VW CEO Becomes Scout CEO, Netflix Loses More Subs-Changes Model, Kia Skeleton NFTs

SPEAKERS

Kyle Mountsier, Paul Daly

Paul Daly  00:22

Yo, it's Wednesday morning, and I don't have my road caster. Ready. There we go. It's Wednesday morning. That is the perfect start of the fact that Kyle got in at 1:30am. Last night, I got a little bit early, but we spent the whole day recording podcasts in Philly. So let's go.

Kyle Mountsier  00:43

I'm like, did this is this mic attached to me is that?

Paul Daly  00:50

Oh, man, you know, we said this morning, you know why a soda was gonna win? Because the six or seven of us work like 12 to 14 other people. Right? Like there's there's this double duty work ethic going on inside the walls and halls of a soda right now, let us just tell you.

Kyle Mountsier  01:11

And here's the reason why. Because we are all at asoto. united around this belief that like, we don't just want to do what we're doing. But we have to do what we're doing. Like there is an obligation to our industry that we feel here at a Soto. And so if you are a part of the community, if you're listening to the podcast, if you get the emails, if you follow us on social, we we are grateful to you, but also just know like we feel this obligation to you. And so that's a two way street, I think really is what I always say is like, we want feedback. I love I love when people press back or push, you know, to ask questions or dive into something that we're saying. Because it spurs us on to go, oh, there's a new frame of mind. There's another Mindset. Let's draw. Let's draw from that. Let's contextualize that. Whatever's going on in our industry, we feel the obligation to make sure that like you said, you know, yesterday we were sitting with Michael Cirillo to like, put up this beacon and allow people to move toward it. Right.

Paul Daly  02:19

No doubt, no doubt. So we spent the day in Philly yesterday, checking out, going through again with a fine tooth comb, the venue for asoto, the hotel, every room, every detail, every AV technicality. And then we all got together in the penthouse, and we recorded the beginnings of what is going to be auto collabs. The podcast we may actually launch episode 00 this week. This is a longer form podcast. Kyle, myself and Michael Cirilo are going to host this. This we'll call it a podcast extravaganza. We have dozens and dozens of how we're

Kyle Mountsier  02:55

like everything new that we do the Stravaganza extravaganza.

Paul Daly  03:00

Why not? That's what it feels like. That is what it feels like. It feels like that a lot of things happen. It is it is the least sterile and stale thing you're going to hear. And we have interviews with dealers and industry partners and outside industry pros. Long Form no more like just quick shots in the morning news and commentary are going deep on the interviews. We've been being requested of that and bringing Michael Cirillo into the conversation has brought a whole new level of texture and a whole new level of antics.

Kyle Mountsier  03:30

Paul, I don't know. I don't know if you know this but Michael Cirillo This podcast is downloaded in over 70 countries across 7070. Paul,

Paul Daly  03:39

I may may have heard that at one point. I don't know, I'm gonna get a t shirt. So

Kyle Mountsier  03:44

there's the inside joke here apologize? Well, you'll, if you're gonna hear the podcast, if

Paul Daly  03:49

you're gonna hear it all, there are a lot of laughs there's gonna be a lot of insights, because we can have fun and make progress. At the same time. If you haven't gotten your tickets to a show to go to a soda.com. This week, we'll be announcing more speakers, more of the agenda more the list and it's going to continue to shape up and really be textured and with this content from auto collabs. There's some things going on the world because nothing stops because we start podcasting. We talked about the VW brand Scout, when it was when the first concert we were at Digital dealer in Tampa. When the concept pictures came out. And we were like this looks awesome VW dealership and asking for pickup truck for a long time we were in the elevator with a VW rep and we're like, Hey, how about that new scout brand? And she didn't say a word. She was just like oh that's what it looked like her face look like I either a don't have any idea what you're talking about. Or be I'm not supposed to talk about it. I think it was a

