The Best One Yet - Uber Eats’ “Browser Billboard” strategy, Kroger’s “Operation Restock,” and Xerox may acquire HP

Episode Date: November 7, 2019

An Uber Eats job posting revealed that it’s further monetizing the food delivery app by sticking ads into the search results for “pizza”. Grocery chain Kroger hasn’t recovered from Amazon’s acquisition of Whole Foods, so its Operation Restock recovery plan may involve a clever pricing strategy with Microsoft. And Xerox may acquire HP, which is three times bigger than it. We’re looking at how that’s possible.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 Thursday, November 7th. Our last day in the city for a while. Jack, what are you thinking about this one? How was this one stacking up? I'm feeling good because I had a whole bunch of New York pizza last.

Jack can barely get the words of it. It's now still full. I think got pepperoni on the chin right. This is also the best snacks daily we've ever done. We got three great stories for you. The first, Kroger, the Midwest-based grocery store. It's going through Operation Restock. Classic inventory inside Joe Care.

We're calling it Operation Don't go out of business. Because we're kind of snarky and we have a sense of humor. But that story actually has emojis and dynamic pricing. You want to hear it. It's really fun. Second story, Xerox. Still around. Still around.

It might acquire HP. Also, still around. According to some reports that we saw. There's one small issue, though. HP is three times the size of Xerox. We got a baby bro, big bro situation. Who's going to win the arm wrestling match? It's possible for baby bro to win.

Third and final story, what do we got, Jack? Uber Eats may start advertising restaurants up in your face. But it's actually. part of a bigger development with platforms. We're calling it browser billboards. Because we're fans of alliteration. Snackers, before we jump into that, do you remember we were chatting yesterday? We had a great conversation. It was you, it was Jack, it was me, and we were having a lot of fun. Yeah, there's the Apple Watch and there's the Show Me Watch, which is kind of a Chinese knockoff. Technically, it looked just like the Apple Watch. In fact, check out our Twitter page at Robin Hood Snacks.

We've got a little side-by-side comparison, see if you can tell the difference. It's like the Coke Pepsi Challenge, but with two smart watches. Turns out these kind of knockoffs are here in the United States as well. You can have an American knockoff, and Bud Light is doing it with the new Bud Light Hard Seltzer. Open up your fridge. Odds are you probably have a Spike Seltzer situation. I mean, first of all, every big beer company is freaking out right now that Spike Seltzer

is taking their business. Jack and I may launch a Spike Seltzer pretty soon. And so Bud Light's Hard Seltzer, we looked at the package yesterday. It's a total knockoff of White Claw. It looks like White Claw vomited all over the Bud Light. First of all, classic, it has this slim can. It's like a typical 12-hour. It's canned, but a little stretched out.

Apparently, you can't do a spike seltzer these days unless you can fit into a pair of skinny jeans. Slim fit chinos, exactly. We get the picture here. And they can. It's the gray background, just like White Claw. Same thing. It's got the colored flavored, like label banner. Bang.

Mango, mango, mango. And just like White Claw, it proudly proclaims that it's gluten-free. We get it. It's like water. Yeah, it's gluten-free. It'd be weird if there were gluten in there. Snackers, squint hard, you can barely tell the difference. In the meantime, we'll hit our three stories.

Knockoffs happen in the U.S. too. snacks daily. We spoke to the lawyers and we got to get something legal out the way. It's snacks about to hearin food. It's air candy. They don't reflect the views of the robberhood family. It's all informational just so. 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 FINRA SIPC. For our first story, Kroger, the grocery store, just released some strong earnings.

It also announced a rebrand. Ooh, okay. And a tech partnership with Microsoft. We're going to get into all that to start, though. Can we talk about some Midwestern values here? Please and thank you, Jack. Kroger is a Midwestern institution. Everyone there calls it Kroger's with an S.

