The Best One Yet - Rent The Runway hooks up with W Hotels — GM & LG joint venture a battery — Tupperware’s plastic strategy

Episode Date: December 6, 2019

Rent the Runway partnered up with W Hotels so you don’t have to pack clothes for vacation. GM and LG are launching a joint venture focused on car batteries, which are the critical (and absurdly expensive) part to any electric car. And Tupperware is trying to go upscale with its plastic by claiming its reusable plastic is more sustainable… even though it’s plastic.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. This is Snacks. Daily, this Friday, December 6th. Great Friday to be a snacker. Thank you for listening to Snacks Day. Yesterday's snacks was pretty good. This is the best one yet.

It's so much better, Jack. And hit me with the first story. Rent the Runway has partnered up with W. Hotels to offer its clothing to guests. That means you basically don't need to pack a suitcase. It's all about partnership strategy and whether or not they're going to have a size 32. Can we talk about this? What are the size issues here?

I want a margin. Medium large. Second story, General Motors and LG, aka GM and LG. Get more creative, guys. They just whipped up a joint venture because cars are important. True. But electric car batteries are more important. This is the art of the JV.

Third and final story. Tupperware is actually a company with publicly traded stock. Still around. Tuporware just opened up a store in Manhattan selling $14 Apple protectors. But we noticed that the stock is down around 80% in the last year. So we're looking at why Tupperware is doubling down on plastic. Now, Snackers, before we jump into all that, we've got to talk about what's going on in retail. You've heard about the retail apocalypse.

Yes, we have. You've heard about the mall's closing. I have. You've heard about the small stores closing. Yes. You know what's having a great year, though? Who? Santa's.

What do you mean? I'm talking mall Santas here, Jack. Santa demand for, like, mall santas has risen 128% over the last four years, according to one, like, entertainment booking. Nick, what do you, some kind of South. pole elf what is a mall santa mall santa is like a rare breed of santa where the beard is just barely hanging on get this experiences are still in

and uh millennial and gen x parents want their kid to sit on santa's lap and say what they want for christmas so apparently people are hiring sanas to come to like family parties you get about 200 bucks an hour they're charging 200 bucks an hour when i was a kid we had a santa at our family christmas party must be nice yeah i think it was my babysitter april's dad But never confirmed. Never, you never see where they come out of.

How did he squeeze down that chimney in Vermont? I don't know. We actually were looking out the window, distracted when he like showed up in the litter of there. But here's the thing about Mall Santas. They're charging like $5,000 a day. I mean, here's the thing. It's a tight employment market. Not that many people are unemployed.

Not that many people are, you know, big-bellied and have white beards. No, it's really tough to get that. So it's a good time to be a Santa. Living like in the, you know, in this fit lifestyle. No, it's not working. for Santa. Now, one professor of marketing at Syracuse University said, Amazon can't put on a beard and put a kid on its leg and ask what they want for Christmas. So true. Let's hit our three stories. By the way, this is Jack and I own stock of Amazon.

You're tuned in the snacks daily. We spoke to the lawyers and we got to get something legal out the way. It's snacks about to hear rain food. It's ear 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. No. It's not. 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, Jack, how do you think I look in this thing and be honest? It needs a dry cleaning. Okay. Rent the runway, people. Just snagged a partnership with W Hotels, so you don't have to pack your clothes anymore. Snackers, clarification, W Hotels is owned by Marriott. True. Which is a publicly traded company. Rent the runway is still private, has not IPOed yet.

By the way, rent the runway, are we at the point where they can drop the rent and the the the the? Oh, definitely. Just go with runway, rent the runway. It's a million dollar idea. Actually, no, a billion dollar idea. Yeah, Nick will accept a thank you on Twitter. We're very excited about this partnership is about four locations of W hotels. We're talking the W. Aspen.

Very nice. The W. South Beach Sharp. The W. Washington, D.C. intense. And the W. We're talking about the kind of hotel you'll walk in. The water's got a cucumber in it. dreamt about saying, oh yeah, I'm staying at the W. Haven't had that opportunity.

