Scott Galloway: Growth Is the New Profitability

A loser: profitability. The most disruptive company in the largest economy, Amazon, is setting the cue for a new relationship between investors and companies. Simply put, vision and growth have replaced profitability. Amazon wasn’t profitable until 2001, seven years after it was founded, and since then its profits have been negligible. What happens when Amazon reports a big profit? Jeff Bezos calls senior management into a room and says you fucked up and greenlights a bunch of very expensive initiatives that will deliver against long-term advantage. This gestalt around capital formation has moved all the way down the ecosystem. Small companies now pursue leadership versus profits. Why? The market doesn’t seem to demand profits from quote-unquote innovators. A continued loser: Ad-supported television. There’s almost triple the amount of sports content than there was ten years ago, but fewer people are watching it. On top of that, tech giants are buying the digital rights to sporting events. Amazon recently purchased NFL streaming rights for $50 million, quintupling the bid from last year from Twitter. Facebook also signed deals in March to stream Major League Soccer matches and is in talks to buy the digital rights for Major League Baseball games. Prediction? In the next 24 months, we’re going to have one of the Big Four – Apple, Amazon, Facebook or Google – buy the rights to the Olympics, March Madness or the Super Bowl. This is one of the last bricks to fall from the wall protecting the industrial ad complex. The winner: Viewers, who will have more options to view content on their own terms and hopefully, for at least now, fewer shitty ads shoved down their throats. The losers? Those of us that wouldn’t have known unless we watched ad-supported TV that there was a treatment for opioid-induced constipation. Hi, I’m Frank, I take Movantic for OIC – opioid-induced constipation. I tried prunes, laxatives, still constipated. Had to talk to my doctor. She said how long you been holding this in? What the fuck. A winner? Reviews, which have fundamentally changed the way we shop. Most adults under 50 read online reviews before buying new products and one in four shoppers check Amazon reviews even when they’re inside a store. A third of online shoppers claim they won’t buy products that don’t have positive reviews. The average consumer rating on Amazon is 4.4 stars. We’re living in Lake Wobegon. All the women are strong, all the men are good-looking and now all the products are above average. This is the part of the episode where I usually make some snarky comment about my prostate or porn. However, many of us were having a difficult time coming up with something humorous with all the images coming out of Syria. We wanted to spend this time talking about some of the things we can all do to try and help. You can donate or volunteer at the following charities. The International Rescue Committee has rescue workers in Syria providing medical services and emergency shelter, Save the Children is addressing the emotional scars of Syrian children and Oxfam is helping settle Syrian refugees in over 90 countries. I’m going to spend some time investigating Lifeline Syria where you can sponsor a Syrian family. I will let you know what I find out. We’ll see you next week.

100 Replies to “Scott Galloway: Growth Is the New Profitability

  1. There is still value in old "classic" companies that reliably churn out profits quarter after quarter though, right? Every industry can't necessarily be disrupted. I mean for all the talk of Tesla's value, as a car guy I think they still have a lot of serious execution issues just from a basic auto manufacturing standpoint. I think growth is probably worth more now than it was before, but I also think it's being used as a cover for the overvaluing of bad business. You can't really compare something like Tesla to Amazon, but the excitement surrounding both seems to be similar.

  2. Aww, I was going to make a joke, but then you had to go and get all serious with the Syria talk. Now I'm going to be backed up, holding the comedy in until next video.

  3. When shit got real, major props for mentioning Syria and showing how we can help, most would be afraid of backlash, props!!!

  4. Scott, thank you. It can't be said enough; you're generosity, insight and no bullshit approach is a beacon to my day and the mundane.

  5. Could some one explain this to me. If Amazon strives not to be profitable then why is Jeff Bezos one of the richest people in the world?

    Thank you for the help.

  6. companies have been focused on growth over profit for a LONG time- I would argue it has added to our economic woes, so I have one question for you Scott…
    How long have you been holding this in?

