The Best One Yet - 💍 “#BamaRush Made Me Buy It” — Kendra Scott’s jewelry. FedEx’s concert problem. Ford Mustang’s dealer deal.

Episode Date: September 19, 2022

Kendra Scott jewelry is now worth billions because she focused on college football — Alabama earrings, not New York necklaces. You can blame 1 company for the latest stock drop: FedEx. And Ford’s newest Mustang reveals a dirty secret about the car industry…we call it the Dealership Tax.$F $FDXFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on YoutubeWant a Shoutout on the pod? Fill out this formGot the Best Fact Yet? We got a form for that tooLearn 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. It's Monday. Welcome back, September 19th. And today's pod is the best one yet. It's a T-boy, Nick. I'm sorry. I just got a DM from Delta.

Jack, did you just book a flight to San Francisco? I sure did. I'll be there next week. I'm going to get two Giants tickets. I got to get you some Suvla. What sandwich do you? Nick and I are going to a San Francisco Giants game. My first time seeing McCovey Cove.

Okay, we got chicken. We've got lamb, and there's a plant-based lamb off. All right, we'll do it with this later. What's the first story? A women's jewelry company has taken over college football stadium. Kendra Scott is making $340 million a year on Alabama earrings, not New York necklaces. For our second story, the whole stock market plummeted Friday, and there are two reasons to blame. FedEx and Lady Gaga's summer concert tour.

Our third and final story, the dirty secret about the car industry, is the dealership tax. The dealership tax for its new Mustang just revealed the sneaky tooth. thousand dollar fee but yeties before we hit that wonderful mix this is why we show up on mondays baby i love this mix man cooper's town that's the baseball hall of fame canton that's i don't know which hall of fame the football hall of fame okay what's going on in toronto the ice hockey hall of fame but jack what's going on down in cleveland the rock and roll hall of fame do you know about what happens in rochester new york yeties rochester new york is the fun capital of the world because the national Hall of Fame is there. The National Toy Hall of Fame. Yeah, uh, Yetis, we are not playing games here.

Actually, we're kind of on. We are kind of playing games here. The National Toy Hall of Fame. It's an upstate New York. And this week's a big week because they're voting. The biggest day for toys until Christmas. Yeah, 12 toys are contending for the National Toy Hall of Fame class of 2022. This is exciting because those 12 toys are squabbling for a spot in the pantheon of play. The ceremony is kind of like a playday, but you get to stay up late. It's the only award show suitable for children under three. There will not be a wardrobe malfunction. We can guarantee that.

Now, yet he's last year, the American girl dolls got voted into the hall. Although kind of controversial because the cabbage patch dolls got snubbed again, Jack. Yeah, some old school voters believe they had performance-enhancing hugs. That made it the most controversial toy ceremony since the My Little Pony drama.

Remember that? I do. How could I forget? But the 12 toys nominated for this year's Hall of Fame class are historic. Because one of those toys pioneered a new form of plastic. One of them's over 500 years old. And one of those toys definitely broke Jack's little brother's wrist in second grade.

Actually, no, it was my wrist. It was your wrist. And it was a jump rope. I'm going to blame Teddy on this one. We'll hit that on a bonus bot. But Jack, if the whizzing Nerf football doesn't get a nomination, it always spirals. I'm going to write a letter to Hasbro.

The 12 toy finalists for the 2022 Toy Hall of Fame class are going to be announced at the end of this podcast. Let's tease our three stories. For our first before this song, two boys from the Northeast met in the dawn. They had an idea that cost of cultural. 50%.

That's a fat tip. Tea boy city on your at list. If you know, you know, because we're ready to go. We can't wait no more. So just start the show. For our first story, stocks plummeted on Friday.

And it was all because of one company and you know who you are, FedEx. Because FedEx doesn't just measure. packages, they measure the economy. First of all, FedEx doesn't get enough credit here. Their logo is actually pretty exciting. Yeah, the E, it kind of creates an arrow. It's a subliminal message in the FedEx logo. Yetis, if you look at this thing, there's an arrow in the FedEx logo. Yeah, but how about FedEx Express? Oh, right, right. Which is their product that means Federal Express Express Express. They double down in the Express and you don't even realize it. But Yeties, FedEx also had a pretty exciting week last week,

but not for good reasons. Exciting in the negative. The stock fell 21% on Friday. The worst drop in FedEx stocks 44-year post-IPO history. Okay, the bad news, they gave a warning about their earnings. Yeah, profits fell, and they refused to forecast the rest of the year's profits. It was that bad. The worst news for FedEx? What's happening to the company? They're stopping hiring.

