The Best One Yet - 🩴 “Ugly gets money” — Crocs’ simplicity strategy. Hard Seltzer’s obituary. YouTube’s Chief Creator Officer.

Episode Date: February 17, 2023

Take this week’s TBOY Quiz: https://go.tboypod.comCrocs just announced its best year ever because there’s nothing ugly about simple. Boston Beer just admitted spiked seltzer’s “post-hype era��… because you can fight competition, but not substitution. And YouTube’s CEO Susan Wojcicki is stepping down, but she invented a new concept everyone’s copying: The Chief Creator Officer.$CROX $SAM $GOOGFollow 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.

It's not just a show. It's a journey. It's not a journey. It's a journey. It's not a journey. Come on. It's a journey. It's a straw.

It's a pod. A journey's like... This is Nick. This is Jack. It's Friday, the real Friday. February 17th. And today's pod is the best one yet. It's a T-boy.

It's the best. Happy Quiz Friday to all the Yetis out there. It is Quiz Friday. Yeties, our one-minute weekly pop biz. quiz drops today. It's live at go.t.tboopod.com. You can play the quiz. Go.ttboid.com. Jack and I, we'll see you there. How well do you know this week's business news from our pod? We'll also see you up on today's pod. So, Jack, what's the first story for today's episode? Crocs just had their best year ever after having their best year ever. Because there is nothing

ugly about simple. You know, I own some crocs, and don't you even dare, Dick. For our second story, Boston Beer Company just admitted that Spike's Seltzer wasn't a trend. It was just a fad. Yeah, so Jack and I are going to write the obituary on White Claw. And our third and final story, YouTube's CEO, Susan Wojitzki, is stepping down after 15 years. Yeti, Susan turned YouTube into YouTube with one innovation. Crosk. But yeties, before we hit that.

Actually, no connection between those two stories, we should point that. Oh, Yeties, before we hit that wonderful mix. Earlier this week, we told you about the crew, everyone's jealous of D-I-N-K-D-N-K-Dinks. What does it stand for, Jack? Double-income, no kids. Double-income, no kids. You and your partner bring in money, but you got no baby expenses. But then we pointed out, the only thing more envious than a dink is a dink-W-A-D.

A dink-W-A-D, double-income, no kids with a dog. You got money, you got no children, and you got a doggy. seemed like the millennial dream. But yeties, the grass is always greener. Besties, there's always someone else with a little more or something else. Because there's actually one thing even cushier than being a dinkwad. And there is actually one lifestyle more leisurely than double income no kids with a dog. And that lifestyle is dinkwad ass.

Dinkwad ass. D-I-N-K-W-A-S-S double income no kids with a dog. And some succulents. And some succulents. You've got two income streams, no kid expenses, one cute pooch, and some really fancy houseplants. And those houseplants, they require no maintenance. He could still pop over to Cabo anytime you want. Not too shabby.

Yes, what Jack and I are trying to say here is being a dink, it's nice. Being a dinkwad is nicer. Being a dinkwad ass is the nicest. Double income, no kids with a dog, and some succulent. Now, full disclosure, this is Nick, that is Jack, and neither one of us are dinkwad asses. As I told you the other day, I'm a Sukwai. Yeah, can you clarify that one, Jack? What does it stand for?

Single income with kids and a dog. In the meantime, Jack, all of our T-Boy audience, most of them are probably dinkwood asses. A not insignificant portion of our audience is a dinkwad ass, Nick. Yetis, happy Friday, the real Friday. Celebrate the wins. Let's hit our three stories. 15 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 one yet, but they need to practice. 50% that's a fat tip Tea Boy City on your at list If you know you know Cause we're ready to go We can't wait no more So just start the show Start the show

For our first story Crocs just announced Its best year ever After its best year ever After its best year ever Crox shares jumped by 7% Because you can move mountains With simplicity

But if we're gonna talk about Crocs Jack We're going to talk about the drama going on over in the New York Post with Crocs. Did you hear about the bride who wore white crocs to her wedding? I did, and I'm here for it. I'm loving every minute of it, Jack. That's fantastic. Yeties, the earnings of Crocs looked less like a clog, more like a Lubiton heel. Yeah, this company, they've gone from ironic to iconic. The CEO cited exceptional demand for Crocs, which led to record numbers yet again.

Yeties, get this, Crocs has experienced five straight years of double-digit growth. Revenue surged by 61% last quarter to nearly $1 billion of Crocs. Is now worth $8 billion as a company? That's two lifts. Call Reid Hoffman. They have scaled the clog. Get this. Crox is selling 200 shoes a minute. So by the time this podcast is done, that's like thousands of shoes. Look, Bieber has always loved Crocs. I think Post Malone is still wearing them. They're still trendy, but there's one fundamental reason for Crox's continued success. The one fundamental reason for Crox's continued success, simplicity. Can we open up this quote machine that is Steve Jobs?

