The type of layout you choose for the SmartArt graphic determines how text in the Text pane maps to shapes in the graphic.
The pictures above show how text is treated differently with two different layouts. In the picture on the left, the layout supports top-level text in one set of shapes, the primary ones that have the arrows between them. The second-level text, indented in the Text pane, appears in the lower shapes, which are also slightly indented and include a bullet.
By contrast, in the picture on the right, the layout puts all the text, first-level and second-level, into one shape. It indicates the second-level text by using bullets and a smaller font.
So, how your text is displayed depends on the layout you choose.
More about text and layouts Some layouts may not contain enough main points or levels in their shapes to accommodate your text. If so, a red X shows by that text in the Text pane. If you apply another layout whose shapes do accommodate all the text, the text then appears in the graphic. But if you save the presentation while using the layout that didn't show some of the text, that text will be lost.
Automatic text sizing As you type, PowerPoint adjusts font size so that text fits within the shapes. When you're through typing in all your content, if some of the font sizes aren't to your liking, you can resize text within individual shapes.