Why AMD lost to Intel/NVIDIA despite having a superior product, & How to differentiate your agency

You want to know why AMD lost to Intel and Nvidia despite having a superior product?

I thought AMD has a larger market cap than Intel.

Now, right now they do, but before—

AMD's $297 billion.

I have this chart over here. It shows when—

AMD beat Intel.

AMD overtook Intel in 2022. So I'm looking at this chart. You see the red one? That's Nvidia. And then AMD's in green. And then you have Intel in blue. But remember when we were growing up, Everything is about Intel that sounds like dun dun dun dun, right? Yeah, Intel inside. Intel inside, right? So what Intel did back in the day, AMD's like they have a quad core, right? So what Intel did was they just like they just combined two dual cores together and made it a quad core. When when AMD's like we have a dual core, it's like okay, let's just combine two. And so Intel did a better job of marketing, and that's how Intel was was ahead of AMD for for the longest time.

And Intel also had the stickers on laptop. Intel inside.

Everyone wanted Intel. I wanted Intel before. It's just like, it was cool back in the day. Yeah. So, okay, this tweet is from, um, wait, how'd AMD lose?

They're double the size of Intel. I'm confused on this.

Well, no, they lost, and this is back in the day.

Oh, okay.

Yeah, back now AMD is like, okay, they're, they're like on top of it. And you, by the way, you know Jensen's cousin, um, who's the CEO of, of AMD?

Is it really?

Yeah, Jensen's cousin. And it's, it's, uh, it's this woman, she's super smart. She didn't found AMD. So somehow like they all like, Nvidia was founded by Jensen and then I forgot what her name is, but she was a hired CEO and then she's like brought it up to what it is now.

Yeah, she's amazing. It's Lisa Su.

Yeah, Lisa Su, there you go.

And what's funny is, is there was a video clip of her at a Formula 1 race and talking about like, oh, who are you? Should we be here? And I think they were like sponsoring a car. She's like, oh, I'm the CEO of AMD.

Oh, that's cool.

And I was like, I'm pretty sure she is supposed Maybe the person interviewing isn't supposed to be there, but yeah, it was a funny clip.

Okay, so this guy, Hamant Mohaptara, anyway, sorry for butchering that. So he says, so now that Nvidia has far outstripped the market cap of AMD and Intel, I thought this would be a fun story to tell. I spent 6+ years at AMD engineering in mid to late 2000s to help— helping design the CPU, APU, GPUs that we see today. Back then, it was unimaginable for AMD to beat Intel in market cap. We did in 2020, and for Nvidia to beat both. In fact, AMD almost bought Nvidia, but Jensen wasn't ready to sell unless he replaced Hector Ruiz of AMD as the CEO of the joint company. The world would have looked very different had that happened. Here's the inside scoop of how and why AMD saw the GPU opportunity, lost it, and then won it back in the backdrop of Nvidia's far more insane trajectory and lessons I still carry. So this is a long tweet storm. But basically, let me just give you the point over here. So they were always on top of it when— to what I said earlier, they're very engineering-led. They're always about the product. And they kept saying— they kept doing all these things. They kept building on top of engineering. But Intel just kept beating the crap out of them when it came to marketing. So your story matters. How you position things matters at the end of the day. It's not just all about your product. You need to have both.

Do you remember those old Intel commercials where they had like that Indian dude? I'm Indian, by the way, for anyone listening. That Indian dude who looked like nerdy but cool. And they're like showcasing how life is at Intel. They did that.

And then Microsoft, and then, um, then I think it became like, uh, like Apple versus, um, PC thing.

Right.

But they, they did this first is what you're saying.

I don't know if they did it first, but either way, they try to make really cool commercials. And that cool Indian dude wasn't actually a real Intel engineer. They were a paid actor from my understanding. But, um, but yeah, they did They had a lot of cool marketing campaigns. I don't know if laptops put their sticker on there for free or if they paid for it. Either way, it was great marketing. But yeah, Intel was amazing at marketing. Where they failed was to keep up with the product.

Yep. I just want to call— there's a couple more things. While I don't know what an APU is, while all this APU work was going on, AMD totally missed the iPhone wave. When we built chips for the PC, the world was moving to laptops. When we moved to laptops, the world moved to tablets. When we moved there, the world moved to cell phones. We also missed the GPU wave trying to introduce a fundamentally better but also fundamentally new architecture, APUs. So CPU plus GPU on the same die. We love same-die everything, I guess. Category creation is hell, but if you're going through hell, keep going. We hesitated, 2008 crisis happened, and we were totally caught with our pants down. After that, AMD basically lost the market to pretty much everyone. Intel, ARM, Nvidia. I learned it the hard way how superior products lose to superior distribution, lock-ins, and GTM. So go-to-market is obviously, we're just talking about the market, And all that. But superior distribution lock-in, you talk about all the partnerships, right?