Steve Jobs. One said that simple is harder than complex, but it's worth it. Because once you get simple, you can move mountains. Once you get simple, you can move mountains. Yet these Crocs' numbers are moving mountains because of the product's absurd simplicity. We looked at a bunch of earnings reports from the past two years, and executives continue to highlight the same thing, the simplicity of the product. Case in point, what did we notice just in yesterday's earnings report, Jack?

The CEO said robust cash flow is the result of the simplicity of our product lines. Because yet he's pumping out a laceless shoe filled in a factory mold. That's profit puppy. The most complex part about the crock isn't the shoe. It's your foot. My foot in particular. Although I think your foot is made for the crock in stock. You know what that is?

Wow. I can imagine. It's a collab between. Crox and Birkenstocks, and it hasn't happened soon enough. I think my Hobbit feet could be the model for that shooter. You don't have Hobbit feet, Jack. You've got Gandalf feet. So, Jack, what's the takeaway for our buddies over at Crox?

Crox is the most enduring pandemic stock of them all. Yeah, and I have kept a list of pandemic winter stocks. You know, you get your big tech on there. You got Amazon. You got Facebook. You got Google, the classics. How could you forget Zoom, Netflix, and Peloton, too? But here's the problem.

Every pandemic winner stock we've had on that list, that stock is now lower than or close to where they were before the pandemic. The exception to that is Crocs. The stock is not quite at its record high, but the stock is still three times higher than they were before the pandemic started. It's three times higher because here's the one difference between Crocs and every other pandemic winner. Crocs is 100% not tech.

There is literally nothing digital about Crocs. Nothing digital. Like the tech companies that boomed during the pandemic, they've all come. back to ground. But non-tech pandemic winners like Crocs, they're still winning in this pandemic comfort-first lifestyle. Tech's COVID winners have crashed, but physical COVID winners have endured. And Crocs is the most enduring of them all. For our second story, Boston Beer just announced the post-hype-hype era for Hart Seltzer. Spiked Seltzer may have been a victim of its own success. But yet he's Boston Beer Company, it's kind of

a contradiction in terms, right? We kind of got a paradox going on here, Jack. It's a publicly traded company that's the biggest craft beer company by far. Literally, there is not a craft beer that is bigger and yet it is a big company, but it's doing craft beer. And they just announced earnings. Boston Beer Company was once known for their flagship Sam Adams brand of beer. It's why the ticker symbol is Sam. Well, in 2021, following White Claw Summer, which was a blast, Boston Beer announced they were doing a pivot. And what did they call it, Jack? Boston Beer. Boston Beer basically renounced beer. Actually, Jack and I covered a story a couple years ago when we noticed a majority of Boston Beer's business was not beer anymore. The main focus

for Boston Beer these days is truly the hard seltzer brand that was all the buzz for many years. Which led to the awkward news yesterday. Boston Beer just declared we are in the post-hype era for hard shelters following another quarter of declining truly sales. Yesterday, Boston, Boston beer stock fell 15%. It's now down 75% from the 2021 White Claw Summer Highs. Now, yet he's Nick and I looked at this story and we think we found the problem. When Boston beer pivoted beyond beer, so did the rest of the beverage industry. Because the first thing that happened was every major beer company launched their own version of a hard seltzer.

Corona had a seltzer spinoff. Coors Light had a seltzer spinoff. Bud Light has a whole herd of spiked seltzeritas. And then the non-beer company saw what was happening in that white claw pool and they said, hey, we want to jump into polar seltzer based out of Worcester Mass. They have a hard seltzer. Topo Chico owned by Coca-Cola. They launched Coca-Cola's first ever hard seltzer.

Barefoot wines? They usually do grapes. Now they're doing whatever is in a hard seltzer too. Honestly, Jack, kind of shocked. Capri's son hasn't whipped up a hard seltzer. Nick, we should have spotted the peak at hard seltzer when Boston beer company launched, and this is no joke, a hard mountain dew. We're not kidding. Although peak hard seltzer may be when Campbell soup launches a hard seltzer check.

