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DIGITAL ENGAGEMENT AND THE CONNECTED CAR: How cars are transforming into digital platforms and opening an entirely new channel for service providers

Posted: 12 Feb 2018 02:07 PM PST

monthlytimespentThis is a preview of a research report from BI Intelligence, Business Insider's premium research service. To learn more about BI Intelligence, click here.

Media consumption is at a saturation point. After rising for much of the last decade, total digital time spent has been nearly static since the start of 2015. As a result, it's increasingly difficult for content producers to win over minutes of consumers' time.

One platform, though, is poised to move the needle and provide a new avenue to boost digital time spent: the connected car. Consumers will spend more time in cars that offer a range of connectivity options, giving them the chance to use the services they know and love in the car.

The key question for service providers is how to take advantage of the connected car by integrating their services into this growing platform.

In a new report from BI Intelligence, we provide a roadmap for service providers looking to offer their services in the car. We analyze media consumption and overall digital time spent trends, and then forecast the growth of the connected car market in relation to the digital time opportunity. Finally, we propose potential routes that service providers can take to get into connected cars and ride-hailing vehicles.

Here are some of the key takeaways:

  • Digital time spent has become nearly static; however, people are spending more time in cars every year, and the growth of connected cars will likely turn these extra minutes into digital time.
  • Getting services into the car is more complicated than ever before, and will require service providers to take different approaches to integration.
  • The introduction of autonomous vehicles and the growth of ride-hailing services in the coming years will completely change what people can do in cars, which will alter the requirements for digital services in these developing platforms.

In full, the report:

  • Analyzes trends in digital time spent and the growth of connected cars.
  • Explains the connected-car ecosystem, where service providers fit in, and what relationships they need to succeed in the space.
  • Provides a detailed explanation of the future of connected cars, which will expand media consumption and offer new e-commerce and payments opportunities.

Interested in getting the full report? Here are two ways to access it:

  1. Subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >> Learn More Now
  2. Purchase & download the full report from our research store. >> Purchase & Download Now

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The analyst who predicted Amazon would buy Whole Foods says only 2 cities have a shot at HQ2 (AMZN)

Posted: 12 Feb 2018 01:39 PM PST

Scott Galloway HQ2

  • Scott Galloway, a marketing  professor at NYU and business analyst, has laid out his predictions for where Amazon will put its new headquarters, HQ2.
  • Galloway correctly predicted Amazon would buy Whole Foods, lending his predictions some clout.
  • He narrows it down to five regions on Amazon's 20-location short list. They're all in either the New York metro area or the DC metro area.

Amazon is about to choose the location for its second headquarters.

Who will get the $5 billion investment and 50,000 jobs — along with any of the potential downsides?

"It comes down to two locations: the metro area of New York or the metro area of DC," NYU marketing professor and business analyst Scott Galloway says in a new YouTube video.

Galloway doesn't get more specific than that prediction, which technically includes five of Amazon's shortlisted locations: New York City; Newark, New Jersey; Washington, DC; Montgomery County, Maryland; and Northern Virginia.

Why those two regions? Galloway says there are only two items to consider. The first is that Amazon wants to go where it can get the best talent.

"In the eyes of Amazon, the best talent is a 24-year-old [electrical engineering] grad from MIT. This individual isn't concerned with cost of living," Galloway said. "Cost of living only matters when you're in your 30s and you begin collecting dogs and kids."

Then, Galloway says, the next thing to consider is where Amazon CEO Jeff Bezos wants to spend his time. Bezos already owns homes in New York and DC, in addition to Seattle.

Galloway then goes on to implore Bezos to pick his city now, instead of waiting for the HQ2 bidding process to go on any longer. He also calls on mayors and civic leaders to band together and refuse to offer the company financial incentives to locate in their city.

"Mr. Bezos, come to the light," Galloway says.

Watch the full video below:


SEE ALSO: Amazon is cutting hundreds of jobs in a 'rare' move

Join the conversation about this story »

NOW WATCH: Diet Coke has released four new flavors — here's what our resident Diet Coke fans have to say

Japan's snow festival is a beautiful annual event — here are 2018's most impressive snow sculptures

Posted: 12 Feb 2018 01:30 PM PST

Over 50 years ago, a group of high school students on the Japanese island of Hokkaido decided to build snow sculptures. They invited the public to visit, and come they did. "The festival attracted about fifty thousand people and soon became a major winter event of Sapporo," the 2018 Sapporo Snow Festival official history reads.

In modern times, millions of people visit Hokkaido's largest city — Sapporo, like the beer of the same name — each February to celebrate the Sapporo Snow Festival. It's easy to see why:

Sapporo Snow Festival 2018

Though I wasn't lucky enough to be there myself, my former colleague-turned-composer Dale North flew to Sapporo for the festivities. Here's a tour through his eyes of the best snow sculptures from this year's festival!

SEE ALSO: Inside Hong Kong's lawless 'walled city' — the most crowded place on Earth for 40 years

The 2018 Sapporo Snow Festival ran from February 1 through to February 12. Sometimes snow is brought in for the festival, but Sapporo gets plenty snowy on its own as well.

The city of Sapporo is beautiful unto itself, and acts as a beautiful setting for the annual festival.

This view of Sapporo from above helps to illustrate how nice the city is unto itself. It's a sister city with Munich in Germany and Portland in the US, among others.

See the rest of the story at Business Insider

Nvidia could get caught in a cryptocurrency ‘downdraft’ (NVDA)

Posted: 12 Feb 2018 01:24 PM PST

TEL AVIV, ISRAEL - OCTOBER 17: Participants send their 'aircraft' off the edge of a pier during Flugtag, the 'Red Bull' flying day competition on October 17, 2003

Crypto-mania has been a boon for Nvidia’s graphics card business.

Store shelves have been wiped clean of the company’s GPUs as would-be miners of bitcoin and other cryptocurrencies seek out the chips that were once only popular among PC gamers, but are extremely effective at running the algorithms behind the digital coins.

Shares of Nvidia exploded throughout 2017, gaining 112% in the past year. It was one of the best-performing stocks in the S&P 500, thanks in part to unexpected revenue from newly minted crypto-enthusiasts snapping up Nvidia cards.

However, 2018 hasn’t been as kind to cryptocurrencies so far. That’s where the downdraft kicks in.

Since January 1, bitcoin has fallen 35% while the total market for cryptocurrencies has lost 30% of its value, or roughly $182 billion.

"With crypto likely contributing larger-than-expected revenue, it is unclear if Q1 will be flattish next quarter,” RBC Capital Markets analyst Mitch Steves said in a note to clients following Nvidia’s record fourth quarter earnings release.

"We think it is still doable without material crypto exposure given that GPUs are difficult to purchase due to pent-up gaming demand."

Despite the fears, Steves maintains an outperform rating for shares of Nvidia, with a target price of $280 — 22% above where the stock was trading Monday afternoon.

Gaming makes up just over 18% of Nvidia’s total GPU revenue, behind data centers (60%) and automotive (22%), according to Bloomberg’s financial analysis.

Others on Wall Street aren’t as optimistic as RBC. 

