The Best One Yet - “If you could sell stock of The Crown” — AT&T’s alleged cheating. Discord’s maverick. Gatorade’s tech thingie.

Episode Date: March 9, 2021

The social media app du jour Discord hit a $7B valuation for doing the opposite of every other social media company. Pepsi’s Gatorade just made an unprecedented move in the beverage industry: It’s launching a FitTech gadget. And AT&T gets charged with cheating after telling employees to “work the analysts” in an insider information faux pas.$PEP $TGot 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/viewform 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 Tuesday, T-Boy Tuesday, March 9th. It's Picey season. It's also T-B-B-T-L Tuesday. And this happens to be the best one yet. That's what the stars are saying.

Jack, T-B-O-Y, what's the first story? Gatorade's first commercial ever said that you sweat more than just water. Gatorade just launched a sweat patch, you know, to confirm it. For our second story, AT&T just got charged by the SEC for an insider information faux-Paw. Jack, it's got like CNBC meets big little lot. with a little bit of Harry and Megan tossed into it. For our third and final story, December was TikTok. Yeah.

January was Reddit. Oh, it was. February was Clubhouse. Well put. And March looks like it's going to be Discord. Jack, it is Discord. Hit a $7 billion evaluation doing the opposite of all the other social media apps. But Snackers, before we hit those three fantastic stories,

about 60 million Americans Google alerts just got notifications, buzzing on Monday. Yeah, no big deal. It's just, you know, the CDC's interim public health recommendations for fully vaccinated people alert. For nearly 60 million Americans who've got at least one vaccine dose so far, the CDC just told us what you can do. And for the 268 million rest of us, not vaccinated yet, the CDC's telling you what you can look forward to. All right, let's kick it off with what the CDC says fully vaccinated people can do. Please, Jack, the honors. You can hang out indoors. You can hang out indoors with other fully vaccinated people. No distancing. Nope. No masks required. Jack, the close talker book club, it's on. Okay, number two, fully vaccinated people can hang out indoors

with unvaccinated people of the same household as long as nobody is high risk. All right. So you got grandpa and grandkid non-Zoom hangouts also on. Finally. Number three, you still shouldn't travel. Jack, the trip to Cabo. It's off. Okay, number four, everyone should keep wearing masks when in public and continue social distancing when in public. So this one means the mask burning party, off. The mask burning party in Cabo? Ooh, definitely off. Snackers, 2.2 million people are getting vaccinated daily in the United States.

2.2 million people getting close talking privileges, grandkid, grandpa visiting privileges every day. Early takeaway here, it's going to be a better spring. Not necessarily the best spring yet. Yeah, that's true. But better. Let's set 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 are about to hear. It's air candy. They don't reflect the views of the Robberhood family. It's all informational just so. You know, 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, Gatorade, just made the biggest move in big beverage. That's why they called it Gatorade. launching a fitness tech wearable. Yeah, they are. Now, Snackers, Gatorade dominates. Gatorade dominates. The sports drink market with 72% of all sales. Jack, I'm so glad you emphasized the dominates. How about our friends over at PowerEd? They are a distant number two, Powerade is, with 16% of the market.

Power rate, catch up, buddy. Here you go. Here you go, Power! This is really, though, a Pepsi versus Coke situation, because Gatorade is owned by PepsiCo and Powerade is owned by Coca-Cola. Honestly, geopolitically, this is like a proxy war for Coca-Cola and Pepsi. That's what's going down here. But it's actually changed a bit. It's now Pepsi and Coca-Cola versus the world since the world that started hating on sugar. Yeah, basically, it's great you got 72% of the market Gatorade, but if that market's shrinking, not an ideal market.

That's why Gatorade just launched the GX sweat patch. Okay, this thing is wild. It's like a nicotine patch for people not with smokers cough. That's what it looks like. Yes, you buy it for $25 at Gatorade.com or Dick Sporting Gets. And then you're going to stick it on your inner left arm. you're going to do the Zumba class, and then it's going to fill with sweat,

this little patch filled with your sweat. We don't know why you have to put it on your left arm. I thought the body was pretty symmetrical. But it seems like specifics make it seem more legitimate. Yeah, and after your workout, after the thing is full of sweat, you scan the patch on your arm, open your Gatorade app,

and then it will give you a sweat profile. Boom, Jack, you just did the hit workout. The little app is going to tell you your sodium is MIA. You can't find it. Now, of course, you could always fall back to the analog version of this product that's always existed. I mean, why wouldn't you? You go to the bathroom, you pee, and you look at how yellow it is.

That is basically the analog version of this. That's what this is. Clear is good. Yellow is bad. This was such a random new product unveiled that Jack and I got curious. So we jumped into the last earnings report to see if there were any hints from Pepsi. We found a hint. The CEO said, we can leverage trust in providing much more than just a liquid hydration product.