They take their shoes off before they walk in the grocery store. Based in Cincinnati, of course they have manners. A.K.A. Sin City. A.k.a. the city by the River. The Ohio River. The only river you should even count about. Found it 136 years ago by Bernhard. Croger. Jack, can I get a translation in Isle 6? Bernard Kroger. Great guy. So it turns out that's not the

only German, Kroger. The Germans are coming to America. We're talking Liedel and Aldi. Apparently Germans have a thing for grocery stores. They're opening up thousands and thousands of grocery stores in American suburbs. By the way, Kroger stock, it's down 10% since Amazon acquired Whole Foods in 2017. So doing nothing for Kroger, a good, wholesome Midwestern grocery store chain is not an option, it will lose. Instead, the Kroger staff got together in the back, probably by the frozen fruit section. This was a crisis moment. It was in the situation.

We got to get things a little heated up in here. We're coming up with something called Operation Restock. Nice name for the operation. Probably boosted company morale, made everyone feel like we're doing this military style operation. Jack, can we get kind of another translation here on what that really meant? Operations survive. Operation don't go out of business. So Kroger's

doing a few smaller things. It's improving technology. It's partnering up with other brands. it's improving its retail experience, it's doing what it can't survive. But we noticed the new logo, which is called Krogeys. Yes, that is Kroger emojis. Exactly what you're thinking. It's a Kroger emoji. It's a new mascot.

It's adorable. Now, they're not quite emojis. We should point out they're kind of life-sized, and they're doing this kind of post-racial reality thing. They're sort of like the claymation characters from Rudolph the Red Nose Ring. So you're trying to get some whole wheat bread. You turn around. You got a Kroger emoji, Kroji in your face. It's kind of cool.

It kind of scares you at first. I like it. And beneath the Krojis, they have their new. slogan, which is fresh for everyone. Ador, but this is a step up from Ronald McDonald. Inclusive, memorable, post-racial crogis. Okay, so the stock on nerd of all this, it jumped by its most in 26 years. So Jack, what's the takeaway for our buddy stocking things over at Kroger?

Dynamic pricing might be the next big thing for grocery. Buried in this news, Jack and I found a fascinating storyline. A partnership with Microsoft that's been kind of going on. It's kind of a secret partnership. We don't know exactly what they're doing, but They did mention digital price tags, which could replace the, like, manual stickers that you put beneath the chips in I-S6. You know what we're talking about. Someone walks over, boom, they get to the aisle.

A little ticker thing. It's like a gun. You can manually apply tickers to the kind bars. It looks like it'd be fun for about five minutes, but then kind of monotonous. Monotonous mind-numbing work. But digital price tags, if they can actually add this with technology for Microsoft, this could be a game changer with dynamic pricing, which you've seen before. You've seen it with Uber. Exactly.

After the game, when everyone's trying to get home, surge pricing. Exactly. Because there's too much demand and not enough support. So how would this look at Kroger? Let's say you're really into the maple flavored almond butter, which Jack and I happen to be, and it's low in stock. If there's only one left, Kroger could, like, from HQ, say, we should raise the price of that last jar. It was already expensive at $15. Let's see if you really wanted at $30.

Let's make sure the person who gets the last jar really, really wanted that last jar. But then on the flip side, let's say you got a new stock of bananas in, they're green. you got some bananas out there with a few brown spots showing, you got to get rid of these things fast. If you need to get rid of bananas, what can you do? You can lower the price on the bananas dynamically because of these digital price tags. Boom, you get a whole tree of bananas for like 30 cents. And this is economics at work. When the supply is too high or the demand is too high, you adjust the prices to even it out.

It's incredibly efficient, and Kroger knows it's got to do it. This is our bold take. Kroger did not announce this, but Snackers, you know first, this could happen. Dynamic pricing. For our second story, Jack, I got a couple, throwbacks for you here. You ready? Go. Xerox Wow. Might acquire HP as in Hewlett-Packard. Turns out the boards of those two companies are chatting with each other and thinking about

making this hookup happen. It's kind of adorable but also kind of arranged marriage. Seems a little arranged marriage. These also have to be two companies that Jack and I heard the name is like, oh, we didn't know they were around. I actually thought Xerox was bankrupt. This is like true story. You hear about that one person from high school, you're like, Ben, that's what Ben's doing. So one is a huge printers, copier, scanners company. The other is a smaller printer's copy of your scanner company. And they were living their best lives in the 90s. These two are getting together like ex-athletes just reminiscing about their golden days.

