BNPL, QVC, and the New American Dream

(upbeat music) - Welcome to Day 1 FM Show where we're getting a gut check on the shifts happening in the ad world and beyond. There's a shiver of winter in the air tray, as I saw in your email subject last time. - There is, I'm feeling a little chilly. - Wow. And our latest micro weather event, the Arctic chill. - Yeah, just call it like it is. It's cold out, and rain now is atmospheric flood. - Yeah, yeah, I know it's going to drizzle. - Anyway, we've got a great show as always for you today. We're going to be spending the bulk of the time talking about some holiday spending. We talk a lot about products and branding on this show, but not too much about how people are paying for them or allegedly paying for them. So we're going to do a medium, shallow-ish dive on by now pay later. The preferred method for financing products, particularly among younger consumers. But before we get there, Clara and Trey, I'd love to hear, you know, we were talking off-pod about some very productive weekends, some productive insights, Trey, that you have from a film industry that, Dakota Johnson said feels grim, but in Saudi Arabia, very lively, and has really renewed her faith in the industry. So talk to us, I know the Golden Globes has just launched, or not launched, released their nominations. - Yeah, they're you feeling great. - I'm feeling great. - I'm feeling great. - In, you know, a world that is full of dire news, the Golden Globes nomination stand out as a bastion of culture finally getting its due. - Along with the Red Sea Film Festival. - Yeah. (laughing) - Hard to wait. - Well, it's interesting because they invented a new category this year, which is like best cinematic achievement, which is basically a category to appease the people who are like yelling at the cloud, whenever, you know, the biggest... - Where's Utopia, too? - Yeah, where's Superman? Actually, it's never meant to get snubbed, sorry, for those people. - Sad. - But so that has cleared the way in a Moses kind of metaphor for the films that had did receive the most nominations, actually being genuine works of art in my opinion. - Okay. - So I was waiting for that. - Yeah, be up. - So Paul Thomas Anderson leads the way, one battle after another, got nine nominations, but also a bunch of other films like Sentimental Value, the Joachim Treeer Film Centers. Did you guys see Centers? - Mm-hmm. - Very good movie, Hamnet, got six nominations, and then it kind of trickles down. But the point being, like, Neon, which is like an indie kind of art host distributor, got three best whatever nominations. - Not to be confused with Neon, which is the futuristic city in Saudi Arabia, that is really struggling to break ground. - Oh my gosh, that always circling us back. - And I've noticed that there's a podcast category this year, which I was scrolling down doing a Command F, Day 1 FM. - Unfortunately, there is no combination for Day 1 FM, but, you know, we feel like we are gold in the hearts of our listeners, so thank you for listening. But now what's interesting here, I think, is just like, because there is sort of this, you know, we've been tracking the crumbling of mainstream culture and how there's no sort of water cooler moments anymore, which in my opinion has kind of made it so that you basically have these award shows that are diversified, you know, the Golden Globes famously had an issue with the diversity of its voting cohort. And so they've diversified that, but it has led to a suite of nominations that are now more just culturally grounded, let's say, and less pandering to this mainstream audience. That probably doesn't watch the Golden Globes at all, anyways, so. - Yeah, I mean, do you chalk it up to also, like, the emergence of, like, I don't know what you would call the sort of letter boxed greater universe, but, like, more interest in, like, quote unquote, cinema and film, kind of beyond, like, the mainstream blockbusting movies. - I think that could be part of it. I do know that there has sort of been a trend that I can't really track or hear about much, but people have been, like, talking about how Gen Z specifically is flooding into the art house cinemas of at least New York with, like, Metrograph, IFC, you know, banging down my doors to see safe features. (laughs) - New Wong Car Y. - Featuring Julianne Moore. But yeah, I do think that's part of it, but I also think it's like, when the, you know, taste machine is fractured. The best way to showcase your taste is just to, like, what you like and watch those freaky, begonia movies, get your shaved head at the screening, and that translates it to a... - To starting to grow back. - Big gnomes. Big gnomes for Emma Stone. - I know. - Those begonia shaved heads have a little peach fuzz, but yeah, I bet. - You'll be a little nugget. - But now we're in the golden, we're in the playoffs for the Golden Globes now, so it's like, now