Boston beer's execs announced yesterday that consumers are confused. They're overwhelmed by the number of fruity, 12-out skinny can options in the hard seltzer. Seriously, if I walk into the grocery store, I'm wondering if I'm going to see a Campbell soup tomato bisque hard seltzer. So Boston beer company is announcing an overhaul of their truly brand by going back to the basics to unconfused customers. Chicken noodle hard seltzer. So Jack, what's the takeaway for our buddies over at Boston Beer Company? You can fight competition, but you can't fight substitution. Now, Yetis, did you think Big Beer was going to go off quietly into the night without a fight? No, they did not.

Truly Hard Seltzer was a victim of its own success. It was so successful, so fast that it attracted the big competition from Big Beer. But Besties, the problem for a truly hard seltzer isn't just other hard seltzers. it's actually other drink categories. Because every five years or so, American drinkers seem to trend toward another hype drink of the moment. Like right now, it's ready to drink canned cocktails and non-alcoholic options. In other eras, it's been IPAs, rosés, or espresso martinis.

Because in the alcohol industry, competition is tough, but substitutes can be tougher. Now, a word about our sponsor, Robin Hood. You know, honestly, your salad, it says so much about you. Nick, you like to blaze your own trail at the salad bar. I'm ordering a salad. I go off menu, man, like a combo of kale and croutons that has never been made before. Me? I'm not reinventing the wheel.

I like to go classic. Sweakerian thinks it's a good combo. Jack's not going to change that. Kind of like investing strategies. Someone to build a custom portfolio of stocks, crypto, and options. Others don't want to reinvent. Just give me the most standard ETF. Whether you're tweaking your one-of-a-kind portfolio every day

or prefer a more hands-off approach, Robinette has the tool. If you're not investing on Robin Hood yet, to get started, go to robin hood.com slash t-boy to choose your free stock. That's robinood.com slash TBOI. Limitations apply. Stocks offered by Robin Hood Financial LLC, member SIPC. Crypto offered through Robin Hood, all investments involve risk. By the way, this podcast is not owned or part of Robin Hood, and we are not employees of Robin Hood. For our third and final story, YouTube CEO Susan Wojitzicki is the top female in tech right now, but she's stepping down. Thanks to Susan, YouTube is the only platform that puts its money where its mouth is.

Now, you may have that buddy from business school who brags, they were employee number eight at that cannabis cocktail start. Yeah. Well, Susan Wojitsky, she was employee number 16 at a little startup called Google. In fact, Susan let the founders of Google use her garage as the first Google office. What did she charge again? Well, she didn't let them. She charged them $1,700 a month. which for a garage, that's pretty expensive.

Fast forward to 2006, Susan was working for Google's video search and noticed Google videos was getting crushed by YouTube. Now, since Google had basically started in her garage, she convinced the Google founders to buy YouTube, a young startup at the time for just $1.65 billion. YouTube, which is probably worth $100 or $200 or $300 billion today, was bought for less than $2 billion, Thanks to Susan.

Well, then Susan built out the YouTube business model. And then she became the YouTube CEO in 2014. And here's the YouTube numbers today under Susan's leadership. $30 billion a year in revenue. We repeat, YouTube now brings in $30 billion a year in revenue. That is more than Netflix brings in. There's only one company that has more active users than YouTube. That's Facebook.

And only one company gets more online search queries than YouTube does. That's Google. After building YouTube into a bigger business, then you probably realized Susan Wojitski just announced she's retiring. Now, yetis, Jack and I were wondering when we jumped in T-boy style, how did Susan quietly transform YouTube into video dominance? Here's how she did it. Instead of winning advertisers love, she focused on winning creators love.

Yeties, YouTube is the most creator-friendly platform, by far, full stop. Top video creators who make a career with video content? They make that career on YouTube. Yeah, those top video creators, they could. just publish on TikTok or Instagram or Facebook, but they don't. TikTok, Instagram, and Facebook, they make tons of money off ads, just like YouTube does. But here's the key. Only YouTube shares that revenue with the people who actually created the content.

So if your video on YouTube gets a million views and that generates $1,000 of ad revenue, you get 55% of that $1,000 of ad sales that YouTube made. With other platforms, you're not getting 55%. You're getting nothing except some last. likes maybe. So Jack, what's the takeaway for our buddies over at YouTube? Susan's true legacy is the revenue share. Now, Yeti's, like every tech leader, Susan Wojitki has some blemishes on a wreck. YouTube has been accused of radicalizing people by recommending you into a dark rabbit hole of conspiracy videos that you end up watching all night out of nowhere and then you're a changed person.

It's some dark stuff, it's some dark stuff. But Susan did prioritize creators from the start, literally sharing 55. percent of YouTube ad revenue with creators. Zuck and TikTok say they love creators. And occasionally they'll create a big fund to give them some money. But the way we see it, YouTube puts their money where their mouth is. They give creators a majority of the ad money. Susan Wojitsky is stepping down from YouTube. But her biggest success there will remain.