Liquid hydration. Why would they expand beyond liquid hydration? Jack, what's the takeaway for our buddies over at Pepsi and Gatorade? Personalization is the ultimate future profit puppy. Snackers, great research from the consulting from BCG. Apparently companies that use digital info to personalize their products see revenues grow two to three to three to three times faster than those who don't. Thanks to data and technology, the cost of customizing a product has plummeted. Yeah, it has. And that's opened up three big opportunities, Nick and I see. Okay, first, with personalization, you get to charge high. higher prices. Call it the ego premium. Second, personalization drives customer loyalty. You're less likely to switch products when only that one brand really knows you. And the third and probably most subtle but important of personalization benefits is innovation. When customers are personalizing

the product, they're literally telling the company like the tweaks to the product that they want. If everyone's electrolytes are shown up low with this new Gatorade patch, maybe Gatorade should start sticking more electrolytes in the drinks. We think Gatorade. It's end goal with this product isn't to enter the fitness tech industry. No, no, no, no. Their end goal, it's personalization profits. For our second story, AT&T is getting sued for allegedly providing Wall Street analysts information that nobody else could have.

And that would be a violation of the sacred rule of finance. It's holy, Jack. Equal access to information. Okay, Jack, you're in Santa Barbara. You're covered in, I don't know, roses. That's what they live in there. Imagine you knew about Oprah's interview with Prince Harry and Megan Markle a few days before it aired. I'll tell you, if British royalty was a stock, you would have sold that stock the minute Harry opened his mouth.

Jack, season nine of the Crown, it's going to be insane. And you would have got out early because Harry dropped the Crown's reputation big time. Can they bring back Claire Foyce? She was fantastic. Everybody else is frantically selling their stock of the Crown Monday morning. Yeah, but you were able to sell Friday before. the massive drop. That royal situation that you found yourself in, In Lovely Santa Barbara, was a little case of insider information. Yeah, it's illegal to invest in a company based on insider information. Ideally, investors should have an equal playing field. Everyone should be

able to compete fairly, including with the VIPs. And for investing, quality and speed of information, that can determine the winners and the losers of investing. Jack, it feels like we need a second Oprah interview here, because that is exactly why the SEC just sued AT&T and on Friday. The SEC, the Securities and Exchange Commission, they're busy policing the stock market and they just pulled over AT&T. All right, here's what they're a legend. First of all, going over 65. Second, AT&T's investor relations team was apparently instructed to quote-unquote work the analysts. Allegedly, they gave a handful of Wall Street analysts private, non-public information about ET&T. So here was AT&T's goal with all this. The goal was to lower everybody's

expectations before their upcoming earnings reports. So in March of 2016, after work in the analysts, Wall Street downgraded what they thought AT&T would make in profits that quarter. Boom. Then April comes around. AT&T, shocker beats everyone's incredibly low expectations. And what happens to the stock jack? The stock jumps. And that's why the SEC alleges that AT&T created an unequal information playing field. A shocker, AT&T, says the allegations are meritless. A judge is going to decide. And Jack and I are going to whip up, Jack, the takeaways for our buddies at AT&T. You get news as quickly as Wall Street VIPs. Snackers, when you get engaged, when you have the baby, all right, first you're going to call

the parents, then maybe the siblings and friends, then you make an Instagram official. Pro tip, we recommend you make it Instagram official like a few days later. Give it a social media silent error. You're going to want like this time to yourself. American CEOs, on the other hand, they can't follow that announcement hierarchy that we just pro tip. No, they can't. They have to tell the world at the same time.

Which brings us to Regulation FD, the SEC rule created in the year 2000 that requires companies to share information equally. All right, Reg FD, if news is meaningful enough to move the stock price, then the company must share it in a way that everyone can access the information at the same time. Case in point, you can subscribe to receive press releases by email. Same as a VIP can. You can call in and listen to the CEOs discuss their earnings. Equally as a VIP can.

You can read earnings reports at the same. time as everyone else. Nick and I sit around at 430 waiting for earnings reports just like you. Honestly, that's like half of our life is that. That's what we do. For some big corporate news, the stock markets actually pause trading to make sure everyone can digest the information before making a move. That's right. Your buddy, Timmy, you traded GameStop once, has the same right to stock market info as Warren Buffett. For our third and final story, we got our social media app DeJure worth a cool $7 billion. Jack, can I introduce you to my friend Discord? We're calling it the Maverick of Social Media because they refuse to play by the rules of social media. We're going to jump

into this wild chart we found in the Wall Street Journal on Discord. Get this. The social media networks where American adults have spent the most time in January, it's going to shock you. Number five is Reddit. Number four is Snapchat. Nice. Number three is Twitter. Make sense. Number one is Facebook. I like what you did there. I skipped number number two, which is our buddy Discord. Discord came out of nowhere that kids' tables distracted by TikTok. Adults are having fun over at Discord. Founded in 2015, Discord was for video game live chatting with your buddies. Yeah, you get the FIFA crew together on Discord at 2 a.m. That's your thing. That's your Saturday. FIFA 2 a.m. Discord. Don't be a minute late. Now here is the key snackers. The app is basically one

giant live chat room. That's what it is. It feels like a Slack channel met a Zoom call at the same time. It's basically what it feels like. Now, the conversations, they're happening in real time. It's kind of like a running text message. Right. And real time is different than like your Facebook news feed, which has your top posts with all the likes and all the comments. But Discord has evolved.