Not quite yet. It may happen after this because they're doing a fancy little thing with our buddies at rent the runway. Here's the deal. You book your room on W. Aspen.com, and it's probably like 500 bucks a room. You're like, you're getting your uggs out, you're dry cleaning them so they're in spruce shape for the Aspen W. And then after you're done booking, they're like, would you like four styles of Rent the

runway for $69? Come again, W. Hotel? They're like, we will ship to you any of the clothes of our. massive wardrobe, we will have them waiting in your room dry cleaned, ready for you to wear, while you're done at Aspen. For $69, you can choose between like four basic styles they're going to offer at the hotel. And here's the thing. They're customizing the clothing options depending on like the location that you're at.

You don't want to show up to Aspen in a tankini. Let's put it down. No, you don't. In fact, if you're showing up at Aspen, they'll have the Ula Johnson pullover sweater, perfect for the Apreyski scene. Because you're going to roll up, you're going to do the Samores. You want to look good. in your Ula Johnson pullover sweater.

You do not want to be full send at that bar. No, but let's say you happen to be in South Beach for this winter break instead. Maybe you want to go with the Nanette Lapoor cover-up by the swimming pool. Okay, so you see, they have different wardrobes for different hotels. And if you have size issues. We know what you're thinking. Because Jack and I have been here before. You're talking to two guys who were confidently marges in college days.

Nick is a medium these days. Let's be honest. It's a marge-large-large. If you don't fit in that medium thing that you ordered and you don't fit in the large area, You can check out the mini closet at the hotel, which will be the backup selection just in case the stuff you order didn't. Cy stress is a real thing. By the way, this is now the first ever hotel with like a BYOC policy. No, actually, no BYOC.

You don't need to bring your own clothes. You just show up and let it take it from there. Now, it's good timing for Rent the Runway because 2019 has been a challenging year. All right, they had that supply chain issue that we told you Snackers about in September. We're like they couldn't add new customers. Remember, Rent the Runway is one of the biggest dry cleaning enterprise. is in the entire world. And their dry cleaning was like all messed up.

The tickets were missing, the numbers were gone. Remember, you're borrowing someone else's clothes essentially. Rent the Runway is giving you show clothes. You'll wear them for a weekend. And then you're sending back the Rent There One Way for your buddy Timmy to wear again. Right. And since its dry cleaning facility was shut down,

there were people counting on a dress for like the big wedding next weekend. And they had to come up with alternatives because Rent the Rwanda had like a two-week freeze. Well, it wasn't just that. It turned out that Urban Outfitters, Banana Republic, Bloomingdale's Express, all these big brands,

they launched identical business models, subscription clothing this year. Subscription business model. They're basically saying stop buying and owning a wardrobe of clothes. Instead, you can get a new wardrobe each month through this subscription. The new wardrobe is actually a used word. Yeah. Our buddy Timmy probably wore those clothes last week. So, Jack, what's the takeaway for our buddies over at Rent the Runway and Marriott?

Partnerships are about hacky marketing, and we think it's cool. In response to all that competition we just mentioned, Rent the Runway has been pursuing partnerships aggressively. They're allowing Rent the Runway customers to drop off their clothing at Nordstrom. They're letting you drop off your clothing at WeWork. Another partnership. They are letting you rent clothes at W hotels. And that's because partnerships are an alternative way to get new customers.

They're an alternative type of market. One way Rent the Runway could grow its customer base is paying a ton of money for a TV ad between the Super Bowl. Right. They'd have to spend big money and then convince new customers in this ad that you're going to great in these mom's cut jeans, but you've got to get them through Rent the Runway. Alternatively, Rent the Runway could do a partnership with a company like Marriott Hotels. And that involves spending only a little bit of money and then cross-pollinating your user

basis. Look what's going to happen here. Everybody who's ever stayed at W Hotel is going to get an email about this Rent the Runway Partnership. And everyone who's ever rented a blast from Rent the Runway is going to get an email saying they can now get that at a W hotel. It's cross-pollination of customers. For our second story, GM and LG are the latest power.

couple focused on electric car batteries. The chemistry between these two is electric. You can feel this thing all the way from here, even though the names are kind of lame. They're just letters. Now, the real winners of this GM and LG story is Lourdes Town, Ohio. Great Town. And Detroit, Michigan, where I lived for a full summer on the corner of Cass and Warren. LG is one of the South Green companies that does, like, a bunch of random things.

