Scott Galloway Predicts Amazon $AMZN Will Be Broken Up Circa 2020

Scott Galloway: Amazon Will Be Broken Up

Predictions made in 2017 for 2020: L2inc.com's Scott Galloway predictions re: AMAZON.com, Inc. $AMZN, catching up to Netflix with original content, producing more innovative hardware than Apple, and about to lead the biggest consumer sector in the world--Amazon $AMZN: (1) this company will hit a $1 trillion market cap by 2020, and (2) thereafter broken up.

Sources:
(0:09) “Amazon to Acquire Whole Foods Market,” Amazon, June 2017. http://bit.ly/2rynJxL
(0:39) “Amazon.com Market Cap,” Y Charts, July 2017. http://bit.ly/2uWnj2y
(0:45) Yahoo! Finance, June 2016.
(0:56) “Supermarkets & Grocery Stores in the US: Market Research Report,” January 2017. http://bit.ly/2tNg3r1
(0:56) SelectUSA, 2016.
(1:06) “Global E-Commerce Grocery Market Has Grown 15% To 48BN,” Kantar WorldPanel, September 2016. http://bit.ly/2piz4jZ
(1:29) “7 Price Tags That Prove Whole Foods Has Gone Too Far,” Spoon University, June 2016. http://bit.ly/2uefckp
(1:56) “Time Warner Boosting HBO Budget As Netflix, Amazon Keep Spending,” FierceCable, December 2016. http://bit.ly/2o8CFkE
(1:56) “Amazon Is Spending An Insane Amount Of Money To Catch Up To Netflix,” Vanity Fair, April 2017. http://bit.ly/2pjCxij
(2:09) “Exclusive - Amazon To Charge $2.8 Million For NFL Ad Packages,” Reuters, June 2017. http://reut.rs/2t3rNGd
(2:45) Synergy Research Group.

Transcript via YouTube.com:
0:02 A winner: Amazon and their acquisition of Whole Foods for $13.5 billion.
0:08 We don't like to gloat, but here are our predictions around the acquisition.
0:18 Okay, so we like to gloat a little.
0:20 This deal will be for Amazon what Instagram was for Facebook:
0:25 a genius acquisition that gives them an unbelievable growth vehicle.
0:28 Amazon in our view is going to be the first trillion-dollar market capitalization company.
0:34 The acquisition was essentially free as the marketplace said to Amazon hey it's yours
0:40 and bid up their stock more than the value of the acquisition price.
0:45 In addition, other retailers were told that they are going to pay for this acquisition
0:49 as their value was taken down the day that deal was announced.
0:53 Grocery is ripe for disruption. It's also the largest consumer sector
0:58 weighing in at $750 billion --
1:01 and Amazon is about to become the fastest-growing $1 billion-plus grocer.
1:06 The markets are going to love that.
1:08 Just one and a half percent of fast moving consumer goods sales in the US occur online.
1:13 Even in South Korea, that enjoys the greatest global penetration, at just 16%, shy of the 20% tipping point that really causes disruption in the sector.
1:23 Who's the big winner here besides Amazon?
1:25 Consumers.
1:26 Have you ever wanted to shop at Whole Foods but it was just too damn expensive?
1:29 Well, your prayers have been answered.
1:31 Amazon is going to lay their operational expertise across Whole Foods,
1:36 bring down prices and also put in place their hurdle rates for profitability i.e. zero.
1:42 As a result we're about to get a Mercedes for the price of Toyota.
1:46 Whole Foods is about to become in a word, awesome.
1:51 And who's the most dominant company on the second most important screen in the world, your television?
1:56 Netflix, but for how long?
1:57 They've increased their original content budget to $6 billion only because Amazon's feet they can hear behind them.
2:04 Amazon is about to become the fastest-growing media company in the world
2:09 and they're going to get sports, they're already streaming some NFL games.
2:12 Look for them to capture the Olympics, March Madness or the Super Bowl with their infinitely cheap capital
2:18 which will only expedite the incredible fall television is going to register
2:21 or broadcast TV is going to register when they no longer have sports as their firewall of viewership erosion.
2:28 And who's the most innovative hardware company in the world?
2:31 Yes it's still Apple, but for how long?
2:33 The most innovative hardware products of 2016 to 2017?
2:37 The Apple Watch? The AirPods?
2:39 No, Amazon's Alexa.
2:41 Oh and who happens to be the most dominant company in the fastest-growing tech sector, the cloud?
2:47 Amazon. By 2020 Amazon will be our first trillion-dollar market cap company.
2:53 But don't begin celebrating yet as soon after a district attorney will realize
2:57 that the fastest blue line path to the governor's mansion will be to go after Amazon and break them up
3:03 as we begin to connect the dots and realize this amazing company is destroying jobs faster than we can recreate them.
3:09 2020, a trillion dollars and the end of Amazon as we know it.

