The Best One Yet - ⛰️ “Coors Premium” – Molson’s economy massacre. Big TV’s ad migration. Tencent’s electric drug.

Episode Date: August 5, 2021

Molson Coors is retiring 11 classic brew brands because beer is like an airplane. Tencent (Earth’s 2nd biggest video game company) was just told by China that its top game is “spiritual opium.” And Big TV is losing so much ad money to Big Tech that we’re calling it a migration.$TCEHY $TAP $CMCSA $DISCAGot a SnackFact? Tweet it @RobinhoodSnacks @JackKramer @NickOfNewYorkWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Got a SnackFact for the pod? We got a form for that too:https://docs.google.com/forms/d/e/1FAIpQLSe64VKtvMNDPGSncHDRF07W34cPMDO3N8Y4DpmNP_kweC58tw/viewformLearn 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 Thursday, the new Friday, August 5th. How's the Dow look, Nick? Dow is down 323 points. That's okay. We're still close to a record high.

What about the situation for Team USA? Jack, Olympic team from Russia, 53 medals. China, 70 medals. USA, 77 medals. Did you hear about Tamara Mensa Stock who just won a gold in wrestling for Team USA? Did you hear what she's doing with $37,500, Jack? I did. That's her prize for winning gold.

She's spending $30 grand on it to buy her mother the food truck she's always wanted. That's a good move. This pod, by the way, the best one yet. Jack, first story. Tencent. China's tech and video game giant plummeted it this week. Because apparently its top game is spiritual opium. Not our words.

No, those words came from way up off our pay grade, actually. Second story, Jack, what do we got? NBC, Warner Media, Discovery. They make up big TV. And they just told us the money. they're making on ads is shrink. It's part of the second great migration of ad money. For our third and final story, Mulsin Coors is treating beer like it's an airline ticket. Premium, you get pampered. Economy brews, you're going to get ignored. But Nick, before we hit those

three great stories. Okay, this is a wonderful mix today, Jack. This is the best one yet. Who else just won an Olympic gold? You're not going to believe this. Your phone, your phone just won Olympic gold. Actually, all our phones just won a medal. True story, because for the first time in Olympic history, phone parts were recycled into the metals. They're in the medals. There are 5,000 medals being awarded in these games, and every single one of them is pretty much one part Android, one part iPhone. It's in the computer. The Tokyo 2020 Metal Project literally sorted through 78,000 tons of electronic devices that had been trashed.

They sifted through, they found 6.21 million discarded phones no longer scrolled. by the Japanese people. And guess what's buried in that electronic treasure deck? Jack, I got the periodic table of elements over here. Is it a little bit of gold, a little bit of silver, a little bit of bronze? There's treasure in that treasure. Snackers, it took two years of sifting and smelting. Oh, the smelting.

The smelting. And that brought us to this moment. For the first time ever, 100% of each medal in this Olympic Games is recycled metal. And it's all from phones. Yeah, Snackers, your phone? It's not just a phone. If you recycle, it's a gold map. Let's hit our three stories.

You're tuned in the snacks daily. 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. Robahood Financial, LLC, member FINRA slash SIPC. For our first story, Tencent is actually the number two biggest video game company on planet Earth. They're behind Sony's PlayStation. They're ahead of Nintendo's Nintendo. Donkey Kong's not happy. But China's government just announced that Tencent's games are like a drug for the Chinese people.

Now, Snackers, before we jump into that, Jack, I feel like we could clarify here. We researched like a whole bunch of news sources every day, probably like 30 each, a whole lot of news sources. One source we've never read is the economic, Information Daily until this week. Interesting little fact about the economic information daily, though. It's owned by the Chinese government. And on Tuesday, they published an article claiming that video games are a spiritual opium for the Chinese people.

We repeat, they called video games the spiritual opium that is an electronic drug for the kids of China. They told parents to watch out and they said regulations should be adopted for video games. First part was kind of poetic. The second part was more direct. They said the worst offender of all was this one game called Honor of Kim. Honor of Kings, what you'd probably end up naming a video game. Actually, the first video game to ever hit 100 million daily users.

Congratulations. And this is huge news because if something is published in the Economic Information Daily, that means the message has been approved by China's president Xi Jinping. And Snackers, as we know, what she wants, she gets. So publicly traded Tencent, the leader of video games in China, the stock fell by 8%. But Snackers, that's not even the wildest part of this entire. entire story. What's wilder is what Tencent did next. They reacted by immediately announcing a bunch of self-regulation. Tencent aggressively treated itself. Basically, they whipped up a bunch of self-rules.