dye your peach fuzz blonde to... - It's actually a pet Golden Glove. - Anyway, Clara, you were talking to us about some real life gen alpha insights, there's a more lame way to tee that up. - Yeah, well, I mean, I should say, you know, I'm a, you can't really be a proponent of eavesdropping. However, I do think that it is sometimes a good, you know, benefit of forgetting one's headphones at home, but I was sitting on the bus. - Real public transportation head. - I know exactly. A lot of people are like, hey. - Your face timing with no headphones. - I know. I turned off my music that I was listening to at full volume. But I was taking the bus this weekend, and I happened to sit next to these two kids that were maybe like eighth grade-ish. They were coming back from a sleepover. They both had sleeping bags, which I didn't realize at first, but then something kept hitting me in the leg, and I was like, oh my God, this is a Pokemon sleeping bag. I haven't seen one of these in like 10 years. - Big insights right here. - But it was, I mean, it was funny. Like, I was talking with Eli a little bit about it, but like, I feel like the gen Z or the gen alpha speak that has been like much parodyed. I have not actually like heard a lot of, you know what I mean? - Like giving a toilet right there. - Like, bro, it's so cooked. It's cooked as hell. The teacher is cooked, I'm like speaking in, just like, B to B social media. Speak, if that makes sense. - A LinkedIn guard book. - But then like, speaking in like, whatever, like TikTok comments, verbiage, but then like, interspersed with things that like tweens talk about, where it was like, yeah, bro, like the whole sleepover, like he was really like on his phone for real. And like, I was talking to him about the perm, I'm trying to get it. I'm like, this is crazy garbage. But speaking of, and I mean, it was heartening that these kids are still going on sleepovers and like, maybe not all is lost. And it was positive to hear that they were, you know, it was lame to be on your phone all the time. But in general, what stood out to me in their conversation, which we will get into, is the fact that like, they had so much like brand awareness about things that like, I don't think I had that much brand awareness about when I was young. Like, they were talking a lot about like shampoo and like hair care and not to stereotype. But like, I don't remember when I was in eighth grade, like, boys knowing about like that shampoo and conditioner were two separate things. Much less knowing life. - Don't look at me and say, I know you still know. - I know, I mean, you know, some of us, but tell of us now know that you're in different things. But like, they were talking about like, carastas, name-dropping. - That's crazy. I was gonna ask you. - Name-dropping way, name-dropping like, like, trezame is like a bad shampoo. He's like, no bro, like, that has alcohols in it. I was like, how do you know all of this stuff? But anyway, we were gonna get into it more, but I feel like one thing that was kind of surprising to me was just like, I don't think, I mean, even like, aside from like the whole, like, beauty and, like, personal care aspect of it. Like, the literacy to understand, like, what is, quote, unquote, a good brand versus a bad brand is something that, like, I feel like I started to understand maybe in high school, but like, much more so when I was, like, in college and had, like, disposable income. And it's just crazy to hear them talk about, like, yeah, like, my mom's got, like, all these great solutions. Like, she actually uses DIA, or whatever that brand is. And it's like, yeah, like, my dad got me some kules for my birthday. I'm like, what is this? What is this, like, kules is like the starting place for, like, - Kules is kind of expensive. - Kules is expensive and like, these kids are getting, I know, these kids are getting kules on a perm. - How are they affording dogs in this season? - The next generation of warfighters. - Well, Eli, it might be here. - But maybe they'll be able to pay for it with the sprawling array of buy-and-out pay later options, such as after pay, - That was such a happy, candid segue by all of them. - But I wanted to talk about this because, you know, Trey, you and I were speaking about this via Slack and in person in real life. - I needed to fix one day. - Yeah, it wasn't heated, it wasn't heated. It was robust. Anyway, the larger point was there were several headlines coming out of Black Friday, Cyber Monday. It's all fucking month now. That was talking about how spending was up to a record, 11.8 billion. I think that was just specific to online shopping, but regardless, I think what stood out is that like you have all these headlines about, you know, the general health of the American economy, the consumer sentiment might be, you know, low, but spending is still up. So in large part, people were kind of confused, you