So they're saying the superior partnerships and distribution beats out superior marketing.

Yeah. And also with Nvidia, like, I don't know if you noticed, but to use the GPUs, you have to use their software too. So that's lock-in too.

I did not know that.

Yeah, their software— we're not technical here, but from the interviews I've seen with Jensen, that software is required to power everything.

So And when I was in the UAE, I was in Dubai and I met someone. He was telling me how his son wanted a chip, an NVIDIA chip for one of their computers or something like that. He's a big gaming guy. And I don't know why you would need an NVIDIA chip, but let's just go with it.

I used to buy NVIDIA video cards for my games, just specifically for games when I was like 9 years old.

And he was saying that they're not allowed in the UAE, as in the US doesn't let them ship it out to other countries.

Oh, it's like a national security thing.

Yeah. Yeah. And, and this guy's really well connected and rich. I'm not saying like he's worth a million dollars or $100 million. I'm talking about like billion plus.

Mm-hmm.

So I'm like 99% sure he has his hands on that chip.

Yep.

Uh, for his kid. And he used to live in the States anyways, but you know, I, yeah, these chips are hard to get ahold of. Imagine if all, everyone can buy these Nvidia chips and they could actually produce the amount that people, um, Because there's still a shortage of them.

Yeah, I think there's still— this has a lot of room to run for the next 5, 10 years or so. We're not giving investment advice, but the final thing I'll say here is this is what kept AMD together. I think we can both learn from this. AMD was a tribe. For so many, it was their first job out of college in the late '80s and '90s and 2000s, and they are still there after 30 to 40 years. My first manager at AMD retired there after 30-plus years. My second manager is still there. My super manager has spent 40 years there by now. This is how they survived multiple near deaths. And this is why when it comes to AMD, I still say we as if I'm still a fanboy as I was a college student. So I think the lesson here is a lot of business is just about surviving at the end of the day. And I don't think we talk about that enough. I don't think enough people talk about that. It is just about survival. If you survive long enough, like good things will happen.

I had a great lunch today at my normal spot. There was this—

Avra?

Yeah, Avra. And I met this dude who was in the marketing experience space. Good dude, I won't name his name, but I'll share some numbers. You know, you're talking about $100,000 and a little bit more than $100,000, $120,000-ish in revenue, good profit. And he's been doing this for, I don't want to give away the exact amount of years, but more than 10 years, less than 20.

Okay.

So it was a good amount of years and he did this straight up right out of college and people were just like, man, you know, it's hard to build a big company and you know, it's tough. What's helped him succeed was just doing something for a very long period of time. And people forget that just being persistent, not giving up and keep pushing in a big enough market, you can make money if you're patient and you're willing to just play the long game. But most people are not willing to put 10 years into one company because most entrepreneurs This ADD approach was like, oh yeah, this is starting to work. Let me go do 5 other things. Well, if it's starting to work, why would you go do 5 other things? Just focus on the thing that is working.

And it's funny, we'll say that, but like we had to go through it to actually accept it. Right? Like, like I read all the books in the world saying focus, focus, focus. Right. But I still went and did all these other things. Right. It wasn't until I got punched in the face. You've been punched in the face before where you realized that, okay, fine. Focus.

Yes.

Yeah.

And it was funny what, I think made Eric and I really focus is when we've both focused unintentionally, right? Maybe we didn't have things to do or during COVID we didn't have a ton of possibilities. When we both focused, we saw our numbers go up and we're like, huh, maybe we should focus more.

It's really hard to focus, by the way, but it is the way.

Yeah. Even right now, I don't just focus on my business. I actually spend most of my time on M&A. Like I'm really laser focused just like on one aspect of things.

And that's the highest leverage activity that you have.

For me, I believe so, yes. And I really love spending time on it. It's like, how do we get a deal done? How do we grow faster? How do we expand into more regions?

And it's like a puzzle too, because you have to come up with different deal structures and there's like, people have different incentives, people want different things. So it's all like a puzzle that you have to put together.

Dude, totally agree with that.

