The Best One Yet - 🫙 “The Avicii of Aioli” — Heinz’s sandbox strategy. AI’s nuclear agency. Target’s growing shrinkage.

Episode Date: May 18, 2023

Heinz’s newest product isn’t a sauce, it’s a make-your-own condiment freestyle machine — Because you should treat your customers like kids in a sandbox. The creator of ChatGPT just told Congress that AI is a nuclear technology… that should be regulated like nuclear. And Target just revealed that it’ll lose $1B this year on Shrinkage — which is corporate speak for theft — but the root of the problem isn’t what you think.$KHC $TGT $TJXWant 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. It's Thursday, the new Friday, May 18th. And today's pod is the best one yet. It is a T-boy, Jack. The Dow stocks jumped 400 points yesterday on hopes of a debt-sealing deal. The president and the speaker just said that the U.S. is not going to default. They said they're inching towards a deal.

They're inching towards a debt deal. Yeties, we'll keep you updated. In the meantime, Jack, what's our first story for the show? For our first story, Kraft Heinz's newest product isn't a sauce. It's a mixing sauce machine for you to do a flavor-free for all. It's all part of a little strategy Jack and I call sandboxing. For our second story, the creator of ChatGPT just testified to Congress, and the senators were nice to him.

Because AI is getting an international agency. And our third and final story is Target. Target just announced that stolen, broken, and lost product will cost it a billion dollars this year. All of that stuff, it's called shrink. And it turns out shrink is growing. But Yeties, before we hit that wonderful mix of stories. Just a fantastic mix of stories, Jack. Love this mix.

We have to talk about the newest trend in fitness. Yeties, the newest trend in fitness, it's to work out like an animal. And we're not talking like great workout, Timmy. You're an animal, man. We're talking like literally, Timmy, you are mimicking a mammal in order to work out. According to the Wall Street Journal, gyms across the country are adding primal movement classes inspired by wild animals. We repeat, these are primal movement classes inspired by something that will eat you.

The only primal movement I ever did in the gym was the bear crawl, which is exhausting. It was not fun doing any kind of a bear crawl. Crawling on your hands and feet, it's pretty primal, isn't it? But 60 minutes of bunny hops? Apparently, that's trending on TikTok. Monkey bars? They're making money right now. Pump and iron, you're doing it like a porpoise that's paddling jack. And the reason that crunch fitness has you doing kangaroo kicks, they're accessible. Foreclines are loud and they are scary. But a bodyweight crap push-up isn't. No equipment needed.

You could do a primal workout anywhere, including in a forest. We're talking burpees like a badger. Oh, we're talking push-ups like a panda. Ten sets of lunges like a Liger. Jack Parks, they used to be a place we could just look at ducks. But now we're looking at Darlene doing donkey kicks over there. Hey, Darlene, why are you waddling on us? Yet he's the biggest threat to Peloton is not Equinox or Planet Fitness.

No, no, no, no, no. the biggest threat to Peloton is a one-hour crab walk. Less spinning, more growling. You got to squawk if you're on the squat rack. Yetis, let's pounce on our three stars. That's a beauty! Fifteen years before this song, two boys from the Northeast met in the dawn. They had an idea to cause a cultural storm. It's the best one yet, but the best is a known. 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. Start the show.

first story. Craft Hines's newest product. It isn't a sauce. No, Kraft Hines' newest product is a mixing sauce machine. Because the secret to innovation is in your childhood playground. All right. By the way, Yetis, a secret recipe for the best spicy mayo ever? What is it, Jack? We should have shared on the pod. One part mayo, one part saracha, and then a spritz of lime juice. That's it. Well, Kraft Hines is a $50 billion company obsessed for this kind of condiment conversation. Yeah, but their stock, It has not been delicious lately. What's going on with the stock, Jack? Craft Hines stock peaked in 2017.

Since then, it's been down like a soggy french fry. Because ketchup, it isn't cool anymore. The millennials, we're doing Pesto. Gen Z, they want chili oil. Jack and I, we kind of like mixing those, too. It is a good combo, Pesto and chili oil. So, Craft Hines launched what they're calling a customizable digital sauce dispenser. Or what Jack and I are calling a really big sauce machine in a restaurant.

