The Best One Yet - 🐔 “Nuggets 4 life” — KFC’s Window of Loyalty. Air Conditioner’s duct tape. Netflix’s stoooooop.

Episode Date: July 20, 2022

KFC is launching their first chicken nugget in their 92 year history — because the window for their chicken loyalty is closing fast. With extreme heat ravaging Europe, people are turning to climate change duct tape: Air Conditioners. And Netflix’s shrinkage continued for a second-straight quarter, so it should initiate Code Red: Make Fewer Shows. $YUM $NFLX $CARRFollow 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.

I do think there's something about the tint on our cameras that makes your hair slightly red. Have you noticed that? I haven't seen that. Okay. Not on Riverside. Unlike YouTube the next day. I think it's an ad of things. Adam is amazing with us.

Here we go. Three, two. This is Nick. This is Jack. It's Wednesday, July 20th. And today's pod is the best one yet. It's a T-boy. Stocks rallied 3%.

Bitcoin's up 15% this week. Jack, it's earning season. It's pool season. T-Boy season? For our first story, KFC is launching its first ever chicken nugget. Because the window of loyalty is about to shut. For our second story, a heat wave is hitting Europe and coming to the U.S., but one company is loving this extreme heat.

Carrier air conditioners because they're the duct tape of climate change. Our third and final story is Netflix. Their earnings just showed the most important thing that Netflix must do. Make fewer shows. Three words. That's it. That's the movie. But before we hit that wonderful mix. Although if you want to do a show with Jack and me, we're open to doing this show.

Yeah, that's true. Do one more show than the fewer that Nick just prescribed. One more. That's the kid. Yesterday, we told you about Subway's tuna sandwich drama. That Subway tuna may be funa. Oh, and also, Subway bread? It's legally not bred over an island. And its footlong meatball subs may not be footlong after all per se.

But Subway isn't the only big food company with a faux ingredient problem. Yes, Yeti, Adrienne Jalali sent one our way, and that company is Skittles. Skittles may not be the rainbowed candy crush that you think it is. Get this. This week, a lawsuit just dropped on Skittles. Yeah, that Skittles, the candy. Because Skittles aren't just sugar, sugar, more sugar, and yellow five food coloring next. Every bite of Skittles also has just a little tad of titanium dioxide. It really does. It's right there on the label, and Skittles says that that titanium dioxide, it's FDA approved. Well, the sweet tooth plaintiff in this case disagrees.

Because titanium dioxide is the same ingredient you enjoy in paints, sunscreens, and plastics. Fantastic, a.k.a. Things you don't eat. So when you're indulging in a 2 o'clock Skittles binge, you don't just taste the rainbow. You may be tasting some delicious toxins. Now I know why I felt sick after eating three bags of Skittles during recess. Jack, you're too hard on yourself. It's not because you ate 18 times the recommended daily serving. I honestly just can't wait for it. for Skittles to launch Skittles plus them.

Skittles plus no titanium dioxide. No amount of titanium or oxide, please. Let's in our three stories. Let's go, baby. Fifteen years before this song, two boys from the Northeast met in the dorm. They had an idea to cause a cultural storm. It's the best 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. Our first story, KFC is planning its first ever, unprecedented chicken nuggets. Because there's a three-year window of loyalty. And once it closes, it's closed forever.

Oh, KFC, they're devouring 750 million chickens a year. They have the world record for largest bucket of fried chicken in the world. And yet, despite all those chicken records, KFC has never done a true nugget. By the way, that bucket was 2,000 pounds, Nick. For the record, that's a record. It's like nine feet tall. Sit down, stand up and eat back up again. But here's the news. KFC is launching their first chicken nugget in their 92-year history.

It isn't a tender, is it? It's not a tender, right? No, and they've done popcorn chicken, too. This is a bona fide, well, no bones, actually. Chicken nugget. We're talking A12-36 piece testing in North Carolina. They're tossing 11 herbs and spices on this 100% white meat jack. Dip it in a friar. That's it. But the other surprise here isn't just the nugget.

What Jack and I found fascinating is the explicit reason why. KFC was very upfront. They said we're targeting Gen Z and millennials with this chicken nugget because they prefer boneless. It is. Put it right out there because nothing is more chuggy than meat with a bone. Now, the way Nick and I see this story, KFC isn't just targeting Gen Z. They're really targeting the window of loyalty. The window of loyalty. Sounds like something from a fairy tale.

