The Best One Yet - Airbnb’s 7M-home trust pledge, Coke’s new (caffeinated) sparkling water, Toyota’s “muda” hatred

Episode Date: November 8, 2019

Airbnb’s suffering a sudden trust crisis so it’s responding proactively(ish) with a bold move: Verifying all 7 million of its listings by next year. Coca-Cola’s trying to succeed in the flavored sparkling water market (again) with an aggressive anti-LaCroix move — caffeinated sparkling water for your mornings. And Toyota is the profitable surprise among Japanese car companies because it hates “muda.” A lot.Learn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. And this is Snacks Daily. It is Friday, November 7th. Yes, happy Friday. It's actually the 8th. Oh, it is. Yeah, we'll go with the 8th.

So stocks rose because of news that the China-USA trade war seriously might be de-escalating. Good news for stocks. Better news for us because this is the best snacks daily we've ever produced. Our first story today is Coca-Cola. It got in on the sparkling water wars early and failed. Failed. So it's trying again, but this time with caffeinated self-term. It's looking at where the industry is going, not where it is right now.

On this pod, we've talked about Tesla, GM, Ford, Renault, Fiat Chrysler. Serious garage situation here. Toyota's kind of a boring company, but it's worth talking about it. Because it's a very profitable company. We're talking about Muda. Third and final story, Airbnb plans to IPO next year, but it has a crisis situation on trust right now. Trust, it's pain. So it's planning to verify every Airbnb by next Christmas.

They're going to have to hands across America this thing. Seven million Airbnbs they need to verify. College seniors, you need a job. Apparently they may be part-time hiring. snack because before we jump into all that, we got to talk about some important history right now. From 1961 to 1989, there was a foot wide of concrete 12 feet tall separating West Berlin from the rest of East Germany. You could have said Westeros there, most people were thinking. Now, you've probably seen slivers of the Berlin Wall because it was covered in graffiti.

It was kind of an artist statement, but it actually was a major historical statement, too. November 9th, which is Sunday, marks 30 years since the Berlin Wall came down pretty much ending the Cold War. Now, Jack and I happen to have had our first, essentially like an international date situation in Berlin. It was a lovely weekend. I was studying abroad there. Nick was doing something in Europe and he stopped by on the way home. It was 36 hours of only consuming three things. Pretzels, sausage, chocolate. Beer? Pretty much it was chocolate. There was beer as well, but I guess that doesn't lie into this category.

There was a lot of chocolate. Anyone says you can't have chocolate for breakfast? Remind them, your cuckoo for cocoa pot. Now, Berlin is a wonderful, wonderful city with so much to see. But Nick and I checked out the Checkpoint Charlie Museum, which is right on the border. It is highly immersive, incredibly worth seeing. It's right on where the wall was that separated East Berlin from West Berlin. You're experiencing history in real life, and it's a pretty recent history, which is pretty cool. You saw the great lengths that Easterners took to get to the West, risking their lives, creating one-person submarines. Crazy, crazy stuff.

It's a wild experience. It's worth going to Berlin for also because Jack and I tried going to some clubs, but we definitely couldn't get into any of them. No, my baggy gap jeans and my T.J. Max bought a polo shirt wasn't. I think the faux Timberlands I was wearing pretty much got its booted out of one place. Let's hit our three stories. You're tuned in the snacks daily. We spoke to the lawyers and we got to get something legal out the way. The snacks about to hear ain't food.

It's air candy. They don't reflect the views of the robberhood family. It's all informational just so. We're not recommending any securities. It's not a research report or investment advice. Not an offer or sale of a security. Snacks is digestible. Business news for you.

Robberhood Financial. LLC, member Fenra slash SIPC. For our first story, KTZHC, Coca-Cola is launching a sparkling seltzer. But it's going with a caffeine angle. Now, Nick, yes. We had a passion for hydration for years now. It's aggressive.

You know, I don't drink caffeine. I'm not a coffee kind of guy. It's not sweet enough for me. I need that almond milk lot. Nick's weirdly obsessed with H-2-L, but why does Coke care so much about it? One second, I've got to go to the bathroom. You're probably wondering why Coke is so curious about. Look at the sparkling salts.

sparkling water market. We're going to start at the bottom with Spindrift. Okay, so what do you, what do you think? You'd probably drink Spindrift. What do you think? You might drink Spindrift. What percentage? You actually probably don't, according to this data. Basically, what percentage of the sparkling water market? Does Spindrift have, Jack? One point two percent. Spindrift has like 10% real fruit juice and 90% sparkling water. Right. It's kind of like a grapefruit in your face. Second from the bottom, you got Coca-Cola. That's 2.5% of the market. We know what you're thinking? What about our buddy's Topo Chico, the fancy stuff from Austin? Topo Chico is owned by Coca-Cola.