All right, yeties. Picture this. You know that big soda fountain where you can get like, Mountain Dew, Pepsi, Sprite, whatever. It's at McDonald's. It's total classic. This is that, but for sauce, not Sprite. It's called the Heinz remix, because this thing is going to whip up 200 combos in a flavor free-for-all of sauces. It's a condiment cacophony.

This thing is wild. You can pick from four sauce bases, and then you add a, like, flavor splash of mango or jalapeno or Chipotle Mayo. And then out of the machine comes your unique condiment concoction. You can put it right onto your quarter-pounder with cheese or into the little dish for fries later on. You're making freaky franken flavors. You're doing like mayo chup, mayonnaise ketchup. That could be your thing. You can do cranch, which is ketchup branch. Throw in tahini. What the heck, you're basically creating condiments like a DJ. You're the Tiesto of Tartar. You're the Avichy of Aoli. Yeah, this isn't just fun in games. No, it's not, but it has been a lot of fun, Jack.

It has been funny in games, but it's also a opportunity to unlock billions of dollars for Kraft Hines. Because Kraft Hines looked back in the history, books of business and noticed some precedent. Fifteen years ago, Coca-Cola launched a similar machine called the Coke Freestyle. The Coke Freestyle. It was when Coke let you mix and match different flavors of sodas in a restaurant. For example, at the restaurant, your buddy could do a Coke cherry plus a splash of vanilla. And guess what? Coca-Cola noticed what your buddy was doing. They noticed it wasn't just your buddy who did that, but millions of others. So Coke launched Coca-Cola a cherry plus vanilla.

Basically, Coca-Cola let the customers do all the creating here, Jack. Yeah, the scientist didn't invent that flavor. Derek, some dude North Dakota did. Basically, Coke outsourced its entire research and development department to the consumer. Coke innovated by letting you innovate for them. So Kraft Hines, they're thinking that with this new machine, you're going to invent the next flavor combo and then they are going to make money on it. Hot honey, Harissa, here I come.

Jack, get your hands out of the tahini. So what's the takeaway for our buddies over at Craft Times? Every company needs an innovation sandbox. Yet these creative companies, they treat their customers like kids in a playground. They help them play with a product, like six-year-olds in a sandbox. You know why? Because pure creativity occurs when you can fool around free of any judgment. The lack of inhibitions that a child feels, that unleashes inventiveness.

Exactly. And that is why sandboxes are a source of so much creative fun when you were a kid. The sandbox was a safe space where your imagination could run wild. So Yeti's channeling your inner child, that is a key of innovation. With this remix machine, Heinz ketchup is sandboxing. Crowd times, you sandboxing son of a gun. For our second story, this week, the Senate invited the CEO of Open AI to Capitol Hill. And we learned that to regulate AI, Congress is going nuclear, literally.

For Yeti's, some tech CEOs, they like to wear hoodies. this tech CEO, he prefers to wear Henley. He does. We're talking about Sam Altman, the 38-year-old CEO, who's the most important person at the most important AI startup. Although, Jack, I'm looking at his show right now. I think it's a cashmere, Henley. It's cashmere because his company is worth $29 billion. This guy, Sam Altman, he's the Mark Zuckerberg of artificial intelligence. This guy runs OpenAI, which is the company behind ChatGPT that took the world by storm in November.

Well, on Tuesday, Sam Altman put away the Kashmir headily and instead put on a suit and tie because he was speaking to Congress. The Senate invited Sam to come testify about artificial intelligence, but they didn't grill him like they've grilled so many tech CEOs before. This is kind of what shocked Jack and I. Like Sam Altman showed up, spoke to Congress and this wasn't like an angry free-for-all. It was kind of like a kumbayama. The Senate actually said, Sam, thank you so much for coming. The floor is yours. We like just want your advice on how to regulate AI and robots. Please tell us anything.

