The Best One Yet - 🥜 “Unhinged marketing” — Nutter Butter’s Gen Z case study. OpenAI’s new emperor. Shein’s mysterious loophole.

Episode Date: September 27, 2024

OpenAI is switching from non-profit to for-profit… and Sam Altman was just anointed their emperor.Nutter Butter’s social media has turned insane… it’s a case study in Gen Z’s aesthetic.Shein has become the biggest fashion brand in the world… but it’s loophole is closing.Plus, 25% of travelers forget something at the hotel… so the hotel industry found 2 solutions.$MDLZ $ANF $GAP—-----------------------------------------------------GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/  Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. It's Friday the real Friday. September 27th. And today's pot. Today's pod. This is the best one yet. The top three pop business news stories you need to know today.

One sec, Jack. I'm checking the counter. Is it September 27th or December 25th? Because Yetty's Jack just got me my Christmas gift already. I can't believe it. Three months early. It's a very early Christmas present. Okay, I got to unwrap this thing.

But that will be a story for another pod. I'll tell you what I gave Nick next week. In the meantime, three fantastic stories before the weekend. What do we got on the podcast? For our first story, Open AI is making its biggest change yet, from a nonprofit organization to a for-profit company, because Sam Altman is the little finger in the game of AI Thrones. For our second story, Nutter Butter's social media has gone wild. It's unhinged, it's totally nutty, and it's working. Nutterbutter's Instagram is a case study in Gen Z marketing versus millennial marketing. And our third and final story. Sheehan is now bigger than Abercrombie.

The Gap? Really? Levi's and urban outfitters combined. Sheehan has become the largest online fashion company in the world thanks to one single loophole. But that loophole is getting closed. We've got to talk about that loophole, Jack. But yeties, before we hit that wonderful mix of stories. Fantastic mix of stories before the weekend, Jack. If you're traveling this weekend, there's a 25% chance you forget your toothbrush at the hotel. And we know that you forgot that toothbrush because the data tells us you forgot that toothbrush. According to Hotels.com survey, 25% of hotel guests forget an item at the hotel. One out of four guests forget a headband, a book, or that one lovely bracelet your nana bought you 16 years ago at a hotel.

It's called suitcase scatterbrae. Yeah, we call it luggage laps. Hotel amnesia. Yeah, it's a chronic problem. And we're all suffering from it. And the number one most forgotten item at the hotel, according to that survey? What is it, Jack? A charging cord.

Yeah, the charging cords. You dropped a dungal by the bed and you're going to have to spend $40 on a new one. After that, you're most likely to lose your dirty laundry, your makeup, and your underwear. Buddy, my $80 skin cream is gone forever. I know you've got one of those, Jack. The hotel room, it's like a black hole for your most personal, personal line-ups. We lost a lot of good men out there. Now, there's actually a psychological reason why we're so often forgetting things in hotels.

It's called contextual dependence. Our memory is tied to routines and places. But hotel rooms are new places, and you're off your routine while you're traveling, so you're more likely to forget stuff. But the wildest part about hotel amnesia, what is it, Jack? Hotels are adapting with new features to help you remember your stuff. You can now set reminder calls at the hotel before you check out. A reminder to sweep the room, look under the bed, and check the chest of drawers.

Hotels even have checklists now that provide you with the most forgotten items. Keys, dongles, and then. That dirty underwear? Check, check, and dirty check. So, Yeties, the next time you forget something in a hotel, don't sweat it. In economics, they talk about sunk costs. This is a sunk lost. It's a sunk lost.

And it's a write-off. Jack, let's hear our three stories. Wait, where is my underwear? 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 an norm. I don't even think they need to practice. 50%, that's a fat tip.