Rule number one, minors can only play Tencent's video games for an hour a day. That's it. On regular days and two hours on weekends and holidays. If you got good behavior, Jack, let's not get carried away over here. They're saying literally everyone under the age of 12, you can't play for more than one hour, even though we know you're all playing for 24 hours. It's like a parent telling their kids, no more instant messaging, but the parent is Tencent. Jack, this is classic 2003 AOL. No, you can't I-M after dinner. Tencent announced they're even considering banning their video games for anyone under 12. That's a huge move.

It appears their number one priority is to show remorse for any past misdeeds. So they're like scrambling to win back the good blessings of the Chinese government, which out of nowhere turned against them. Which leads to our takeaway, Jack, what's the takeaway for our best? buddies over at Tencent and all the Chinese tech companies. Tech is a nice to have for China, but manufacturing is a must have for China. Snackers, just last month, China banned downloads of the RideHale app Diti, the Uber of China. Last week, China told the ed tech industry they could only offer tutoring services as a

non-for-profit business. And now the whole gaming industry in China has been warned that a crackdown is coming. Jack, what's the like one similarity between these three examples? While they're all tech companies. Yeah, they are. It seems the Chinese government recognizes a big risk of having a big and powerful tech industry. Yeah, it's like considering it a threat to their stability, the tech apps, the tech companies. For example, a social media platform could, in theory, disseminate some banned information to all of the Chinese people like that.

So, Jack, what does the Chinese government want to focus on instead of tech? Well, last year, President Xi made a speech that the online economy is flourishing in China. But he emphasized that the real economy. is the foundation of China. And by real, he's talking about factories because he went on to say that manufacturing cannot be abandoned in China. China's government is choosing between computer chips or the apps that run on them. And they're choosing the chip factory. For our second story, what was your screen name, by the way?

I don't even remember. What was your screen name? Oh, it was JK Baseball 5. Okay, you went literal. It's right. I went with face off guy 22, sports agnostic, could be lacrosse, could be hockey, you don't know. Yeah, you were apparently much more confident than me. I went with the old initial favorite sport, favorite number.

Didn't convert to any kind of playing time. Snacker, second story, NBC, Warner Media, Discovery, they all just told us how much money they are making. We're seeing the second great migration of ad spending from TV to digital. Senator, we sell ads. Famous words from Mark Zuckerberg to Senator Orrin Hatch in our nation's capital. Yeah, and Jack, Zuck's a good. ad sales guy. He sold a lot of ads last quarter. Facebook sold 68% more ads last quarter than

pre-pandemic level. What do I got to do to get you into this Instagram ad space, Jack? It wasn't just Facebook. Snapchat. Their ad revenue is up 170% compared to the pandemic. Twitter up 49%. Google up 54%. Even Amazon's revenues grew 160% compared to pre-pandemic in the advertising unit. Big Tech has vacuumed up the bulk of marketers' advertising budgets. Yeah, not just in the United States, across the world. Meanwhile, the legacy TV networks used to love all the ad bucks. They're not loving them anymore. Perfect time in Jack, NBC, Warner Media, Discovery.

They all just showed us their second quarter ad money. The mullah, the box. Those three networks, NBC, Warner Media, and Discovery, they own like 20 channels. I used to flip through with my remote. They're big TV, the ultimate scroll. And their channels are huge fans of those three. 30-second Jeep ads. They love just having that thing climb on something.

You know, doesn't matter what it is. The car industry, alcohol, snacks, pharmaceutical, movies, they're all about TV commercials to market their product. And, Jack, like, our whole generation spent eight minutes of every half hour on Rugrats watching commercials. It's true. But now that so many of us have cut the cord, those TV commercials, those ads, are less valuable today.

Yeah, Snackers, we've got some harsh numbers here from NBC. Warner and Discovery's ad revenues. The money they make on TV commercials in the second quarter is 4%, 4% and 3% lower than what they made before the pandemic. So clearly, advertisers have decided that the big money should leave NBC and go to Snapchat. Exactly. So Jack, what's the takeaway for our buddies over in Big TV? A third migration of ad dollars could be coming. Snackers, the first great migration of ad dollars was advertising going from print. to digital. The Facebook news feed is better at targeting and has a younger audience than that huge Sunday newspaper used to get delivered. The second great migration of ad dollars was this one right now,

from cable TV networks to online search and social media. Yeah, another benefit of digital is it lets you measure clicks and impressions. Television doesn't. But here's the thing. Jack and I think that a third great migration of ad dollars could be coming from radio to podcasts. Think about it. The market dynamics of radio versus podcasts is. extremely parallel to cable TV versus digital. Exactly, Jack. And the data shows that radio industry ads are stagnating while podcast ads are booming right now.

Mattress, mattress, mattress. For our third and final story, Mulsin Kores is retiring. It's 11 cheapest beer brands. First came inflation. Yeah, it did. Then came shrinkflation. That did too.

