GMs Non-Auto CMO, Carvana Spooks Then Soars, Activity Avalanche

Paul Daly: 0:27Yo, what's up Welcome to Wednesday, got a little bit of a, I don't know a stock roller coaster to talk about a new D, a CMO, a TM, and an activity avalanche. We're going to tell you what that means. The people really want

‍Kyle Mountsier: 0:42

who is in who ideal. Yeah, I feel like it is a great band name. It's also what I'm going to say to my wife Every time she's like How was today? Be like it was a very avid

Paul Daly: 0:56

activity. That's right. You get a sticker on my door that just says activity avalanche and progresses.Caution, right. Activity avalanche that's actually could be in the soda theme. Actually not I think about it. Activity avalanche. What do you guys do?We're professional activity.Creators? I don't know man.

Kyle Mountsier: 1:14

i That's so good. Oh, man, you never know what you're gonna come up with in a little pod title. You know,

Paul Daly: 1:19

we got a we got a new in the dirt podcast release today, if you don't know in the dirt is a podcast that we created just so we can capture moments when we are on the ground. Like at a dealership or,you know, kind of with a frontline person. Sometimes it's at an event, but usually now it's in a store. So you did this interview console. You talk about it?

Kyle Mountsier: 1:40

Yeah, no, this is this was really cool. I kind of alluded to this a couple days ago. But we talked to a 22 year salesperson at the same store are a 27 year salesperson, and a22 year customer at the store.And they were at the store, like randomly buying another car when we were there. So it was just cool to

Paul Daly: 2:00

kind of like they've been doing business together for that long. It's what you're saying?

Kyle Mountsier: 2:04

Yes. The salesperson has been at that store for 27 years, they've been doing business at that store for22 years with the same person.That's they just happened to be in the showroom while we were scripted,

Paul Daly: 2:17

unscripted. Oh,that's amazing. You can get that by going to any podcast platform, Spotify, Apple Music,probably the best places to get in the dirt with a Soto and it'll be the last episode are we releasing that we're probably it's going to be a video and stuff like that, to see it on social media or if you're not following along. LinkedIn is kind of where the most conversation happens. So follow the sorter page on LinkedIn,we'll do a thing. There you go in the thing. Alright, let's get into some news. So General Motors has hired norm to grieve,as the new CMO, he was the CMO of CVS, so a non auto person coming in. And effective July31. So he's ramping up to start here and just about a week and a half to grieve known for transforming CVS into the country's largest consumer health care company. So if you remember, back in the day, it was like, we're no longer a drugstore, we are now a healthcare company, their skill set now to spearhead GMs marketing, as they you know,continue into this new territory of EVs. So he was at CVS since2015. And he really had this purpose. They call it purpose related marketing. And this was his initiative. So he did things like, you know, stopping using altered images of female specifically in advertisement say, Hey, we're going to be real life here. To combat image insecurity. They had a, they had a program called role model. He also stopped doing business with any agency that worked with a big tobacco company, right?Because like, how can we be a healthcare company if we're selling cigarettes? Well

Kyle Mountsier: 3:50

sells cigarettes, though.

Paul Daly: 3:52

Not anymore. No, they stopped. Really? Oh, yeah, like back that when they made this decision. It was a big, it was a big deal.

Kyle Mountsier: 3:58

Totally. I've only I liked all tobacco products. Yeah, like Walgreens is definitely more popular here.So I just don't get into a CVS.So

Paul Daly: 4:07

though, they changed,but they all did it like CVS,Rite Aid, they changed their logo, they're like, Oh, we're health proponents. Now. I don't know there's still a lot of candy bars in that aisle. No,no, he lacks extensive auto experience. He did have prior experience with GMs digital marketing when he was employed with the big agency digitus from2001 to 2014. So business is a little different than it was back then. But also man,

Kyle Mountsier: 4:29

I'm excited for them you know and and I have seen like GM do some some unique things with with marketing over the past I you know, I follow some of their their marketing team on LinkedIn. And so they they do push the boundaries a bit. You know, and so, it's always tough for me like watching someone come from, you know, it's basically consumer packaged goods rebranded as like an an over company, you know,and then the healthcare side of stuff. It's it'll Be interesting to see how that translates into the brand of GM, like whether we see kind of a renewed vision or refreshed, refreshed look and feel. Because when when you're going from like healthcare to trucks, yeah, that's a big difference, you know, but I, you know, innovative, innovative thought innovative voices.Thinking about this vertical with the context of other verticals, I think is important,especially as when you think about like, EVs and software and the way that that GM is, is positioning itself for the next seven years, it's probably a strong move.