Tea Boy City on your at list. 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, a quick word from our sponsor. For our first story, Open AI is facing another employee exodus

right before it closes its biggest fundraise ever. We're experiencing a consolidation of power around Emperor Sam Altman. Yiddies, the big theme this week, it's HR moves in artificial intelligence. This week, your LinkedIn, has been blowing up with massive bonuses and hires. Shogger, that guy in high school you never talked to just got a huge signing bonus to join a

different AI company. And at the top of the feed is Noam Shazir. He was a top AI expert over at Google, but he quit Google in 2021 to start his own company. But get this, Yetty's. According to the Wall Street Journal, Google just paid him $2.7 billion to come back to Google. That's half a lift as a bonus. It's the biggest signing bonus we've ever heard of. And why is Google paying it? Well, Jack, because Nome Shazir is a dragon. He's one of the few people in the world with a mind powerful enough to build

AI. He is rare. He is an AI dragon. Yes, he is. But there's another HR move by OpenAI that's even bigger. Because Open AI is reportedly giving Sam Altman, their CEO, a $10 billion gift. OpenAI is the company behind ChatGPT. And they're about to close the biggest fundraise in private venture capital history. Yeah, they're about to hit a $150 billion valuation. And that fundraise includes a gift to their Dragon CEO, Sam Altman. Seven percent ownership in the company worth $10 billion. Wow. Sit down, stand up, and cash that check, Sam. But there's actually more Open AI news that's an even bigger deal. That's right, because Open AI is pulling off the ultimate switcheroo. Open AI is reportedly changing its corporate constitution.

to go from nonprofit to for-profit. That's right. Now, remember Yeti's, OpenAI was created in 2015 as a non-profit company. It's worth $150 billion, but technically it's still a nonprofit organization. Open AI basically is the same corporate structure as the Make a Wish Foundation. It's really weird. It's like Wikipedia, but with a whole lot more money. But after surviving the coup to oust him last year, Sam Altman is changing the company's bylaws to make his pivot to profits official. When this deal closes, according to reports, it will also make OpenAI officially a for-profit company. Funny timing. You had his funny timing.

This week, OpenAI lost two more executives in very public departures. Check of checking my LinkedIn and superstar chief technology officer Miramaretti just left. OpenAI. Right after the news that Sam Altman is making it a for-profit company. Oh, and OpenAI's chief research officer, they just quit too. Oh, and the president of OpenAI, he's been on leave for weeks and months. No one knows where this guy is. Like we said, Yeti's the big theme of this week, it's HR moves in AI.

So, Jack, what's the takeaway for all our buddy is over in tech? Sam Altman is being anointed as the second emperor in tech. He's the CEO, the chief executive emperor officer. Yeti, is that $10 billion gift that Sam Allman's getting? It's a vote of confidence from the Open AI shareholders. The only other time we've seen a gift like that to a CEO was Elon, Musk earlier this year. Yeah, Tesla shareholders, they voted to give Elon a $56 billion gift, and Sam Altman just got a $10 billion gift. In both cases, the shareholders basically are

promoting their CEOs to emperors of the company. Yes. Well, Open AI, it was founded as a non-profit organization with democratic processes, checks, and balances. But over the last two years, Sam Alton has shrewdly consolidated power, like Little Finger in Game of Thrones. Little Finger. Ironically, Sam and Elon, they come. kind of hate each other, but now they're the two dragon emperors of tech. Sam Altman is being anointed as the second emperor in tech. The chief executive emperor officer. For our second story, the most viral social media account of the year, it's Nutter Butter.

The Nutter Butter Peanut Butter Cookie is the perfect case study in millennial marketing versus Gen Z marketing. But Jack, if we're going to tell this take... which we shall. Let's start with your seventh grade diet. What do you got, Jack? 25% egg of waffles. Samezies. 25% freeze pops. That's where we differ. I had 25% snack wells. And the rest was nutter butter cookies. 50% nutter butter wash it down with a Capri sun. Yet he's nutter butter. It is the peanut butter cookie that is shaped like a peanut.

