The Best One Yet - ⛏️ “He’s a gold digger” — Adidas $800M Kanye loss. Shopify’s quitting reward. Michelle Obama’s snacks.

Episode Date: May 8, 2023

Adidas first thought that ending Kanye’s Yeezy line would cost it $250M, but turns out it was $800M… cause when you live by the Influencer, you die by the Influencer. Shopify just announced it’s giving up on its biggest dream, but Wall Street rewarded it for quitting. And Michelle Obama’s first startup is kids snacks and drinks — because the biggest thing in food right now is small. $ADDYY $SHOP $KWant merch, a shoutout, or got TheBestFactYet? Go to: www.tboypod.comFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on YoutubeLearn 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. Welcome back. It is Monday, May 8th. And today's pod is just the best one yet. It is a team boy. Last week, the Dow jumped by 500 points. On Friday, the Dow leaped by 2% not too shabby, Jack. But honestly, can we retire the Dow Jones Industrial average? I think I know what you're getting at and I think you should continue on. What is this thing? First of all, it's not industrial. That's a good point.

It's not an average number. That's a fair point. And who the heck is Dow Jones? Either way, The Dow's up 500 points. Jack, what's our first story? Adidas U.S. sales dropped by a shocking 20% last quarter because of Kanye. Yet he's Adidas. It didn't just lose sales. It lost the love. For our second story, Shopify just made a major announcement in their battle against Amazon. Shopify, they're proven that you can get rewarded for quitting. And our third and final story is Michelle Obama.

The former first lady just launched a food and beverage startup. Because if you're not in the snack and breakfast. business, then you are not in the food business. But Yetis, before we hit that wonderful mix of stories. That is how you begin a week. I love this mix, Jack. Great mix, man. Over the weekend, Nick and I meet people and ask us what we do for a little.

Some of them are Yetis. Some of them aren't yetties. Either way, they ask us what we do. And what do we say, Jack? We tell them that we're full-time podcasters. Jack, what's their reaction? They're always surprised and a little confused. They're like, oh, this can be a full-time job?

That's what you do? Cute story, buddy. Yes. podcasting can be a full-time job. It's my favorite job. I have no other job I want to do. It actually is the best job yet. It's the only job we want. So we want to update you on our podcasting business. Jack and I want to jump in a little T-boy style with you to our business. There's two ways that podcasts can make money, generally speaking. Yeties, there are two core revenue streams for any podcast. Those two revenue streams are

subscriptions and ads. That's the bicep and the tricep and podcasting. That's what that is. Now, we do not want to charge you a subscription. We want this to be a free show. Yeah, we want everyone to be able to access our takeaways. Everyone should be able to hear a chicken noodle hard seltzer every once in a while. That's why we monetize our show through ads. Yes, and for our second year of T-boy, Jack and I just whipped up some new ad deals. You're going to start hearing new ads on the show.

We're kind of excited about it. We hope you are, too. Yeah, you're going to hear a variety of ads on the show, not just one ad for the full year. Here's the best part. All the ads are products that we have tried and we love. And here's the bester part. All the ads are for brands that we think you're going to like. We wanted to give you a heads up about this news.

But we also wanted to share a bit about the podcasting business. Why not? Because we can't run this business without you, the besties. Without the ads, Jack's cookie, it would have no crisp. Without the ads, Nick wouldn't be a dink. He'd be an oink. One income, no kids. Yeah, that would be a problem right now.

Yetis, we love our listeners and we love our sponsors. Besties, enjoy the new ads, Jack. Let's hit our three stories. And those 17 ads. No, it's not going to be 17. Just kidding. We're good. We're good.

15 years before this song, two boys from the Northeast met in the dorm. They had an idea that caused a cultural storm. It's the best one yet, but the best is a norm. Jack Nick, that's it. I don't even think they need to practice. 50% that's a fat tip. Tea Boy City on your at list.

You know you know because we're ready to go. We can't wait no more. So just start the show. Start the show. For our first story, Adidas just announced that profits fell. Get this. 90% because of Yeezy. Adidas didn't just get tackled by Kanye West.

No. It got injured by him. All right, Yeties. Let's talk about this. Last year, the biggest celebrity drama wasn't on Real Housewives of Rhode Island. No. It was with Kanye West, aka Yeezy. Yeah.

Kanye West. He said a bunch of anti-Sense. Semitic things, and then he got dropped by a whole bunch of brands. He got dropped by Balenciag, by Gap. Even his talent agency dropped Kanye West. Okay. So many companies ditched Kanye West last year that he is no longer a billionaire. He lost it.