It's not just like who died on Halo last night. People can use Discord for homework, for simultaneous movie watching, and recently for stock trade. That's right. Maybe you're figuring out this algebra together on Discord. Or watching coming to America together on Discord. Or maybe you're selling. Spike Seltzer stocks together on Discord.

Okay, three, two, one. Sell. You sell first. But Jack, can I drop some numbers on you? During the pandemic, Discord's revenue has tripled to $130 million. Its valuation has doubled to $7 billion. And the number of users has doubled to $140 million monthly. Let's compare those numbers to the rest of social media.

Twitter, Facebook, Snapchat, TikTok, Reddit. they make over 90% of their revenues through targeted ads. All right, so get this Snackers. Maverick Discord, it makes zero percent of its revenues on ads. It is doing the opposite of every single other social media company. Instead, Discord charges $10 a month for something called Nitro. Nitro. Nitro is a premium version of Discord that gives you DIY-Do-It Yourself emojis.

Or you can animate your profile pick. So it's like the fat lady that gets you into Gritro. Riffindore Common Room. Or you get higher-res videos and you get that by paying 10 bucks monthly for a Nitro. Different than Facebook, which is going to target you with a mattress ad because you uttered queen-sized in one message the other day on Instagram DMs. Mattress, mattress, mattress, Casper, Casper, Discord's going to charge you a monthly subscription for premium services. So Jack, what's the takeaway for our buddies over at the Maverick Discord? When it comes to business models, ads are a drug, subscriptions are of food. Snack or social media right now, it has an unhealthy

addiction to ads, and we are living with the repercussions of that business model. Since social media is free, it forces them to use user data to sell ads. And then they highlight provocative posts to get more engagement so they can collect more data so they can sell you more ads. Subscriptions, on the other hand, they are a reliable meal of nourishing, recurring revenues. But like any solid dinner dish, subscriptions are harder to whip up. If it was easy, everyone would do it. These subscription apps need to keep developing charming premium features to get you

to pay up for those features. And then every month, everybody who's paying for a subscription sees it in their credit card statement and considers ending it. Discord, the maverick of social media, is showing what social media's food diet could look like. Jack, can you whip up the takeaways for us over there? Gatorade's first wearable could lead to its first customizable. All right, so a gatorade is $1. A personalized Nick Martell Gatorade, I'd pay a buck 50 for that. I'd pay for a Jack Kramer version of actually. For our second story, AT&T has allegedly broken the sacred rule of finance. Equal access to information with the VIPs.

For our third and final story, Discord is a maverick in social media. The rest sell ads. Discord is selling DIY emoji perks. And that's pretty healthy. Now, time for our snack fact today. This one DM'd in on Instagram by Emma McCarthy, our local submariner in Farmington Hills, Michigan. All right.

So you may have heard that American submarines are powered by nuclear reactors in the submarine. They provide the electricity and the propulsion. All right, here's the wild thing. That's, like, continuous. It is non-stop source of power. They only need to, like, refuel this thing. Right. So, technically, the only reason why a submarine has to, like, go back to shore and, like, restock up is the food.

Yeah, the food. The crew actually can make their own water on the submarines. Can't make their own food. Yeah. Yet. Snackers, you looked fantastic today. Have a great Tea Boy Tuesday. And if you didn't yesterday, give us five on Apple Podcast.

You may as well scroll down, drop of five. We'll see you tomorrow. Quick correction, Snackers, Sean McBriar tried to send us a picture of this Hudson Non-Stop Amazon Go-powered cashier-less convenience store. He tried to send us a picture, but it's not at the Dallas-Forth Airport. Like we said, it's actually a Dallas love field. If you're flying Southwest, check this out and send us a pick at Robin Hood Snacks. And before we go, happy birthday to Snacker Yady Garcia and Hinnathega, Nicaragua. and Abishak Sen in San Francisco

and Jasper Wong in Philadelphia and Amelia Mendoza in Portland, Oregon and David Jensen in Springfield, Missouri and Carlton Hill in Suffolk, Virginia. And happy birthday, Iriano Rodriguez in Cambridge, Massachusetts, and Camille Manette in Dallas, Texas, and Ji Yang in D.C., and Marissa Hernandez

in Dawson, Alabama, and David Lopez in Boca Raton, and Nelson Chan, happy birthday. Also, Michael, congratulations on the move to Taiwan. Diana Lim's got a new internship in Oakland, California, which I here is lovely. Matt and Allison Rumpf married Asbury, New Jersey, not Asprey Park. Kim and Eric Donald, a couple, one of whom has a birthday, one got a promotion.

Must be nice. They're celebrating the right way with a hike in New Mexico. That is wholesome. And to anyone else who's celebrating something today, make it a T-Boy. Celebrate the wins. By the way, this is Nick and I own shares of Apple. 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 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.