Kyle Mountsier  04:46

it was definitely a witch. I mean, to be fair, a lot of companies have this same struggle where it's like, you know, quiet roll out the new thing and everybody else doesn't really know what's going on so the public and the employees get it. But yeah, So yesterday another big announcement in the journey of, of the new brand scout. That's, that's a VW brand. And it was announced that the now former CEO and President of Volkswagen are starting September 1. Well, okay. So starting September 1, it Scott Keogh is stepping into the role as CEO of Scout, which is, is a really, I think, because I think a very, very intelligent move for the brand. Because from what I know, of Scott Keogh, in the dealer community, and also in the public eye, he's a very light person, right, he, like people are attracted to his way of thinking to the way that he's run the brand, especially since taking over in 2018, with all of the like emissions debacle is and where he's kind of led them through the resurrection of that brand through a lot of different things. So yeah, I think I think that it's a really positive move to kind of, you know, see what scout is going to be in the market? Because there have been a lot of questions around, you know, scalping a lot of

Paul Daly  06:10

questions for dealers, there haven't been a lot of answers. So I really liked that that entrepreneurial, Norio nature of what this is going to be, so I'm quoting from an automotive news article, who is probably just quoting from a press release, it was a simple, straightforward decision, either one stay in my existing role. This is Kiyotaki, stay in my existing role and continue to operate and do it accordingly, and keep rocking and rolling or take the chance of a lifetime to do a startup company. Key had told the reporters in Chattanooga, Tennessee, he said, I think if you're an American and a businessman and a person of humanity, in my mind, it was no choice to do a startup to be entrepreneurial, and revive an iconic American brand. I mean, that just gets the dinner. I

Kyle Mountsier  06:52

feel like, I feel like he's one. All right. All right. I see you. I see you.

Paul Daly  06:59

Funny. Funny story about Scott Keogh is that just yesterday, Kyle shadow crossed a draft letter that, you know, we had plans to have him at UConn. And so Kyle's like, Hey, here's the draft letter. We're going to send it out. We had some people that we're going to get it to, and then I sent Kyle a screenshot of this story. Like, I don't think he's going to come in.

Kyle Mountsier  07:17

I think he might I think he's actually he may actually be more willing to now that he's in this like entrepreneurial brand, because there's a there's an identity that has to be that has to be fulfilled around

Paul Daly  07:28

it. No doubt. And Jim Elliot just commented, Scott is a new brand and not protected by state franchise laws as VW is so VW has a clean sheet distribution system. Opportunity, Jim, that is the question. That's the question. We've been asking the question that hasn't been answered. Right. Like it was like, yeah, love that one is? Clear. Right. But that really is the question. And like, if we can get them to asotucon or get them on a podcast, we would love to talk through that. Because right now, he said this in the interview, like, he's like, Scout is a company that has one employee, right? And that's him. So it is really an interesting, like synthesis of events, we'll see what happens. And again, our whole thing is to show the dealers and the OEMs, actually, that the dealer network is the biggest single greatest asset in getting vehicles to consumers in a way that consumers can really connect with and connect with a brand and be serviced well, because you know, service is not a strength of any Evie company right now. Service is actually where it really trails off. So we'll we'll see where this goes. I love the entrepreneurial spirit. Love the concept designs. Love Scott Keogh. Let's see if we can love the business model that is

Kyle Mountsier  08:39

to come. There it is.

Paul Daly  08:42

But we're gonna have to recontextualize our letter to Scott, we will. And we will maybe he'll maybe we'll see him at a soda con. We'll see. Yeah, I hope so.

Kyle Mountsier  08:50

Let's just say let's just say we should, let's just say we should. Well, hey, speaking of interesting business models,

Paul Daly  08:58

segway will take that stretched a stretch looks at the dog that, look when you have a 20 hour work day, the day before our night

Kyle Mountsier  09:08

asleep. Where your watch text you when you wake up, go back to bed with it's like yo apps after each of it. Yeah,

Paul Daly  09:16

it's periods of claps, like you have two options, go back to bed, or I'm dialing 911?

Kyle Mountsier  09:25

No. So, you know, there's been a lot of attention paid to all types of subscription model Services recently. Because many people are seeing what subscription services have done over the last 10 years to acquire customer bases, and are trying to figure out we've talked a lot about this, whether or not that's the like viable solution for for the next 10 years. And by the way, we're gonna have to run the story back on the BMW thing because I've seen some things about how that might have been a fake story and all that type of stuff. So speaking of options, yeah, the Oh, yeah, we'll get back. Well, yeah, I need to do some research, but I just saw it on the interwebs yesterday. So hang tight.