And that big success is the 55% rev share. Jack, can you whip up the cream of broccoli, Spike Seltzer? Takeaways. Jack, can you whip up the takeaways before the three-day weekend? Crocs is so 100% physical a product. It's the most enduring pandemic stock that we could find. As Steve Jobs said, simplicity can move mountains. For our second story, Boston beers truly is losing market share in a shrinking hard sales

or market. Because it can fight competition, but you can't fight substitution. And our third and final story, after building the YouTube business model, Susan Wojitsky is stepping down. but her biggest success there remains, the 55% RevShare. Now time for the best fact yet, this one sent in by Al Rubio from lovely San Antonio, Texas. Push and play. Here we go. Although some podcast hosts will try to make you believe that tacos are not a breakfast option,

here in South Texas we know better. The breakfast, or morning taco, is a blend of Texas available Anglo-Germanic ingredients with elements of Mexican culture. The exact origin of this bundle of deliciousness is unknown and a contentious issue with San Antonio, Austin, and the Rio Grande Valley claiming to be the birthplace of this morning state. So, come on down to Texas and give them a try, y'all. Aren't some podcast host just the worst? Breakfast tacos, the breakfast of champions, apparently. Morning tacos sound delicious. And based on Al's report just now, I'm going to say San Antonio is where they're from.

Well, we are supposed to be going down to Austin soon. We should get some names of some places we should hit. We're going to hit up Al's tacos down there too. Yeties, if you are eating a breakfast taco right now, send us a pick of T-Boy Pod. We've got to see this thing. I might get one this morning, a morning taco. I think you should get one day. They sound fantastic.

In honor of Al. The guac on a breakfast taco sounds a little less extra, Jack. Amen to that. Yeties, you looked fantastic this week, and you're going to look fantastic for the three-day weekend, President's Day. We'll see you again on Tuesday. French onion, hard seltzer. That sounds appalling. And before we go, congratulations to Yeti Stephanie V.

A history enthusiast who's finally going to Washington, D.C., after missing the eighth-grade class trip. And congratulations to Megan LaRoche, who just quit her job in health care to launch a candle startup in Chicago. It's called Chi City Candles. And Nick Jordan, congrats on finishing that first week working from the New York Stock Exchange. It's a cool spot.

And happy anniversary. Brendan Hall and Stephanie Shea in Brooklyn, New York. And John Lozano from El Paso has been snacking and tee-boying with us for four and a half years. Not too shabby. Thank you, John. And happy eighth birthday to June Peters, who owns her own stock portfolio over in Colorado. And Kevin Venturina, happy birthday down in Glendale, California. And happy birthday to Cassie Zahenny in St. Louis, Missouri.

And Beto Hernandez has a birthday in Mexico City and has listened to every single T-Boy episode. Beto, that's incredible. And happy birthday to Mark Erickson in Houston, Texas. And Dominic Alloff, happy birthday in Glendora, California. We got another young Yeti. Mia Caphanner, she's turned seven, happy birthday. She's already investing her allowance neck in Hiana's Massachusetts. Just outside of Boston.

And Brandon Thichol, happy 23rd birthday over in Chicago doing logistics. And happy 46th birthday to Daniel Prado, who's also celebrating his first wedding anniversary in California. And Betty G. is a black lab puppy, but still has a birthday, also in Chicago. My first dog, Bo, also a black lab puppy. Great dog. Good boy. Puppy. And to anyone else celebrating something today, make it a team. Celebrate the wins. This is Jack. I own stock of Amazon, Crocs, and Netflix. And Nick and I both own stock of Peloton and Robin Hood. And I have two pairs of crocs. Burking Crocs. Now a word about our sponsor, Robin Hood. Okay, so Jack and I both worked in finance for a while. And we know the six-monitor

Bloomberg jockey with charts, numbers, balances, and more charts. They got coffees in both hands while they're executing some complex trade on a soybean future. Well, we're not trying to impress with our mission control trading center. Just give us an app, please. Robin Hood, with its mobile first and intuitive design, it lets you trade with just a few quick taps on their app. And even if things still don't seem easy, Robin Hood has your back 24-7 with its live and robust customer support. If you're not investing on Robin Hood yet. To get started, go to Robinhood.com slash T-Boy and choose your free stock. That's Robinhood.com slash T-B-L-Y. Limitations apply. Robin Hood Financial LLC, member SIPC, all investments involved for us.

By the way, this podcast is not owned by or part of Robin Hood, and we are not employees of Robin Hood.