  7. Really stunning layout, especially the bit about the issues in Syria and how we can all pitch in, to help other human beings…

  8. thank you for the Syria shout out. I am looking to get involved and very overwhelmed with grief. this gives me hope

  9. I get so excited to hear that cable television is dying. And please can someone get the rights to the fucking olympics so we can watch it digitally on a decent platform. NBC is doing a shit job at it. We want more content than a 2 minute advert for a sport.

  10. FUCKING-FINALLY. Growth should have always been better than profitability. Investors have always been stupid, this is why playing in the market is so easy if you don't mind a little risk. Profit chasing never has good long-term returns.

  11. so what's the profitability of this YouTube channel? genuinely wondering. on another note thanks for talking about options for helping Syria

  12. Jeff Bezos needs to give Scott a board seat. Scott is responsible for increasing Amazon market cap by billions

  13. im glad you gave awareness out for syria and those charities. One question is, esports seems to be turning up on investors radar now. Have you got any comments on this?

  14. Excellent show. Dont know what you expect of donating to a third world degenerate hole though. Its very difficult to do charity for an instable mess of a nation. Most of it gets swallowed up without ever producing any long term benefits.

    But hey if you wanna flush money for some marginally noticeable benefit to someone else, go on and do it. Maybe give a nearby homeless bloke a burger or something too. Wont fix anything, but it feels kind of nice. Would be nicer if those places could get all the religion out to allow social structure a chance for building.

  15. Excellent work. I want to point out that IRC usually gets the highest ratings for best use of donations. The others I can't speak to but thank you for saying something.

  16. Great episode Soctt and team!!! Thanks and big thumbs up for 1) the humility of self-effacing humor and 2) the sensitivity to know when press the pause button and look at bigger real issues. Thank!

  17. I just find out how much I fucking love marketing. I also just found out this channel while taking marketing class last year. This is fucking awesome. I wish I took his class

  18. I'm currently developing a system that will reroute any Amazon drone carrying Brunello Cucinelli To the L2inc rooftop. Where you and I will be drinking scotch, smoking cigars and comparing our latest PSA results.

  19. Semi-quoting Scott,.. 'Jeff B. calls senior executives into a meeting, after stock soars to new highs, to tell them, "You bastards. You really f$#*ed up this time",' is closer to the truth than you realize. Might be his genius, or his eventual (ie. +50yrs) decline.

  20. Saw this video and was wondering if you have any thoughts. None of the cosmetic brands I see growing have any interest in going public, but I'm still interested in what direction the older and well-known brands are going in.

  21. I don't agree that we are seeing the end to ad supported TV. I actually believe we're going to witness the rebirth of it sooner than later. YouTube, DirecTV, and Comcast have all launched "streaming" services where you can pay for the same old crappy TV options of yesterday, complete with options for overbuying channels you probably don't want along with traditional, ad laden television programs. What's best, AT&T(DirecTV) and Comcast have an increasing grip on the price of distribution, which means that they are charging more money for Netflix and Amazon Prime Video, while allowing users to stream their services without risking any additional fees. ISP's buying television companies are looking to grab the internet bull by its horns and level the playing field in the hopes of propping up these old TV service models.

  22. Hey you guys should talk about the biggest video game in the world and its creator. League of Legends and Riot Games.
    I am aware the company name makes no sense since they have only made on game.

  23. Amazon isn't intereted in surplus cash right now, they're creating a monopoly. It's sort of like when Starbucks made all those stores to put smaller chains/stores out of business just so they could close them down, raise their prices and have a monopoly on coffee shops.

  24. My dad showed me this channel because I do Business at school. Even though I don't understand all of it, I love it! 🙂

  25. I've been seeing these Winners & Losers videos pop up as ads lately. I normally skip everything but after the third or so time, I let it play. Glad I did. This is my kind of demented charm. Good work.

  26. Wow, Classical Conditioning amped up at its finest! John B. Watson would be very proud! You all are fucking Pavlov's Dog tools!

  27. No, the real losers are those that bought into professional sports and allowed teams to pay a single person MILLIONS of dollars to touch an object. And, later get hook on drugs and lose all their money. Great job society!

  28. As long as we all buy into the lie that future earnings belong to the shareholders the house of cards remains standing. Long live the PEG ratio!

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