Melbourne, Australia – 26 May, 2026 – Australian SMEs are entering a major shift in how customers discover businesses online, with AI search tools such as ChatGPT, Claude, Gemini, Perplexity, Copilot and Google AI Overviews changing how recommendations are made.
Sagar Sethi, Founder and CEO of Melbourne digital marketing agency Xugar, says businesses that still rely only on traditional Google rankings may soon find themselves invisible in the next stage of search.
“For years, businesses focused on ranking on page one of Google. That still matters. But the next question is different. When someone asks an AI tool which company to choose, will your business be mentioned, trusted, and recommended?” said Sethi.
According to Sethi, AI search does not behave like traditional search. Instead of showing a list of websites, AI tools often summarise options, compare businesses, and make direct recommendations. This means SMEs need to build stronger trust signals across their website, third-party platforms, industry mentions, review profiles, and structured content.
“AI tools do not only look at your website. They look for signals across the web. They want to know whether your brand is consistent, credible, talked about, and easy to understand. If your business has weak content, poor citations, thin service pages, inconsistent business information, and no independent authority, you are making it harder for AI systems to trust you,” Sethi said.
Xugar is now encouraging SMEs to review their digital footprint through an AI search readiness lens. This includes reviewing website structure, schema markup, content depth, author authority, business citations, online reviews, media mentions, and how clearly services are described.
Sethi says the businesses most at risk are those that have treated SEO as a one-channel ranking exercise.
“SEO is no longer only about keywords and backlinks. It is about entity authority. Google and AI systems need to understand who you are, what you do, who you serve, where you operate, and why your business deserves to be trusted,” he said.
The shift is especially important for service-based businesses, local businesses, eCommerce brands, professional firms, trades, healthcare providers, and B2B companies where customers often compare options before enquiring.
Sethi recommends SMEs start with five practical steps.
First, make sure the website clearly explains the business, services, locations, industries served, and proof points.
Second, improve structured data, including organisation schema, local business schema, product schema, FAQ schema, and review signals where relevant.
Third, build deeper content around customer questions, comparisons, use cases, and buying concerns.
Fourth, strengthen third-party credibility through digital PR, industry mentions, directories, partnerships, reviews, and expert commentary.
Fifth, test how the business appears across AI tools using realistic customer questions.
“If a customer asks ChatGPT, ‘Who is the best provider for this service near me?’ and your business is not mentioned, that is a visibility problem. If your competitor is mentioned, that is a revenue problem,” Sethi said.
Xugar believes AI search will not replace traditional SEO overnight, but it will change the way customers make decisions.
“The winners will be the businesses that start preparing before everyone else catches up. The mistake is waiting until AI search becomes the default behaviour. By then, the authority gap will be harder to close,” said Sethi.
About Xugar
Xugar is a Melbourne-based digital marketing and growth agency helping businesses increase visibility, generate leads, and improve commercial performance through SEO, paid advertising, website development, content strategy, and AI search optimisation.
Xugar works with Australian businesses across service, eCommerce, trade, healthcare, professional services, and B2B sectors.
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Company Name: Xugar
Contact Person: Sagar Sethi
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Phone: 1300 565 610
Country: Australia
Website: https://xugar.com.au/