I got to take a minute to tell you about the Agency Owners Association. This is a peer group for agency owners. Think YPO or EO, but for agency owners. And I just wanted to read you a couple of testimonials. This first one comes from Carrie, and we asked her, what do you like most about the group? She said, having a group of people to discuss and bounce ideas. The leads are great too. Yes, we share leads in this group as well. This one from Ollie, and he says, the ability to really post whatever I want and need, and the group responds. Great experienced members. Getting a lot of insights from conversations with other members. Getting a lot of value from sessions from Eric. Getting advice from others as well. And so if you want to grow your agency faster and you want a peer group to To do so, just go to marketingschool.io/agency. This is a group that both Neil and I created. And our hope here is to create a vibrant community of agency owners and do a lot more with it in the future. So again, marketingschool.io/agency, and we'll see you inside.

Speaking of agencies and growing, someone actually asked me this question yesterday, and I was curious your thoughts on it. How do you differentiate your agency?

For us right now, our mission— I'll read the mission statement first and then how kind of we're thinking about things and how I've been planting that seed internally, right? So our mission is to be the most innovative marketing company that drives customers. So the last sentence is very important. But what does that word innovative mean? It means we have to be on top of trends. We have to be trying the newest things. We actually have to be getting customers for them, right? We have to be experimenting quite a bit. So there's a lot that goes into that innovation. The thing I tell my team behind the scenes is like, look guys, Like, we can only afford to hire the top 5% of talent the way I see things. Like, I have a little uneasiness about M&A right now because like, one, you can buy the customers, but two, like, okay, if you need to cut a bunch of staff, like, that kind of sucks, right? My point of saying this is someone like you, let's say you really, you understand AI, right? Like, if you have an army and you have no shortage of ideas, I have no shortage of ideas too, right? It's all about execution at the end of the day. We're both constrained by what? Resources right now.

Yes.

Once we have 500 to 1,000 people that are resource— like these are drop-in agents, or we've talked about agents, right? But drop-in remote workers that can just get quickly onboarded to your company, then you have 500 to 1,000 people actually helping you maybe in the next 5 to 10 years, right? When, especially when artificial general intelligence comes out. So the way we see things right now, I'll give you an example of this, is we have something that is going to come out in 2 to 3 weeks. Where we could hook in with all your ads. Am I making you tired? No. Keep going. So, so, so you can tell when he's about to yawn.

I was about to yawn.

So, so, okay, so let's say we hook in with all your ads. Would you say if you're running 500 ads right now, what percent of your ads are aligned with your landing pages?

If we're running 500 ads?

Uh-huh.

Probably 450 of them at least.

Are aligned?

Yes. Okay.

That's not the case for most people, right?

But we also have a big team.

Yeah. But for most people, you would say, what would you say the percentage is? Pretty low, right?

It's usually less than 10%, but that's a— it's a biased question to ask me because as marketers and a marketing agency, our people practice what we preach.

Yeah, but right now I'm saying, okay, let's say the normal person.

No, no, that's what I'm saying. I'm saying we're not the average. I would say we're rare. I would say most people from what we see are less than 10%.

My point is, so we have— we're going to have something where we're going to hook in with your ads and basically align your landing pages with your creatives, right? But, and then we just want to give it away for free. Right? So we want to do a lot of things like that where it's led by technology because I've always seen marketing as like, if we're not leveraging technology, then what are we doing? So I'd say that's our edge, right? I don't want to say we're an AI-enhanced agency. I'm just going to say innovation. So you, your turn.

Yeah. So if I could say that, you know, we're an independent performance shop that really tries to over-service customers because in our industry, a lot of the big competitors that we go against are run by accountants.

That's good.

But I would actually have to say, when I look at differentiation, what we get hit up the most from and what people perceive us as, even though we're full service and we'll do paid ads and social and email and conversion optimization, et cetera, our biggest RFPs are written— Can I guess?

Can I guess?

Yeah.

SEO?

Specifically what kind of SEO?

I don't know.

Global SEO.

I was going to say enterprise SEO.

So it is enterprise. You are right. Because most people want global SEO.

Yeah, yeah.

Big large corporations.

Yeah.

The biggest thing that we get hit up for, not percentage-wise, but revenue-wise from new inquiries, like potential revenue, is companies who are like, we are this clothing company, we operate in 50, 60 countries, we need you to help us with our SEO in all of them. Or we're a payment processing company, please help us optimize our rankings. all the tier 1 countries in North America, Europe, and Asia, right? And then from there we land and expand and try to get into more. But that differentiation, we didn't necessarily try to push, but that is what people see us as. And that's what, you know, I would say there's not too many other competitors that I can think of that really do SEO on a global scale that are well known for it.

