April 11, 2020
What Will The New Normal Be Like? | Scott Galloway on The James Altucher Show
Check out The James Altucher Show Episode Page & Show Notes
Key Takeaways
- “If we were to all successfully distance 6 feet for 14 days, you’d likely put a stake through the heart of this thing” – Scott Galloway
- If you don’t socially distance, you’re not only putting yourself at risk but also others at risk
- Scott’s predictions for the new normal:
- About 70-80% of retail stores will close
- Grocery deliveries will grow by 10-15% over the next few years
- Remote work is going to rise and it will be normal for workers to work from home 2-3 days a week
- The office space business will decline
- Healthcare will become more remote and prescriptions will be delivered to your home
- “Every year [universities] raise prices faster than inflation so the jig is up, people realize that’s just not worth it” – Scott Galloway
- Universities should be public servants, not luxury brands
- “We’re about to get wildly disrupted in higher ed”
- Universities should be public servants, not luxury brands
- Scott doesn’t believe many universities will open again in the fall
- “I can’t imagine we’re going to make a conscious decision to open again” – Scott Galloway
- The top universities will be fine but a large number of schools who were dependant on tuition will close up and never reopen
- “I can’t imagine we’re going to make a conscious decision to open again” – Scott Galloway
- For a lot of kids, the traditional form of college (living on campus and going to a physical classroom) will become the ultimate luxury item
- Students don’t pay for an education, they pay for the brand: “The strongest brand in the world is not Apple, the strongest brands in the world are Harvard, MIT, Carnegie Mellon, these brands have been built over centuries” – Scott Galloway
Intro
- Scott Galloway (@profgalloway) is the author of The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google and The Algebra of Happiness
- He hosts 1k: The 1,000 Second Interview Podcast and co-hosts Pivot with Kara Swisher
- He is also is a Professor of Marketing at NYU Stern School of Business
- Host – James Altucher (@jaltucher)
Thoughts on COVID-19
- Scott is currently sheltering in Florida while James is in NYC
- “Every bar and restaurant right now in New York City is out of business, even chains” – James Altucher
- James believes that Small Business Administration (SBA) loans will help bring most of them back, but it’s hard to predict the future
- “Every bar and restaurant right now in New York City is out of business, even chains” – James Altucher
- “If we were to all successfully distance 6 feet for 14 days, you’d likely put a stake through the heart of this thing” – Scott Galloway
- If you don’t socially distance, you’re not only putting yourself at risk but also others at risk
- “My sense is the way we go after this thing is just to distance like crazy in a very vigilant and hopefully short time”
- About 7-9 states still haven’t gone into lockdown
- “My sense is the way we go after this thing is just to distance like crazy in a very vigilant and hopefully short time”
- If you don’t socially distance, you’re not only putting yourself at risk but also others at risk
- The U.S. currently has more infections than China, Italy, and Spain combined!
- However there is some good news: “All the models that predicted enormous hospitalizations in New York City are now about 80-90% off, including the model they used in the White House to figure these things out” – James Altucher
- The peak for NYC will be in 6-7 days (around April 15th)
- However there is some good news: “All the models that predicted enormous hospitalizations in New York City are now about 80-90% off, including the model they used in the White House to figure these things out” – James Altucher
- “So far no one can be accused of overreacting, the only negative attribute I think in response will be that thus far that we, amongst leaders, amongst citizens…is that we underreacted.” – Scott Galloway
- Scott is worried about the possibility of the virus coming back in the winter
- In war, the guy next to you is your ally, but in a pandemic, the guy next to you is your enemy
- The US is looking at around 100-250K deaths from COVID-19
- The US considers itself technologically innovative, but when the crisis hit, it couldn’t meet demand for ventilators or protective equipment
- “I think our response here…hasn’t been what I’d call robust or reflective of…what’s supposed to be the most innovative supply chain an technologically sophisticated economy in the world” –Scott Galloway
- When we look back at how we handled COVID-19, we’re not going to feel very good about it
- “I think our response here…hasn’t been what I’d call robust or reflective of…what’s supposed to be the most innovative supply chain an technologically sophisticated economy in the world” –Scott Galloway
- “This is worse for the economy than coming out of war” – Scott Galloway
- When you come out of war, there’s a shared sense of optimism and unified vision for the future
- In a pandemic, there’s a lack of optimism: “The reason why people don’t talk about the Spanish flu that killed so many people in America is we’re ashamed of our response”
- “I’m hopeful we come out of this with a generation of leadership that is more emphatic, thinks more long-term…and realizes the key isn’t to create more billionaires but to create more jobs” – Scott Galloway
Scott’s Predictions For The New Normal:
- About 70-80% of retail stores will close
- Grocery deliveries will grow by 10-15% over the next few years
- Remote work is going to rise and it will be normal for workers to work from home 2-3 days a week