know, you hear about how generally people aren't feeling good about their job prospects. People aren't feeling good about the stock market, although it is by and large kind of booming, but they feel left out. So that all seems good, but in the backdrop of that, when you look at the actual details, a very smart young man by the name of Adam Cochran on X, the Everything app really laid this out. So bringing it down in detail, there was a minus 1% in total item volume from last year, so people bought less. Prices were 7% higher, so showing that inflation was still fairly stubborn. And there was an 11% increase on by now pay later use, clarnous specific use was up 45% by volume last year. All in all, I think the most jarring statistic that people really gravitated to was 95% of sales volume was financed. So that could be like, people bought it on a credit card, which I think a lot of people do. But, you know, the increasing use of essentially financing pretty much everything in the economy, famous so you can, you know, buy now pay later a burrito or a labubu is really kind of glossing over the cracks generally, and allowing, you know, younger consumers in general, which I think we should get into to experience and buy a ray of products that they feel like they need to for social status, et cetera. But the long term financial health of it all is yet good. So I don't know, have you guys ever buy now pay later before? Only my medical bills, which we don't have to get into. I mean, you should be doing it for like a house, which is famously called a mortgage. But, yeah, I don't know. Clara, I'm curious based off of your eaves dropping on the B, whatever, 26 that you were taking. Good knowledge of the bus system, by the way. Of course, real public transportation head over here too. But why do you think there has been such an increase? I don't think we need to get into like the economic ramifications of this all. But why do you think there's such an increase in buy now pay later use among a younger consumer cohort? Well, now that I'm the expert. After hearing one conversation, I mean, I think, and I don't, I actually don't know, but I'm speculating. I think that a lot, the kids just have access to maybe not credit cards, but like have access to buying things in various ways much earlier than they used to. And I think partly maybe that's just like the internet. Because all you need to do use Clara is a debit card, right? You don't need to have like a credit, like you can basically-- Yeah, but that's how they get you. Yeah, exactly. But like I think that you're able to, like at least like when I took out a credit card, it was sort of like, you don't have to I guess for certain cards. But like you kind of do like wait to a certain point. And like there's kind of like a whole thing where like you talk with your parents about like what a credit card means and why it's different from a debit card. And I feel like there's just in the same way that I feel like, and this is maybe a bad example, but like I feel like vapes are sort of targeted towards children. Like I just feel like Clara is essentially targeted towards-- perhaps not children, but people who don't have an understanding of what credit means and what interest means and what like for payments of $20 a month would mean if you missed a payment. And also I think the thing that's funny to me is like the Lububoo of it all that you could put a Lububoo on a buy-and-out pay later plan. And like by the time you've paid off the Lububoo like nobody cares anymore, which I think is also a part of it where I think it speaks to a trend cycle that is like both very-- that feels in some ways mandatory to people that it's like I would rather like go into like semi debt and then like miss out on this trend. So I'm going to put my Lububoo in my quarantine plan or whatever, but I don't know. I wouldn't say that my bus experience has given me opportunity or like licensed to weigh in in terms of like-- Yeah. What are the twins saying about that? But what was your robust discussion? What were you-- what were the-- I think it was shocking like to me, the numbers, the 40-- what is it? 95% of things were financed during this weekend of spending and 45% of volume with Clarner or something over last year. Either way, people are like-- I think big again is when people were starting to get into these buy-in-out pay-liter apps and financing their take-out burritos for a joke and paying like 10 payments of 11 cents or whatever, that kind of created a discourse. Saying which is happening with like polymarket or calcina where it's like every ad on TikTok I get is like, OK, don't scroll away just yet. But I'm using the polymarket app and I can bet on the weather and I can blah, blah, blah. And it's like making-- it's the new era infomercial. Like the things that we saw on late night TV in the early 2000s where it's like three easy payments of 33, 33, 33 is now every