That's right. Our U.S. senators are trying to craft AI regulation before AI regulates us. So the U.S. Senate basically asked Dr. Frankenstein, how do we keep Frankenstein under control here? Yeah. You invented this. How do we regulate what you invented? Oh, funny thing. Jack and I should mention Sam Altman doesn't actually have any equity in open AI. This was a surprising aside that he said under oath to our Senate this week. He has no equity in this company that he's leaving. No stock in chat GPT. Just a surprise.

It's like, what are you doing there? Well, anyway, here's what he did talk about because he was at Congress. Basically, the Senate found three grave and extremely a scary, immediate threats to America posed by AI. Yeah, the first big threat of AI to our country is misinformation and impersonation. Misinformation and impersonation. Because Joe Biden makes speeches. But AI generated faux Biden can make speeches too. And that could be a problem.

The second big threat to our country from AI is job disruption. Because AI has already taken jobs. Like, Jack, we did that story on the Wendy's drive-through AI cashiers. Yeah. And millions and millions of more jobs are at risk from automation from AI. And the third threat of AI to America is copyright catastrophe. Drake and the weekend had a number one hit. It was lovely.

That neither Drake nor the weekend were involved. Yeah, unfortunately it was the bots. Nick, so those are some pretty serious. serious like fundamental threats to everything. Which means we could use some pretty serious, some plans here. What's the plan, Sam? That's what Senate wanted to know. Well, the plan, the plan is our takeaway. So Jack, what's the takeaway for our buddies over in AI? If you want to know what will happen to AI, look at what happened with nuclear.

All right, Yeties. Let's go back to the hearing. Here's what went down. The senators asked Sam Sam Altman how we should regulate AI. They literally asked that. Like, Senator John Kennedy said, Sam, tell us in plain English what rules we should implement. And Jack, what was the chat GPT creator's suggestion? He suggested a powerful new international agency to issue licenses for companies to practice AI. Interesting, Jack, a powerful international agency to control a new technology? Have we heard of this before? We have. That is a big proposal, but it's not unprecedented.

No, because who oversees the nuclear power plants of the world, but the International Atomic Energy Agency. That's what Sam Altman said we should model this regulation on. Because AI could have a nuclear impact on the world, so we may as well use the nuclear model. Yet he's this week, Sam Alpin told America, we need an international atomic agency, but for artificial intelligence. And the senators of America from both parties wholeheartedly agreed. Our third and final story, Target, its stock is up after earnings. But there's one thing Target said, that kind of shocked us and freaked out a lot of people. It was about shrink because shrink is real.

Shrink is crazy and shrink is not shrinking. Yeti's Sundays, they are fun days, but Saturdays, that is for the Targes. Saturdays for Targeet, baby. Yes, it is. Target. It sales rose 1% last quarter, which actually isn't that good, is it, Jack? That's weak growth, but any growth is good growth in this economy. In this economy?

In this economy. So the stock rose by 3% because you're still shopping there, and that's a win. But honestly, Yetis, we're just going to cut right to it. There was one thing that stood out on this earnings call that took over the whole call. Everyone was talking about it. Shrink. As in, honey, I shrunk my earnings. Yeah, they said the word shrink 22 times on the target earnings call.

Shrink. We're not talking about George Costanza shrinkage. I was in the pool. We're talking about an accounting term that is technically called shrink. Shrink is a real financial thing. It's one of companies inventory shrinks, but not because it's selling stuff, but because stuff is getting stolen. That's right. Finance has codified the concept of theft. It sanitized it with the term shrink. Shrink is an accounting term for stealing stuff. Pietis, here's why this shrink was such a

big deal with Target. Here's why this shrink was huge. Target just said the biggest shrink number we've ever heard on a corporate earnings report. Get this. Target is expecting its shrink to double this year to $1 billion. That's a billion dollars of stolen stuff from Target. I'm sorry, Jack, can we please sprinkle on a little context here. Target made $3 billion in profits last year, and they're going to lose a billion dollars this year in shrinkage. Shrink is huge, but then yet he's Jack and I got curious, so we jumped in further T-boy style. It turns out shrink is not just a shady person in Isle 6 stuffing their shirt with more shirts. No, it turns out there's a bunch of different types of shrink. Like shrink is also when employees steal stuff. And shrink is also when stuff

gets spoiled or damaged or expired or just screwed up. For example, if you had dented that detergent bottle and they can't sell it anymore. That's shrinkage. Or if you drop that jukebox and they can't sell it anymore. That shrinkage tip. Or if you mislabeled that orange into a pair and then you put it in the wrong place and it expired and you can't sell it anymore. Add up all that shrink yetties and Target is going to lose a billion dollars of product this year. Shrink has become huge. So Jack, what's the takeaway for our buddies over at Target? Shrink isn't shrinking. Now, Yeties, we do want to point out that Walgreen CEO thinks that America's theft problem is being and overblown by other CEOs.