Literally. And it is peanut both in taste and in form. Very meta. Very meta. And it was invented by Nabisco back in 1969, but acquired by Mondalese, the mega snack. company in the year 2000. And today, it's a top brand in Mondalise's $14 billion cookie division. But lately, um, Nutter Butter has been, quote, unhinged, quote, disturbing, and quote, can someone please check on Nutter Butter? Those are the media's reactions to Nutterbutter Butter's Instagram, X, and TikTok accounts. And we jumped in T-Boy style and we concur, they are insane. It's like the Joker took a job as the social media manager at Nutterbutterbiter. Yes, it did. It did. post psychological analysis. They're posting videos that would give a conventional marketing executive

a heart attack. All right, check this out. One of the Nutter Butter posts is of a shrimp, like a bunch of shrimp on their peanut butter cookies. Another is a bonfire with the Nutter Butter melting above it. Like it's being burned. Then they added like disturbing mouths to the Nutter Butter cookies, yelling the word Adrian, just yelling the name Adrian. Adrian's a recurring theme on this account. Nobody knows who Adrian is. Besties. These are completely chaos. Posts. They made one tweet that was simply the word peanut butter 38 times with no explanation. But for the first time in 20 years, you're thinking about Nutter Butter. Aren't you? You are. And you know what? So are a lot of people. Because these videos got 10 million views per video and Nutter Butter's following has surged to 1 million followers.

That's more than chips a hoi, more than Oreos cookies, more than Kit Katz. I am so glad you sprinkled on this pantry context, Jack. It's more than Dunkeroo's, Nick. Now, that's impressive. But yet, this is what Jack and I found fascinating. We actually covered a similar, scary, surprise success story just last year.

Remember Grimmis? Grimmis, the McDonald's social media campaign created by the ad firm, Wyden & Kennedy. It was all about a dead grimace. Grimmis is the giant purple mascot from McDonald's past, and he went viral

for killing people with the new Grimmis milkshake. Yeah, last year, that was a similarly disturbing, dark and unhitched campaign, but it also worked. People playfully shared those videos, even though they were kind of gruesome. And what was our takeaway when we covered the grimace trend last year? There's a case for chaos. Yes, yes, yes. There's opportunity if you go to the extremes. Companies want control and predictability, but good marketing is creative, the opposite of predictable.

But that grimace campaign last year, it caught fire because the public ran with it. On the other hand, this nutter butter campaign was all nutter butter. Like, they set their own mascot on fire. That's why this nutter-butter nuttiness reflects something bigger. I'm impressive. You said nutter-butter-ninnitus. But Jack, what's the takeaway for our buddies over at Nutterbutter. Nutterbutter's Instagram is a case study on millennial marketing versus Gen Z marketing. Yeties, the millennial aesthetic can best be described as the three peas, playful, pretty, and planned. Picture the logos of Airbnb, Casper, and Glacier. They're optimistic, they're cheerful, they have welcoming color palettes. Playful, pretty, and planned. But Gen Z's

aesthetic is the 3D's, darker, disturbing, and comically deranged. Nutterbutter's Instagram is so uncomfortably freaky that it's comfortably amusing, too. I want to look away, but then I also want to hug it, Jack. Not yet, he's to oversimplify this. Millennials came of age in the 2010s during an ambitious period of startup and tech companies to save the world. And while Gen Z came of age in the 2020s, an era of of misinformation, pandemic, and climate change anxiety. That duality is captured by the uniqueness of Nutter Butter's social media strategy,

which is working so well. So, Basties, go check out Nutterbutter's Instagram because it perfectly illustrates the difference between the Gen Z aesthetic and the millennial aesthetic. Now a quick word from our sponsor. For our third and final story before the weekend. She-in is now bigger than Abercrombie, The Gap, Levi's and urban outfitters combined.

But now, Sheehan's loophole is getting closed. But its legacy is lasting. Gettys while you're grabbing brunch with your buddies this weekend, if you're not swiping Sheehan every day, then you are missing out on a brand new category. We call it real-time fashion. Real-time fashion. Traditional fashion, like J-Crew,

dropped new styles quarterly. Fast fashion, like Zara, dropped new styles monthly. But She-E-E-N-E-Style. In drops new styles daily. There are 600,000 products you can buy on their website right now. Huge. They drop 10,000 new apparel items every day. And that Sheehan is powered by a vast network of Chinese factories so Sheehan can drop those 10,000 new items every single day.