Video above originally published Jul 13, 2017 by L2inc.com.

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Scott Galloway on Honest Company and Unilever (video)

Scott Galloway on Honest Company and Unilever:

CPG giants Unilever and Procter & Gamble are taking different approaches to fighting competition from innovative startups in the category. Procter & Gamble has invested in its own Gillette Shave Club to rival Harry’s and other razor subscription services, while Unilever is going the acquisition route. It purchased Dollar Shave Club in July and reports surfaced that it was in talks to buy The Honest Co. – which offers subscription diapers and organic personal care products - for $1 billion. Scott Galloway has some advice for all parties involved. Video above published September 20, 2016, by L2inc.com. Scott Galloway is a NYU Stern Marketing Professor and founder of L2inc.

Note: "CPG" is Consumer Packaged Goods.

Domains of the brands referenced above:

• unilever.com
• pg.com
• gillette.com
• harrys.com
• dollarshaveclub.com
• honest.com

Transcript viaYouTube.com:
0:00  So the celebrity deathmatch of this week Apple vs Samsung? No. There's a bigger
0:10  fight shaping up and that's between Unilever and Procter & Gamble what
0:14  brought this on the category has enormous margins and it's still growing
0:18  but not for the big players 90 of the 100 biggest cpg brands in the US lost share last
0:24  year and two-thirds decline in revenue why largely because of the death of the
0:29  industrial advertising complex these companies are great advertisers and
0:32  advertising has become the valarium steel that is losing its edge it's
0:37  getting dollar and dollar in addition the firms are largely dependent upon
0:40  distribution that is in structural decline specifically brick-and-mortar
0:44  grocery distribution and their investors have become addicted to their profits
0:49  similar to a heroin addict so they're likely to tell them to ya go innovate
0:53  but don't give out my profits bc is an entrepreneur smell blood in the water
0:57  these unbelievably rich margins and there's now dozens of startups armed
1:02  with cheap capital and no legacy reflex reaction toward broadcast media or
1:06  traditional channels so two very different reactions PNG is aggressively
1:11  invested in there too let's shave club
1:13  however unilever is taking a different tack and going for the chin and ass the
1:17  baby ass for some sort of analogy and I just can't figure it out with
1:21  acquisitions that directly take on the core of PNG's business specifically
1:25  diapers and razors so on friday was leaked the unilever was in talks with
1:30  the honest company to acquire them for a billion dollars fast on the heels of
1:34  their billion dollar acquisition of dollars shave club by the way it was
1:37  probably leaked by Unilever who wanted to see if the financial markets threw up
1:40  on it before they proceeded both startups are masters of the medium and
1:44  catalyze more traffic and searches in the Cincinnati and London _____ and
1:48  more depth with social platforms and more aggressive with online advertising
1:53  granted it's easier to be innovative when your investors are rooting for you
1:57  to grow and spend more money versus unilever and PNG investors who are
2:01  rooting on them to grow as long as they stay profitable so some unsolicited
2:05  advice to the various parties here first off disclosure we work with both procter
2:10  & gamble and Unilever like them
2:12  with a lot and our backers of the same backers of the honest company's you're
2:15  about to see me kiss everybody's ass every day that goes on the price is
2:20  going to get better
2:21  there is no other acquire the honest company threatened to go public that is
2:25  never going to happen the public markets have become more discerning in the
2:28  private markets let's flip back to the honest company another big piece of
2:31  advice to you sell you are being valued at three to four times revenue in an
2:36  infinite multiple on your even you are cpg company and you are never going to
2:42  get this price again in my view . advice for Procter & Gamble specifically the
2:46  folks at Gillette I think this warrants an adult conversation that if you don't
2:49  invest $MONEY to $MONEY billion dollars plus in your own subscription effort
2:53  specifically Gillette Shave Club you are going to lose share so how does this all
2:57  play out your diapers and your razors are about to become a lot less expensive
3:02  jessica alba and exact set both firms that get this stuff about to get a lot
3:07  richer and tens of thousands of people who manufacture and market razors and
3:12  diapers are going to make less money why the future involves higher stock prices
3:17  more billionaires but fewer middle-class households both firms will come under
3:22  pressure to reduce costs specifically people with technology however the
3:28  upside razors and diapers whenever and wherever you need them
3:33  yay
3:35  mmm


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William McDonough: Innovative, Profitable, Sustainable Growth (videos)

How to Achieve Sustainable Growth, Make It Profitable - William McDonough & Partners Founder William McDonough (architect, designer) discusses the business of sustainability. He speaks on "Bloomberg Markets." Published on Nov 12, 2015.

mcdonoughpartners.com

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Twitter: @billmcdonough

Video below: Resource Abundance by Design presented by William McDonough at the World Economic Forum in Tianjin, China, September 12, 2014:
Design is the Signal


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