Owned by Coca-Cola. And Desani is Coca-Cola's other sparkling water option. So Coca-Cola basically is hardly any of the flavored. Then you got polar-seltzer water straight out of Worcester, Massachusetts, with almost 8%. Wonderful. Wonderful city. Who else is in the flavored water, sparkling water market? Pepsi unleashed the brand called Bubli, not pronounced Boubley.

Okay, they've got 8.5% of the market. Nestle owns the fancy boy stuff, San Pellegrino. Oh, my God. And the stuff they're drinking up in Maine, Poland, Spring. If it's top shelf, if it's a special moment you're whipping out the San Pelagrin on the West Bank. Finally, LeCroy has 18% of the market with ingredients they call natural. Right.

But what are alleged to be synthetic. They're leading the market, but that is stopped. It is topped off. They haven't been advancing because of these legal issues. LaCroix is owned by National Beverage Corp, which was one of the best stocks of like the early 20 teens. That stock is down 60% in the last year. It hasn't handled the competition in sparkling water well. And it fell 9% yesterday on,

word that Coca-Cola is upping its games. Let's talk about Coca-Cola. Coke is both early and late to the sparkling water thing. The year was 2014. Aquaman movie, we think, may have come out around there. And maybe that inspired Coca-Cola's first entry to the sparkling water market. It decided to launch Desani Sparkling Water. Mick, it's Desani with an S, not with the Z.

There's, like, one listener right now who's named Desani, who's really pissed. But Desani makes us wonder, what the heck is DesaSan? Who came up with that? What's marketing team? It sounds like Little Mermaids. like mentor. Helped her grow. She taught her how to walk.

But Desani didn't really go anywhere. It wasn't differentiated. Right. So Coke is back this year, starting from scratch. Just like Bud Light, it's recognizing that Seltzer is a big deal, so it's starting something new. But it's recognized that it can't just do an extension of an existing brand. It needs to start from scratch. And it's adding caffeine, almost as much caffeine as a typical can of Coca-Cola.

So basically, that's going to be the differentiator here. They're jumping into the market late. They're trying again, and they're trying to be a little different with a little bit. with a caffeine. What's the product called? Product is called, get this, wait for it. Aha. Aha. It's a caffeinated drink.

They have some caffeine in your speech. They claim pretty much that when people were testing us out, that's what they ended up saying, was, oh, aha, I'm testing it out. The name is spelled like you'd expect it to be AHA, with a lot of capital letters. And it comes out in about four months in March with eight flavors, a bunch of citrus flavors, and then also green tea. Yeah, they're like mixing these things together. So, Jack, what's the takeaway for our buddies over at Coca-Cola?

Sparkling water has got so big that there are a bunch of little niches now. Nitches? Niche's? We're really struggling with the pronunciation. Friedrich Nietzsche. I think we drank too much sparkling water today. Now, the trend, the big trend here Jack's talking about is the sparkling water trend, because soda sales have slipped and they've been replaced by sparkling water. Consumers want a healthier option, and that has created an epic surge in sales of sparkling water in the United States.

Snackers, sit down and get these hydrated numbers. A hundred million gallons of sparkling water were sold back in 2013. Last year in 2018, $400 million. That's quadruple in just four years. You're seeing sparkling waters marketed for different times of the day. That's how big sparkling water's gotten. For example, Bud Light and Corona, they're both making spiked seltzers like White Claw because people want sparkling water in the evenings when they're partying.

What about midday? Regular salters. Yeah, I just did regular sparser. You want to drink something. But then what about in the morning when you'd like to be having sparkling seltzer, but you don't really want the alcoholic option? And you want a little caffeine to pick you up, maybe instead of coffee. So what Coca-Cola is trying to do here is segment out a sparkling water for a different time of day to capture a sub-trent.

Seems like they're going for the morning because there's caffeine or maybe that 3 o'clock feeling. Aha is looking at where the industry is going. Not where it is right now. For our second story, Jack, eyes on the road over here. Toyota separated itself from the rest of the other Japanese carmakers with its latest earnings report. Because it's doing great in SUV-obsessed America. Jack, can I toss some names at you right now? Go.

Okay. Honda. Yep. Nissan. Honda was my first car. Mitsubishi. Yep. Toyota. What are they all of in common? Mazda.