They're closing down 90 stores as we're entering the holiday season, and they're slowing down Sunday deliveries because they're just aren't packages to deliver. But the worst news for FedEx was the question and answer session with the new CEO that caused their PR team to have a hernia. A Wall Street analyst asked the CEO, do you think we're in a recession? And his answer, Jack? I think so. In fact, a global recession.

Now, yet he's, here's what Jack and I found fascinating about the story. If FedEx wants to blame someone, they're going to blame actually your family. They're going to blame your family vacation. That's who they're blaming. They're going to blame Block Island. Yeah, Jack, you went to Block Island and basically you caused FedEx stock to lose like billions in value. Yet he's last week, we said it's hard to get a restaurant reservation right now. We talked about all the revenge experiencing everyone's doing.

And that revenge experiencing is messing with FedEx's neck of the economy, the physical goods logistics neck of the economy. Because besties, our spending is shifted from things into feelings. From material goods to experiences. Look at your credit card statement. We're taking trips. We're not buying trucks these days. We're hitting concerts.

We're not acquiring couches. We're looking at you. Your Lady Gaga concert is great for Live Nation, the company. Bad for FedEx the company. FedEx would prefer that you order a Lady Gaga t-shirt from gaga.com instead of going to our concert. They'd prefer you order at FedEx Express Express if you're going to do it. Express, Express. So, Jack, what's the takeaway for our buddies over at FedEx?

FedEx doesn't measure packages. They measure the economy. Yeties, we told you FedEx's stock plummeted 21% last Friday. But it didn't fly solo. FedEx brought the whole market down with it. The Dow finished the week down 5%. Thanks to FedEx's awful news at the end of the week. Because what is our economy?

It's the buying and selling of things, like physical things, like the only things that FedEx moves. So FedEx's results are a big signal that scream out either yes, our economy is strong, or no, our economy is not strong. In fact, FedEx is such a good barometer of our economy that Alan Greenspan. The famous former Fed chairman. Used to have weekly chats with the FedEx CEO when he was running our economy. nation's central bank. Now, we should point out, FedEx doesn't measure services. Right. Good point. The non-physical goods part of our economy, which is a big part of our economy. So it's possible

that all our splurging on experiences right now could offset what FedEx just told us. So maybe we're not in a recession is what we're saying. But FedEx's results still scared investors. Because FedEx doesn't measure packages, it measures the economy. For our second story, Kendra Scott's jewelry brand has quietly become a unicorn. Because Kendra Scott wrote a wave that just wasn't on the coasts. Okay. University of Alabama Sorority Rush just finished up last month. How did things look? Who's winning here? Try it out. Okay. Try it out for life. There you go. There you go. But Yeties, the famous University of Alabama sorority rush isn't just about choreographed dancing and like meeting your forever sisters and then sharing it on TikTok. No. One brand name was

constantly getting mentioned. And that brand was Kendra Scott. Keeps on trending. Kendra Scott is a private jewelry company that we just discovered is now worth billions of dollars. In fact, Kendra Scott began crafting jewelry 20 years ago as a single mom with a three-month-old kid. She had $500 was living in a one-bedroom apartment in Austin and like so many jewelers was selling handmade pendants and stuff for an average of like 100 bucks out of her house. 20 years later, fast forward, Jack, where is Kendra Scott today? Everywhere. Yeah.

130 stores. The company's worth over a billion dollars. Okay, Kendra Scott is doing $360 million in revenue on study earrings and necklaces every single year. And then hashtag Bama Rush happened on TikTok. Oh, yeah, it did. And those videos grew Kendra's TikTok following by 800%. Do a backflip and hug your big. That was a rush of free advertising, Jack.

tried out for life. But yeties, the main accomplishment that Kendra Scott pulled off, it's actually kind of a paradox. While the dudes were banging heads with helmets on the field, Kendra Scott bedazzled the college football fans with jewelry. Yeah, Kendra Scott's profit puppy has actually become the gemstones that sparkle with your alma mater's logo. Here's a classic product, an orange stone for the University of Texas alumni base. Classic. And current students that are emblazoned with hookham horns on the stone. Kendra Scott's making all the money on gems that basically do the gator chomp, Jack. Here's the formula. Put the Greek alphabet of football and an affordable amethyst on a necklace and sell for a hundred bucks.

I'm checking Kendra Scott's top sellers right now. It's like Red River rivalry stuff. I'm not seeing the Ivy League and I'm not seeing a Nesgack ring. No, the SEC universities. The ACC, every southern university is covered like Spanish moss on a magnolia tree with Kendra Scott jewelry. Because here's the secret sauce. Kendra Scott combined. a sense of luxury in the jewelry with a sense of relatability in its features. That sounds like an obvious thing you should try as a jewelry store. It does. It seems like why didn't someone else do this? Tiffany's didn't do it.