Yeah, it does. But actually, the window of loyalty isn't about a demographic. It's about an age. It's a three-year window in everyone's life when young people grow loyal. to a brand. Now, the window of loyalty is a theory that was first developed by FSU professor Jeff James, Dr. Jeff James, focused on sports. He noticed that kids are age nine through 12 when they become loyal to a sports team. Because at age nine, kids develop complex operational thinking, and that makes them capable of fandom. When I was age nine to 12, the Yankees won back to back

to back world series, and now I'm a fan of that team for life. Perfect timing. Jack sounds like Jorge Posada jumped into your window of loyalty. And if you become loyal to a team from those crucial years, 9, 10, 11, and 12, then even if you leave that hometown, you're still going to love that team from your child. And that is why the Yankees increasingly focus on more family nights, and that is why KFC is whipping up their first nugget. KFC needs the fried chicken item that kids want. They do.

Nuggets so that kids choose KFC for their entire fried chicken future. So KFC's new nugget is trying to jump through. a kid's window of loyalty before Ronald's McNugget can. Great job, dude. I got nothing to say. So Jack, what's the takeaway for our buddies over at KFC? The window of loyalty opens up to lifetime value. You still got nothing to say or you want to whip something up here. Yeties, it is important as entrepreneurs to think not just about the one-off transaction

with a customer, but about the lifetime value of that customer. Because if KFC can sell a chicken nugget to a kid today, then it can sell that kid fried chicken sandwiches in 10 years when he's an adult. And then 10 years later, it can sell her a bucket of family-sized chicken. That's lifetime value. And here's the thing. Yes. Lifetime loyalty doesn't just boost sales. It saves money to. Because if your mouth commits to KFC by age 12, that's less marketing money KFC has to spend to convert you. Lifetime value means KFC gets your fried chicken sales for life. And that is why the window of loyalty is worth jumping into. And that's all.

I got to say about that. For our second story, a heat wave is hitting Europe hard right now, but one company is loving it, and that company is carrier air conditioners. Because air conditioning is the duct tape of climate change. Yeties, you want to know how hot it is in Europe right now? It's so hot that an airport runway melted. The Royal Air Force had to cancel flights. It's that hot.

That's how hot it is. You got triple-digit temperatures in the UK. You got the hottest days on record in France and you've got wildfires across Portugal. And over a thousand people have died because of this extreme heat in Europe right now. Okay, so we're sending our cool thoughts to our listeners who have never seen 40 degrees Celsius in their lives before. But every challenge is also an opportunity. It is. And an extreme heat happens to be an extreme opportunity for Carrier Corp, the $30 billion Florida-based air conditioner company.

It's not just Carrier, Lennox, Train, and other companies, doing HVAC, heating, ventilation, and air conditioning. Their stocks are outperforming. Carrier stock jumped 4% yesterday, double the rest of the stock market. Carrier's air conditioning business is enjoying record profits right now because of moments like this. Jack and I have recorded, what is it, Jack? Like almost a thousand podcasts now?

Almost a thousand. Almost a thousand. So Jack and I were looking at the story and we were trying to figure out the right way to cover it and we remembered a similar story we covered one year ago. The best way to tell this story is that we told the same story. one year ago. Jack, take us back to the Pacific Northwest one year ago. In July of 2021, we had record demolishing temperatures in the Pacific Northwest of the United States. Looking on the screen here, it was 116 in Portland, 108 in Seattle. And one year ago, all those air conditioner stocks,

we just mentioned, also hit record highs. Same phenomenon. Extreme heat. Same reaction. Air conditioner stocks popped. In both cases, dangerous heat in. places with historically mild climates. That's what drove it. In both cases, people and businesses that have never had air conditioners urgently realized they needed air conditioners now. Last time it was Portland and Seattle, this time it is Portugal and Spain. And ironically, it's an air conditioning vicious cycle. Yeah, because the more use of the air conditioners to deal with the climate change, the more greenhouse gases that create more climate change. It's a vicious cycle. So Jack, what's the takeaway for our buddies who happened to be in the air conditioning business?