"We think that there is a growing risk that Nvidia could be impacted by a downdraft in cryptocurrency-related demand at some point in the future," Wells Fargo analyst David Wong said Monday. He has an extremely bearish price target of $100 for Nvidia — less than half where shares were trading Monday.

Nvidia has gained 13% since January 1. Analysts polled by Bloomberg say on average the stock could rise another 10% above current prices.

Nvidia stock price

SEE ALSO: Sign up to get the most important updates on all things crypto delivered straight to your inbox.

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NOW WATCH: Microsoft President Brad Smith says the US shouldn't get 'too isolationist'

MORGAN STANLEY: A Dell and VMware merger is a 'worst case scenario' for shareholders (VMW)

Posted: 12 Feb 2018 01:19 PM PST

Michael Dell

  • Analysts at Morgan Stanley warned in a note Monday that a reverse merger between Dell and VMware is a "worst case scenario" for VMware shareholders.
  • Analysts said a merger could devalue VMware by as much as $28 billion. This also leads them to believe that a merger is unlikely, according to the note. 
  • VMware confirmed in early February that Dell is considering a reverse merger with the publicly-traded company, as a means of going public itself. Dell is also looking into an IPO, or keeping things as they are. 

Dell Technologies is considering mixing up its ownership structure, and analysts at Morgan Stanley are not going along for the ride.

In a note published on Monday, Morgan Stanley analysts Keith Weiss and Sanjit Singh warned investors against one of the most interesting options on the table, in which Dell Technologies would do a "reverse merger" with its subsidiary company VMware.

Analysts called a merger the "worst case scenario" for VMware shareholders.

VMware is traded publicly, and a merger would take Dell public without putting the company through an initial public offering. Dell currently owns 82% of VMware stock, and 97% of its voting interest, thanks to the 2015 Dell/EMC merger. 

A reverse merger would have tax benefits for Dell and give the company access to VMware's cash, according to the report, but ultimately it would have a negative impact on VMware's shareholders. 

Analysts at Morgan Stanley project that a combined company would devalue VMware by $28 billion — considerably more than the $500 million-600 million annual taxes Dell will face if it continues to operate under its existing structure. 

Already VMware stock, which traded at an all-time high of $150 in late January, has suffered. Shares currently cost around $117, which Morgan Stanley expects would "quickly" return toward its $143 price target if "the risk of a reverse merger diminishes." 

However, analysts also conclude that it's the least likely of the three strategic options Dell is pursuing. 

The company is also looking into doing its own IPO, as well as looking into whether staying private is actually the best option. 

SEE ALSO: CONFIRMED: Michael Dell really is thinking about going public again, maybe through a 'merger' with VMware

Join the conversation about this story »

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We drove a $53,000 Alfa Romeo Stelvio — and the new luxury SUV is far from perfect

Posted: 12 Feb 2018 01:14 PM PST

Alfa Romeo Stelvia

  • The Stelvio is Alfa Romeo's first crack at an SUV since returning to the US market.
  • Luxury SUVs are a mission-critical segment for the Italian brand.
  • We enjoyed the crossover's styling and driving dynamics, but it fell short on infotainment and interior quality.

Alfa Romeo exited the US market back in the mid-1990s, and if you had told me prior to the financial crisis that the legendary Italian brand would be back, I'd have scoffed.

By the bailout and bankruptcy of Chrysler in 2009 set the stage for an unlikely return, as Fiat — Alfa's owner — acquired Chrysler and formed Fiat Chrysler Automobiles. CEO Sergio Marchionne was keen to restore Alfa in the lucrative US luxury market. So first we got the offbeat 4C sports car, followed by the marvelous Giulia sedan.

Now the most unlikely Alfa of all has arrived, the Stelvio SUV. Luxury SUVs are a big segment in SUV-mad America, with pretty much every major brand supporting a lineup. Alfa had to be in on the action.

The Stelvio landed in 2017, and we recently got our hands on a $53,000 Sport-trim example (the base model is $42,000). The car was mega-sharp, with its quintessentially Italian styling. A Range Rover this definitely isn't. But what was it like to live with?

Photos by Hollis Johnson.

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Our Stelvio tester arrived in a Rosso Red paint job with an all-black interior.

The Alfa front end is utterly distinctive. You can't mistake it for anything else, with that dashing shield grille, those saber-like headlights, and the gorgeous Alfa badge. As front fascias go, it's amazing.

The Rosso Red exterior was luminous. We seen Alfas in black and we've seen them in red. And red is better.

Of course, because the design is so Alfa, it's bound to be polarizing.

The obvious question is whether you want your rugged SUV to look like something that's dressed for men's fashion week in Milan. From my perspective, SUVs have exuded rough-and-tumble cred for so long that the arrival of panache with the Stelvio and the Maserati Levante is a good thing.

The Stelvio is symmetrical and sleek.

To be honest, apart from the glorious color, we weren't 100% convinced by the Stelvio's beauty. 

The rest of the world didn't share our skepticism. There was no shortage of admiring glances, rapt stares, thumbs up, and questions from total strangers for the week that we spent driving the SUV around New York and New Jersey.

See the rest of the story at Business Insider

Amazon is laying off hundreds of employees — and it shows the danger Seattle and HQ2 face by hitching their prosperity to the tech giant

Posted: 12 Feb 2018 12:34 PM PST


  • Amazon will reportedly lay off hundreds of employees, primarily at its Seattle headquarters.
  • Amazon employs more than 40,000 people in Seattle and has radically changed the city over the last decade.
  • The cuts point to the danger of a city being too dependent on a single company, an issue Seattle and whatever city wins HQ2 will face in the coming decades.


Amazon is laying off hundreds of employees, primarily at the company's Seattle headquarters, according to the Seattle Times.

The cuts will primarily affect the company's retail division. Amazon is America's second-largest employer with around 566,000 employees as of December. More than 40,000 of those are in Seattle alone.

While the cuts are hardly sweeping, they point to the precarious position that Seattle, and whatever city wins the competition for the company's new $5 billion headquarters dubbed HQ2, will face in the coming decades. 

Amazon dominates Seattle, sprawling across downtown and upsetting locals with snarled traffic, soaring housing prices, never-ending construction, and accelerated gentrification.

At the same time, the city has seen an unprecedented economic surge, adding 220,000 jobs over the past decade. Many of those jobs have been due to Amazon's growth and are high-paying.

But for many Seattleites, they've seen this story before. The city was once even more dominated by another company — Boeing.

In 1968, Boeing employed more than 100,000 people in the Seattle area. By 1971, that number had plummeted to 32,500, leading to an infamous billboard exclaiming: "Will the last person leaving Seattle turn out the lights."

While Amazon's layoffs of a few hundred are nowhere near that level, they are a solemn reminder that pinning a city's future on the ebbs and flows of a single company is a precarious place to be.

I recently spent a day in the Seattle neighborhood locals call Amazonia to see how Amazon has affected the city.

In the '90s, Seattle's South Lake Union neighborhood was a mess of parking lots, warehouses, and industrial buildings. Amazon has transformed the neighborhood and its surrounding areas, Belltown and Denny Triangle. Each of those pins on the map is an Amazon office.