second scroll in your TikTok that's telling you you can finance any kind of decision you make. And when everything is like in the same ecosystem, that is both entertainment selling you something. There's an orange button at the bottom of the screen where you can buy it and finance. At the same time. So like I think there's even more pressure now on young kids who are at the sleepover spending too much time on their phone, scrolling through, making predictions on the Calche about like the fucking weather, the weather events. I think that's the most but not in bedding. But can you imagine like the the sleepover games of yours which were like, oh, let's play talk phone. And now today it's like, bro, let's bet to see if it's going to snow on Tuesday. I'm sure you're not always that innocent. Get dead, get dead card out. We're going to bet on the. Tell us about the cool on lame sleepovers. But also this past this past week was the Kim's Miss live stream which was like a 45 minute live show that Kim Kardashian did with, you know, her sister, her mom Kathy Hilton was there and like Kyle Richards for some reason anyway. But it was like, we are at this point where entertainment, live shopping and financing, all of your purchases has come together in such a way that it's like unavoidable but also so much pressure. If I'm a young person and I want to experience the Lububoo and it's like, oh, my favorite creator is talking about it. They get commission if I buy through their link so I can also support them and dad's credit cards handy 'cause like, it's already in the, whatever, in the car not app. Yeah, I mean, I think we're cooked. Sure, that's true. But I think it also goes to the fact that to your point, all of these platforms are now basically like a giant dollar stores like TikTok shop, live stream, TikTok maybe by IG live streams. Essentially everything is QBC. I was watching this video that was served up to me on Instagram about Gary Vee and he's like, he's talking about, wait, when I tell young people how they can make money, live streams, like I... You love to do Gary Vee. You gotta be posting on Con Edison. You gotta be posting on the, on the healthcare market. But anyway, so he was talking about like eBay live stream. If you're not fucking posting 20 times a day, what the fuck are you doing? We should do a whole interview just with Gary Vee. Yeah. So you happen right here. You're fucking 25. You're just getting started. Gary, come on the pod. It's on good fun. That was more Mickey Mouse tonight. I mean, listen, there's a Venn diagram of all of it. There's a Venn diagram in all of it. The larger point was that all of these platforms are entirely commerce first. I mean, in the back end, they are. They're all essentially ad platforms that surveil your every behavior and then monetize it. But I think, when you think about... When you think about like younger consumers or like Gen Z, Gen Alpen, you always see some status. Like 57% want to be creators. What that usually means is that they want to like sell and hawk products, because that is what the bulk of like the creator economy is, as we've spoken about previously. And this is actually something that Mia Stado wrote in a piece today on the verge titled, You Are Not Immune to Shop Aganda. And like one of the last lines in the article, which you should definitely read, is the idea that you can create actually means that anyone can promote, which is basically like the incentive structure of the platforms, which I think speaks to why these kids know about all, "Neutrogena and Omnior Venus on your fire," and whatever the hell. Perm shit is out there, because they're constantly being sold to and in turn will probably sell something else. - This was just hilarious. I sent you guys this clip on Slack, but like basically there was some kind of, I don't know, symposium that X, the everything app, slash their AI arm is doing, where they had some kind of like group of engineers that for the last 24 hours have like shared different projects they're working on. And there's like a giant thread on X that's highlighting the best that has come out of this like, it's whatever symposium thing. So one of them being halftime, which dynamically weaves AI generated ads into the scenes you're watching. So there's a clip of the show, Suits, and literally like he's walking out to a car in one scene. And then in the actual scene, he's like holding a coffee, but then in the AI halftime, dynamically weaved in a generated version, he lifts his hand and it's like a Coca-Cola, and then he like AI turns to screen and there's like a learn more button you can click on. So basically, I just think like, yes, all platforms are very like purchased first, but it's now being, you know, piloted. Everything's like happening. - You gotta be fucking posting on halftime. - Oh my God. - Every time I'm a jumpscare. - And I'm a tween locking onto chat GPT to ask, which