That is wild. Now, Sheehan is the subject of myriad controversies. Like the Sheean CEO is as mysterious as their supply chain and their pricing. model. Creatives also accuse Sheehan of stealing their designs. Yeah, if that looks like a Forever 21 leopard print, it's because Sheehan may have knocked off that Forever 21 leopard print. Still, we're buying that leopard print. Yeah. Sheehan did $32 billion in sales last year. Jack, could you sprinkle on that shocking context, please? That is more sales than Abercrombie and Fitch, The Gap, Levi's, Urban Outfitters, and all of those company sub-brands. Combined. We had to say to

third time because we were so shocked. That's how big Sheehan is. But here's the news, Yetis, Sheehan is a loophole company. And the loophole sheen used to grow is about to be closed. Real-time fashion like Sheehan, it's possible in part because of Sheehan's trick. Yeah. Sheehan bypasses customs. That's the trick. It's called on-demand production, and it lets Sheehan sell items duty-free. Here's why. Sheean's factories don't produce things until they're ordered. That's called on-demand production. So every cute top they make already has a buyer who's waiting for it to be shipped. And it ships that cute top directly from a Chinese factory to that buyer's door.

And here's the key. The package coming from China, there's just a cute top in there. That's it. So it's low enough in value to be exempt from duties. Now, on the other hand, when Amazon orders a palette of products from China, it's subject to customs and duties because they cram so much in there. There's thousands of dollars of product in that palette. But Xi'in and Timu, they ship everything. under that $800 duty exemption limit.

That's the loophole. Yes. They send tiny products directly to people's door, and they sweep right past customs and border control. Well, now the White House says that it is closing that loophole. If Sheehan packages have to pay duties, that's going to increase the prices of Sheehan stuff and increase the shipping time to get to your door. That's not going to be good for Sheean. But bigger picture, Sheehan is part of a group of new tech companies that are schooling American

business. One sec, Jack, I'm just ordering a $3 tankini and a matching pineapple pool toy for $2 on Xi'in. So Jack, what's the takeaway for all our buddies over in American business? Algorithms aren't just for apps. They work for apparel too. Yeti's Sheehan, Timo, TikTok, they are enormously popular in the U.S., but also they're facing enormous scrutiny. Because of their Chinese ownership, they may get banned by the U.S. But their biggest legacy is here to stay. The algorithm. algorithm. All three of China's real-time shopping apps use algorithms with masterful efficiency and precision. TikTok's algorithm, for example, they show the video you post to just like 100 viewers. That's it. And they'll only scale that video if it gets a bunch of engagement. Similarly,

Sheehan only makes a hundred of those Q-tops and only mass produces what quickly sells out. They know because of their algorithm. So all three of China's big tech platforms, Sheehan, TikTok, and Timu, they could all get banned in America. But their legacies would live on. Algorithms aren't just for apps. Algorithms could work for anything. Jack, could you whip up the takeaways for us for the real Friday? As Open AI hits a $150 billion valuation.

Whoa. It's also switching to a for-profit company and giving Sam Altman a $10 billion gift. Sammy Allman, he's being anointed as the second emperor in tech, the CEO, the chief emperor officer. For our second story. Nutter Butter is the surprise social media success story of September. Nutter butter's success is a demonstration of the Gen Z marketing aesthetic. And our third and final story is Shien. Sheen has been wildly successful, but its duty-free loophole is about to close.

The legacy of China's real-time shopping apps, algorithms, ain't just for apps. But Yeties, this pod's not over yet. Here's what else you need to know today. First, jump in the car because the price of oil just fell to $68 bucks. after Saudi Arabia abandoned their goal to raise prices to $100. A gallon of gas today, it's $3.22 on average across America. Not too shabby. It's expected to drop under $3 as the winter approaches.

