The Best One Yet - “The anti-Amazon rebel alliance” — Shopify’s new shopping app. High Times, the weed chain. Trolls change movie math.

Episode Date: April 29, 2020

Shopify does everything behind the scenes so brands can have their own ecommerce sites, but they just launched an app to take on Amazon. High Times is the NY Times of weed, but it just acquired a chain of 13 cannabis dispensaries. The new Trolls sequal wasn’t just adorable — its direct-to-streaming pivot may change movie industry math forever.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 Wednesday, April 29. Hello, Snackers. It is our pleasure being back here to serve you digestible financial needs. You all look fantastic, perfect timing because this happens to be, is this better than yesterday's Jack? The best one yet.

Our first story. Someone page Darth Bezos because there's a threat to the Amazon Empire. Turns out Shopify is building an e-commerce rebel alliance. This is a drama comedy. Shopify, the e-commerce company, is trying to. to band together an alliance of non-Amazon retailers into one shopping app. Help us Shopify. You're our only hope. That was a terrible Princess Leia impression, but I'll let this pass. You go with the vocal cords you got. Now, High Times is basically the New York Times of cannabis.

But it's going through like a little bit of a midlife transition we noticed. From covering weed to selling it in its own stores. When you've built a brand, leverage it with what you know best. For our third and final story, did you watch the movie trolls? or not. It kind of looks scarier than Frozen. Nick, I'm not talking Twitter trolls. I'm talking Disney trolls. We're talking the movie trolls, people. Real thing, second episode. Yeah, actually, that's not a Disney movie. I take that back. But the movie was supposed to go to movie theaters this month. Instead, Universal Studios went straight to streaming. And that single decision may change movie math forever. Before we get to those three story, Snackers,

we love chatting with you, but this conversation feels kind of one way. We know you're there, but we can't see you. So we kind of just put our hands out and and hope you're there. That's why we're pumped to whip up Snacks Break, episode two, this Friday. It's going down this Friday, 4 p.m. Eastern Standard 1 p.m. Pacific on Instagram live, snacks break. Last time we did Snacks Break earlier in April, we did it all buttoned up corporate style on Zoom. This time we're cutting off a few of the buttons, retailing the shirts, going full-on t-shirt mode for Instagram.

I was wearing pants the whole Zoom, but the highlight was actually that we got Zoom bombed by Zuck, who was trying to promote a podcast called Zuck's Daily to all of our listeners. Zach, we know you're listening. Please just let us know ahead of time we would have given you the invite link. Snackers, you can engage with us directly. And we're really excited if you follow us at Robin and Snacks. So that Friday, when we go live, you'll get a pop-up notification on your phone and you can join us. So here's what we're covering on this snacks break.

Last month, we predicted some COVID-19 business trends. And it turns out the evidence is in. This Friday, we'll decide which of those predictions we got right and which which of those predictions we got wrong. Plus, we're answering your questions live. They can be in full-on English, German, Italian, or even emoji. We'll take them. This thing's going to be about 45 minutes at Robin Hood Snacks on Instagram. 4 o'clock on Friday. We can't wait to see you. Let's hit our three stories. You're tuned in the snacks daily. We spoke to the lawyers. The snacks about the air ain't food. It's air candy. They don't reflect the views of the Robin Hood family. It's all

informational just so you know. We're not recommending any securities. Nope. It's not a research report or investment advice. Not an offer or sale of a security. Right. Snacks is digestible. Business news for you. Robberhood Financial, LLC, member FINRA slash SIPC. For our first story, Shopify just launched a profound shopping app. It's called Shop, which was shocked was still available. That name. Great name. And it's 100% anti-Amazon. Here's the great thing about Shopify Snackers. You've touched it, but you didn't know was there. It is purely focused on behind the scenes for online shopping websites. We're talking about a company that powers everything from like Kylie cosmetics to chubbies and then like thousands of startups in between. Correction.

A million companies' e-commerce websites are powered by Shopify. And they're doing everything from like you got the order flow, you got your product pages, you got your payment processing, you got launching a clearance section, that's all done by Shopify. If you want to launch like a t-shirt company online, you can figure out all that stuff or you can just hire Shopify. Shopify takes care of all of it. It's your plumber, your architect, your designer, your electrician, your dog walker, and your roommate Dave, who does some fantastic shelves. Remember him, Jack?

Think of Shopify like your wedding planner. They're doing all this stuff, yeah. But they shouldn't be seen, unlike Beverly, my wedding planner. Beverly was aggressively involved in Jack's wedding and way too present. Now, big news for Shopify. They just launched an app for consumers for the first time called Shop. Yes, and the great thing about that name, Shop? It's already a verb up there with like Venmoing.

Becoming a verb is the Nobel Prize of Business. Now what fascinated Jack and I is the key new feature in this Shopify app. A personalized, mobile first online marketplace to shop. Snackers, you know Jack and I, we jumped in snack style, we downloaded this thing, we started playing around. This is a hybrid of Amazon and Instagram if we've ever seen one. This app knows what Shopify powered products you have bought before online, and so you're automatically following these companies' pages on the shop app.