This is premiumization. Jack, Miller High Life Light, Keystone Ice, Milwaukee's best best. premium. All of them born in the ice beer craze of the 1990s. We were too young. Didn't know this was the thing at the time. But that craze was all about the higher alcohol, lower flavor. These beers were sold in 30 packs. They were high volume, low cost. That they were too. And the trend today, though, is it's kind of the opposite. It's less drinking of beer. Right. Memorable occasions over

not remembered frequency. Well put. Well put. So Snackers, Jack and I noticed that in the Molson Coles earnings. They said they're retiring 11 economy brands to focus on higher-end brews. You heard economy. That's right. Alcohol companies treat their drinks like airlines treat their seats. This is kind of wild. Business class gets the banquet drinks. These are the premium drinks. The economy sitting in like row 38 gets the water down cheap stuff. And you're in the middle and it's extra water down. In the U.S. last quarter, Mulsin Corr sales rose by 7%. And half of that growth came from the business class brews. It's not coming from the Miller High Life Lights, the Keystone Isis, or the Milwaukee's best premium. So Moulson Coors is retiring 11 heavy beer drink and beer brands

to save money and save resources. And they're going to reinvest that money in the Spike Seltzers and like the no alcohol energy drink, Zoa is a big one for them. Which the Rock is behind. Dwayne Johnson, he's a big fan, big fan of that stuff. Those drinks just have more potential and they sell at a higher price too. But Snackers, that's not the only reason that MulsenCores prefers premium. So, Jack, what's the takeaway for our buddies over at Molson Corse? A great shield against inflation is premiumization. Oh, wheat prices, yeast prices, can prices, shipping prices, all these prices are like surging lately. It's brutal. Now, Mulsin Corr's could pass those costs on to you. That wouldn't be nice. But that would require raising the price of a Keystone Ice 30 rack by a dollar.

And you might not pay. Who's going to do that? It's Keystone Ice. But if you're a premium beer drinker, you're already signaling to Molson Quarres that you're willing to pay more. So these premium beer products, they have more profit margin, which makes cost increases much more manageable. Premium pale ale cushions the impact of rising costs in a way that Old English simply can't. And Keystone Ice wishes it could. RIPP, Keystone Ice. Jack Kenyon, whip up the takeaways for us and Jake Kramer now Baseball 43 over there. Okay.

NBC, which is owned by Comcast, by the way. And WarnerMedia. Owned by AT&T. And Discovery. Which is merging with WarnerMedia. They're all suffering from a migration in ad dollars. Second takeaway, Jack. China's corporate crackdown continues.

It's all focused on tech software. China is picking the chips over the apps. Third and final story, Moulson Quarrest is retiring 11 beer brands. Premiumization is a defense against inflation. Now, time for our snack fact of the day. this one tweeted in by Jordan Marcus from lovely Oakland, California. Yahoo, the ancient internet icon. Classic.

Their name is actually an acronym. Turns out Yahoo stands for yet another hierarchical, officious oracle. I have no idea what that means. No idea. But Yahoo is also a term for a rowdy person. Like, I couldn't even hear you because of the Yahoo's over at the bar. Yeah, and the Yahoo co-founders, thought there were some pretty rowdy guys over there. Evidently.

Snackers, you look fantastic. Jack, I'm getting on a plane after this. I'm doing the first Red Eye in a long time. Oh, yeah. You're on your way to Vermont to celebrate the wins. Get those paddle boards ready. We're going to do some stand-up paddle. Snackers, have a good one.

We'll see you tomorrow. Can't wait. And before we go, happy birthday to Global Citizen Snacker, Utkarsh, from Michigan. And Caitlin Dildjer from Fort Worth, Texas. And Nico Sucodis from the island of Greek. And Jeremiah Lazzow in Rio Grande Valley, Texas. And happy birthday, Jess Fernandez, down to Miami. and Echo Yarni in Toronto.

And Sunol Metal in Portland, Oregon. Congrats to Rihanna, who just became a billionaire, according to Forbes. And Judy Nelson and her puppy are moving over to Vail Jack. It's on my bucket list. Congrats to Cameron and Claire Smith for moving into their first house in Cyprus, California. And Henry Kaminsky Jr., congrats on 14 years in business in Sparta, New Jersey. We wish a speedy recovery to Josiah Haas, who's recovering from ACL surgery in Ohio. And Jack, Ben Harrison, had a birth.

date and engagement and bought a house all in Rochester, New York. Go bills. This is Jack. I own stock of Amazon. 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, or any of its subsidiaries or affiliates. The podcast is for informational purposes only and is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. The podcast is also not a research report and is not intended to serve as the basis of any investment decision. Robin Hood Financial LLC, member FINRA, SIPC. Oh, they're smelting.