And that would be the cheapest gas in your tank since 2021. Second, New York City's 110th mayor, Eric Adams, was indicted. And yesterday we saw all the details. And here are the details. Mayor Adams was charged with bribery and fraud. Adams is accused of taking $100,000 in bribes from at least one Turkish government official and a bunch of other wealthy Turks. And finally, Vanderbilt University is taken a page from the Northeastern University Playbook already right after our story, Jack. Vandy just acquired a struggling school in Manhattan, so Vanderbilt is now going to offer a New York City campus.

And what was our story yesterday, Jack? Universities are running like corporations. Schools are starting to run like corporations. Anchored down, Vandy, on that balance sheet. The Southeastern Conference now has a footprint in Manhattan. Now, time for the best fact yet. This one sent in by Manish Parique and Amy Del Prado because it is World Space Week. There is a mini moon coming to planet Earth this fall. Oh, yeah. It's a mini moon.

Not like a mini honeymoon, like a literal miniature moon. A mini moon is a space object that's temporarily captured by the Earth's orbit. Regular, like, normal-sized moons are permanent. Like our moon, it's going to be spinning around us. She's there. She's looking fantastic. But this mini-moon is named 2024 PT5. It's an asteroid, and it's about 33 feet long.

Mini-moon. The researchers say that this mini-moon is going to travel around the Earth in a horseshoe path for about two months before the gravity of Earth can't hold it anymore. So, Bessie, as you look up into the skies over the next two months, and you see something really quickly going by, that could be the mini moon. Yeah, it's probably not, though, because 33 feet long, that's not big enough for us to see. I've got pretty good eyesight, Jack.

Yetis, you look fantastic going into the weekend to celebrate the wins. And remember, if you're staying at a hotel this weekend, make a checklist and ask for a reminder call. Do you forget anything this week in Seattle? Pull a Santa. Make a list. Check it twice. And then keep your dongles, your undies, and your makeup right by the door. That's the third idea here.

If you don't, you might be flying. Home Commander. Oh, and if you haven't yet, subscribe to our newsletter. We got a link in this episode description. You'll get it Saturday morning and you'll feel fantastic all weekend. We'll give you the tidbits to make you the most interesting person at the party. In the meantime, celebrate the wins and Jack and I will see you Monday. And before we go, Jack, grab the champagne, because Alex Larson and Oleksandra Toribara are getting married this weekend and they're looking fantastic. Have fun, guys. Congratulations to Jeff Hagen in Chicago. Illinois, who just got promoted to manager for the first time.

HR Logistics, and Jennifer Wood and Andre Hetman in Pittsburgh, Pennsylvania got married, and their first date was seven years ago. That is just beautiful. Send us the deeds on that first date from seven years ago. We want to know. We want to hear him. And a happy sixth birthday to Yaliyah Shen down in Austin, Texas. Happy birthday to Sarah Summer in Mansfield, Texas.

And Xavier Alejandro in Colorado is a longtime bestie celebrating a birthday. in Germany. Happy birthday to Doug Kennedy in Clinton, Iowa. And Bellagie is turning 29 years old in Dallas, Texas, stargazing into the dark sky at a state park in Texas. Looking for that minibon. If you're Superman like Nick, you might see that mini-bole. I'm not bragging. I'm just saying it's 2020, Jack. No cavities either. And our fantastic buddy, Jason Geiger in lovely Buffalo, New York,

has got a five-year anniversary with his wonderful wife Dawn, and they're celebrating with a beautiful trip to see those Niagara Falls. Happy birthday to Shama Guyquod in Valencia, California. The love is coming from Sanjay and your kids, Archie and Sanmi. And Jack, whip out that abacus because Chris Brown has turned 31 years old in Manchester, Connecticut, doing accounting. Which is financial logistics. And Israel Martinez in Dos Polos, California is starting a new facial skincare routine with the help of Chachy-P-T. Well, insult it.

I thought my skincare routine would provide you the help. Yeah, if you need 41 more steps, Israel, you know who to ask. This is Jack. I own stock of Amazon, Abercrombie and Levi, and Nick and I both on stock of Airbnb.