They're doing like microwaves, and they're doing like Mars rovers. And they're doing refrigerators. They're doing televisions. They're also doing cell phones. they also make batteries. And guess who needs hundreds of thousands of lithium ion batteries right now? Jack, I'm not going to buy a vowel. Can I buy a G? Can I get an ad? You got those two consents.

There we go, baby. General Motors and LG are both investing $1 billion each into a new electric battery company based in the United States. Now, the cities we just mentioned, Lawrence, Ohio is going to get a thousand jobs out of this to make the batteries. And those batteries are for electric pickup trucks that are really. being built in Detroit. Now, funny thing Jack and I notice here, another kind of company is part of this little duo situation. Best day in Piedmont Lithium's life.

We got to talk about Piedmont here. The stock jumped because this tiny little company has a lithium mine near Charlotte, North Carolina. The stock jumped 7%. Yeah, they're probably going to get some good business out of this. Now, here's the thing about electric cars. They are expensive because of batteries. Basically, batteries are the car.

Yeah, I think Tesla's Model 3 is one of the most affordable, electric cars out there, it's still $35,000. Right, it's like, do you want to buy a house or the battery to an electric car? Well, in 2010, the average cost of a car battery, an electric car battery, was $110,000. Then get this, people, the price now for an electric car battery is all the way down to just $15,000. But that's still a lot of money. You could buy an entire car for $15,000, or just the battery for an electric car. Jack and I have to do. Jack and I, We're blown away, though. That's a difference in price from $110,000 down to $15,000 in just a few years. Battery technology has been great and the prices come way down, but it has to keep coming down.

$15,000 is too much. But one of the reasons you're noticing more electric car talk out there, the price of the batteries is down. So Jack, what's the takeaway for our buddies over GM and LG and A, B, and CD? Joint Ventures are like having a workout buddy. They'll help you improve. They're going to keep you accountable. They're going to yell at you at 633am when you don't get that full rep in. and they let you work out harder. And they're a spotter. Spotter. So this new company in Lloydstown, Ohio, it's 50-50.

It's 50-50-owned. GM is bringing car expertise. LG is bringing battery expertise. Now, here's the one downside to joint ventures, though, in the art of the joint venture. Both partners have to make decisions together. You'll lose control. You can't want to you be like, hey, I want to do leg day. And everyone be like, no, I want to do upper body day.

You both have to go to the bench and spot each other while the other works out and vice versa. And you're going to enjoy it. You're going to. With a 50-50 joint venture, both companies have to agree. Also, you both must trust each other because you don't want LG sharing General Motors' secrets with Toyota or Hyundai. Yeah, your spotter knows you wake up in the morning. Maybe you're having a little creatine on the side. Now, if this joint venture works out, both will end up stronger and get batteries for a lower cost.

And those batteries are the key to electric cars. For our third and final story, Jack, take me out of the freezer and throw me in the microwave already. Tupperware just unveiled a bunch of plastic. plastic products. It's to reduce plastic bottles. It makes no sense. But it kind of makes sense. Tupperware has been saving lasagna leftovers since 1946.

It goes a long way back. Good time to be in the business in Tupperware. Fun fact, plastics were basically commercialized in 1946. Prior to 1946, it was it? Everything was metal or glass. Stapler's like aluminum. You could injure someone with those things. Like weapons.

Huge. Now, Tupperware is based in Orlando, Florida. Its stock is down 77% this year. and the CEO just left. But at least they're in Orlando, which is a lot of fun. That's a good thing. It's near Lake Mary, Florida, which is where the second Robin Hood office is. Very true. It's a great area. There's a lot of sun there.