Remember back in the 90s, man? Oh, my God. The company outings, the company offsite. It's like Furby, Dunkeroo's, and Closer explains it all. They had a time. They had a moment. It was a couple decades ago. Stocks of both of these companies rose on reports that the merger might happen

because they could cut cost together and boost profits. Exactly. Because you know what? You don't need two accounting departments when you're one company. You don't need an HP printing room and a Xerox printing room. You're a printing company. You have one room. You definitely don't need two holiday parties.

Also, maybe for sales, like they could boost sales by offering bundles. Like, do you need a printer, a fax machine, a copier, and a scanner? This is Todd from sales at HP Xerox. How can I help you today putting all those things together in one machine? But the main reason for the stock price increase is the $2 billion of expenses that analysts think they could cut by eliminating duplicative things. It feels like a TLC song. Like when two become one, it's like a beautiful thing. Don't go chasing waterfall.

Exactly what I was thinking, Jack. Now, there is one reason why this was able to happen, and it's because HP, Hewlett-Packard, was split into two companies a few years ago. Two years ago, HP's cutting-edge division was split up from its laptop and printer division. Right. So Xerox would never have been able to buy

or really been interested in buying all of the old HP. Not a chance. You think they would have known what was going on like the cloud enterprise division of HP. No one knows what's going on there. But a nice package, low-tech printer and laptop company that's something Xerox can understand and benefit from. So the funny thing with Hewlett-Packard is that by splitting into two companies,

it actually unlocked value that didn't exist when it was just one company. Think of it this way. You might need like a muffler to replace the muffler that fell off your car. Right. You show up at the car place. Like, I just need a muffler, Julie. And they're like, I got a 1976 Honda Accord here. with 400,000 miles.

There's a muffler in there. You're like, that's charming, but I just need the muffler. I just need the muffler. Just need the muffler. So you can split up the car into parts, and that's worth more than the car itself. Jack, I just need the muffler, but can you tell me what the takeaway is

for our buddies over at HP and Zero? A smaller company, I love this as the third out of four brothers, a smaller company can acquire a bigger company. This is like a metaphor for a Disney movie. I'm getting dinner with my brother to talk tonight, now here's the weird thing. HP is worth $27 billion, which is like almost it's like two lifts that's two lifts and xerox is worth like half a lift right eight billion

that's about how can xerox be acquiring a company three times as big as it well there are a few different ways but the core and most likely way is that xerox could borrow a lot of money because they have a very particular relationship the report from the wall street journal said that a big bank is on board and ready to finance this that's what banks do they finance financial transactions like maybe lending a lot of money to the smaller guy for our third and And final story, this one's a wild one. Uber Eats is selling ad space in the app. And we're seeing the billboardification of the apps that you love. Now, full disclosure on this one, the job posting on Uber that revealed this was actually discovered by TechCrunch.

What did they see? And TechCrunch's article was discovered by us. It's like a double discovery. So now you get to discover it through Snacks Daily. So TechCrunch noticed that there was on the job posting page for Uber Eats, a quote saying they were looking for someone to help create a new ads business that enables eaters to discover new foods. There you go. This is an ad placement at the top of the Uber Eats homepage.

So think of what's going to happen here as if when you go to a restaurant, you open the menu, and boom, up front, bold letters, italics. We're featuring the lasagna. If you're not getting the lasagna for $14.95, what are you even doing here? To all the waiters out there, don't say the lasagna's on sale because that doesn't sound good. It's a huge foie on the industry. So if you want to know what this is actually going to look like, Jack and I are playing around with this this week while we were in New York.

Imagine you're looking for pizza in the Uber Eats app. Right. So I'm a native New Yorker. I've, like, grown up on the stuff. Jack lived in New York for years. We both think it's the water or the mariner sauce. Best water in the country. We were craving carbs.