Amazon's offices are spread across more than 33 buildings throughout the area, though some say the number is closer to 40. The company leases 100,000 square feet of office space in this building, nicknamed Otter.

Source: SF Gate

It's hard to overstate how thoroughly Amazon dominates downtown. The company is up to occupying 8.1 million square feet of office space in Seattle, reports say. Day 1 Tower, opened in 2016, is one of two towers that form the heart of Amazon's campus.

Source: Geekwire, SF Gate, CNBC

See the rest of the story at Business Insider

Oracle is making a massive investment in 12 new data centers to gain ground on Amazon in the cloud wars (ORCL)

Posted: 12 Feb 2018 11:57 AM PST

Mark Hurd

  • Oracle is adding 12 new cloud data centers around the world, the company announced Monday.
  • The new datacenters will be built throughout Asia, Europe, and North America.
  • It's part of Oracle's efforts to reposition itself as a cloud infrastructure company.

Oracle is making heavy investments in its cloud infrastructure with the addition of 12 new data center locations around the world, the company announced Monday.

 “As we invest, our margins will continue to expand. And with our global datacenter expansion, we are able to help customers lower IT costs, mitigate risks and compete like they never have before,” said Oracle co-CEO Mark Hurd in a statement.

The 12 new locations include China, India, Japan, Saudi Arabia, Singapore, and South Korea in Asia, as well as Amsterdam and Switzerland in Europe. Oracle will also open two new data centers in both Canada and the US.

Oracle, which made its name and fortune selling on-premise databases, is in the midst of repositioning itself as a cloud provider. However, the company consistently ranks behind other tech giants — including Amazon Web Services (AWS), Microsoft, Google, and IBM — in terms of market share.

Last quarter, Oracle reported $1.5 billion revenue across its cloud products, compared to $1 billion at Google, and $5.1 billion at AWS, though each company includes a different set of product offerings in its cloud calculations, so it's not accurate to directly compare their cloud revenues. 

SEE ALSO: Google Cloud is now a $1 billion per quarter business — but it's still way behind Amazon

Join the conversation about this story »

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'Creep wisely' as Instagram tests a way to let you know if someone screenshots your story (FB, SNAP)

Posted: 12 Feb 2018 11:48 AM PST

Kylie Kendall Jenner Kardashian Phone

  • Instagram is testing sending users a notification when someone has screens hotted their story.
  • This is only a test. The company did not say if or when it will be implemented for all users.
  • Users are not happy, with some tweeting that people now have to "creep wisely."

The days of quietly lurking on someone's Instagram may be numbered, as the app begins testing a feature that would let you know if somebody has screenshotted your story.

According to screenshots shared on Twitter from users who are in the testing group, a camera shutter icon will appear next to the name of someone screenshotted that story. Users will not get a push notification when someone has screenshotted their story, TechCrunch reported on Monday — so at least it could be sort of subtle. 

Instagram confirmed with Business Insider that it's only testing the feature with a small number of users. "We are always testing ways to improve the experience on Instagram and make it easier to share any moment with the people who matter to you," says an Instagram spokesperson. 

Users aren't welcoming the potential change, judging from their reaction on Twitter. The message is clear: users want to Insta-stalk their friends, family, and followers in peace.

Normally, Instagram only alerts users when someone screenshots a private direct message. With the ability to see if somebody screenshotted a public story, well, in the words of one Twitter user: "Creep wisely."

And, hey, if Instagram did implement screenshot notifications for Stories, it would be yet another feature the company has borrowed from Snapchat. 

SEE ALSO: The key to disrupting a billion-dollar industry is 'ignorance,' says the founder of SoftBank's latest multi-million dollar investment darling

Join the conversation about this story »

NOW WATCH: I quit social media for a month — and it was the best choice I've ever made

Uber is now forcing its drivers to take a long break after 12 hours on the road

Posted: 12 Feb 2018 11:39 AM PST

Uber driver car logo

  • Uber is now requiring that drivers in the United States take a 6-hour break after a 12-hour shift driving.
  • The move is intended to cut down on drowsiness and stop drivers falling asleep at the wheel.
  • Rival Lyft already has a similar limit, and Uber has previously tested the feature elsewhere in the world.

Uber is cracking down on dangerously long shifts from its drivers.

The transportation firm is now requiring that American drivers take a six-hour break if they drive more than 12 uninterrupted hours on the road, it announced on Monday.

The move is intended to tackle the risks of drowsiness that accompany overly long driving sessions, citing statistics showing that nearly 7 million people fell asleep while driving in the space of two weeks.

Rival Lyft already has a similar — though more lenient — policy, enforcing a six-hour break for every 14 hours of driving. And Uber has previously experimented with similar limits elsewhere in the world. In the UK, for example, drivers can only go for 10 hours at a time before being forced to take a six-hour break.

Of course, the feature isn't foolproof. Many drivers work using multiple ride-hailing apps, so truly determined drivers could simply switch from Uber to Lyft when they hit their limit (or vice versa). But it should still help address the issue and cut down on overly long shifts from drivers.

In a statement, Governors Highway Safety Association executive director Jonathan Adkins praised the move

"Driver fatigue is a serious and underappreciated traffic safety issue, and states need all the help they can get to address it. GHSA is thrilled that Uber is taking steps to prevent drowsy driving by limiting the hours drivers can be behind the wheel," he said.

"This new feature has tremendous potential to protect not only Uber driver-partners, but also their passengers and, ultimately, all road users."

Join the conversation about this story »

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Tesla has transformed the car industry — but its biggest strength could become its greatest liability (TSLA)

Posted: 12 Feb 2018 11:37 AM PST

Elon Musk Tesla Model S

  • Despite being younger than many of its competitors, Tesla has had a significant impact on the auto industry.
  • It has influenced what kinds of cars its competitors make, what they look like, and their tech features.
  • But Tesla's ambition has also led it to make promises it may not be able to keep. 

Tesla has put the auto industry on notice.

That's because Tesla's ideas, and the way it has connected those ideas to an ambitious vision for a future of renewable energy and self-driving vehicles, are as compelling as those coming from any other American business. The company can thrive despite significant growing pains because it has made observers believe it's more than a car company.

"It's more than just a company that spits out a product. It means something," Kelley Blue Book executive analyst Akshay Anand told Business Insider. "And I think more than any other automaker out there, Tesla has been successful at that, at being more than a car company."

Tesla has shifted the auto industry's narrative

Anand compared Tesla to Apple and Google, companies that make consumers believe they're buying into more than an isolated product. This may explain why Tesla's $56 billion market capitalization is greater than Ford's ($42 billion) and close to General Motors' ($58 billion), two companies that are more profitable and better at building cars. And it may explain why Tesla has played an outsized role in shifting the auto industry's narrative.

"I think the most critical thing that Tesla's done in terms of the rest of the automotive industry is create a greater sense of urgency as far as innovation and electric," Anand said. "I don't think you would see as many car companies putting all these chips in the electric basket and doing it with a sense of urgency."