But now, if you are in New York City, not Florida, and you walk down Mulberry Street, which is No Lita, the key to like the Christmas shopping area. Great Street, charming store is wonderful place to be. You'll see a store that is selling $25 drink straws. You'll also notice that they're selling $40 cold brew crafs because there's nothing people like more than telling you about their cold brew making routine, then carrying it around in a fancy bottle. The store we're talking about is Tupp Soho, which is Tupperware's pop-up store committed to convincing you that Tupperware is a company that is fancy and relevant. They want you to think that plastic isn't a throwaway thing.

It's like a life partner. It's something you need like a mortgage for. Yeah, true. You're going to introduce to your parents. Now, Tupperware makes plastic products, and Plastic's brand is just about as good as asbestos. So get this. Tupperware is doubling down on plastic. We dove into the snack style.

We couldn't believe they were doing this. There is not a single mention of the word glass in the entire annual report of Tupperware. We scoured the website and we could not find any glass products on it. It's all plastic. This ain't no Pyrex. Here's the thing from plastic. You know, plastic's made from fossil fuels. It takes like a millennium to decompose.

It's tough. It's not good for the environment. But Tupperware is trying to distinguish between single-use plastic. Which is the enemy. And long-lasting plastic. Which is, they think, your friend. It claims that its new. plastic has stronger, higher quality resin, and should last for a long time.

Now, the multi-use plastic that they're working with, they're claiming because it could be used so many times, it's actually saving waste. So it's funny, Tupperware is on trend because it's trying to reduce the amount that we waste. But they're off-trend with the actual material that they're using to do that. Which is plastic. Right. Also, shout out to our colleague, Abby, who has the most ambitious pledge to never consume any products if it includes virgin plastic.

It's impressive because imagine. being on an airplane and not having any single-use plastic. Yeah, Delta flight attendant. Would you like water? No, that is a plastic cup. Please pour it into my Tupperware. And they give you this weird stare. It's an awkward thing. So, Jack, what's the takeaway for our buddies over Tupperware? Tupperware is in the waste reduction industry. Snackers, Jack and I have spoken about this with you before.

Waste management, the publicly traded company, it's a leader in recycling nationwide. Recycling is good, but eliminating waste altogether, so you don't even need to recycle, that's better. And we're noticing that demand for waste reduction, it's getting pretty high. You have the Paris Climate Accord, which lots of companies are pledging to, even though the U.S. has not signed into it, to fight Global One. You've got cities that are charging you money if you ask to get like a plastic bag. You got Amazon, which is under major pressure to reduce the number of cardboard boxes at ship stuff.

Snackers, sustainable packaging is big. And Tupperware is trying to squeeze its brand into that do-gooder category. Jack, can you whip up the takeaways for us over there? Rent the runway is partnering with Marriott Hotels, so your room has a closet full of clothes. Runway gets W hotel customers. W gets runway customers. I like what you did there. We're pushing it. It's subtle. GM is partnering with South Korea's LG to build batteries for electric cars.

Because JVs are 50-50 partnerships just like your workout, buddy. A lot of two-letter names in that. Can't go wrong with that, right, J-B-J? PJ. Tupperware is trying to rebrand plastic as good for the environment. It's using an unsustainable material for sustainable purposes. It kind of cancels out. Time for our snack fact of the day. This one from like a longtime snacker way across the pond, he's been listening for so long.

We're basically buddies with him. Richard Philbin. If I had the power to knight someone, I would knight Richard Philbin. I think you can do it via audio. I think there's like a loophole there. Get this. The country of China has 421,000 buses that run on electricity. That's its fleet of electric buses.

United States, we have 300 electric buses. We got to get on this. 300 electric buses to 421,000. China is taking a leadership position in sustainable transportation. Snackers loved having you with us this week. You all looked fantastic. You did. And happy, happy weekend. I'm getting a Christmas tree. I'm doing one of those cut your own Christmas tree down with my life. It's intense. I'm moving so it's the same kind of workout, but with less satisfaction for the entire time. It's hard. You know, you got to watch Snackers, we'll talk to you Monday. Thank you for snacking. You got to look both ways. 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, 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.