The Prof G Pod with Scott Galloway - How AI Is Shaping the Future of Retail, Las Vegas and Its Strong Brand, and How Do You Help Your Kid Pick the Right College?

Episode Date: December 4, 2024

Scott discusses Perplexity’s new ‘Buy With Pro’ feature, specifically what it means for the future of the retail industry. He then speaks about Las Vegas and its singular brand positioning. He wraps up with advice to a parent who is struggling with his kid’s college decision.  Music: https://www.davidcuttermusic.com / @dcuttermusic Subscribe to No Mercy / No Malice Buy "The Algebra of Wealth," out now. Follow the podcast across socials @profgpod: Instagram Threads X Reddit Learn more about your ad choices. Visit podcastchoices.com/adchoices

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in no time. Learn what Amazon Q Business can do for you at aws.com slash learn more. That's aws.com slash learn more. Welcome to the PropG Pods Office Hours. This is the part of the show where we answer your questions about business, big tech, entrepreneurship, and whatever else is on your mind. If you'd like to submit a question, please email the voice recording to officehours.propgmedia.com. Again, that's officehours.propgmedia.com. Just a little bit of background, a little bit

of texture on the dog. I'm in Brazil in Sao Paulo. I took an overnight here. I couldn't sleep this morning. I took a Xanax, which made me sleep very hard for about three and a half hours. And I have been podcasting for five and a half hours straight. I am so cooked right now. So with that, let's throw a bunch of meaningful, deep life lessons at me or questions. And I don't know, this is either gonna go very well or very poorly. First question. Hi, Prof G.

I'm Sarah from New York. I run a startup in the retail marketing space and I'm super curious to hear your thoughts on Perplexity's new Buy with Pro feature. What does this mean for the retail industry? Thanks. We had to come in hot with a hard question. Buy with Pro is a way to shop online with AI. The platform now allows its paid users to search, compare, and buy

products all in one place. It's a chat-based assistant that includes visual search, similar to Google Lens. So, okay, a couple of things here. I say this a lot. The biggest mistake we've made in marketing is that consumers don't want choice. They want fewer choices presented,

but wanna be more confident in those choices served up to them. That's the whole basis of specialty retail. Not 32 toasters at Walmart, the right two from William Snowa from a woman who has better taste in kitchen electronics than you do. Perplexity isn't alone here. Google, Amazon, eBay, and Clarion are all getting into the shopping game.

How could this affect the industry? It's already challenging traditional affiliate marketing models. Platforms, including perplexity, are partnering with publishers to share ad revenue. But it's unclear how much these relationships will shift the balance of power. So alongside the launch of these tools, I think perplexity is rolling out a merchant program and that is retailers who enroll have a better chance of being featured in recommendations and get free API access to power search on their own sides.

When asked if perplexity makes any money from sales through the buy with pro button spokesperson there said, not at the moment, but I think if they create enough traffic and attention, they will be able to monetize it. Look I like this and we talked about the balance of power. The balance of power is just shifting from the analog or from capital to IP. What do I mean by that? You don't want to manufacture cars. You want to create a layer of software on top of them to sell them.

You don't want to be in the business of fast fashion. You want to be in the business of fast fashion. You want to be in the business that's Airbnb. You want to be in the business of having software that observes the traffic on your site and then sends out orders to whatever factory can do this most elegantly and then put in place a transportation system and you don't want to own any assets. And this to me feels like again, more assets and shareholder value are transferring from the people who own stores,

the people who insert themselves in between them. If I could invest in any AI property right now, hint, hint, CEO, please call me. I'd like to invest. It would be perplexity because I like the positioning. I like perplexity. This is whether this application works or not. It's already worked because we're talking about it. It signals innovation, yet another person getting in between the consumer and the

retailer. And if they build enough traffic, this is a model overspend. No one can compete with you. Oh, you know, don't charge anything, start getting big traffic and then slowly, but surely once you have one 10, 50% of traffic, start implementing, you know, real fees and onerous fees. Anyways, thanks for the question. Question number two. Hi, Scott. This is Noah in Nevada.

