Intro
In this episode of “The Prof G Pod with Scott Galloway,” Scott discusses various market updates and rebrands, including Twitter’s name change, Mattel’s media strategy, and the future of Snap. He also shares insights on the economy, stock market, and brand building. Let’s dive into the main takeaways from this episode.
Main Takeaways
Market Updates
- Meta posted double-digit revenue growth for the first time since the end of 2021, and the stock rose 8%.
- Google beat expectations for revenue and earnings per share, and the stock rose 6%.
- Microsoft’s stock fell 4% on news that revenue growth in its cloud business slowed quarter over quarter by 1% point, and it gave weaker than expected guidance.
- The Federal Reserve raised interest rates by another 25 basis points, bringing the Federal Funds rate to a 22-year high, and it might not be the last.
- UPS and the Teamsters Union reached a tentative agreement for a new contract, and existing part-time workers will see their pay raise to a minimum of $21 an hour.
Rebrands and Brand Building
- Elon Musk’s decision to rename Twitter to “Twttr” wiped out between $4 billion and $20 billion in value.
- Success makes you stupid. Musk may have started making decisions out of gut and instinct because everyone around him is telling him that his gut and his instinct are infallible.
- Some of the best rebrands include Apple changing to just “Apple” and PricewaterhouseCoopers becoming “PWC”.
- Some of the worst rebrands include Nissan changing from Datsun and Facebook changing to “Meta”.
- Scott Galloway’s biggest brand mistake was naming his gift website “911 Gifts” based on the idea that the internet is all about saving time and is for men.
Mattel’s Media Strategy
- Mattel’s Barbie movie had the best opening weekend for the domestic box office since 2019, and sent the stock up 18% year to date, establishing the company’s media strategy going forward.
- Mattel is taking IP and leveraging it across different sectors and different mediums, specifically taking Barbie to the movies.
- Greta Gerwig, the director, was a huge factor in the success of the movie, and the brand marriage between her and Barbie was powerful.
- Barbie has 99% brand awareness worldwide, making her the perfect leading lady.
- Mattel plans to create a cinematic universe, similar to Marvel or DC, using their iconic franchises like Hot Wheels and American Girl.
The Future of Snap
- Spotify reported record audience growth, but their podcast division is still suffering from weakness in the digital ad market, while Google and Meta posted advertising revenues that topped analyst estimates.
- Snap posted its second consecutive decline in quarterly sales and saw its stock decline 14%, due to being unable to compete with big tech monopolies in digital marketing spend.
- Snap’s daily active users reached 400 million, up 14% from a year earlier, and over 150 million users sent more than 10 billion messages to Snap’s AI bot.
- Snap is a sub-scale platform that should be part of a bigger company, with Disney being a logical buyer due to their market cap being around ten times larger than Snap’s.
- Apple could also be a potential buyer for Snap, as their brand lineup aligns perfectly.
Summary
Market Updates and Rebrands
In the market updates segment, Meta and Google reported positive revenue growth, while Microsoft faced a stock decline due to slower cloud business growth. The Federal Reserve raised interest rates, and UPS reached a new contract agreement with the Teamsters Union. On the rebranding front, Elon Musk’s decision to rename Twitter to “Twttr” had a significant impact on its value, highlighting the risks of rebranding with consumer equity. Scott Galloway shared examples of successful and unsuccessful rebrands, emphasizing the importance of brand building.
Mattel’s Media Strategy and Barbie Movie
Mattel’s Barbie movie achieved great success at the box office, leading to an increase in the company’s stock. Mattel is leveraging its intellectual property (IP) by bringing iconic franchises like Barbie, Hot Wheels, and American Girl to different mediums. The collaboration between director Greta Gerwig and Barbie contributed to the movie’s success. Mattel aims to create a cinematic universe similar to Marvel or DC, utilizing its beloved brands.
The Future of Snap
While Spotify reported audience growth, Snap faced a decline in quarterly sales and struggled to compete with big tech companies in digital marketing spend. Snap’s daily active users increased, but the platform is considered sub-scale and could benefit from being part of a larger company. Potential buyers like Disney and Apple align with Snap’s target market and brand lineup.
Conclusion
This episode covered various market updates, rebrands, and the future of Snap. It highlighted the importance of brand building, the potential of Mattel’s media strategy, and the challenges faced by Snap in the digital marketing landscape. As always, Scott Galloway provides valuable insights into the business world and offers thought-provoking perspectives.