Paul Daly  10:09

Be a brilliant play of BMW see did that? No, that was a fake story. That was a fixture.

Kyle Mountsier  10:16

Right? Yeah. So looking at Netflix in, in the, in the last month, they have for the second month in a row and had a drop in subscribership. And I think did you I don't know if we if we put the number in our show notes. But

Paul Daly  10:34

total, the total down over the last two months is 1.3 million last month alone was about 900,000. So they went 400,002 months ago. 900,000. Last month, down 1.3 million.

Kyle Mountsier  10:45

It's really interesting, because you've got these new entrants, right, that are that are trying to kind of acquire some of that, some of that business and more than trying, not more than trying eating at exceeding and and what's so wild to me is it's not just the platform people are chasing shows, you know, one of the things that they were talking about this is that they that Netflix is really trying to find their place in kind of this having to keep up with always having the next best show like the thing that everybody wants to stay sticky to. And it's it's less and less like, oh, that's the platform that I want to be on. Because everything on it is what I want. Because and more. I'm kind of like subscribers are chasing what the next big thing is, right?

Paul Daly  11:35

Yeah, so Stranger Things is obviously the latest hit. And they didn't release it all at once they actually staggered the layout across two months, right in an effort to get people to not subscribe and then cancel at the end of the month. It also in the article, we didn't put it in here. But they've acquired the studio that made the Lego Movie The animation studio that made the Lego movies. So they are making moves again, like to your point Kyle to make sure that they can create that they are like legit creators. And so with all the shifting, they said they're actually projecting a gain in subscribers next month. I don't know how they do that. But you know, they're probably not making it up. And they also announced an earnings call a new model where they are going to release a lower cost ad supported version. So like we see a lot of that, you know, Hulu where you don't have to pay the full price, you get it, you know, a reduced price. But you have to see ads and Netflix has you know, what's a 220 million subscribers right now. So, you know, banking on the fact that a big portion of those are going to go into the lower cost. When I actually cancelled Netflix, I just got I actually the worst thing was paying more money for better resolution is the dumbest thing I can ever imagine. It just it just made me mad if they just had. So releasing that version might bring some people back to the platform. And just think of the ad inventory. This opens up

Kyle Mountsier  12:53

like that it is possible revenue stream that they haven't even tapped into at this point. So from a from an investor perspective, and from a net revenue perspective, it probably opens up a whole nother layer. I think the other thing that a lot of people are asking it and not that they've done it yet. But there's this question mark around the kind of shared login issues that Netflix has experienced over the years. And so recognizing that the user base is used to one type of experience. And that's hard as a brand to say like, Oh, we've got people sharing logins across four or five users, which means we're missing out on these types of, you know, revenue streams from those multi users because, you know, 200, scription, right, drivers, right? Yeah, you're probably you're probably close to, if not higher than 2x that on total, like installs on, you know, household devices, right. So let me ask you this. That's a big deal.

Paul Daly  13:52

So does if, say they loosen up the multiple login, right? They stop cracking down on that? Is it beneficial to stop cracking down on that? Because now more people are watching the ads and they can sell more inventory? Like that's got to offset it? Well, they

Kyle Mountsier  14:07

haven't they haven't quite they haven't done that. They've only done that in like a few markets so far. But I'm okay. People hedging for that may be coming. So, but you know, it's interesting, because, like, most people don't share their Apple ID login, right? Because it's a lot more tied to well, it's tied to your whole life. And so now like, Apple TV, they've got that locked system. And yeah, so that's, that's where Netflix has that kind of open open system that that multiple people can get in but I do think you can start selling on impressions over just yet subscribers. Without a doubt. That's a that's a big key.