Paul Daly: 5:36

I think it could also come in, like when you think of them moving into the home charging space. And then also like the power storage and power generation, like in the home, I can see that as kind of like a similar vein, like, Hey, we're reintroducing GM as an energy company. I mean, I know that's like kind of like a far stretch,but they're starting to dip their toe in the water. So there's, there's some relevance there. But hey, wish, wishing him the best of luck. And GM,obviously, the best of luck. You get fresh thinking into an organization shakes things up.And, you know, Mary, Mary's paying attention.

Kyle Mountsier: 6:09

Yeah. And I think, you know, you look at like, the company overall, you know, that really is telling the story of, they're, they're a they're an electric company,more than me. And so if he's said to rebrand something like that, that when, so speaking

Paul Daly: 6:28

of winning so, I have, I have a little journey, I have a personal journey with this story, because I started building the show last night,which is an odd thing. I usually only build it in the morning,but it was late. I'm like, I'm gonna like start put a couple of things in and so Carvana stuck at the time. Last night Carvanha stock had dropped over 9%, after the online retailer startled investors, by moving its quarterly results release up by two weeks, they were like, We're gonna announce this two weeks early. And everyone's like,whoa, whoa, whoa, what's going on? People started selling,despite, you know, seeing a big rally this year are actually over like, 700%. I mean, they were pretty low at the beginning of the year.

Kyle Mountsier: 7:12

$24. Yeah, yeah,

Paul Daly: 7:14

I'll take that,though. Yeah, I'll take that if you bought a $3. You love every bit of that. 700%. And then I wake up this morning and open everything back up, and shares are up 25% In premarket trading,because they announced the actual announcement is they signed an agreement to really restructure their debt and cut one point billion $1.2 billion in debt and increase their cash flow. Their interest expense went down by a lot, and basically ever they're like,we're restructuring things. And then now it's up. 25%, actually,20 I don't know what it is now.Like, as of like, 20 minutes ago, it was 27%. They, it's wild.

Kyle Mountsier: 7:55

Like, there is it's so strange that Carvana continues to trade on the voice of what they like on what they say and less of what they do.Absolutely. It's a voting machine. It's just a pure voting machine still, which is just wild, especially after what we saw with them in the second half of last year. You know, I, I'm,like I was counting them down and out last November, but it

Paul Daly: 8:23

was three bucks a share, and I was like, it's bankrupt, or they're gonna make it. I heard a lot of people saying they're gonna go bankrupt, or they're gonna make it. Yep. And so restructuring

Kyle Mountsier: 8:31

debt is a big deal to stay out of bankruptcy,for sure. They they are they changed their second quarter adjusted earnings to one 155million a difference, you know,a different age or loss of 216million the same period last year. And so, and what's crazy about that, is they still have a23% reduction in overall revenue. They missed that they've reached a slice and over there, oh, yeah. I seem getting everything in line. You know,one of the one of the interesting things that was noted is like, there are people saying, hey, look, are you are you going away from some of the things that you've always done?Like it? Like, where where is all of this changing? Because it's like, it doesn't look like anything's changed from the outside. Right. But there's obviously a massive restructuring, restructuring to accomplish those goals internally.

Paul Daly: 9:28

Two things. Number one, this highlights the power of a strong brand. Yep. Right.They're trading on brand and trait like very literally trading on the exchange on brand and things like that. A lot of the large analysts say, you know, their price has completely disconnected from the fundamentals of how you would grade A stock. And so like,train on brand, man, they are trained on brand and, you know,from a public perception standpoint, a lot of people don't pay attention to the stock market. They don't care. They just want a good experience by in your car, I want to feel good about doing it. So I'm Carvanha is obviously keeping that keeping that dream alive. And I don't know maybe the story will be different tomorrow. So how are we going to get rid of

Kyle Mountsier: 10:10

this glue keeping the dream alive maybe speaking of keeping the dream alive, okay.

Paul Daly: 10:16

Segue.