They're all Japanese carmakers. This is like an all-star lineup we're talking about. Now, what are these cars specializing? Coops and sedans. We're talking two-door or four-doors? You've seen the Corolla, the Camry, the Ultima, the 1991 Honda Accord, which I used to own? The Civic, if you get picked up in Uber, odds are when you slide into the backseat and they have like a creepy cover over the seats? That's a Japanese made car.

It's got to be a Japanese-made car. All of these Japanese car companies are struggling in the United States because we're just not that into coups and sedans. Snackers, you're probably driving right now, and we wonder what you're driving in. Odds are it's an SUV. Just 28% of the cars that Americans bought last quarter were actually cars. 66% were SUVs and pickup trucks, and the remaining 6% wish they were SUVs in pickup trucks. That is a huge percentage of cars that we're buying, like higher than ever before, that are 4x4s, that are minivans, that are SUVs. that are big things.

But Toyota is one Japanese car company that seems to be doing just fine despite everyone else investing in these smaller cars. Honda, Nissan, Mitsubishi, Mazda. They're all like downgrading their expectations because they don't make the cars that Americans want. And Toyota just announced that its revenue rose 4.5% to 7.6 trillion yen.

Which is about $70 billion. That's true. The biggest car company there is. Now, Jack and I are looking at this. We're seeing the numbers come in. We're doing our little yen calculation right there to dollars. And we're not totally surprised because we've been following Toyota. And we've seen that Toyota is a brilliantly run company. They foresaw this switcheroo among America to trucks and SUVs.

And they invested years ago in creating assembly lines to put out trucks and SUVs. Because that's what it takes. You can't just start making an SUV or a truck overnight. You've got to plan an advance for this thing. And now think about it. Toyota is the only non-American car company that has the SUV and truck lineup to match with like general motors, Chevrolet, Dodge, Chrysler, Ford. Nick, trivia question.

What pickup truck did my brother drive us in at my wedding? I mean, he's totally a Tacoma guy. No, he's a Tundra guy. Or he could have been a forerunner guy. Yep, or a Rav-4. They used to make the Land Cruiser, which my family would take to hockey practice, and you could fit half a team in that thing

just in the third row. Toyota is all over the 4x4 department, and it's surrounded by a big Detroit auto companies. So, Jack, what's the takeaway for our buddies working hard over at Toyota? America created the assembly line. Toyota perfected it. And the key here is a wonderful word that Jack and I love. Muda.

Muda. Muda. It's the Japanese word for waste. And at Toyota, they are religiously dedicated to destroying Muda. It's highly ironic. They put Muda up on a pedestal and then they get rid of Muda. There are business school case studies about their dedication to killing Muda. There are business school case studies about how many business school case studies there are on Muda.

And as a result, Toyota is by far the most valuable and, by far the most profitable of all the car companies. Snackers, we sat down and crunched the numbers on this. These are the profits per car for some of the top car companies in the world. $268. That is the amount of profit that Tesla made, on average, last quarter, for each of like the $50,000 Tesla's that they sold. $1,400.

That's how much profit Ford is making off of every car. It's rolled out. So Tesla makes $268 per car. Gotcha. Ford makes $1,400 per car. I'm following you. Toyota, $2,300. a profit per car. Snackers, let that sink in. It's about almost 10 times as much as Tesla.

And it's because Toyota hates Moot. With a passion. For our third and final story, Airbnb has announced it will verify every single listing on Airbnb. Wow. It's going to be insane. And Airbnb is going to do it by December 15th, 2020. We don't know what we're doing on next week on November 14th. But I love the specificity. of Airbnb here. They're not like, we're going to create a self-driving podcast by 2021. They're giving us the exact date and that holds them accountable. And this is important because there are only, you know, seven million listings that they're going to have to do this for. And they're going to have to check every one of them. To make sure they are accurately advertised. Now,

there's some recent news here. There was a rager recently at an Airbnb listing on Halloween in California. True. It was advertised on Instagram as an Airbnb mansion party. Tons of people came. There was a Shooting. Terrible. Five people died. Horrible situation and also terrible PR for Airbnb. This highlights a trust problem with Airbnb. The host, they don't really know who's renting these spot out.

And the guests, they don't know that the place they saw online is really the place they're going to. Seemed like a charming two-bedroom with a lot of really nice sconces. Didn't turn out to be the right situation. Or like for me in New York a couple months ago. This is traumatic. Are you going to bring this on? Nick, my therapist says I should talk it out. This is a perfect spot.

