Scott Galloway will be speaking at the next Global Officer meeting. He is a professor at NYU and one of the top thinkers/authors around where technology and retail is going. He wrote the book The Four

Here are some clips of most interesting soundbites…

There is a survivor bias that plagues old-economy CEOs and their shareholders. My nightmare job is the “invisible until you fuck up” position. These jobs are everywhere: IT, corporate treasurer, auditor, air traffic controller, nuclear power plant operator, county elevator inspector, TSA officer. You’ll never be famous, but you have a small, and terrifying, chance of being infamous. CEOs of successful old-economy firms have a similar bias — they are “rich until they fuck up.


History favors the bold. Compensation favors the meek. As a Fortune 500 company CEO, you’re better off taking the path often traveled and staying the course. Big companies may have more assets to innovate with, but they rarely take big risks or innovate at the cost of cannibalizing a current business. Neither would they chance alienating suppliers or investors. They play not to lose, and shareholders reward them for it — until those shareholders walk and buy Amazon stock. Most boards ask management: “How can we build the greatest advantage for the least amount of capital/ investment?” Amazon reverses the question: “What can we do that gives us an advantage that’s hugely expensive, and that no one else can afford?”


In 2015, Amazon spent $ 7 billion on shipping fees, a net shipping loss of $ 5 billion, and overall profits of $ 2.4 billion. Crazy, no? No. Amazon is going underwater with the world’s largest oxygen tank, forcing other retailers to follow it, match its prices, and deal with changed customer delivery expectations. The difference is other retailers have just the air in their lungs and are drowning. Amazon will surface and have the ocean of retail largely to itself.


And Amazon isn’t stopping at web hosting. Amazon Media Group, the company’s advertising business, grew 58 percent year-over-year in Q3 2017 and is expected to bring in between $ 4.5 billion and $ 10.2 billion in advertising revenue in 2018.64 That would surpass Twitter’s $ 2.4 billion 2017 revenue65 and would make Amazon Media Group the third largest digital media property, after Facebook and Google. Amazon Prime, the most nonexclusive club in America (64 percent of U.S. households68), is offering, for $ 119/ year, unlimited, free two-day shipping, two-hour shipping on select products (Amazon Now), and music and video streaming, including original content. Ideas for content are given the budget for a pilot, and then viewers are asked to vote online for which series get greenlighted.


At L2 we have run tests (by which I mean barking commands at Alexa) to glean insight into Amazon’s strategy. Some findings: It’s clear that Amazon wants to drive commerce through Alexa, as they are offering a lower price, on many products, if ordered via voice vs. click. In key categories like batteries, Alexa will suggest Amazon Basics, their private label, and play dumb about other choices (“ Sorry, that’s all I found!”) when there are several other brands on amazon.com. Though Amazon carries several brands of batteries, its private label, Amazon Basics, accounts for a third of all battery sales online.


I spoke the following morning, after Jeff Bezos, at a recent conference. Similar to the kid who sees dead people in The Sixth Sense, Jeff Bezos sees the future of business better than most CEOs. When asked about job destruction and what it would mean for our society, he suggested one more time that we should consider adopting a universal minimum income. Or, he added, a negative income tax where every citizen is granted a cash payment that will be sufficient to stay above the poverty line. People fawned, “What a great man, so concerned about the little guy.” But wait. Ever notice that there are very few pictures of the inside of an Amazon warehouse?

Obviously, grocery is one of those doomed sectors. It had it coming. This, the largest consumer sector in America ($ 800 billion107), has been where innovation goes to die. Same bad lighting, same depressed workforce, same impossibly frustrating experience in finding my Chobani yogurt as I search from aisle to aisle.


In reality, 55 percent of product searches start on Amazon (vs. 28 percent on search engines such as Google). 118 This shifts the power, and margin, from Google and retailers to Amazon.


So … Is Every Retailer (and Its Employees) Screwed? The short answer is no. There is a rebel force of innovative retailers out there who are fighting the empire: Sephora, Home Depot, and Best Buy, to name a few. These firms are zigging as Amazon zags and investing in people — beauty associates, blue shirts, geek squads, and gold canvas aprons. They couple this investment in human capital with a deft investment in technology. Consumers no longer go to stores for products, which are easier to get from Amazon. They go to stores for people/ experts. Bureau of Labor Statistics. Will their strategy — or Amazon’s — eventually emerge victorious? Or will they somehow accommodate each other and carve out a separate peace? The answer will not only decide the fate of companies, but millions of workers and households as well. What’s clear is that we need business leaders who envision, and enact, a future with more jobs — not billionaires who want the government to fund, with taxes they avoid, social programs for people to sit on their couches and watch Netflix all day. Jeff, show some real fucking vision.


We place immense trust in the mechanism. One in six Google queries have never been asked before. 13 What other institution — professional or clergy — has so much credibility and trust that people bring their previously unanswerable questions to them? What guru is so wise that he inspires so many original questions?


A mess of big companies thought they were going to be Facebook owners and ended up Facebook renters. Nike paid Facebook to build its community, but now less than 2 percent of Nike’s posts reach that community — unless, that is, they advertise on Facebook. If Nike doesn’t like it, tough shit, they can go cry to the community on the world’s other two-billion-member social network … oh wait. Similar to someone dating a person much hotter than them, brands complained and took the abuse.


But I’d argue that the majority of stakeholder value created over the last decade has been a function of removal…removing friction.