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”
  • 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
  • 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

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
  • “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
  • 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)
  • “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
  • “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
  • 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
  • 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
  • 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 
  • 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 
  • “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

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
  • 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 

Additional Notes

  • If you’re struggling economically or emotionally right now, reach out to people for help
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Notes By Alex Wiec

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