You can see that urgency in the steady stream of aggressive investments auto companies like Porsche and Mercedes-Benz announce in electric vehicles, despite the fact that electric vehicles make up around just 1% of the global market. But Tesla has shown there's money to be made in innovation — if not from customers quite yet, then from investors who are happy to pay over $300 per share for a compelling story.

Tesla has had a similar impact in the race to develop self-driving vehicles. Anand says companies would have developed them with or without Tesla's influence, but Tesla accelerated that effort in part by showing how self-driving technology could be integrated into contemporary cars with its Autopilot system, which gives its vehicles the ability to stay in a lane and keep a safe distance from other vehicles in certain situations. Now, it seems that a luxury car announcement doesn't come without a feature that resembles Autopilot.

Tesla anticipates and sets trends

But not all of Tesla's ideas are so high-minded. In some cases, the company has simply anticipated consumer demand before its competitors. Anand said that Tesla wasn't the first company to think about making electric cars look like sports cars, but it showed how much excitement could be generated around sleek, electric vehicles.

"This sounds simple, but I think, going back to the Model S, what Tesla did right was make a car that's super fun to drive, and they made a car that looks downright sexy," he said. There's a reason established, luxury brands like Aston Martin and Ferrari feel compelled to compare themselves to Tesla.

And if you've noticed the touchscreens in new cars growing at a rapid pace, you can thank Tesla for that. According to Anand, car companies shifted from incremental to exponential changes in screen size after Tesla started replacing knobs and instrument clusters with displays that were twice the size of some competitors'. For the Model 3, Tesla removed the instrument cluster entirely and installed a 15-inch touchscreen to control most of the car's interior functions.

Tesla's biggest strengths feed its greatest weakness

But Tesla isn't perfect. The company's greatest assets — ambition and marketing prowess — also feed into the company's biggest weakness: a tendency to make big promises that it struggles to keep. 

"I think they need to learn to not promise the moon," Anand said. "I think, at some point, there has to be a level of realism."

This is why Anand thinks the Model 3 is a critical moment for Tesla. It will determine if the company's most pressing issues are growing pains or the inevitable result of a CEO, Elon Musk, who tries to juggle too many projects at once.

"You are starting to see more questions around Tesla," Anand said. "If you looked at Tesla two years ago, they were infallible."

The company's struggles to build the Model 3 are well-documented. Musk said Tesla would be making 20,000 Model 3 vehicles per month by December 2017, but while the company hasn't released production numbers, it delivered just over 1,500 in the entire fourth quarter last year. The reviews for the vehicle have been positive so far, but whether Tesla can capitalize on that excitement may determine whether it continues to be a leader in the auto industry.

"If the Model 3 does not work out, we're not going to be talking about Tesla the same way in five years," Anand said. "We could very well be talking about Tesla, the company that used to exist."

SEE ALSO: Tesla's Model 3 is the millennial dream car

Join the conversation about this story »

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The key to disrupting a billion-dollar industry is 'ignorance,' says the founder of SoftBank's latest multi-million dollar investment darling

Posted: 12 Feb 2018 11:30 AM PST


  • Insurance provider Lemonade is a three-year-old startup that recently received $120 million in a funding round led by Japanese telecom giant Softbank.
  • Lemonade is attempting to reinvent the homeowners and renters insurance model in the US by cutting out brokers, offering competitive rates, and using an AI-powered mobile app.
  • Co-founder Daniel Schreiber sat down with Business Insider to chat about the key characteristic needed to break into a multi-billion dollar marketplace.


In the spring of 2015, Daniel Schreiber and Shai Wininger sat down in a cramped coworking space with a whiteboard and an unusual goal: to reinvent the homeowner and rental insurance industry, entirely from scratch.

The catch? Neither Schreiber nor Wininger knew anything about insurance.

Instead of reaching out to insurance experts to gain a better understanding of the industry, the co-founders resisted what Schreiber describes as a "temptation" to access insider knowledge and opted for an alternate route: "We milked our ignorance for all its worth," said Schreiber. 

Last week, Schreiber sat down for an interview with Business Insider in the freshly minted SoHo headquarters of the project he set out to create just three years ago. The result of Schreiber and Wininger's thought experiment is a company called Lemonade, a blossoming insurance provider that's everything the established insurance industry isn't.

For one, the startup's central product, a cheery white-and fuchsia-hued mobile app, is surprisingly straightforward. Users receive bespoke rates for renter and homeowner's insurance in an exchange with Lemonade's spunky chatbot, Maya. The entire process takes under two minutes.

And it's not just straightforward, it's affordable. When I take the app for a spin, I'm surprised by my quoted rate. For a home-rental insurance policy that covers everything from fires to vandalism to water damages, Lemonade quotes a rate of less than $8 a month. It's $6 less than the $14 from Liberty Mutual and nearly half of the $16 that Geico quotes me. 

LemonadeLemonade won't pester you with reminders to sign up, either — a congenial courtesy that might have escaped my notice, had it not been for the multitude of emails and voicemails left me by both Geico and Liberty Mutual. (Notably, the cheerless customer service representative at Liberty Mutual had about half the personality of Lemonade's chatbot.)

Aside from its competitive rates, everything about Lemonade's approach to insurance is distinctly counter-intuitive from what many people envision when they hear the word "insurance." There's nothing staid or stuffy about it, and the company is refreshingly upfront about their business model, which is presented in an upbeat cartoon that's available on YouTube.

The branding, the app, and the product are all intended for people like me: urban dwelling millennials who would prefer to handle their finances through personable, easy-to-use apps. 

Despite the obvious challenges ahead, Schreiber says undercutting the behemoth insurance industry presented an intriguing proposition to both Wininger and himself.

"We were looking at a few different things, but once we encountered insurance, we stopped. It had three things that never come together," he said. "How often do you discover a huge industry that nobody's touched in a hundred years that everybody hates? It's too good to pass up."

According to Schreiber, there's plenty of problems with the way the insurance industry currently makes money.

"Insurance companies make money by disappointing their consumers," said Schreiber. "It's difficult to think of another sector where that's true. But if they delighted all of their consumers, they'd go out of business, because the way insurance providers make money is by denying your claim."

Schreiber describes this model as an innate conflict of interest, in which customers and providers quibble endlessly over the same coin, imbuing the relationship with enmity even before a claim is filed. 

Instead, Schreiber and Wininger decided to implement a model in which they receive a flat 20% of the quoted rates for their services.

Lemonade has co-opted a clever approach to discouraging the filing of fraudulent claims as well. When users sign up for a policy, they're asked to select a charity of their choice. A percentage of any money leftover from unfiled claims will go towards the charity, which Lemonade hopes will deter any dishonest filings. The company estimates that 10% of its yearly revenue is awarded to its charitable giving program. 

With 75% of its users under the age of 35, Lemonade's attractive position as an insurance company that appeals to the country's up-and-coming city dwellers has attracted big name investors as well. In its most recent funding round, the company scored $120 million in a round led by Japanese telecom mogul Softbank. Schreiber says the funding will go into expanding both the company's platform and geographic reach, and hints at plans for other types of insurance that are in the works.