And then based on that, you can scroll through those companies' new products on the shop app, kind of like Instagram, and then buy directly straight through the app, kind of like a Shopify site. And you know they got algorithms that are thinking, if you like this product, you might like that product. You should discover this. Nick, you bought the obviously gray because they don't do any bright colors ever laying a hoodie. You may as well try the bathrobe from snow. Jack, you bought the obviously gray outdoor voices hoodie because their gray looks awesome. It's like a combination of black and white that looks like gray. Pairs really nicely with the all birds new running shoes. Obviously those probably came in gray too, we're both living in the Bay Area. So Jack, what's the takeaway for our buddies over at Shopify?

Shopify's app is the rebel alliance to Amazon's e-commerce empire. Snackers, Amazon is now probably about, if not more than 50%, 50% of all U.S. e-commerce. And Amazon's biggest advantage, it's a marketplace where sellers can immediately access like half the population of shoppers that are out there. Keyword there, marketplace. Now, Shopify was trying to power like the other 50% of U.S. e-commerce. And this shop app unites all of the businesses that decided not to list on Amazon in the most optimized way. But before you run away with this thing taken on Amazon, you got to remember that it faces one big challenge. Getting you to download the shop app. But ShopVicon hopes, honestly, enough people probably don't want to support Amazon these days.

There's a lot of vague and general anti-Amazonism out there, and Shopify's positioning itself as the Obi-Wan. Leader of the Rebel Alliance. For our second story, the New York Times of weed is finally getting into the actual weed business. High Times is transforming from a cannabis magazine to a cannabis chain of stores. Now, classic Baby boomer style, High Times has been talking about weed since like back when it was illegal. You weren't even born and I was toting the toke. And High Times was literally founded by someone who was a famed marijuana smuggler. We're talking about Thomas King Forcade back in 1974.

Cheech and Chong have adorned the cover of the magazine, eight times based on our cursory Google image search. They're like, who we're going to put on this week? I don't know. Let's call Cheech again. They're probably available. Willie Nelson's booked. We basically are doing the same rotation every third month. High Times is trying to go public so it can have a publicly traded stock that anybody can buy, but it's not doing it through a normal IPO. No, no, no. Of course they had to go with a rebel process here. They just issued $15 million

worth of stock to investors through what's called a Regulation A. They're not a publicly traded stock yet. They're kind of practicing. It's almost like what they just did was like a minor league IPO. Straight out of the farm leagues over here. And Reg A for short, and reg A icon Bob Marley is smiling somewhere in appreciation. High Times has a self-proclaimed title as the most iconic cannabis brand. And we think they might be right.

Exactly. Because Pineapple Express, you've heard it before, but that's like a, it's a fictional brand of weed. It's a James Franco and Seth Rogen movie. It's not like the real deal. The thing is, it's hard to develop a real legit pot brand because of its illegal status federally kind of prohibits you from doing that much with the concept. High Times Magazine is legal, though, because of free speech protection. And that brand is strong after 45 years of publishing this magazine, which became a culturally subversive icon. High Times Magazine is media. It's not a cannabis company. And that brand that High Times has developed, it has value. That's the concept behind brand equity. And it's why you're popping off like 29 cents for a Chiquita banana banana and not 25 cents for just, you know, the yellow one.

Chiquita, that little sticker is worth four cents for sure. That's brand equity. She's fantastic. She's worth every penny. She's cool. So high times used to capitalize on that strong brand by selling magazines and then selling ads in those magazines. But just like the rest of media, that business has disappeared as Google and Facebook,

they eat up ad revenues. Then comes the news this week, High Times just paid $80 million for harvest health and recreation. That's right. High Times Magazine is now the proud owner of 13 retail marijuana dispensaries in California, and they're selling actual cannabis. It's kind of like if Playboy acquired a chain of adult toy stores. So, Jack, what's the takeaway for our buddies over at High Times? It's time for this weed brand to finally sell what it's known for. Snackers, High Times has 17 million users through the magazine.

and social media and the website visits. It's built them all up as a media company. To make money off those 17 million users, they don't want to compete with Facebook and Google on ad sales anymore because that was really hard. Brutal. So instead, they'll do what Facebook and Google won't. Sell marijuana. And that means you shouldn't be shocked if you see 13 weed stores get rebranded as high times, which is the most valuable brand in the industry. Imagine the 11, 12, or 13, whatever it is now states that have legalized marijuana. Imagine seeing a high-time storefront on Main Street that you can walk by and check out. Boom, suddenly the company has a magazine to help people learn about cannabis and a trusted brand of cannabis for them to actually

buy. Snackers, we're a little over halfway into the pod. If you're running a snacks challenge, time to turn around and head home. Always hydrate. For our third and final story, Trolls World Tour. It ended up skipping movie theaters and it worked. This may change movie math forever. What is everyone watching? What are you watching? That's pretty much the only way you begin every Zoom conversation these days. I just signed up for Little Fires Everywhere. Sorry, I signed up for Hulu to watch Little Fires anywhere. Nice little bonus, Seinfeld comes with Hulu. Not to be confused with Big Little Lies, which just involves some characters and plays off a similar kind of a title. Little Fires, big lies. Yeah, kind of similar. But the one thing no one is talking about,

which everyone should be, is the Incredible Trolls franchise. Spoiler alert, Poppy and Branch discovered, there are six new troll tribes throughout the universe so they go find them. Honestly, Jack and I were talking, we didn't think there'd be more than four. Turns out there were six tribes. This is a lovely family-friendly movie by Universal Studios that was supposed to premiere in theaters on April 10th. Turns out that was, you know, the height of your quarantine. So instead of postponing, Universal decided we're not going to wait until this crisis ends and then give the people what they want. Let's go straight to the living rooms with streaming. You end up turning on your TV, boom, spend $1999. You can watch this movie on Apple TV,