As a branding expert and visitor, do you think any city or product has marketed itself as effectively as Vegas turning a hot gray, isolated desert crossroads into the global hub of entertainment, opulence, and networking, appears to be a contender for number one masterclass in branding. How do you see Las Vegas adapting and faring over the next decade or so? Thank you for your consideration and enjoy your time in the desert. No, that's such an interesting point. Hands down, best managed brand in

municipal cities or in metros or whatever the term is for a city hands down. What is brand? Brand means differentiation, right? You got 10 brands of cereal, which one you pull off the shelf. You got 10 super cities. Actually two thirds of all economic growth is going to take place. I'm about 25 super cities. I don't think Las Vegas qualifies as a super city. But I think LA is a little bit like Sydney.

I think that New York is a little bit like London. They're kind of analogs to almost every city. I would argue that Orange County or Southern California is a little bit like Cape Town. Cape Town's on my brain because I'm going there later in the month. It reminds me of what I think California was like in the sixties. There's always sort of an analog. Except for Vegas. Vegas is singular.

In addition, the brand positioning of what happens in Vegas stays in Vegas. I just think it's fucking genius. I know this firsthand. I was in Vegas 15 hours ago and what am I doing in Vegas? I'm gambling. I'm yelling when I get blackjack. I'm getting way too fucked up and it's okay. I thought about going to a strip club last night.

I haven't been to a strip club in 10 years. That's just not my, not my vibe, but it felt natural. It felt like, oh wait, we just gambled. We made some money. We're fucked up. Oh, we should definitely go to a strip club. No, I shouldn't. Why on earth would I go to a strip club?

But you have license to just go kind of just, to just sin a little bit and it's legal. But you would never do, I would never go to a strip club in any city I live in, by the way, general rule, general decent rules for life. Don't go to strip clubs or eat fast food in the cities you live in. I do eat fast food, but only when I'm traveling. And I'm trying to screen that out of my life because I'm getting older and that's just shitty food. Anyways, the branding around Vegas is singular.

These people are very smart and it's amazing shitty food. Anyways, the branding around Vegas is singular. These people are very smart and it's amazing how it survived. And granted it's down a little bit from post COVID because gambling is so ubiquitous now, but they have done an amazing job. So a singular brand, high margin revenue because it taps into an addiction and the result is just an incredible offering.

By the way, let's talk a little bit about Vegas hotels. I used to get 40 bucks from a ready-teller when I was in college and we get ridiculously stoned and think, I know, let's go to Vegas. And I get in my friend's Red Jetta. Of course he did not drink and drive. We'd go to Vegas for the night. Golden Nugget, Steven Wynn, 9.99 best buffet.

So we'd have 30 bucks. I'd play blackjack at a $1 table. Boom. I remember because I used to wear my mom's boyfriend's cardigan because he was rich and had good tastes and he gave me a cardigan that I always used to wear. And then I upgraded to the Tropicana with the toucans with those birds, 19 bucks a night. And then I got really fucking crazy and started going to the, Oh my God, what was the one with the tigers?

Treasure Island? No, wait, I don't know where. And then when I started to make some money, hello ladies, and I started going to the Rio. Remember the Rio Hotel? The hook, I love what cab drivers say. I would say I'm going to the Rio and they'd go, the Rio where it's hooker friendly.

Anyways, loved the Rio for a while. Then I went to the Palms for like a hot minute. And then when I started making some money, I started staying at the Cosmo. State of the Bellagio, too high end for me. Felt like I was in a Frank Sinatra film. I was waiting for the ass cancer from all the meat. I'm partying with Angie Dickinson later tonight. By the way, did I tell you I did Xanax last night? Anyway, so then when I started making real money, I went to the Cosmo with your older and have some money and you want to hang out with younger people.