Schreiber credits Lemonade's early success in the industry to the ignorance which allowed both Schreiber and himself to re-envision an insurance company for the modern age. "We were able to think about stuff at a foundational, fundamental level," Schreiber said. "You don't often get to do that."

Join the conversation about this story »

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Amazon jumps after report says it's laying off hundreds of workers (AMZN)

Posted: 12 Feb 2018 11:30 AM PST

amazon workers

  • Amazon's stock jumped after a Seattle Times report said the ecommerce behemoth is planning to lay off hundreds of employees, primarily in its retail division.
  • The layoffs are being conducted amid the company's expansion plans that includes starting up a new headquarters.
  • Watch Amazon's stock move in real time here.

Shares of Amazon rose 3.32% to $1,384 per share on Monday following a Seattle Times report suggesting the ecommerce behemoth plans to layoff hundreds of workers, mostly in its consumer retail division. Monday's big gain has the retailer well ahead of the benchmark S&P 500, which trades up 1.56%. 

Though an exact number of layoffs was not disclosed, a person familiar with the matter told the Times that the number will be "several hundreds." Additionally, hundreds more could possibly be reassigned within the company.

"As part of our annual planning process, we are making head count adjustments across the company — small reductions in a couple of places and aggressive hiring in many others," the company told the Seattle Times. "For affected employees, we work to find roles in the areas where we are hiring."

The cuts come amid the company's rapid expansion as it plans to build a new headquarters in a select US city. It plans to hire or move over 50,000 employees to this new destination.

Amazon announced on Friday plans to launch its own shipping business, and a pilot program for same-day delivery service for grocery items from Whole Foods stores.

Amazon's stock was up 16.75% for the year.

Read more about why the Amazon-Whole Foods same-day delivery service may actually be a boost for other grocery stores.

Amazon stock price

SEE ALSO: The Amazon-Whole Foods delivery service may actually be a good thing for other grocers

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NOW WATCH: Microsoft President Brad Smith says the US shouldn't get 'too isolationist'

Cisco has got a big plan to beat its greatest rival in the next big network market (CSCO, ANET)

Posted: 12 Feb 2018 11:24 AM PST

Cisco CEO Chuck Robbins

  • It is a good time to buy Cisco stock, advises Nomura analyst Jeffrey Kvaal in a note to clients.
  • Cisco is in a good position against one of its most hated rivals, Arista Networks, in the next big thing to come to the networking industry: Networks that operate at speeds of 400 gigabits per second (400G) — four times faster than the fastest network today.
  • Cisco has a team of people trying to win Arista customers away with Cisco's 400G tech, Kvaal says.

The time is ripe to buy shares of Cisco, says one of the company's long-time Wall Street analysts, Nomura's Jeffrey Kvaal. In a research note on Monday, Kvaal upgraded the stock from neutral to buy, and upped his price target to $46.

The stock was trading at just under $40 at the closing bell on Friday, and it's been many years since it's hit $46.

There are a few reasons why Kvaal has become bullish on Cisco, just in times for the company's Q2 FY18 earnings report on Wednesday.

For one, he likes the company's security business, which he reckons is benefiting from Cisco's new push to sell software on a subscription basis. Cisco is now offering it customers all kinds of extra features and services when customers choose to buy an upgraded subscription of its software. For instance, Cisco premium subscribers get access to services like its Encrypted Threat Analytics, which helps companies analyze encrypted traffic to find viruses and other malware. 

For another, he believes that Cisco's flagship networking switch for the business, the Nexus 9000 — as well as its corporate WiFi equipment — will continue selling well. Companies are shifting ever-more of their IT to the cloud, which will cause them to slow down on buying data center equipment like Cisco's networking gear, However, Cisco may not see a hit from that trend that for another year or two, Kvaal believes. In fact, he says, companies are beefing up their corporate networks right now to better handle the shift to the cloud.

But the biggest reason Kvaal is hot on Cisco is because the company has got a handle on selling its latest network equipment to the cloud computing providers themselves.

As companies more more IT to the cloud, the big money shifts from selling IT to companies to selling it to the web and cloud providers. Running a cloud computing service requires massively scalable networking infrastructure, and Cisco is riding the wave, Kvaal says, and is already making good progress. Cisco has nabbed Microsoft and Google as cloud provider customers, and is doing well in China, too, notching up sales to Alibaba and JD.com, he says.

Ethernet technology keeps getting faster to serve this need, too. The cutting edge in networking speed right now is 400 gigabits per second (400G) – four times faster than 100G, the current standard. Cisco offers 400G-capable networking equipment, as does Arista Networks, its biggest rival.

In September, Morgan Stanley’s James Faucette came down as bullish on Arista, saying he believed it was positioned to grab the 400G market, just as it had fared so well against Cisco in 100G. Kvaal says that Cisco has no intention of letting that happen. He writes, "we believe Arista caught a wave with the 100G cycle that propelled strong share gains in 2017. Cisco claims to have teams of people working to prevent the same from happening again with the 400G cycle as it hits scale in 2019 and 2020."

Cisco and Arista have a long and contentious history. Arista was founded by former Cisco star engineers and, under former CEO John Chambers, Cisco created what it called a "tiger team" dedicated solely to competing with Arista.

SEE ALSO: Against all odds, former Intel exec Renee James has launched a new chip company: 'Everyone took my calls. Everyone told me no'

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NOW WATCH: A cybersecurity expert showed us how hackers can tap into an office phone and listen to everything you're saying

The ideal smartphone is all screen with no buttons or borders — here's how close it is to becoming a reality

Posted: 12 Feb 2018 11:04 AM PST

vivo phone with synaptics hidden fingerprint sensor

Smartphone makers have had us drooling for years over the idea of a phone that's all screen, with no buttons or borders to interrupt the pure design.

But try as they might, the concept hasn't exactly come to fruition. The most popular devices have come with extremely thin bezels — or, like the iPhone X, add a notch toward the top of the phone to house the camera and all its front-facing sensors.

Still, we've been seeing more patents and murmurings of an all-screen phone. Here are some details on what might be in the smartphone pipeline.

SEE ALSO: Samsung wants to best Apple with a notch-free phone

Several details have surfaced in recent days suggesting that smartphone designs could shift in many different directions.

An image shared by Slashleaks last week showcased a prototype of a bezel-less smartphone by the Chinese manufacturer Vivo.

The device also has no visible home button, leading us to assume it's similar to the Vivo X20 Plus, which the manufacturer announced in January as the first mobile device with an in-display fingerprint sensor.

Vivo isn't the only manufacturer considering an edgeless design.

Samsung recently registered a patent for a smartphone with a "full-screen-filling display."

Images included with it suggest there could be a component at the top of the display, which Let's Go Digital refers to as a top notch. However, it could also be a cutout for a front speaker.

There is no indication from the images that the screen isn't continuous.

It might take a while for all-screen phones to become mainstream.

It looks as if Apple's iPhone line will feature the TrueDepth camera system (aka "the notch") for the foreseeable future, and Google is also rumored to be working on a slew of smartphones with top notches.

A recent report from Bloomberg suggests Google's coming Android P software update may include optimization for smartphones with notches at the top, like the iPhone X.