Paul Daly  14:47

Without a doubt. They said they're going to be partnering with Microsoft to deliver the technology they need in order to serve up the ads. And a lot of people say Netflix really knows their users well. So a couple of brands have already expressed interest Isn't committing to really long term multimillion dollar agreements. A couple of companies brands that are just looking to be on the platform peloton and Hyundai are mentioned as far as even product placement in some of the shows. So this is just another story of evolve or die. And from a dealership perspective, I think it's you know, the more OTT inventory there is to buy, the better that is for pricing and the better that is

Kyle Mountsier  15:24

to talk about Monday enough. Here's what we're

Paul Daly  15:27

speaking of Hyundai, Hyundai. Well, speaking of Hyundai you a little little car company called Kia, owned by Hyundai. We're gonna talk about them today. So they've just deployed another commercial where they inserted the built the commercial around NF T characters. Again, they did it once in the Superbowl with the Robo Dog but now they have taken an existing community of people who are around these NF T's called Dead army skeleton club clubs spelled with a K, of course, short for Dask DSK are they appear in this really cool commercial, I watched the commercial and it's awesome. Where the skeletons are driving around in the Kia and they go to a drive thru. And here's the thing, there's a QR code that is a part is worked into the commercial is actually a piece of like set decoration that you can scan and you can get one of 10,000 free NF T's that are kind of a collab between Kia and the dead army skeleton club. The reason this is cool, it's not just to be an NF T's if you look, you know Kia has been dabbling in this for a little bit. But what they've tapped into is they understand and I'll say it right now, this is the new buzzword right brand was the buzzword for like the last three or four years. The new buzzword is community. I'm just gonna put it out there. Everybody's everybody's got a community now. Right? But all communities aren't the same. Just like all brands aren't the same? Oh, well, we'll get into that a little bit with a run on that one. Oh, we got we got a battle ax on behind that what? But here's the thing, key understands that the NF Ts, they have a lot of micro communities that gather around these goofy characters, but it's deeper than just the character. It's actually a group of people who think about things the same way and approach certain areas of life the same way. So by Kia bringing them into the fold and saying, Hey, we're part of your community, guess what they've done? They've just made the brand sticky? Yes, like in a way in a way that I've never seen OEM brands be able to cross that boundary?

Kyle Mountsier  17:25

Well, I think it's interesting, because when you when you talk about NF Ts, you either I think they kind of go community one of two ways. Either you take an existing community and bring them on to NF TS because you've crafted you migrate, right? And you migrate them into the NFT world because of validity or access or something like that. And then there's this this other piece that that Hyundai Kia is tapping into, which is saying, hey, there's a community that we can get to align with our brand. And if we align that correctly, we can actually migrate that community back into our community correctly. And I think that both ways are just dynamic plays on how to access the this, this new web, social atmosphere and thinking about like, How can I especially in regionalised, localized blends brands, how can I connect communities, whether it be NF T, or the local coffee shop community? How can I connect communities both ways, right? Yep. I think any business any business owner entrepreneur should be thinking that way.

Paul Daly  18:34

We talked yesterday in our I think our episode 00 for auto collabs, the new podcast, we talked about how bringing everybody together collaborating isn't just dealers and industry partners. It's actually also OEMs. And also you brought up the consumer. Yeah, right. It's the collaboration between all those groups if we're going to be successful. And so this is an I think this is a great example of OEMs reaching out to consumers making the big play connection, right the broad market connection and really teeing it up for Kia dealers to take the next step and bring some of these people closer and that means learning something about the dead army skeleton club NF TS because I guarantee you there's some key salespeople out there that understand NF T's and can really quickly get in that discord. Learn a little bit about the community and I guarantee you there's a local element to that community and boy they should be buying and key is from this point forward. They really should thank you oh, yeah, thank you Kia for thinking about that. It's dealers turn to take the football and run with it because it is accessible. It's right on your phone. It's right on your screen. I don't want to hear any complaining

Kyle Mountsier  19:42

later. There you go. You know what? What communities are your people already embedded in that you can that you can draw back in

Paul Daly  19:52

to your people in your store right like taking their community networks.

Kyle Mountsier  19:57

Bingo and and draw Calling from their knowledge of that community to pull that into the dealership network community. Lights out, right?

Paul Daly  20:07

Lights out. We have some work to do even though we had very little lights out in time last night. We hope you go crush this when they go learn a little bit about something new. But more than anything more than anything go show people with the retail auto dealer network is about

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