Really interesting concept. Take the coolest brands, Beauty and Essex, Milos, license it, bring in there. Then I went to the Aria, newer, higher end, kind of like a Lexus sort of feel more modern was a disaster for the developers, but they finished it. It was nice. And now, now I stay at the win because even though it's a bunch of rich people from Texas and not my vibe, I just like good service and they do the best job. The win in the encore, my hand, my impression hands down. The best casinos. There you go. There's a story of my hotels in Vegas, but see above a singular city resulting in unearned margin.

Thanks for the question. We have one quick break before our final question. Stay with us. Support for the show comes from Betterment. Do you want your money to be motivated? Do you want your money to rise and grind? Do you think your money should get up and work? Don't worry, Betterment is here to help. Betterment is the automated investing and savings app that makes your money hustle. Their automated technology is built to help maximize returns.

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Question number three. Hi, Prof. G. I'd appreciate some parenting advice. I have an ambitious high school senior who has been accepted to a high status university, Michigan, and a lower status university, Montana State. He plans to double major in mathematics and computer science. My son fell in love with the lower status campus and his outdoor recreation, skiing, fishing, mountain biking,

all of which he loves. My instinct screams, take the higher status option, but compelling him away from his first choice runs the risk of resentment, burnout, or dropout? Look, I hate this bullshit of just where he's gonna go, where he's gonna be happy. This is the bottom line. College is just fucking amazing, all right?

He's gonna have four amazing years. And there's just no getting around it. We tell ourselves this myth that it doesn't matter where you go to school as long as you get a good education. It's not true. We have a caste system in our society. In Europe, it's your family name. In the U.S., it's the college you went to.

And then the first few firms you work for, your economic trajectory in your 20s largely sets the economic trajectory for the rest of your life. And the thing that sets your economic trajectory right out at 22 is the university you went to. The big name brand state school you're talking about, it's just going to offer more opportunity. There's very few brands that stick with you the rest of your life and say something about you. And unfortunately that's your university. My son, I had a similar situation with my son.

My son applied to a bunch of boarding schools in the UK. One was lesser prestigious. He got in and he got into another one that was kind of like iconic. And I think he was a bit intimidated by the iconic one. And we said, look, you have agency here. What do you want to do? And he said, I want to go to the kind of the second tier, but good one. And I took them on a long walk and this is what I said to him. I said, you know, I'm smart, right?

I literally said that. And he was like, yeah. And I said, and you know, I love you, right? Yeah. I want to make really good. I want to help you make really good decisions. And I want you to trust me on this one. I think you'd be better off here. I think this will set you up for a better education and more opportunities.

And I was really lucky. He was silent for a second and he said, okay. Um, and I don't know if you have that kind of relationship with your son, but I want to be clear. I think you're more doors. I just talked to a kid who got into a mediocre university where he could play basketball and to MIT where he wasn't going to play basketball and he chose the mediocre school. And my advice was, dude, go to MIT and buy a fucking basketball team in 20 years. Would you like to own a basketball team someday?

I'm like, you're not going to be an NBA player. There's just no getting around it. Your son would be better in terms of prospects. I mean, if he hates it and he's going to be depressed, fine. But the school you're talking about is an amazing school. He's going to have a great time for attorneys, sororities, football games. So I hate to say this, but I would just and say look boss. I love you. I'm smart

Can you can you defer to me on this? Can you trust me on this and if you don't like it you can easily transfer from this school to this one? You know on this one. Can I cash in some chips? Let me finish with the following you and your partner have clearly done a great job This is what you call a great problem. If your son is into both these schools, it means you have raised a thoughtful, disciplined young man. And at the end of the day, that's the headline news. Well done. That's all for this episode. If you'd like to submit a question, please email a voice recording to officehoursatprofgmedia.com. Again, that's officehours at ProfGmedia.com.

This episode was produced by Jennifer Sanchez and Caroline Chagrin. Jew Burrows is our technical director. Thank you for listening to the ProfGpod from the Box Media Podcast Network. We will catch you on Saturday for No Merc No Malice, as read by George Hahn. And please follow our Profit.G Markets pod wherever you get your pods for new episodes every Monday and Thursday.