Air conditioning is duct tape for climate change. Uh, yeah, it is ever notice how every mechanic, every hardware store, everybody who happens to be your roommate who fixes everything in your house, they carry duct tape? Duck tape. It's never the long-term solution, but it's cheap, and it's a quick fix for now. Well, we've said before climate change is a mega trend. That's a mega problem that requires we reinvent our energy system. Well, we're not doing that. So the world is resorting to duct tape. So for people and businesses that can afford it, air conditioner,

are the duct tape that fixes their personal climate change problem. So carrier, Lennox, and train, they're not selling air conditioners. They're selling duct tape. So for all our Yetis sweating it out across the pond, Jack and I are sending very cool vibes your way. And now word about our sponsor, Robin Hood. Nick and I got to know Vlad and Bay Jude, the co-founders of Robin Hood, when we worked there for three years.

And there's this one business principle we heard from them. And we just, we honestly loved it. A, B, L. Always be launching. Always be launching. That's what keeps customers engaged. It keeps investors happy and it keeps competitors kind of concerned. Always be launching is also consistent with Robin Hood's mission to democratize finance for all. Yeah, not just stock trading. Also options, crypto, spending, wallets, and more. They launched a lot of stuff. And that's something we heard. We saw and we adopted. Yeah, this week, we relaunched the podcast as the best one yet and launched a video pod right here. More to come.

If you're not on Robin Hood yet, want to get started. Go to robin hood.com slash T-boy and choose your free stock. That's Robinhood.com slash T-B-O-Y. Certain limitations apply. All investments involve risk. Robin Hood Financial LLC, member SIPC. By the way, Robin Hood is no longer affiliated with us or this podcast. For our third and final story, Netflix just announced another brutal quarter of shrinkage second in a row. Growth is over for Netflix. So it's time for fewer Netflix shows. Yetie's funny thing happened to Netflix just last year. It stopped growing. Jack, do we have an update on the situation? over at Netflix this year.

It's shrinking. Netflix announced yesterday that in the second quarter, its subscriber base fell by just about a million households. Yesterday, we told you everyone's shrinking except for your grandma. Netflix is that grandma right now. And if Stranger Think Season 4 didn't boost subscribers, nothing will. Help us, 11. You're our only hope.

So Nick and I are thinking, now that the era of growth is over at Netflix, their turnaround strategy has started to emerge. It has, and we've noticed it's emerging in four different. parts. The number of users have stopped growing at Netflix, but no one said their revenues had to stop growing too. So here we go, Jack and I are going to whip up for you the four new ways. We've noticed that Netflix is going to squeeze more money and attention out. The first is the headliner. They're adding an ad-supported subscription. We've told you about that before. A lower-price

subscription, if you'll sit through a thytast or saw commercial to show you that thing on your thigh. The second way Netflix is going to try to make more money, we've also told you about their ending password share. Actually, Jack, didn't Netflix just say they found over a hundred million households flixing but not paying for it? Yeah. So Netflix is finding creative ways to find the moochers and make them pay. You know who you are?

And that includes us. And number three, they're going to focus on product placements in Netflix shows. The Crown, season five. Did you see Queen Elizabeth wearing those white gloves, Nick? I did. Is that a J-Crew logo, Jack? It is a J-Crew. crew logo. The Queen and J. Crew, that sounds like some money for Netflix. And the fourth way,

Netflix is going to make more money off this shrinking subscriber base. It's a surprise. They're going to stop dropping entire seasons and start delaying entire season. Yeah, so besties, you can't just binge 10 episodes of the next Bridgeton season on a rainy Sunday and then call it quits and unsubscribe from Netflix. No, you can't. Netflix is starting to spread out episodes so that You're a paid subscriber at least a month or two or three to watch the latest season. So, Jack, Netflix is borrowing from old school HBO. Don't just drop the episodes. Delay the episodes.

Sundays are for HBO. Everyone knows that. Agaba ghoul. So Jack, what's the takeaway for our buddies over Netflix? Code Red. Netflix should make fewer shows. Okay, for the past 10 years, Netflix has made too many shows. We know you love your true crime document.

