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Support for this show comes from Klaviyo. You're building a business. Klaviyo helps you grow it. Klaviyo's AI powered marketing platform puts all your customer data plus email, SMS and analytics in one place. With Klaviyo, Tindfish phenom Fishwife delivers real time, personalized experiences that keeps their customers hooked. They've grown 70 times revenue in just four years with Klaviyo. Now that's scale. Visit K-L-A-V-I-Y-O.com to learn how brands like Fishwife build smarter digital relationships with Klaviyo.
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Hey, it's Liam from Decoder with Neelai Patel. We spend a lot of time talking about some of the most important people in tech and business, about what they're putting resources to and why they think it's so critical for the future. That's why we're doing this special series, diving into some of the most unique ways companies are spending money today. For instance, what does it mean to start buying and using AI at work? How much is that costing companies? What products are they buying? And most importantly, what are they doing with it? And of course, podcasts. Yes, the thing you're listening to right now. Well, it's increasingly being produced directly by companies like venture capital firms, investment funds, and a new crop of creators who one day want to be investors themselves. And what is actually going on with these acquisitions this year, especially in the AI space? Why are so many big players in tech deciding not to acquire and instead licensed tech and hire away co founders? The answer, it turns out, is a lot more complicated than it seems. You'll hear all that and more this month on Decoder with Nilai Patel, presented by Stripe. You can listen to Decoder wherever you get your podcasts.
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This episode is brought to you by Google Gemini. With the Gemini app, you can talk live and have a real time conversation with an AI assistant. It's great for all kinds of things, like if you want to practice for an upcoming interview, ask for advice on things to do in a new city, or brainstorm creative ideas. And by the way, this script was actually read by Gemini. Download the Gemini app for iOS and Android today. Must be 18 to use Gemini Live.
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What sector boasts the strongest brands in the world? Tobacco, Universities? Tech companies? No, the strongest brands in the world are people. People are the new brands. By Ed Elson as read by George Hahn.
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Scott's away this week on a safari. I'm not sure what a Prof. G Safari looks like, but it likely involves tented camps with fine china, zacapa and remote NAD treatments. In his absence, I'm keeping the lights on. Yes, me Ed Elson, Scott's 25 year old co host on Prof. G Markets I get paid to make Scott appear younger and more relevant, that is Keep him abreast of trends in business and tech. Plus wardrobe advice. The guy dresses like an aging skateboarder this week I'm sharing my thoughts on a long brewing trend that came to a head in 2024. It's simple. America has fallen out of love with brands and in love with people. This is evident in every corner of American life, from politics and business to technology and media. People are the new brands. Some context what I lack in age and wisdom, I make up for in screen time. I spent almost seven hours scrolling the Internet yesterday. Average for me, below average for my generation. I am a product of the greatest digital transformation in history, and the erosion of traditional brand value is happening downstream of this transformation. Scott concurs. Where our views differ, however, is that while he believes digitally enabled products and services have replaced brands, I believe people have first, some numbers. Gen Z spends an average of 109 days per year looking at a screen. 80% of our waking hours are spent consuming information, up from 40% in 1980. We see 208 ads per hour, 10 times more than our parents did at our age. As a result, we are more anxious, distracted and depressed than any generation in history. We all know this, but do not comprehend it. Like frogs in boiling water, we've been slow cooked by screens. The most important number is 12%. That's the share of Americans who say they have zero close friends, up from 3% in 1990. Meanwhile, half the country says they're struggling with loneliness. These numbers took off when Apple put computers in our pockets, and they've been climbing ever since. There is an epidemic of loneliness in our country that extends far beyond the lives of Gen Z. We've underestimated its impact. Loneliness touches everything from the media we consume and the products we buy to the relationships we don't form. When we reflect on the winners and losers in 2024, we will bucket them into two those who capitalized on loneliness and those who didn't. Moreover, we'll realize that in this society of lonely people, we find a lot more to love in a person than a brand. Meta Naturally insists the loneliness epidemic has nothing to do with social media. Common sense suggests otherwise. We now spend 70% less time with our friends than we did a decade ago. There is no question the phone has replaced our friends. Research shows our bodies are not okay with this. Loneliness has a neurochemical impact similar to that of hunger, in that it activates the same parts of the brain. The longer we go without social interaction, the more we crave it. Interacting with other people is not a human desire, but a human need. For the past