still pretty dominant, right? But if you take a closer look at Google in isolation, it does suggest that their market share is eroding ever so slightly. So make no mistake, this is a huge threat to Google, which is why it’s unsurprising that Sundar Pichai, Alphabet’s CEO, referenced AI and their investment in technology a number of times in his Q3 earnings summary.

Google is coming off the back of an impressive earnings:

• Total Revenue: Increased by 15% year-over-year to $88.3 billion, surpassing analyst expectations.

• Net Income: Rose to $26.3 billion, or $2.12 per share, up from $19.69 billion, or $1.55 per share, in the same period last year.

• Google Cloud: Revenue surged by 35% to $11.4 billion, driven by strong demand for artificial intelligence (AI) infrastructure and generative AI solutions.

• Search Advertising: Revenue grew 12% to $49.39 billion, benefiting from enhanced user engagement through AI-generated search summaries.

• YouTube: Combined ad and subscription revenue exceeded $50 billion annually for the first time, reflecting increased user engagement and advertiser interest.

I was surprised to read the many references to AI Overviews, which are extremely new to Google’s search repertoire. Yes, I get that the narrative needs to showcase how Google is meeting the threat of ChatGPT and the fact that Google is, arguably, the biggest player in AI having acquired Deepmind in 2014, which has somehow lost early ground in the race - yet the product has only just started rolling out globally and started incorporating ads as of a month ago.

Google has the data and I do not, but I find it hard to believe that AI Overviews is a major reason for these impressive earnings and is more around the narrative with ChatGPT making impressive strides forward.

In the old world, you would go to a specific platform/app/website to gather all of your information. ChatGPT will no doubt focus on integration and build partnerships like they have done with Apple, to reach new users when they might not even know they are using it.

Meta is attempting to up its search game

Not content with his new jacked up glow up and full, curly barnet, Mark Zuckerberg is reportedly looking at getting into the search game and reducing Meta’s reliance on Google/Bing to provide news content to users.

This gained traction in the week when Meta announced a partnership with Reuters, and this type of commercial agreement will be the norm, as I commented on LinkedIn back in May, in order to train LLMs and ensure publishers don’t get burned like they did by Google years ago.

The dark cloud of misinformation from the 2016 US election still lingers over Meta. Any deal that promotes news content within the platform will no doubt receive significant scrutiny from both the press and regulators, so this development will be one to watch, especially regarding how it’s integrated within the platform.

Reddit’s growth machine continues

Reddit is an unbelievable success story and highlights the power of combining community, organic visibility and generative AI to accelerate growth. Since going public in March of this year, the stock is up 145.61% and the firm just had it’s first profitable quarter:

• Profitability: Achieved first quarterly profit since going public, reporting a net income of $29.9 million (16 cents per share) for Q3 2024.

• Revenue Growth: Revenue increased by 68% year-over-year to $348.4 million, surpassing analyst expectations.

• User Engagement: Daily active unique visitors rose by 47% to 97.2 million, indicating strong user engagement.

One aspect that always stands out to me is how firms can leverage technology to scale quickly and expand into new markets. Some of their highlights citing machine learning and International expansion:

• AI-Powered Translation: They have expanded machine-learning translation features to over 35 countries, including Brazil and Spain, allowing users to translate entire Reddit feeds, posts, and comments into their preferred languages.

• User Growth: The AI translation feature has been instrumental in increasing international user engagement, contributing to overall daily active user growth.

• Future Plans: Reddit plans to further enhance its AI-driven localisation efforts to make the platform more accessible globally.

I noticed an impressive DAU (Daily Active Users) chart posted by Rich Holmes over on Substack:

This highlights Reddit's impressive Q3 growth in increasing user numbers across new non-English-speaking markets. The following table shows traffic growth across Reddit's international markets in Q3 2024 compared to Q3 2023. I think you’ll agree, this is pretty impressive growth.

Right now, Reddit seems unstoppable as it continues to grow its community, expand its advertising capabilities, and generate profit. However, a major threat to Reddit’s growth trajectory is its reliance on Google to maintain this momentum.

Samba is rife on TikTok

I was doing some influencer marketing research this week and hadn’t realised just how big TikTok is in Brazil. I need to up my TikTok Samba related football content.

According to Similarweb, over the past 25 months, users from Brazil have accounted for nearly a quarter of all traffic to tiktok.com:

According to StatCounter, 85% of smartphones in Brazil run on Android, so I used Similarweb to get a sense of the download numbers. I was going to compare with another high-Android country, like Indonesia; however, the numbers are so far below Brazil’s that it isn’t worth adding to the chart.

Brazil’s love of TikTok can perhaps be traced to three key factors:

• Strong social media culture

• Youth demographics and mobile access

• Influence of Brazilian music and dance culture

So, Brazil is a key region for TikTok, much more than I had anticipated. If you’re looking to grow your audience in LATAM, you should consider TikTok to build your brand organically, collaborate with local influencers, and run paid campaigns.