He dipped under the bee last year. Once you're above the bee, you do not want to fall back below the bee, Jack. But the biggest brand to drop Kanye West, aka Yeezy, AKA Yee. What is it, Jack? Adidas. Adidas. Because Adidas, over the last couple years, had ensconced itself. in Yeezy. Yes, Adidas made a billion dollars a year by selling Yeezy branded footwear. And last year,

Adidas warned us that they could lose up to $250 million because of this breakup with Kanye. We covered that news on our pod a few months ago, but we just got new news. The actual number, the actual loss for Adidas, is three times more than that. Yeti, sit down, stand up and walk around in these shoes again. Adidas lost $800 million on this breakup, not $250 million. By splitting up with Kanye West and his Yeezy brand, Adidas is losing $800 million. Now, Yiddies, here's what Jack and I found fascinating about this story. That $800 million, that was kind of surprising, wasn't it, Jack? Even more surprising news, though, was that Adidas' sales in North America fell by 20%

last quarter. But even more surprising than both those news was this statistic. If you remove Yeezy from the equation, then sales for Adidas still fell by 5% in North America last quarter. Yeties, we got to sprinkle on some context here. For a 99-year-old apparel company, a 5% sales drop in its best market, that's a big deal. That's big. And it reveals that Adidas's issues were bigger than just Kanye.

They were deeper than just easy. And now, Besties, we know what you may be thinking here. Hey, people are getting laid off these days. Maybe they don't want to splurge on some fancy sneakers by a company called Adidas. So maybe the whole industry is suffering. That's what people might be thinking. So Jack and I were thinking that too. and that's why we looked at a similar company, Nike.

And Jack, what did we notice at Nike? We checked to see if Nike also experienced a 5% sales drop in North America. And did they, Jack? No. In fact, sales at Nike rose last quarter in North America. In fact, in fact, sales at Nike jumped by double digits last quarter in North America. Nike's sales were booming here. Adidas's sales were getting crushed, not just because of Yeezy.

Adidas, Adidas, tomato, that. He's a niche need. So, Jack, what is the takeaway for our buddies over at Adidas? You live by the influencer, you die by the influencer. Yeti's influencer marketing, it's been proven to be a powerful tool. It's great. Brands can piggyback off of someone else's established fame. But more and more companies are listing influencers as official risks to the company in their SEC paperwork.

And now what makes this easy situation unique is that it quantifies that risk. The risk was real for Adidas. They just lost $800 million in lost. sales and lost merchandise because of one influencer's antics. But here's what's worse. Yeezy caused reputational damage to Adidas's brand. That is also quantifiable now. Forget about Yeezy.

Americans bought less non-easy stuff too. Because Yetis, we've said it before and now we're seeing it here. You live by the influencer, yet die by the influencer. And then some. For our second story, Shopify, just announced its best news in over a year. Get this. Here we go. Here we go.

Shopify is quitting. Shopify is giving up on its dream to take on Amazon and Wall Street rewarded that decision. Jack and I'm going to start by sprinkling on some sprinkles. I like that. We're going to sprinkle on some context here. Here's the deal yet. It may be the biggest business that you've interacted with,

but you didn't realize it. Shopify is the software that helps run like pretty much every online store. Okay, full disclosure. This is Nick. That's Jack. And T-boypodpod.com, our merch store, it runs on Shopify. Hats are still available. Wink, wink, wink.

Here's what happens. Jack and I actually do use Shopify. And we log in to the software and we can see that like Sarah in Seattle just purchased a couple hats. There you go. We can also see the analytics. Like most Yeties buy two items. Wink, wink, wink. Or most yeties make their purchases in the evening.

Yeah, we get that kind of granular data. So Shopify just announced earnings last week. and Jack and I were naturally curious. And what did we notice in the earnings, Jack? They announced their third straight quarter of accelerating sales growth. They also announced they're laying off 20% of their team. Wall Street actually liked both of those things.

But here's the part that Wall Street liked the most. Okay, Yetis, this was kind of the shocking thing. Shopify is abandoning its biggest dream. Shopify is abandoning its dream. Yeah. They wanted to become this giant fulfillment company to take on Amazon. And now they said,

they're not going to do that. Yeah, Shopify is already the software of choice for companies that want to sell stuff online. But two years ago, Shopify got very ambitious. They wanted to be more than just software, so they acquired Deliver so they could ship those online orders to you too. Shopify wanted to take on UPS and FedEx. And then they launched warehouses and fulfillment. They were going to do that too. Because Shopify wanted to take on Amazon.com. It made big investments. It had huge ambition because an all-in-one vertically integrated, e-commerce company, that's like a tremendous undertaking. Jack, who does that remind us of? Who else is a vertically integrated all-in-one, one-stop shop e-commerce company? There's only one.