decade, we've starved ourselves of this essential nutrient. The implication is simple. Whether they know it or not, near everyone you know is craving a friend. The best visualization of this subconscious craving is the Internet, which has been overrun by billions of people in search of other people. TikTok is an endless stream, not of landscapes or products or experiences, but people. Same for YouTube, where the highest performing videos are those with thumbnails featuring a giant human face. Meanwhile, on Instagram, pictures with human faces are 38% more likely to get a like than those without. The algorithm is the truest reflection of our cravings, and the algorithm has been very we crave people most. For lonely people, however, simply seeing someone is not enough. What we really want is to know them, to understand them, to be familiar with the intimate details of their life, and for them to understand us. In other words, we want a friend. Many have watched in confusion the extraordinary rise of online influencers, people who make millions posting videos of their daily coffee routine or workout regimen. Much of this can be explained by our chronic lack of friends. Research shows Gen Z views their favorite influencers in the same way they view their friends. We know what clothes they wear, what food they eat, and what brands they buy. This has radically transformed the retail economy, so much so that 40% of us now consult an influencer before we make a purchase. The technical term for this phenomenon is parasocial relationship, per the Tech and Science Dictionary, a relationship a person imagines having with another person whom they do not actually know. Parasocial is mostly used in reference to Instagram and TikTok, but I believe our parasocial relationships affect everything. If I had to describe 2024 in one word, it would be parasocial. This is evident in my industry podcasting. Joe Rogan has become more influential than the world's largest news networks. His podcast gets three times more downloads than the average primetime viewership of CNN and MSNBC combined. Many have misdiagnosed this tectonic shift as a left versus right phenomenon, that is CNN woke or liberal. Joe Rogan is anti woke conservative. In the context of loneliness, however, that's a red herring. The key distinction between CNN and Joe Rogan is that one is a brand and the other is a person. This distinction is embedded in everything from the name CNN versus Joe Rogan to the logo red letters versus a face to the product, the news versus normal conversation. In a world of chronic loneliness, the person is more compelling. It's no accident the name of our pod is Prof. G. One might argue that Abby Phillip is a person, but this neglects the intimate nature of podcasting as a medium. Abby Philip reads off a teleprompter, wears makeup and a suit, and sits in a multimillion dollar production studio. Rogan wears a T shirt and talks with his buddies in a room that looks like a converted garage. For millions of Americans, Rogan isn't a newscaster or even a celebrity. He's a friend. And you will find this dynamic at all the top podcasts in America. Side note, I surveyed 10 friends on their preference between Abby Phillip versus Joe Rogan. None of them knew who Abby Phillip was. Hollywood is suffering at the hands of the same trend. The 2024 Academy Award for Dumbest Purchase goes to Larry Ellison's son David, who, after getting caught up in a bidding war with the children of two other billionaires, spent $8 billion on Paramount Global. Every character in this transaction suffered from Hollywood Derangement syndrome, believing the Paramount brand still holds any cultural currency. It doesn't. Meanwhile, they didn't comprehend that Hollywood is up against the same unbeatable enemy that cable news faces people. The individual who's levied the greatest damage in Hollywood is YouTuber MrBeast, whose portfolio includes hits like I Survived Seven Days in an Abandoned City and I Built 100 Houses and Gave Them Away. Mr. Beast has mastered the art of the parasocial relationship. Put simply, he's a friend who gets up to interesting stuff. Last year, Mr. Beast racked up more than 1 billion hours of viewing time, more than any of the top shows on Netflix. He's one of the millions of YouTubers swinging the pendulum of power away from brands and toward individual people. This trend has been well documented. Search the Creator Economy but it was ratified this year when analysts valued YouTube at $455 billion. That's 20% more valuable than Netflix and more than twice as valuable as Disney. Streaming or AI didn't take down Hollywood people did. As with podcasting, this presidential election was also less about left versus right than it was about people versus brands. No one understood this better than Donald Trump, who doubled down on his parasocial relationship with millions of Americans while actively disassociating from the Republican brand. It was the ultimate people over Brand strategy. What drove this home for me was a leaked video of Trump watching the Democratic National Convention with his team. Too many thank yous, he says about Harris's speech. Is she crazy? At first it looks like a watch party. Then the tone changes. Get that out right away. He orders a staffer, types out his exact words, then blasts them across social media channels. Throughout the rest of the speech, Trump live dictates his thoughts. She's talking about how great San Francisco was before she destroyed it. With each thought, another tweet. A lot of talk about childhood. We've got to get to the border. Inflation and crime. Cindy's out. The things of which she