Nope. Zales didn't do it. And we definitely didn't do it. But Kendra Scott did do it and ran with it. Jack, this is the only charm bracelet that pairs a sorority gown with a college game day tailgate. Bama by three. I feel like a court chaster again. Jack, what's the takeaway for our buddies over at Kendra Scott Jewry?

Don't let Vanity distract from the validators. You know what our favorite part of the Kendra Scott story is? It's her stores that fail. She sold $7 million worth of product at first in the town of Plano, Texas, and she started getting confident. Yeah, so she opened on Rodeo Drive in Beverly Hills, lovely Los Angeles seeking validation. She was an up-and-coming jewelry entrepreneur and wanted validation

from big Hollywood. But here's the problem. That L.A. store lost money, so she ended up shutting it down like a year later. Now, in hindsight, her venture in Los Angeles wasn't about validation. It was a pursuit of vanity. Exactly.

Her Plano, Texas success was the validator, and the potential there is what took the brand off. It's just like how movie critics and the Academy Awards hate the Marvel movies. Exactly. Yet those Avengers superheroes are the top gross in films of all time. They're always the top grossing films

of all time. So Yeti's Kendra Scott passed a billion dollars in value by focusing on the validators. Not vanity. Now, a word about our sponsor, Robin Hood. You can do just about anything from your phone, but some industries, they've just been slow to move. The finance industry was slow to move from phone to computer and then from computer to app. Robin Hood wasn't. It's the Silicon Valley-based brokerage that's been updating app since it was born in 2015. Using the Robin Hood app for your stocks and crypto is almost as easy as downloading it. So you can invest to your pace on your terms by downloading the Robin Hood app.

If you're not investing on Robin Hood yet, to get started, go to robinhood.com slash T-Boy and choose your free stock. That's Robinhood.com slash T-B-O-Y limitation supply. Stocks are offered by Robin Hood Financial LLC, member SIPC. Crypto offered through Robin Hood crypto. All investments involve risk. By the way, this podcast is not owned by or part of Robin Hood and we are not employees of Robin Hood. For our third and final story to kick off the week, four, just unveil. a new plan to modernize your car buying experience.

But Ford just also revealed a dirty secret. Oh, the $2,000 car dealership tax. Okay, Jack, let's, beep, beep, Ford had a pretty big week, right? Like they unveiled the new Mustang muscle car. The 2024 Ford Mustang, which is the seventh edition of this historic vehicle. A lot of biceps on that thing. They also just announced new rules for the Ford car dealers. dealerships, that's key.

Yes, the CEO is intent on modernizing the new car sales. Yeah, they got three new rules for your local Ford dealership, which you can picture this thing, right, Jack? Yeah, you can idea it for a dealership because of those balloons, those atomic. Like the guys, the really long balloon shaped like guys. I think like 1% of accidents are caused by those distractions. They're very distraining, but they are charming. Jack, what is the first new Ford rule for these Ford dealerships? Car dealerships must install sufficient electric chargers.

Second rule for the dealerships. They must train their salespeople on electric cars specifically. And third rule for the four dealerships. The price is the price. No haggling anymore. Less of this, what do I got to do to get you into this Ford Taurus, baby? And this ain't the best dealer down. My name's not Bill Ford.

Fully appraised. No money down. We got more spinny signs if you want one. That all sounds great. Like, that sounds good as a customer of a new car, right? Did it sound great? We kind of winged it. I don't know.

listeners may not have enjoyed that, but I guess it sounded great, man. As a potential car buyer, you've got to enjoy those rules. But here's the funny problem with those three new Ford dealership rules. Ford CEO can't enforce those new rules because of a funny quirk about the car industry. The quirk about the car industry is that those dealerships are legally independent. By law, they are not part of Ford, yet they represent Ford. So he's not ordering those new rules. He's asking them to follow these new rules.

All 50 states, in fact, have laws requiring cars to be sold through independent dealerships. It's an incredible accomplishment by the car dealer lobby. We should point out, Jack, that Tesla has an exception here. They sell their cars online. Yeah, they sell their cars on. They don't even have dealerships, so the law doesn't apply to them. They got like reverse grandfathered in. Well, this dealer drama has interestingly revealed a dirty secret about the car industry.

We call it the dealership tax. The dealership tax, because to maintain those car dealerships, it actually costs forward money. It costs Ford a lot of money. The CEO announced that it costs on average $2,000 per car the dealership infrastructure does. Yeah, because you got like the huge parking lots. You got the car shipping, the free coffee, those giant balloons that wave up and down, up and down. It's a lot of money. It all adds up to $2,000 of extra costs per car. Now, dealerships do provide some value, actually a bunch of value for four. Yeah, local peace of mind if you own the car and you have a place to repair. But that $2,000 per a car, that's a pretty, that's a good amount of money.