The tech giant seems to be preparing its operating system for a host of more modern smartphone designs, anticipating not only Android devices with top notches but also devices with flexible displays and multiple screens.

See the rest of the story at Business Insider

Trump's $1.5 trillion infrastructure plan ignores one key thing that could prevent billions in annual damages

Posted: 12 Feb 2018 10:21 AM PST

miami flood

  • On Monday, the Trump administration unveiled its infrastructure plan, which would budget $1.5 trillion toward fixing and rebuilding the nation's roads, bridges, water systems, airports, and more.
  • However, the plan does not mention resilience in the face of climate change.
  • Severe weather, exacerbated by rising temperatures and greenhouse-gas emissions, costs the US billions in infrastructure repairs every year.

On Monday morning, the Trump administration revealed its long-awaited infrastructure plan, which aims to funnel $1.5 trillion toward fixing the nation's roads, bridges, airports, and more over the next decade.

However, the 55-page plan ignores the key thing that would save the US billions in infrastructure every year: resilience in the face of climate change.

Stephanie Gidigbi, a policy director at the Natural Resources Defense Council, called the plan "misguided."

"The Trump administration’s misguided infrastructure plan ignores the threats facing our country from stronger storms, higher temperatures, and bigger floods," she told Business Insider. "Smart investments in our future would help make our communities more resilient to withstand the effects of climate change, and would recognize the opportunities in cleaner energy."

Though it's hard to say exactly how much climate change-linked infrastructure damages costs the US, a 2017 study estimates that rising temperatures are increasing maintenance and construction costs for roads by billions of dollars every year.

That's because asphalt is sensitive to temperature. If it gets too cold, it can crack; and if it gets too hot, it can partially melt. Temperature can determine the construction method, too. Asphalt blends that are more resilient to hot summers often cost more, but they are also less prone to damages.

In 2010, temperature changes added anywhere from $13.6 billion to $14.5 billion in annual pavement costs, according to the study. That figure could increase to $19 billion in 2040 and $21.8 billion in 2070. Under a more extreme prediction, warmer temperatures could contribute $26.3 billion and $35.8 billion in annual costs by 2040 and 2070 respectively.

These forecasts do not account for road impacts from flooding and storm surges, which would make cost figures even higher.

"Because these transportation systems constitute large civil investments ($7.7 trillion in assets and $45 billion annual expenditures) and underpin an economic vibrancy [3.1 trillion miles] of public travel per year and private citizen expenditures equal to 8.9% of GDP), the impacts [of climate change] may be substantial," the researchers wrote.

Trump's plan is a departure from how infrastructure is usually funded. As BI's Bob Bryan notes, the federal government typically covers the majority of the cost, but under Trump's plan, local governments would take on 80% or more of the financial burden. Local governments are already largely responsible for repairs after major storms and other weather events. The City of New York, for example, plans to spend $20 billion on damages from Hurricane Sandy.

"This proposal doesn’t begin to respond to the scale of assistance local communities need to cope with these mounting impacts — it merely shifts the burden of rebuilding our nation’s crumbling infrastructure onto state and local budgets which are already strapped," Ken Kimmell, president of the science advocacy nonprofit Union of Concerned Scientists, said in a statement.

One section of the plan says the White House hopes to expedite the environmental review process for new infrastructure projects by requiring a firm deadline of 21 months. Under current law, projects require analyses that anticipate environmental impacts, some of which take years. Democrats have expressed uncertainty link? about cutting down this regulatory red tape. They say that shrinking the approval time for reviews could make it easier for project sponsors to dodge environmental regulations.

The plan builds on the Trump administration's promise to roll back legislation that addresses climate change, including the Clean Power Plan, Paris Agreement, and Clean Water Act. In 2017, the US government revoked a plan to require higher flood standards for highways and bridges as well.

Kimmel notes the infrastructure plan also doesn't mention renewable energy, the modern electric grid, resilience, or adaptation.

"This is a plan to shore up the infrastructure of the past, rather than invest in what we need for the future," he said.

SEE ALSO: Trump is announcing a huge $1.5 trillion infrastructure plan — here's what's in it

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NOW WATCH: Watch SpaceX launch a Tesla Roadster to Mars on the Falcon Heavy rocket — and why it matters

Tesla's Model 3 is the millennial dream car (TSLA)

Posted: 12 Feb 2018 10:14 AM PST

model 3 interior

  • Tesla is the premier, aspirational car brand for millennials.
  • The company's appeal is rooted in its ability to create a narrative that extends beyond traditional cars to renewable energy, space exploration, and self-driving vehicles.
  • The Model 3's tech features make the car particularly appealing to millennials.

Forget Mustang and Corvette. Tesla is the premier, aspirational car brand for millennials. 

But unlike traditional, aspirational car brands, millennials aren't attracted to Tesla because it implies wealth. They like Tesla because the company cares about more than cars.

"I think Tesla, to a lot of millennials, is more than just a car brand. It's a lifestyle," Kelley Blue Book executive analyst Akshay Anand told Business Insider. 

Tesla's vision reaches beyond traditional cars

Anand said Tesla's appeal to millennials is rooted in the company's ability to create a narrative that includes renewable energy, space exploration, self-driving vehicles, and other developments that could produce wide-ranging benefits for the human race. Anand said millennials "tend to be very cause-centric" and "care about what companies stand for," which makes Tesla CEO Elon Musk a perfect cult figure, and could explain why Tesla was ranked as one of millennials' favorite brands, according to a 2017 survey. 

Musk's ambitions, which include revamping global energy grids and starting colonies on Mars, may reach further than those of any American business executive. He represents the potential for a business culture that cares about more than profits — though it doesn't hurt that he makes beautifully-designed electric vehicles that look like sports cars. 

But Tesla's early vehicles — the Roadster, Model S, and Model X — were expensive, starting above $70,000 and able to hit $100,000 with optional features. So in order to convert young Tesla evangelists into Tesla customers, the company had to make a car that was affordable to those whose salaries and savings accounts didn't justify the steep price tag of a Model S or X.

The Model 3's price makes it more accessible to millennials

Enter the Model 3, which starts at $35,000 and has received a "strong response from millennials," according to Anand. While Tesla is working through significant production delays with the vehicle, early reviews from customers who have received it tend to be positive. The car's handling and acceleration are appealing to owners of all ages, but the car's tech features have a particular appeal among millennials.

"I think that Tesla has a leg up when it comes to technology in the minds of people, and I think that's especially critical when it comes to millennials," Anand said. "We've grown up with smartphones in front of our faces."

For the Model 3, Tesla removed the instrument cluster to bring even more attention to a 15-inch touchscreen display that controls many of the car's interior features. The Model 3 also includes some of Tesla's standard tech features, like over-the-air updates and an Autopilot system with semi-autonomous features that can be used in some situations.

Now, all Tesla has to do is figure out how to make the Model 3 fast enough to keep up with demand. If the hundreds of thousands of pre-orders for the vehicle are any indication, the millennials are waiting.