like caristals shampoo to get. And then it's organically integrating an ad that I can like buy in, buy now pay later through my chat GPT using my R.D. - Sounds like, well, it sounds like Mayhem. I'm a tween locking chat GPT. - Oh my God. - Well, I think like the streaming thing also hits on an interesting point that like, and this is again, conjecture. But I do wonder if for particularly younger people, the idea of like incremental payment is just so much more baked in for lack of a better word. Like I think like with streaming with like, so many other sort of like subscription based platforms, like you're paying in increments to like, watch Netflix or to have YouTube TV or to have your like Roblox subscription or to do anything else. So like, I think some of it too is like, the whole idea of like owning something or buying something in the first place, like are they just maybe more comfortable with the idea that like, oh, this is a like pay over time kind of thing versus like, this is something that like, if you can't buy it, then you can't afford it. 'Cause I feel like we've talked about it before, like how hard it has become to own things, like whether it's like owning the entertainment that you watch, listen to, et cetera, or whether it's owning a home or whether it's like owning anything else. And I feel like Clarna, in a way that I don't know that I can quite articulate, like I feel like it kind of fits in with all of that, like I think not to use the word normalized again, but I think that it is kind of by, especially with younger people. - Or just owning up to you mistakes. - Yeah, or, yeah, exactly. - But I do think just like the newness of the ecosystem being so integrated into the entertainment that we consume, where shopping is now another form of entertainment and everyone on social, everyone in Hollywood, they are integrating ways that you can buy, whether it is like the Marty Supreme Windbreaker that you need to have before you even watch the film to like associate yourself with the coolest A24 release of the year, or if you're like live streaming Kim's Miss or Keith Miss and seeing what kind of collapse they're dropping, everything has now become like a form of entertainment. Keith just launched today, this collab with Frosted Flakes, the Kellogg serial, and there's like a Tony, the Tiger, weird animation short animated film, but like, I don't know, this is probably not directed to kids, but if I'm like, oh, I love animation and Tony, the Tiger and Keith, my main guy, Ron Feeig, I don't know, I just think that's gonna do numbers anyway. - I saw that Keith actually performed at the Kennedy Center class, it was a kiss joke. - Oh, it was a blast, I think. - Anyway, to close us out, it's cool. - It's classical, you like humor. - You know, no laughs. One thing that you are all watching, reading, listening to, tracking closely. - Oh, I sent you guys this really interesting article. - Oh, wait, is it the one on the decline of deviance? - Yes, I read that. - It's really good. So everyone needs to go to substack.com and look up the decline of deviance by Adam Mastroyani, and it's this really interesting article that is like beladen with info about how everything is in decline. - Wow, speaking of decline, I am reading the smartest guys in the room, which is about the implosion of Enron. Kind of like predates FTX by about a couple of decades as the major corporate scandal. You know, it's full of smug confidence and grift and fraud and arrogance and corporate malfeasance and all the things that I enjoy. Nothing that we're experiencing today from the corporate class either. So Clara, over to you, close us out with something optimistic, maybe. - Hmm, well, I watched. - Sleepovers. (laughing) - So this is a pitch for sleepovers. - You know, I watched a movie this weekend called They Live, which is a John Carpenter movie. - Oh, that's classic. - Which is very fun and I would recommend it to anyone, particularly in the advertising space, is there something really fascinating out of, use of out of home, but it was very silly. I'm on a big movie watching kick because I am doing my Christmas crafts. - I actually, the way I came to that film was because I think it was like heavily clipped in one of the Adam Curtis documentaries, I think. - It sounds right. - I'll watch it over, maybe. - Put on the glasses. - All right, thanks for tuning in. - That'll be in your stockings this year and catch you both a pair. (laughing) (upbeat music) - Day one of them is a podcast from Day One agency, hosted by me, I'm Eli Williams, Clara Malley and Trey Taylor, and is produced and edited by Jamila Jalo. He posts new episodes every Tuesday, so be sure to subscribe wherever you get your podcasts and leave us a rating and review. You can also follow us on Instagram and TikTok at D1A or send any of your thoughts and questions to [email protected]. Thanks for listening and see you next Tuesday.