But you've only gotten through a quarter of Netflix's true crime catalog. Meanwhile, Jack, what has Apple proved with Apple TV Plus? Apple TV Plus proved you don't have to do it the Netflix way. People will pay for quality over quantity. And Jack, what did Disney prove with Disney Plus? Disney Plus shows people will pay for spinoffs and sequels of the same core show. Okay, so Netflix, instead of splurge in $17 billion a year on Shmovies, that's over one lift. Netflix should spend half of that.

Netflix should spend like half that. Squeeze more juice out of the oranges you already have instead of planting new orange trees. Cut the budget in half and focus on the already successful Netflix shows. Make fewer shows. Jack, can you whip up the takeaways for us over there? KFC is launching their first chicken nugget, targeting young people. The window of loyalty, it opens to lifetime value.

For our second story, Extreme Heat in Europe, it's a boon for air conditioner stocks. Yeah, because AC units, they are the duct tape for climate change. Our third and final story is that Netflix has stopped growing. In fact, it shrank, two quarters straight. We got a code red, code red for Netflix. Jack, what's the code red? Make fewer new shows.

Unless Jack and I approach you about making a new show. TV boy? Yeah. You're going to want a green light that one. It sells itself. Time for the best fact yet. This one sent in by Joe Neumann. from lovely Pittsburgh, Pennsylvania.

As of June 6th of this year, there is only one state in these United States with zero commercial airline service. And that state, it is not the smallest state in the Union. No, it's not Rhode Island. And it's not the least populous state in the Union. It is not Wyoming.

It is, though, Delaware. Delaware has zero flights. Yeah, Frontier Airlines used to fly from Newcastle, Delaware to Orlando, Florida, but they just stopped doing that. Delaware is grounded. Oh, and Yeti's quick correction before we go. Jack and I mentioned last week that Tesla's autopilot was a subscription, but it's actually included.

It's their enhanced self-driving, and their full self-driving that costs extra. It's even worse because I literally used this autopilot feature in my Tesla, and you didn't pay extra. I definitely don't pay for it. Besties, you look fantastic. today. Jack and I, we can't wait to see you tomorrow. H-Y-H-T-B-O-I. Have you had the best one yet? If you know, you know.

And before we go, a shout-out to Yeti, Coffey in London, who just got the word T-boy Yet on a license plate in England on his car. He's the best T-boy Yeti. And congratulations to the Magic City hippies. The band just hit one million streams on Spotify. Put some champagne on your rider. And Joey Wesley just got a new job in Foshan China. Congratulations to Jason Martin for graduating from Air Assault.

And Megan Curran is turning 21 over in Bartholona. And happy birthday and congrats on getting engaged to Carolyn Giles in New York City. And Lexi Hubbard, happy 30th down in Denver. Happy birthday to Ciny Zhang in Fairfax, Virginia. And Timothy Hartung over in Charlotte, North Carolina. And Casey Longstrap in Sumner, Washington. And John Quinn is turn in 23, the Michael Jordan Year in Memphis, Tennessee. And to anyone else celebrate something today,

Make it a T-boy. Celebrate the wins. This is Jack. I own stock of Disney and Netflix. And Nick and I both own stock of Apple and Robin Hood and some Bitcoin. And now a word about our sponsor, Robin Hood. Funny little thing about the Robin Hood logo. Okay, go look at it right now.

Most people, you just see a feather. Robin Hood's feather and a cap, pretty classic. But it also looks like something else. If you look closer, closely or, you may see an arrow pointing up to the right. Yeah, the Robin Hood logo. Nice little Easter egg in there. It's not just a feather. It also symbolizes bullishness. There's a little arrow in there. If markets are up or down, it's nice to be optimistic. We always love that little detail in the Robin Hood logo.

Honestly, it's all about the little things in life. If you're not on Robin Hood yet, want to get started. Go to robinood.com slash T-Boy and choose your free stock. That's Robinhood.com slash T-B-O-Y. Certain limitations apply. All investments involve risk. Robin Hood Financial LLC, member SIPC. By the way, Robin Hood is no longer affiliated with us or this podcast. I think it's Gills. What? I knew a Gills that it was like this, so, but they didn't have a GILL, dude. I mean, I know, but you know what I mean?

Like there's more than one. Okay. I mean, dude, just English language wise. I after G makes the G soft and the E makes the I a long vowel. So the English language says it should be Giles, but I understand that. I mean, English language tells us that thought should be thoggot. Ha ha ha ha ha.