Yeah. That, I mean, that makes the most sense to me because One, it is a lot of people when we talk about SEO and like, there's definitely a leg up because your background's SEO, my background's SEO. But, um, so when we talk about it, um, internally, it's just like levels above other people. And so that gets you the deal, right? And then you talk about expanding. So I think it is good to be known for one thing. I think the way you, you crafted your, um, one-liner was really good, but I think it's, it is like, we are, we do get a lot of wins on the SEO side.

Yes.

And it's because you've actually done stuff with SEO, right? And so have I. I am baffled by the number of SEOs in the world that just haven't really Exactly.

And what's funny is, is what you may think is your differentiation may not be what other people see. And my advice to agencies is, A, make sure you check out marketingschool.io/agency.

Yep.

To join our—

Agency Owners Association.

There you go. So then that way we can help you grow your agency. But the big thing, that would be one, and we talk about differentiation in there, but B would be, If you think it's one thing and everyone else perceives it something else and that something else is working for you, lean into it. You don't have to create a new narrative. Lean into what's working in the market. Another differentiation that could work is either verticalization or service line, but the service has to be unique. Like for example, doing just marketing for Gen Z or something like that, especially if that's not as common within the country that you're operating in. Or another differentiation is adapting before changes are happening. So in marketing, everyone's talking about the cookieless world that should eventually end up happening sometime next year with the Google change. We'll see if they delay it or not. But when you look at that cookieless world, you'd be like, oh, we're an agency that has our own cookieless attribution software and we can end up figuring out how to end up—

Mm-hmm.

Maximizing your revenue and where to attribute your revenue to. And it does MMM. So then that way we can maximize your overall revenue with all your spend.

I want to take a second to tell you about my podcast co-host's agency. So NP Digital, so Neil Patel Digital. What they do is they do a whole host of marketing services and they are global, they're worldwide. They have SMB services as well. They have mid-market to enterprise services. as well. They cover the entire gamut. So you can just go to mpdigital.com to learn more about it. And now back to the episode. Dude, you know what it is? It's for agencies. You need a service hook. You need one service to hook them in. It's no different than marketing. You need a hook.

Yes. You're spot on. You get one service to hook them in and then you upsell from there. But what's funny is in Europe, we've been seeing more RFPs for multiple services.

I mean, I thought that's the standard base case for you now.

Uh, yeah, but usually when people like want to work with the agency, at least of our size, because we're still small, right? Like we don't have 100,000 employees.

I'd say you're mid-sized.

Oh, we're small.

Let's see, let's— you're probably right. Let's just look at this.

Are you considering about a company size for based on SMB of the United States?

Or just overall company size?

We're considered a large enterprise. Based on US definitions of what's a large corporation.

I think that's mid.

No, it's large.

Whoa, whoa, whoa.

Okay. Okay.

Ah, see, 100. Okay. Okay. You, you, you win this one. So 100 to 999 is medium-sized businesses and then over 1,000 is enterprise. Yeah. Yeah.

But they also base it off of revenue, but we beat that on, on both aspects. And it's also done by industry as well. The reason I know this is because for certain types of contracts, Like governments and stuff like that, certain ones go to different sizes.

Yeah.

So I was hoping that we could be an SMB.

Yeah. Well, if that's the case, in those cases, can you just say, hey, I have this company over at NPXL that only has 200 or whatever employees?

It doesn't work that way. I wish it did.

Yeah.

But yeah, so with differentiation, you got to figure out what makes you unique and you got to lean into it and you better ride that wave before other people are. Just like we were talking about AMD, right? With that example you gave, they kept missing the wave. If you keep missing a wave, these waves are great ways to differentiate. It's why a lot of agencies sell like, oh wow, Amazon marketing's hot. You manage Amazon ad spend, boom. Oh, TikTok's hot. They just released ads. You manage TikTok ads, boom, acquired, right? People are looking for what's the next hot thing that we can cross-sell into all our existing customers.

And that's what the holding companies do, which I think that's it.

Make sure you guys all go Go to marketingschool.io/agency to join the Agency Owners Association.

You got it. And leave a rating, review, and subscribe too, because we were— we haven't gotten one for a while, so give us one. All right, goodbye, guys.