We were cravings mariner. So let's say you search pizza in the Uber Eats app. You're expecting to see the top pizza places with five-star ratings. So maybe for number five, you see DeFarez in Brooklyn. Or Danny's in Q Gardens, Queens. Or in no lady you see Pasqualee Jones. You could get little Frankies as well, a classic go-to in Manhattan. Or if you happen to be in the West Village, maybe you get

Emily were Jack and I ate last night. Detroit-style pizza in New York. We didn't know it was a thing. It's kind of like Chicago, but with more edge. Very thick, very crusty. Now, you're looking at these top five. Those are all great spots. You're about to order via Uber Eats, one of the top five pizzas in New York City and what happens. And then you realize Pizza Hut is above all five of those.

You're like, I don't know what's going on here, but there seems to be something wrong in the universe. An imbalance, if Pizza Hut is above all the five we just mentioned. You're probably going to notice like a slightly different shade of Uber Eats and maybe a little disclaimer that says this is sponsored or this is an ad? Because this would actually be the ad in Uber Eats. So up until now, the Uber Eats platform has been a meritocracy. The best pizza shows up first, but now the best pizza is going to be the one that pays the most to get in the ad. And here it snacks daily, Jack and I are calling it a browsing billboard. And this makes sense, Nick, for the Uber app, because what does the Uber app have on it? It's got a lot of eyeballs on it. A lot of eyeballs. And

other things that have lots of eyeballs staring at it, I'm telling you, they become ads at some point. Case and point. What about elevators? They got those little TV screens in the corner that have ads on them. How about the subway, four or five trends? Ads all over the place in the subway. How about NBA basketball jerseys? Boston Celtics, GE ad right on the chest.

How about toilet stall doors? That's the next frontier for ads because when you are sitting on the toilet, you are a captive audience for an ad. Uber knows people are browsing through Uber Eats. So whatever's at the top of the app, that's valuable space. It can sell. Pizza Hut is going to buy the ad for pizza service. on Uber Eats. So Jack, what's the takeaway for our buddies over at Uber Eats? But really, any app that's actually a platform.

Browsing billboards, that's what we're calling it, is the next evolution of platforms. Amazon is technically a platform for sellers to connect with buyers. And they do this too. When you search for a crockpot, that first one is an ad. Expedia does this too. It's a platform for booking. When you search Best Mexican Coastal Resort, you're going to find an ad. Other platforms that could start selling ads? We got a few here. Well, interestingly, Spotify and Apple both have podcast platforms where basically the best or the trendiest podcast show up. Eventually, those could become paid ads. Jack and I were whiteboarding this thing. We got excited. We got thrilled.

We thought of a few others. One of them could be Airbnb. But Snackers, we want to hear what you think. Who has top digital real estate and could start selling ads for them? Tweet us at Robin Hood Snacks. This is Jack. I own stock of Amazon. Jack, can you whip up the takeaways for us?

Kroger is living its best life with a new slogan, Operation Reefs Nets. stock and the potential for tech innovation. But watch those prices on the maple flavored almond butter. They may get dynamic. Xerox might be acquiring HP. Okay, which is only possible because HP split itself in order to save itself. Uber Eats is going to start selling ads for the top spot when you search pizza. Scroll past the first hit if you want something.

It's actually good pizza. The first hit is just the pizza with the biggest marketing budget. Now, Snackers, time for a snack fact today. This one's sent in by a great snacker, Alex Comziah, from North Vancouver, British Columbia, which if you're wondering where that is, get to Vancouver, and they keep going. North Vancouver, British Columbia, Canada.

Finish it, Nick. Great place. Now, he's pointed out to us that Shigaru Miyamoto, the brilliant creator of Super Mario Brothers and Donkey Kong and the legend of Zelda. That guy is so legendary and so important to the Nintendo company

that Nintendo banned him from biking to work. It's too dangerous. This guy can only get to work. We don't even know how, I don't know, on a cart. As a guy who bikes to work, I know that biking you need to look out for red shells, green shells, bananas. They come out of nowhere. If he's driving to work, I hope he's still wearing a helmet.

Snacker, send us your snack backs to at Robin Hood Snacks. In the meantime, Jack, tomorrow, we'll be there. Can't wait. Same sweater. 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.