It's Amazon. Shopify was trying to be Amazon. But last week, Shopify gave up. Last week, Shopify sold off deliver their shipping company, got rid of their warehouses, and sold off their logistics arm. Shopify quit. And guess what? Wall Street loved it. That was what Jack and I could not understand. The stock surged 33% since 13.000. Since 13,000, day when they made their announcement public. So Jack and I jumped in T-Boy style. Jack, what's the takeaway for our buddies over at Shopify? Sometimes it pays to quit.

Okay, Yendies, Jack and I just told you that Shopify gave up. And yet Wall Street were warranted Shopify for doing that. Because building a global fulfillment network is one of the most expensive endeavors in business. And Shopify, they were two years into that journey. It could have taken decades to complete that thing. And that pursuit caused Shopify to go from healthy profits to a company with huge and growing losses. Now, Jack, you and I should point out that we are not pro-quitting, but like we're also not pro-dooming yourself to a failed idea either.

No, we're not. Shopify is going to refocus on just software. They're going to leave the shipping to somebody else. Because yet is even if you've invested a lot of money, Wall Street just told us that sometimes it pays to quit. For our third and final story to kick off the week, Michelle Obama just launched her very first company, and it's called Plezzi. Because the biggest trend in food right now is small.

The biggest trend is small. Jack, all right, but Jack and I, we were looking through the notes here. We've covered a lot of celebrpreneurs in the last three years. This has been a thing. Celebrities who spin their fame to entrepreneurship. We're talking about Rihanna slash Rihanna. Ryan Reynolds slash Ryan Reynolds. Kim Kardashian.

Michelle Obama is the latest one. Because Yeti, celebs, they don't just endorse products anymore. Now, they co-found them. Celebrities want skin in the game so they can take part in the upside. Well, for the first time, the former first lady, Michelle Obama, is launching her very first company, and it's called Plezzy. Plezzy. They're making kids' drinks and kids' snacks with no added sugar.

Now, Jack, let's sprinkle on a little context here to what business this actually is. Well, child obesity was her thing when she was the first lady at the White House. She had a garden in the Rose Garden. Okay, get this, Yetty's. The typical American kid eats on average 53 pounds. of added sugar every single year. Michelle is committed to kids nutrition, but it's only gotten worse since you left the White House.

That is a lot of cupcakes. 53 pounds a year of added sugar? It's like a mountain of white. So the goal of this company is to make Plessy the Nestle of Nutrition. The Unilever of Healthy Kids Food. We couldn't think of an alliteration there, but maybe like the smuckers of low sugar.

That's what we're going for here. No, the schmuckers of no sugar. Right. I screw it up every time, Jack. The first product is going to be a juice box with 75% less sugar than the competition. And Jack and I looked at the roadmap. We noticed their next products are a whole bunch of snacks. But we'll get to that in a moment.

We know the marketing strategy, though, for Pleasant. Jack, what's the marketing strategy for Michelle Obama's new company? It's at Michelle Obama. It's her 54 million Instagram followers. Get this, Yeties. The press release for this company was an Instagram post from Michelle Obama. And how big did that press release get? It was a press post and it got 100,000 likes.

That's more than any other press release we've ever seen. So Nick and I jumped in T-Boy's style to the menu at Plezzi, and the initial flavors being offered, they tell us something about the company. What these products tell us is that the consumer and the customer are not the same thing, and that's okay. The consumer is who drinks these juice boxes, kids age six to 12. But the purchaser is who buys these products, and that's the parents, ages more than 12. And you can see that with the branding. Yes, there's no cartoon character to convince you that.

you're going to enjoy this little here at juice box. There's no Tony the Tiger. There's no toucan sand. There's no cookie, Chris. I know you held back there, Jack, but that's okay. Now, the bottle and the letters on that bottle, the branding, it is playful. But really, it's focused on the nutrition details. And the key nutritional detail is that there's zero added sugar.