And like some of that costs may get passed down to us car buyers. And the rest of that cost eats into Ford's corporate profits. So Jack, what's the takeaway for our buddies over at Ford Motor Company? Is this historic or is it old fashion? There's a difference. Here's the difference. And historic business is one with a proud heritage that strengthens the brand still today. Disney, it's got a proud heritage and it continues popping out beloved movies. On the other hand, And an old-fashioned business is one that's outdated. It's behind the times of innovation. A typewriter is old-fashioned.

Exactly. It belongs in a museum, not in a modern office. Well, the interesting thing about Ford is that they kind of have a little of both. Like, they're part historic, but they're also part old-fashioned. Ford's history and experience lets it create an electric pickup truck and a brand new Mustang muscle car at the same time. But it's old-fashioned dealership model. It costs it money. That's $2,000 per a car, the dealership tax.

Ford is stuck between historic? and old-fashioned. So the big question, where will Ford land? Jack, what do I got to do to get you to whip up the takeaways for us over there? FedEx stock just fell 21%, but it brought the rest of the market down with it. Because FedEx doesn't measure packages, it measures the economy. For our second story, Kendra Scott Jewelry has taken off on college campuses. Her success was focusing on validators, not on vanity. Our third and final story, Ford's CEO, is trying to modernize the car buying experience with new dealership roles. But is Ford historic or is it old-fashioned? Now, time for the best fact yet. This one was sent in by Jack and me because we wanted to answer your questions about toys.

Twelve toys were nominated for the 2022 class of the Toy Hall of Fame. Okay, Jack, there was some legends in there. Like, what were the big brands? One of them was bingo. Lightbright got a nomination and Nerf toys. Finally, they got nominated. The Nerf Ball. I got in there. Honestly, Lightbrite got in, probably because the publicity from Stranger Things on Netflix. Season 4, fair point. And Nerf deserved to get in years ago. But the oldest toy to get into the Hall of Fame. The only toy nominated that happens to be 500 years old.

It's the Piniata. The Piniata, the toy Pignata that you like hit for candy. It was invented in like the 1500s. The Mexican Pignata has been waiting over 500 years to get into the hall. We wish it luck. Yeties, you look fantastic to kick off the week. And if you've got a fact that you want to get on the first, the pod or if you just want to shout out on the pod we've got forms for you google form

super easy to fill out they're right in the description of this episode you can record your voice we'll get your voice on the pod there we go give us a voicemick and i we'll see you tomorrow the best one and before we go congratulations to lungabangu who just proposed to samki bouti on the rooftop of the tallest building in africa that all sounds fantastic and congratulations to landon and jetta who just launched a pickleball paddle company in the area. And Nambi just got a new job in Kuala Lumpur, Malaysia, helping Malaysians get their first homes. There we go. And congrats to Nick and Megan Beard, who are getting married after 10 years in Spring Lake, New Jersey. And Rick and Roberta Cutler got their 45th wedding anniversary over in Illinois.

And congrats to Boyana Bolazone, who just got engaged in Virginia. And a happy birthday to Professor Rodney Lake down in the foggy bottom of D.C. Get us one of those huge slices of pizza. Please. And Kevin Hans, turning 15. down in Fort Worth, Texas. Happy 15th, Kevin. And Rainy Tofoya's got a birthday in Colorado Springs. And happy birthday to Harsina Naya Talwar in Anaheim, California.

And Vivian Shenz got a birthday in Huntington Beach, California. And happy birthday to Quinn, celebrating a birthday in Mexico with a big, salty margarita. And Pertique, Ashta, we see your 11th birthday while you're riding on the way to school in Melbourne, Florida. Prateek, you're going to crush recess today. And to anyone else celebrating something today, make it a tea boy. Celebrate the wins.

This is Jack. I own stock of Disney, Ford, and Netflix, and Nick and I both own stock of Robin Hood. Now a word about our sponsor, Robin Hood. Jack, rule number one about a kitchen renovation, tell your friends about your kitchen renovation. We know the cabinets are expensive. Well, in the pandemic, a lot of companies renovated their businesses

focusing on apps and digital. Robin Hood didn't have to. It was built digital from the start. Robin Hood's mobile first and intuitive design makes investing a little easier for every stage of your investing journey. Whether you want to trade options, ETFs, or stocks through Robin Hood Financial, or buy some Bitcoin on Robin Hood Crypto, you can do all that right on the Robin Hood app. If you're not investing on Robin Hood yet, to get started, go to Robinhood.com slash T-Boy and choose your free

stock. That's Robinhood.com slash TBOI. Limitations apply. Robin Hood Financial LLC, member SIPC, all investments involve risk. By the way, this podcast is not owned by or part of Robin Hood, and we are not employees of Robin Hood.