Yeah, but other CEOs do complain that shrink is happening more and more in both city stores and in the suburbs. Now, interestingly, those CEOs didn't blame the economy or policing or criminals for all this shrink. They blamed the internet. You just have to follow the money. More crime is happening in stores because it's easier to resell stolen goods online right now. The besties, it turns out the thieves, they aren't stealing that slam and salmon sweater

to wear it. They're stealing that slam and salmon sweater to sell. sell it online. And it's not just Craigslist or eBay where illicit stuff is being sold. Uh-uh. They're selling it on Amazon and Threadup and Facebook Marketplace. That's why up to 10% of e-commerce is stolen stuff, according to the Prosecutor's Alliance of California.

So, Yetis, it keeps on getting easier to sell illicit goods online. That is why shrink is growing. Jack, can you whip up the takeaways for us for the new Friday? Kraft Heinz just unveiled a sauce-mixing deal. DJ booth for fast food restaurants. Because a key to creativity is to think like a kid in a playground. We call it sandboxing. For our second story, OpenAI CEO just told the Senate exactly how to regulate AI.

For a nuclear technology, regulate it like nuclear. And our third and final story is Target. They just reported the biggest shrinkage we've ever seen. Because of online marketplaces for stolen goods, shrink isn't shrinking. Now, time for the best fact yet. This one sent in by W. Will Shane from lovely Oakland, California. Trivia.

This is good. This is really good for a new Friday. What state has the fewest escalators? Now, you're thinking it must be a state with the lowest population. And actually, that does make sense. That's a good guess. But what if the state with the lowest population has a lot of mountains that you don't want to manually climb up? Well, then things would get confusing.

I think I'd just confuse the trivia question. Yeah, yet he's the state with the fewest escalators is Wyoming. But, Jack, how many escalators does Wyoming have? It's only got two. We repeat. Wyoming only has two escalators in the whole state. And get this, they both go up. Yeah.

Yides, you look fantastic for the new Friday. And remember, the best way you can help grow this show is to turn to someone next to you today and say, H-Y-H-T-B-O-I. The second way you can grow the show is rate and review our show on whatever platform you're listening. Have you heard the best one yet?

Nick and I, we'll see you tomorrow. If you know, you know. Before we go, a bone anniversary to Chris and Yelina P. Who are celebrating a 10-year anniversary with a trip to California from Bordeaux, France. And happy birthday to our buddy Timmy's buddy, John Dubin, a huge Yankees fan living in Brooklyn. And James in Chicago, enjoy that birthday doing Air Force Logistics. And happy birthday to Megan Gomberg in Lincolnshire, Illinois. And Alonzo F. enjoy that 27th birthday down in Fairfax, Virginia.

Happy 30th birthday. to Kaylee Brooke in Dixon, California. And a happy 31st birthday to Sond Yishon down in San Mateo, California. And this one is for Dylan, Duffy, John, and James, who are all celebrating Dylan's big 30th birthday. By driving down to Tennessee for a really big Iron Man. And to anyone else celebrating something today, make it a T-Boy. Celebrate the wins.

This is Jack. Nick and I both own stock of Peloton and I own stock of Amazon. I hope you're excited about that reels that Rachel's going to make about our, our drop down and give me five book. Yes. That was a great idea to do that, Jack. I mean, it's stunning. I come home and it makes me happy to see. We moved all the other,

I moved all the other books off the coffee table. It doesn't even totally proportionally make sense, but I just want it out. Did I inspire a book burning? I hope I didn't. They've been retired to the shelves.