Yet these Jack and I are analyzing the brand here. And what we're noticing is that it's not speaking in the language of kids. It's speaking in the language of parents. Now, the big risk here with these healthy juice box. Yes, Jack. Kids are used to sugary juice boxes and kids have hissy fits when they're expecting sweetness and there's no sweetness in it. I love that you said hissy fits just because you didn't get a Capri Sun, Jack. Michelle could end up looking like the person who hands out apples during Halloween. We're not trying to give advice, but we did like those things in the Capri Sons that you

stick in the Capri Sun. It's called the Straw. We're still going to try this product. So Jack, what's the takeaway for our buddies over at Plezzi? The most powerful trend in big food right now is small food. Yet he's Jack and I were talking about this over the weekend. The main food theme we've been seeing in 2023, it's that Wall Street is craving snacks. Snacks, small food. Every earnings report from the food company, the tastiest numbers are in the snack divisions. Yeah, perfect example. Last week, we told you that half of Campbell's soup sales aren't soup, they're snacks. Like goldfish, that's about to become a billion dollar brand. PepsiCo is less interested in Pepsi. They're more interested in snacks, which is the top.

performing division for three straight years. Kellogg's, their snack division is performing so well, they're spinning it off into its own separate company. It's going to have cheese hits, rice Krispies, Pringles. It's a pure play publicly traded pop-dark company. Yes, it is. Yeties. The light we carry, it is focusing on snacks.

Because the biggest trend in food is small. Jack, can you and that schmuckers whip up the takeaways for us over there? Adidas Kanye divorce cost to $800 million. Yetis, you live by the influencer, you die by the influencer. For our second story, Shopify just quit its dream of taking on Amazon head on. And honestly, Wall Street loved it because sometimes it pays to quit. And our third and final story is Michelle Obama. She's launching a line of healthy snacks and drinks called Plezzie for parents to buy their kids.

The biggest theme in big food is small. Small food, snacks. Now, time for the best fact yet. This one sent in by Ryan Park and Loebuck. Logan Conroy from lovely San Francisco. 90% of the world's data was created in just the past two years. Yeties, we repeat, 90% of all the data on earth, it happened in just the last couple of years. If you take all the data in the history of the world that's been created, 90% of it was just the last two years.

Yeah, that's how much stuff happens online. That's how many things you click, save, upload, and download just in the last couple years. And you want to know how much data we're talking about in just the past two years? Let's sprinkle on this context, man. In the past two years, mankind has created 97 zetabytes of data. And since nobody knows what a zetabyte is, Jack, let's just continue on. What is that stuff? One zetabyte of information is equivalent to a trillion truckloads of paper.

If so facto, in the last two years, we've created 97 trillion truckloads of paper worth of data. And that's all we got to say about that. That's a lot of lifts, Jack. That's a lot of life. That's a lot of lifts. Yeties, you look fantastic day. Jack, missed you over the weekend. Great to be back.

We got a fantastic five-day week. Here we go, man. I love this enthusiasm, next. Let's just roll with it, man. Let's make every day a two boy, huh? You look great over there, by the way. You too. Yeties, we'll see you tomorrow.

Can't wait. And before we go, a congratulations to Yeties, Jacob and Hendra, who just got married but are already on that honeymoon down in Tulum, Mexico. And congratulations to Lee and Stephen, who just launched a bubble tea bakery in Maplewood, Minnesota. Not too shabby,

and Paige Garena Esquire has a new dream job over in Times Square. Wave to us from the big board. And congratulations to Delpha Carpenter, who just got into the law school at the University of Michigan, which is the most beautiful part of campus. Go Blue.

And Logan Marshall just became a CPA down in Tennessee. Congratulations to H.Q. Stanley, who just got promoted in Cincinnati, Ohio. And Jack, did you hear what Jasper or Mac Wingang just did? I heard he ran a 50,000 ultramarathons. Yeah. Is that 50,000 ultramarathons? I think it is.

That's a lot of miles. That's a lot of marathons. Congratulations, Jasper. You're in better shape than us. And Annie Crickorian, happy birthday down in Westlake Village, California. Happy birthday to Daniel Saltzman in Manhattan Beach, California. And Avery Patel just turned 19 over in Orlando, Florida. Happy birthday to Sukana Nasser in Orlando.

Florida. And Roshab Sakedava, happy birthday all the way over in Milwaukee. Happy birthday to Josh Trouinsky in West Greenwich, Rhode Island. And Super Macaroni, who's a good boy? The Golden Retriever is turning one year old. And happy first birthday to Hayes Grieson of Pacific Heights, San Francisco, who's celebrating in Alexandria. And Sophie, the future Panther Panzer is turning one year old over in Montclair, New Jersey. Happy birthday, Sophie. You're the best tea baby yet. This is Jack. I own stock of Amazon. Unilever and Nick and I both on stock of Shopify.

Dude, I did not know what to say after a tomato tomato. I was like, Jack's going to say something. And then you're like, no, dude. Hit me with the takeaway. I was like, oh, God. You did great.