Kyle Mountsier: 10:20

If you've been keep trying to keep that dream alive of somehow staying at your house to work for eternity,workday may have your solution in there from a little bit of data that they have. So workday is a cloud based software firm that manages a lot of the world's larger enterprise great companies like HR and staffing and and work tools, they've noticed a boost in collaboration. Overall, when employees return to the office part time last year at some of these enterprise level companies, basically hallway chats, meetings replaced email communication, so there was a lot more interpersonal interaction. However, with a 17%rise in team connections, which I don't even know how you measure that within, they

Paul Daly: 11:05

have it set it in the article, like you can go in and check click the link and read the article. They have metrics.So

Kyle Mountsier: 11:11

they got they got metrics. So there was this downside, basically, those connections created a 24%increase in meeting time,leading to a whole bunch of work pile up and extra stress for employees and, and time away from the activity of what you're doing. And so the all of the ideas that came from the interpersonal reaction, the watercooler the hallway moments actually led to this like overabundance of necessary activity to accomplish the goals that the company was created. So you mean

Paul Daly: 11:43

it's it sounds like this, it's like, Hey, we got together, hey, you know what we should try? We should do this.That's a great idea. Let's set another meeting. I got

Kyle Mountsier: 11:51

meetings, for meetings, all meetings, they got a meeting about a meeting. Yeah.All the way a social scientist Michael Irina coined it, as we talked about, at the beginning of the show was an activity avalanche. Basically, a sudden surge of connect to hyperconnectivity can negatively impact a company, what is this world all? What is this world

Paul Daly: 12:14

activity, avalanche,you know, I've experienced this.When when when I live in New York, and our you know, at the time, a soda didn't exist only had agency congruent, everything shut down. And we went into the Zoom world, which was like this,it was kind of shook us up,because we only came in, like we never operated remotely. And then after we got the hang of it, we got very efficient was like, Oh, my gosh, this is great. We're getting so much done. And then it switched. And then you just spent all day on Zoom meetings, and then you're not efficient, we came back to the office. And we got this boost of efficiency back, right.Because there's no longer I got to set up a meeting. And then little by little mission, creep happens. And all of a sudden,you're back in meetings all the time again. And it's I think this is a constant struggle of any business that is doing a lot of stuff. I know that that from having a little experience with VaynerMedia. Like being in the halls, Gary Vaynerchuk freaks out whenever he sees more than three people in a room together.He's like, like, a James RCV has to say, Oh, if you have more than three people in a room, and Gary's around, you better guarantee he's gonna pop his head and you better be able to tell him why everybody's in that room.

Kyle Mountsier: 13:18

Why everyone's in that room evident. Yeah, it's interesting. Yeah. I mean, you know, like, they, I feel this,right. Because sometimes I get to the my end of the day, I'm like, Callie, I was just meeting out, I was on Zoom calls, or Google meets or something like that all day. And I don't feel like I ever produced what was discussed in the meeting. And so especially, you know, this is, I think, at dealerships, this probably happens less just because the activity is the consumer, or the customer right in front of

Paul Daly: 13:48

happens less than the front lines, I think. Yeah,exactly. Because the customer is there in your face. But I think definitely the management level,the executive level, certainly can happen in like the marketing department. Right? It's easy to get sucked into this, whether it's somebody on your team, or vendors like Shopify, I think we talked about the story, but it's coming back around again,Shopify said, All recurring meetings are done, like done,they just scratched all the meetings, and he actually built a tool or integrated a tool. I don't know what it actually is.But now, when you book a meeting, it shows you what the labor costs of that meeting is.So you can see like, oh, and what was the quote? They said something like no one would expense a $500 dinner, but a$500 meeting could pop up just like that, like that.

Kyle Mountsier: 14:36

Can you imagine like, what would happen if that meeting metric was like finance director, general manager,director and controller all in a room? Everyone would be like,

Paul Daly: 14:48

fire alarm good.Yeah, yeah. 30 seconds Boys Girls, right. We're actually we have a we have a close friend who works out in Shopify, we're gonna ask him, we're gonna ask him, but um, how that feels.Yeah. You know, so this activity avalanche, what is the gentleman that that we quoted in this article? Miko Rinna. He's a smart guy. I guess we'll just say that he's a smart guy. And basically he said, the best leaders he's ever worked with,assess their meetings and more than anything else. So they pay more attention to how the meetings are running, what they're talking about how efficient they are. And because that's the sweet spot for collaboration, they use the word collaboration got our attention on this article, there you go,but I couldn't collaborate, too much. Collaborate. It's like,

Kyle Mountsier: 15:31

the minute you go past a 20 minute meeting,you're hanging out, you're just visiting

Paul Daly: 15:36

Dave Meltzer. Right.So good. Well, we're not gonna go past 20 minutes on this meeting. 15 minutes and 42seconds to be exact. Thanks for spending time we hope it helps you make your day more efficient, think more strategically, and above all,less care for people just a little bit.

Unknown: 15:58

Right

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