SEE ALSO: Tesla created the world's best car commercial without spending a dime on advertising

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NOW WATCH: A $445 billion fund manager explains what everyone gets wrong about the economy

There are 2 major reasons you should buy Apple's HomePod over an Amazon Echo (AAPL, AMZN)

Posted: 12 Feb 2018 09:35 AM PST


Apple's first foray into smart speakers is officially here.

The HomePod, which costs $350, became widely available last Friday. It offers high-end audio combined with Apple's smart assistant, Siri, all packed inside a cylindrical body.

In fact, it bears a quite a few similarities to another smart speaker on the market: the $100 Amazon Echo.

The Echo has been hugely popular with consumers over the past few years. Amazon doesn't disclose device sales, but it pegged holiday sales of Alexa-enabled devices in the "tens of millions."

And the number of people buying Echo devices has skyrocketed over the past year: Amazon shipped 5 million devices in the third quarter of 2017, compared with 900,000 during the same period the year before, according to data from Strategy Analytics.

So with all the popularity of the Echo — which is now in its second generation — why should you consider Apple's HomePod? There are two main reasons.

SEE ALSO: 8 reasons you should buy a Google Home Max instead of an Apple HomePod

1. HomePod is the best way to listen to Apple Music, bar none.

Apple Music doesn't yet have the same global dominance as the music streaming service Spotify. As of September, Apple Music had 30 million subscribers to Spotify's 60 million.

Still, 30 million users is nothing to scoff at, and many of them are most likely looking for a way to get the most out of their music.

Enter the HomePod.

While the version of Siri built into the HomePod is subpar in a lot of ways, where it shines is with Apple Music. You can say things like, "Hey, Siri, I don't like this song," and the device will adjust the music accordingly and remember for the future.

It also learns what you like over time, so if you say, "Hey, Siri, play some party music," it will present you a playlist full of the types of artists and genres it knows you like.

While these capabilities may not be must-have features, they're certainly enhancements to any listening experience. Plus, everything syncs between the Apple Music you're enjoying on the HomePod and the version on your phone, so your preferences will carry over when you leave the house.

Apple WWDC 2017 HomePod

2. HomePod sounds incredible.

I got a demo of the HomePod's comparison with other leading smart speakers on the market, and the Echo has one similar advantage when it comes to the sound: Since the speaker wraps around the entire device, it sounds the same no matter where you're standing, much like the HomePod.

The Echo and the HomePod also both have a soft mesh exterior and touch controls on top. But the insides of the devices are very different, and that's what makes the HomePod's sound significantly better.


The HomePod has seven tweeters spaced evenly around the circumference of the device, so it sounds great no matter where you're standing. The Echo, meanwhile, has one tweeter in the center of the device.

Having more tweeters, which are responsible for producing the highest audio frequencies, typically creates a better, more nuanced sound.

The HomePod also has a high-excursion subwoofer, meaning it can produce deep bass. The Echo has a subwoofer too, but in the demo I got, its bass didn't sound as deep and rich as the HomePod's.

Plus, the HomePod has room-sensing technology that allows it to tune the music based on its surroundings, bouncing ambient sounds in your music off nearby walls. And while it's not available yet, the HomePod will eventually be capable of stereo pairing, which means you can have two HomePods sync to create a fuller, more immersive sound.

If you're looking for a smart speaker that can do internet searches for you, handle complex requests, manage your email and calendar, place calls, and essentially act as your phone while you're at home, the HomePod is not the device for you. There are several major shortcomings with the "smart" aspects of the HomePod that are likely to be a turnoff for anyone looking for an intelligent assistant.

But if you're looking for a great way to listen to music, the HomePod is well worth considering.

See the rest of the story at Business Insider

The CEO of digital advertising's biggest trade group says most big marketers are screwed unless they completely change their business models

Posted: 12 Feb 2018 09:30 AM PST

asteroid meteor armageddon shutterstock

  • Big marketers are facing a crisis, according to Randall Rothenberg, president and CEO of the Interactive Advertising Bureau.
  • Small and mid-sized brands, driven by data and digital marketing, are throttling growth for nearly every major consumer category.
  • Giants like Procter & Gamble and Unilever once had huge advantages in owning their own supply chains and shelf space in national retailers. Now those advantages are liabilities.
  • These companies need to shift their models to direct-to-consumer businesses ASAP or risk being disrupted.
  • Traditional media companies also need to adapt quickly to this new reality or they'll get left behind.

Every industry is under attack from upstarts. Most big companies aren't prepared for a new tech and data-driven economy. Consumers don't care about big brands and are tuning out traditional advertising. 

In a nutshell, traditional marketers are screwed. And traditional media companies aren't much better off. It's all Warby Parker's fault.

These are just some of the stark takeaways being presented by Randall Rothenberg, CEO and president of the Interactive Advertising Bureau, which is hosting its annual leadership event this week in Palm Springs, California.

Rothenberg plans to warn attendees that the marketing and media industries are in the midst of tectonic change, the likes of which has not been seen since the industrial revolution rocked the US agriculture economy more than a century ago. Yes, the situation is that dire, he said.

In fact, the IAB's new research report, The Rise of the 21st Century Brand, opens with the cheery subject: "Brand Growth in Crisis."

The big takeaway from Rothenberg's speech is that basically every single condition and dynamic that traditional marketing companies had been able to count on to protect their dominance over the past several decades has been upended.

Take the much-celebrated Warby Parker. It's built a huge business by cutting out expensive distribution and marketing costs, and selling glasses directly to consumers for way cheaper than they've been used to at incumbents like Lenscrafters. Rothenberg's point is that there are Warby Parker's in every industry.

Warby Parker

There are Warby Parkers and Caspers everywhere

Indeed, this new breed of marketers don't own their own supply chains, or raw materials or shelf space. They don't need to.

An out of nowhere cosmetics company (like Glossier) or frozen food maker or specialized craftsman can make goods without having to own a factories or trucking routes, or needing to hire a giant ad agency and buy massive media campaigns. They don't have to get shelf space at Wal-mart either.

They can sell to people on Instagram for a fraction of what marketing used to cost. And they can collect data on these consumers, track what they buy, what they love and hate about the experience, and market to them directly much more effectively.

It's the direct consumer relationships, and the use of consumer data, that is completely game-changing for the marketing world. And most big marketers, such as Procter & Gamble and Unilever, are not ready for this new reality, the IAB says.

Putting it all together

In a lot of ways, this sentiment won't be a huge surprise to many in the ad industry. They've seen ad conference darlings like Casper and Warby Parker make inroads in their respective industries. Their heads turned when consumer product giant Unilever spent $1 billion in 2016 for Dollar Shave Club, and when an activist investor took on Procter & Gamble for moving too slowly – in its eyes – to adjust to these new realities.

And of course, the ongoing retail Apocalypse – exemplified by classic American brands like Sears – is of top of mind for most marketers.

What the IAB is attempting with this report is to quantify these changes, and put them in context. And what the trade group found is that the upstart direct brands phenomenon is carving up nearly every traditional ad category, and collectively is impacting the economy.

"We pulled together a lot of things that are staring everyone in the face, and we backed that up with lots of data," Rothenberg told Business Insider.