Amazon, or YouTube, and not have to splurge $22 just for some junior men. So Universal Studios decided Troll's World Tour should skip movie theaters altogether. Now, MGM Studios took a different approach with their latest James Bond. They decided to postpone that movie from April to November when they think things will be back to normal. Aggressive move, Daniel Craig's not going to be a fan of that. Daniel Craig's going to be like 90 by the time this movie actually comes out. Every month that movie's postponed, Daniel Craig grows an ab. Now, don't let a 69% rating for Trolls World Tour on Rod and Tomatoes scary away from this movie. Trolls Ward Tour and the way that it came to our living rooms could change the industry forever.

Snackers, get this number. We just learned that the movie made $100 million in rentals online in just its first three weeks. I'm no mathematician, but I think that means 50, million households rented this movie. Is that math right? It's actually five million households or five million individual people who have a really strong obsession with trolls. True. And those people probably saw the prequel to trolls world tour. Yes. Which we're just going to call troll one because I don't know what it was called. Trolls one was movie theaters. We want to know how they compare. So let's do some movie math. Okay. The first Trolls movie made $154 million in the box office by selling tickets to

movie theaters, and they were doing that for five months before it went to DVD. Now, Universal Studios, which produced the movie, does a 50-50 split with the theaters. So Universal Studios got $77 million for that $154 million of box office ticket sales. And the movie theaters like AMC, they got the other half. Trolls 2, the second movie that just happened, that was direct to streaming. And movie producers have more leverage to take a bigger cut. If you're Universal Studios, you really like these numbers. You're doing an 80-20 split with the theater.

So Universal made $80 million with trolls too. Right, they got $80 million of the $100 million of total rental revenue. And that's more than trolls one got in theaters, and it did it in half the time. Sounds like Trolls World Tour did a lot better than Trolls One.

So Jack, can you dye your hair pink and tell us what the takeaway is for our buddies over at Trolls 2? This isn't disruption to the movie industry. It's hybridization of the movie industry. Snackers, direct to streaming isn't a one-size-fits-all, isn't perfect and isn't the end of movie theaters, as you may think it is.

Think about it. Troll's World Tour was the perfect medicine for a bunch of families of like six that were about to kill each other because they've been stuck in the same house for weeks. But in a non-coronavirus normal world, Trolls World Tour probably wouldn't have had such a big online demand for rentals. So instead of the end of movie theater movie debuts, which you might think the story was all about, we're probably going to see a hybrid model in the future. That means smaller movies without Daniel Craig's biceps may go straight to Apple TV to ensure they're profitable. But blockbuster movies like everything Marvel produces, that's probably going to stay in theaters because they can charge 31 bucks per butt per seat. This isn't a death blow to movie

theaters. But it does show movie studios that they don't 100% need movie theaters anymore. Jack, and you get out from under the bridge, I don't know, is that where trolls live? And whip up the takeaways for us over there. Shopify's new app is called Shop. It's pretty much half Amazon, half Instagram, and one app. And it's got one big challenge, friction of getting you to actually download the Shopify shop app. High Times is now a magazine that also has 13 cannabis stores in California. It has the best known brand and weed. Time for them to actually leverage it. Third and final story, the latest trolls movie made more money with online rentals than the original did in movie theaters.

That's why we're expecting a hybrid online and in-theater debut going forward. Now, time for our snacks fact. This one sent in from Athena down in Los Angeles, California. This is a great combination one-two punch of a snack fact. Okay, first of all, wireless bra and brilet sales. They're up 40% during the pandemic. You're inside all day. Nobody can see you.

Comfort is king. Jack and I have said it 100 times. Forget content. It's comfort that's king. But fully wired push-up bra sales like Victoria's Secret style are also up. You're with your significant other. If you don't hate them, then you love them. and you're spending a lot of time together.

If all bra sales want to increase, though, they got to start making these things out of toilet paper and cookie dough. Before we send off, happy birthday to KKK, your wife Kataki is a great snacker and says that you are too. You're turning 30 today.

We're huge fans of you. We're also huge fans of 30. So, Mani, Laura, congrats on turning 29 from your fiancé Catherine, but trust us, 30 is going to be awesome. I think Mani knows that his fiance is Captain. Also, a reminder, Mandy,

your fiance is Catherine. Snackers, that was a great one. Thank you for potting with us today. We'll see you tomorrow. This is Jack. I own stock of Amazon. Nick own stock of Shopify. 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 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.