complains. The things of which you. The team's job is to publish anything and everything that pops up into his head. No edits or cuts, just the raw Trump. Call it narcissism or flooding the zone with shit. But what's most striking is Trump's determination to livestream his Persona to his followers. He's so determined, he hired someone to type out his thoughts. Think of the millions of lonely people watching that convention, craving Trump's live commentary, perhaps because they share his politics, but almost certainly because they want his friendship. Now compare this to the Harris strategy of carefully written speeches and manicured interviews. The Harris team managed its candidate the same way a corporation manages its brand. Every detail was consumer tested, every message board approved. By November 5, it was clear that the candidate was not Kamala Harris, but the Democratic Party. She had become a brand, not a person. And the person won. The corporate world has started to wake up to the power of the person. But the movement was started years ago by Elon Musk. From the beginning, Musk knew he was Tesla's greatest commercial. This is why the company never ran ads. Instead, like Trump, he plastered himself everywhere. At every conference and on every network. His tweeting frequency went from mildly obsessive to clinically insane. He quickly amassed nearly 200 million Twitter followers, then bought the platform. People wonder how Tesla commands a valuation premium 10 times greater than its peers while spending only 4 AD dollars per vehicle sold. The answer is Elon Musk. Other companies have picked up where Elon left off, most notably Meta. Meta's worst rebrand happened three years ago when the company tried to wash away its sins by switching from Facebook to Meta. It didn't work, and brand trust tanked. Its best rebrand, however, came this year when Mark Zuckerberg went from awkward coat and tie wearing Senate hearing prop to gold chain donning T pain loving jiu jitsu fighter in addition to leaning into his personality, Zuckerberg has made himself more public. He posted 71 Instagrams this year, documenting everything from Taylor Swift concerts to UFC fights. In 2021, he posted just 29 times, mostly product announcements. The extent to which the Zuck has put himself on display this year is astounding, but more important, effective. Since the rebrand, Zuckerberg's favorability score among what was once his most hostile cohort, 18 to 34 year olds, has increased 73%. This is what it means to choose person over brand. Honorable mentions go to Spotify and Shopify I've spoken before about the need for CEOs to ditch highly polished press releases and embrace TikTok instead. In line with my belief that people are greater than brands, TikToks show us who is running the company in a way press releases can't. This is starting to happen. Spotify's Q2 earnings update this year came in the form of a short selfie video filmed by CEO Daniel Ek. Shopify president Harley Finkelstein did the same. Memo to CEOs this is the way to do it. Brands and logos and press releases do not resonate with us anymore. We are interested in your people, who they are, what they care about, and what they have to say, not your brand. The most overvalued firm in tech Palantir, isn't a tech company, but a CEO. Alex Karp masking As a public company the premise of my argument is more important than the argument itself. We have become a society of lonely people, and our loneliness is permeating everything we do. This is a harrowing truth, and I'm grateful that Surgeon General Vivek Murthy has lent the issue the gravity it deserves by declaring it a national epidemic. I remind you that more than 1 in 10Americans today have no close friends. Single person households now make up 29% of all households, up from 13% in 1960. We are more socially isolated than ever before. These are important facts for businesses to know if they're to understand their customers. But they're also important facts, and in and of themselves, it's the holidays, which means cheesy movies and trite truisms. I personally find myself increasingly confident that these movies and truisms are correct. This Christmas, I'll be watching It's a Wonderful Life, and I look forward to Clarence's always timely reminder to George Bailey at the end of the film. Remember, no man is a failure who has friends. Happy Holidays, Ed.
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Life is so rich. Hey, it's Liam from Decoder with Neelai Patel. We spent a lot of time talking about some of the most important people in tech and business, about what they're putting resources to and why they think it's so critical for the future. That's why we're doing this special series, diving into some of the most unique ways companies are spending money today. For instance, what does it mean to start buying and using AI at work? How much is that costing companies? What products are they buying? And most importantly, what are they doing with it? And of course, podcasts. Yes, the thing you're listening to right now, well, it's increasingly being produced directly by companies like venture capital firms, investment funds, and a new crop of creators who one day want to be investors themselves. And what is actually going on with these acquisitions this year, especially in the AI space? Why are so many big players in tech deciding not to acquire and instead license tech and hire away co founders? The answer, it turns out, is a lot more complicated than it seems. You'll hear all that and more this month on Decoder with Neilai Patel, presented by Stripe. You can listen to Decoder wherever you get your podcasts.