Randall Rothenberg headshot IABFor example, the IAB report shows that outside of health care and technology, few Fortune 500 companies are growing. For example:

  • the 45 retailers in this category grew just 2.1% from 2014 through 2016.
  • Apparel companies grew just .5% during that time period.
  • Household products companies actually contracted by .3%

Keep in mind, all this has been happening as the US economy has been hitting its stride.

To help bolster the IAB's research, the organization worked with Dun & Bradstreet, which has compiled a massive database of 290 million business records from the majority of commercial entities in the US. The two groups have put together “IAB 250 Powered by Dun & Bradstreet,” which is essentially a compilation of the 250 most important brands driving this change – everything from Wal-mart's Jet.com to the subscription pet brand BarkBox to the luggage startup Away Travel.

This list is very much the opposite of the Ad Age 200, which traditionally compiles the list of biggest spending advertisers, such as P&G, General Motors, Pepsi and McDonald's.

"We think we're proving that the center of growth is shifting permanently," he said. "This is basically as significant as the change from the agrarian economy to industrial. Every function you used to need to own you can get off shelf."

Big brands are being nibbled to death


A perfect example of this point is Gillette

According to the IAB report, Gillette’s share of the US men's-razors business fell to 54% in 2016, from 70% in 2010. Dollar Shave Club and Harry’s combined US share rose to 12.2%, from 7.2% in 2015.

Another good example is the pet food category, which per the IAB is expected to grow 4.4% in 2018. Which isn't bad. But upstarts like the subscription pet product company The Farmers Dog is averaging 40-50% revenue growth monthly, says the report.

This is happening everywhere, said Rothenberg. As recently as 1992, 96% of shopping happened in stores. By 2015 9.4% was happening on the web.

In 2016, small and medium-sized consumer packaged goods manufacturers together represented 64% of sales, up from 39% in 2015.

"Big brands are being nibbled to death," said Rothenberg.


Rothenberg warned that too many people in the marketing industry have treated companies like Casper and Warby Parker as "really interesting curiosities," while not recognizing the collective impact these types of firms have on industries. "They are representative of transcendent change for the consumer economy itself," he said. 

There's only one thing big marketers can do

You might think that giant marketers can easily strike back, given their deep pockets. But many are actually strapped by their legacy businesses. For example, owning stores, massive supply chains and logistics right as people pull away from traditional in-store shopping is actually a huge liability at the moment, Rothenberg argued.

"There’s only strategy," he said. "Become direct." Easier said that done. 38% of companies tracked by the global intelligence firm International Data Corporation are not selling direct to consumer at all, said the IAB's report. "Most are lagging," said Rothenberg.

This has big implications for media companies. And it could be bad news for TV

Given the massive changes hitting consumer industries, selling attention – or loads of ad impressions – matters a lot less than the old days of mass marketing advertising. To help direct-to-consumer brands, media companies that used to just sell ad space need to prove they can help companies acquire customers.

That's a big change.

Right now, driving customer acquisition is a strength for digital media giants like Google and Facebook. Not so much for network television, which has long relied on the biggest national advertisers, not the Glossiers or Caspers of the world. A company like Dollar Shave Club built its name via a cheap web video ad, not a slick TV commercial.

"You can't rely on the top 250 brands anymore," said Rothenberg. "Media companies that do, they're in trouble."



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Olympians may be taking cues from Silicon Valley's favorite way to do drugs

Posted: 12 Feb 2018 09:30 AM PST

Snowboarder at Mammoth Mt

  • Doping is fairly widespread among elite athletes.
  • The World Anti-Doping Agency does extensive testing to prohibit the practice, but experts say their rules may leave room for cheating.
  • Athletes may also be microdosing steroids as a means of flying under the testing radar.
  • Microdoses could provide a significant boost that remains in the system just for the length of an Olympic event.

Cheating in the Olympics isn't that hard.

Estimates suggest that between a third and nearly half of elite athletes use steroids or other drugs to boost their performance, according to a January study commissioned by the World Anti-Doping Agency, or WADA.

"It’s like taking candy from a baby. That's how easy it is for smart chemists and advisers to circumvent WADA testing," Victor Conte, the controversial supplement maker who served jail time for his role in a 2003 doping scandal, told The Guardian.

The problem may be getting worse, thanks to a new doping strategy. Microdosing may allow athletes to give themselves a perfectly timed boost that cannot be detected with current testing. The method capitalizes on the same doping schemes that athletes have been using for years, but involves a very small dose of a steroid — which stays in the system just long enough to give an extra advantage during an event. By the time an athlete reaches the finish line, the drugs are no longer present.

"This is figuring out how to cheat without getting caught. It's really just doping by another name,” Ruth I. Wood, the chair of integrative anatomical sciences at the University of Southern California Keck School of Medicine, told Business Insider.

How microdosing steroids might work

skiingMost performance-enhancing steroids are lab-produced variations on the male sex hormone testosterone. Testosterone-derived steroids are relatively inexpensive to buy, and because the body produces its own version naturally, they are generally harder to identify in a drug test.

In Pyeongchang, endurance athletes will be tested rigorously for steroids as well as a drug called EPO, which is designed to boost endurance and may also be used in microdoses, according to AFP. But testosterone microdoses may escape regulators' radar because they only stay in the system for minutes or hours. 

The current approach to testing for steroids involves taking both blood and urine samples to test for the presence of anabolic agents. Such tests can occur at any time and any location during the Olympics, including just after a competition, according to the US Anti-Doping Agency.

In its tests, WADA compares a ratio of two types of testosterone to determine if athletes have been doping. One type is regular testosterone, and the other is a precursor form called epitestosterone. Since the body produces roughly equal amounts of each naturally, most people have a ratio of one-to-one. Still, there is some natural variation, which is the reason WADA allows the testosterone-to-epitestosterone ratio to reach up to four-to-one for Olympic athletes.

Because the most cheaply available and common steroids are based on testosterone, an athlete who injects would likely have a ratio closer to six-to-one or higher. But because WADA rules allow for a fairly generous ratio, athletes could still be using microdoses to top-up a larger, more chronic doping strategy. Some experts say athletes could even get a significant boost in muscle and strength by doping within the permitted ranges.

Microdosing isn't easy

Wood believes athletes who microdose are likely to be taking chronic, higher doses of steroids — just enough to fall within the WADA limits — then using a microdose, perhaps in the form of a shot, just before an event.

Still, the practice of microdosing may be much trickier than athletes anticipate. Sprinter and Olympic silver medalist Lauryn Williams told the Daily Mail that in 2012, she was advised to microdose on testosterone by the same doctor who treated world champion Tyson Gay. But Gay tested positive for testosterone in 2013.

When compared with traditional doping schemes, microdosing requires more frequent dosing delivered at just the right time, according to the US Anti-Doping Agency. Because testing agencies are aware of the practice, they are increasingly aiming to develop more stringent means of detecting any foul play. 

"If you take a small amount before a contest, that testosterone will have its effects but then it would dissipate by the time you're asked to give a sample,” Wood said. "The goal of course is to get the benefits and not get caught.”

SEE ALSO: A little-known technology that Fitbit and Apple are exploring could be the answer to healthy eating and peak performance

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