This is private. hackers don't share. The super told me it was an illegal listing and told me the cops were coming. Apparently this wasn't a good super. It took me a bunch of phone calls where I'm on hold, a bunch of tweets to tweet shame Airbnb. And then finally, he's tweet shaming right now. After all that fight, all I got back was the price of the listing that I didn't even stay at in the end. We talk about this a lot, Jack here. Let me get you a blanket. Now, the other issue that came out was vice news, which uncovered a network of homes that were advertising really fancy listings. Turned out not to be the case.

So there's some schemers who are on. on Airbnb trying to make a profit off places that are like not the purpose of what Airbnb is supposed to be. Now, Airbnb CEO Brian Chesky has come up with a bold response. First, he promises to verify every Airbnb listing by December 15th, 2020. Again, aggressive with the calendars, but we're impressed. That's a ton of manual work. We don't know how Airbnb is going to verify each place.

Are they going to physically go there? Get a lot of task rabbits together? Are they going to cross-reference pictures of the living room that you sconced up one day with the actual place? College juniors who don't have internships yet? Great opportunity, maybe? Or are they just going to cross-reference, like, the address with Google Maps? I don't know.

We don't know, but there's a lot of legwork involved. And this will make guests more comfortable if there's, like, that classic blue checkmark of approval like you see on Instagram and Twitter. Extremely satisfying. The second thing that he wants Airbnb to do is verify every host by the same date. Like the person, and that's 600 million hosts. We're talking, like, two Twitters here. Another thing, he's giving a guest guarantee.

If you're not 100% satisfied by your Airbnb, they will re-reble. look you to a place just as good, or give you the cashback, no questions asked. Must be nice. I wish I had had that. Airbnb, by the way, you should start doing infomercials with this stuff because it rolls off the tongue. Finally, the neighbor hotline. This is a great name, by the way. If you know that the place next door is in Airbnb, the kids, they're so loud.

You can call Airbnb if there's some shenanigans going on and you think you should report it. No more sending an email to some random service on Airbnb and hearing back 48 hours later. Thank you for letting us know we'll get back to in 48 hours. They're going to have a phone number that's very easy. are defined like borderline 911 situation and they promise a person will be there. That will be a human. So Jack, what's the takeaway for our buddies over at Airbnb? Trust is an Airbnb IPO liability.

The internet, it offers us so much. But one issue Jack and I keep focusing on, it doesn't verify what's real. Facebook is dealing with this problem in a huge way the past few years and probably for the next few years. If you're Airbnb, though, you're not just talking about a digital online profile. You're opening up your own physical home. Yeah. People are opening up their homes, their nests to strangers.

It's a beautiful image. Trust is important. I personally believe the rating situation where the guest rates the host and the host rates the guest. That's a nice reinforcing policy of good behavior. But it might not go far enough. So Airbnb is trying to get ahead of this. It wants to show investors it's being proactive and doesn't have like a Cambridge Analytica Facebook crisis. Because Airbnb plans to IPO next year, but there's another side of this coin.

This is going to cost a lot of. of money. You need humans to manually check and verify these places. And that could eat into profits just as it's preparing to IPO. Jack, can you whip up the takeaways for us before the weekend? Coke is launching caffeinated seltzer water in a can, and it's called Aha. Sparkling water is such a big deal now. There are subcategories of the trend. Toyota is the most profitable car company doing well with trucks. Its stock is traded in Tokyo. But it's also the Moody Destroyer. Airbnb is trying to crush its trust problem with manual verification. And this could be be good news or it could be bad news before the IPO. Snackers, time for a snack fact of the day.

This one sent in by James Schmidt in lovely Emporia, Kansas. We mentioned yesterday New York had the best water. We said it before. It's kind of true, but apparently... The only evidence I have is taste and that little New York thing on the top of New York Pepsi cans. My tongue says it's fantastic. Now, there's actually a convention to answer this question. It meets annual in West Virginia. It's called the Berkeley Springs International water tasting, aka the Academy Awards for H2O. True story. And the winner this past year. Jack, envelope, one second. The winner this year of the best water in the United States was

El Dorado Springs, Colorado. El Dorado, come right up. They also have been winning Best Municipal Water, which is like the Golden Globes of Best. Jamie, thank you for bringing this to our attention. Snackers, we want you to have a fantastic weekend because we love this week with you guys. So many of you have shared snacks on Twitter, on Instagram. We love you for that. It helps Snacks Daily, the podcast grow, and you make Nix and My Day. We love it, and we love you guys. Let's do this on Monday. I'll see you. Can't wait. The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robin Hood Markets, Inc, or any of its subsidiaries or affiliates.

The podcast is for informational purposes only, is not intended to serve as a recommendation to buy or sell any security, and is not an offer or sell.