- The office space business will decline
- Healthcare will become more remote and with prescriptions delivered to your home
- The biggest winner in healthcare will be Amazon
- There will be a consolidation of healthcare providers and players
- The biggest winner in healthcare will be Amazon
- In tough economies, such as the current one, people move from startups to more established and secure companies like the Fortune 500
Education Will Change Forever
- “Every year [universities] raise prices faster than inflation so the jig is up, people realize that’s just not worth it” – Scott Galloway
- Universities should be public servants, not luxury brands
- “We’re about to get wildly disrupted in higher ed”
- Facebook disrupted media, Amazon disrupted retail, now big tech is coming to disrupt education
- “We’re about to get wildly disrupted in higher ed”
- Universities should be public servants, not luxury brands
- Scott doesn’t believe many universities will open again in the fall
- “I can’t imagine we’re going to make a conscious decision to open again” – Scott Galloway
- The top universities will be fine but a large number of schools who were dependant on tuition will close up and never reopen
- “I can’t imagine we’re going to make a conscious decision to open again” – Scott Galloway
- If universities shift to online education, many parents won’t pay the $50K tuition price for their child to sit on Zoom calls all day
- Scott believes some big tech companies will partner with universities to create 2-year college programs (e.g. Google and MIT partner together)
- The best professors will make 3-10x what they make now because they will be in higher demand
- For a lot of kids, the traditional form of college (living on campus and going to a physical classroom) will become the ultimate luxury item
- Students don’t pay for an education, they pay for the brand: “The strongest brand in the world is not Apple, the strongest brands in the world are Harvard, MIT, Carnegie Mellon, these brands have been built over centuries” – Scott Galloway
- Most middle-class Americans won’t be able to afford the traditional college experience and will instead have their kids enroll in online learning programs
- Students don’t pay for an education, they pay for the brand: “The strongest brand in the world is not Apple, the strongest brands in the world are Harvard, MIT, Carnegie Mellon, these brands have been built over centuries” – Scott Galloway
- If online courses become popular, there’s a chance that liberal art degrees will go away–students will only want to study topics that will help them get a job sooner
- Jobs use college as a filter mostly only for a person’s first job; after that employers care more about your skills than your education
How The Media World Will Change
- The content space is booming, especially in the scripted TV and podcast space
- However, traditional media will have a hard time competing with big tech–Apple doesn’t need to make a ton of money from their content, they just need to show their content is helping them sell more smartphones
- “Content is now a feature of a smartphone company” – Scott Galloway
- The same goes for Amazon, all they need to show is that having content increases their number of Prime subscribers
- “Content is now a feature of a smartphone company” – Scott Galloway
- However, traditional media will have a hard time competing with big tech–Apple doesn’t need to make a ton of money from their content, they just need to show their content is helping them sell more smartphones
- “It’s going to be a great new age for consumers…for information workers, it’s going to be a great time to own Amazon and Google stock, but we’re going to see the same trends around income inequality” – Scott Galloway
- Nobody remembers the bad shows a company puts out–Amazon could put out 50 shows and 49 could fail, but Amazon’s brand will stay the same and people will simply watch their one good show
- Big tech companies have the budget to steal the best executives from media companies and hire the best talent for their shows
- Nobody remembers the bad shows a company puts out–Amazon could put out 50 shows and 49 could fail, but Amazon’s brand will stay the same and people will simply watch their one good show
Talent Will Be Built, Not Gifted
- The next generation of talent will be determined by the number of followers people have on their platforms
- The more followers a person has, the easier it becomes to market a book, TV show, podcast, etc.
- Scott got a deal with Westwood One to start a podcast because of his large social media following
- Building a brand isn’t easy, it’s a daily grind that takes years to payoff
- Each platform requires slightly different content because the audiences aren’t the same
- Don’t be reliant on a single platform, if it disappears you’re going to be in trouble–create an email list so you have direct contact with your audience
- Each platform requires slightly different content because the audiences aren’t the same
- The more followers a person has, the easier it becomes to market a book, TV show, podcast, etc.
- James estimates that 9 out of 10 people who stop him on the street do so because they’ve heard his podcasts, not because of his blog or books–that’s the power of podcasting
- Books are like a college degree, they establish you as a thinker, but podcasts are what get your name out and expose you to the world
- Scott says writing a book is probably the hardest thing he’s ever done
- Books are like a college degree, they establish you as a thinker, but podcasts are what get your name out and expose you to the world
Additional Notes
- If you’re struggling economically or emotionally right now, reach out to people for help
