Episode 72: Is DEI Dead? Google AI Dominates, Best and Worst Loyalty Programs, Myer's Big Deal, Turo v Rental Cars, Restaurant Subscriptions, and Raygun Jumps the Shark
The guys discuss the death of DEI, Google's AI comeback, Myer's controversial deal, elite loyalty programs, rental cars, the fascinating business monetising restaurant reservations, and Raygun.
The Contrarians catchup
Adam is in the UK running in the dark and working from WeWorks; Adir is in Canberra exploring museums and rating hotel decor.
The guys have had mixed experiences with Turo, a car rental marketplace. Adir rented a car that wasn’t roadworthy and debated whether to leave a bad review; Adam booked a car rental through Luxury Escapes but couldn’t speak with anyone at the rental franchise when he was trying to find out why it was so cheap.
Adam booked a hotel using points from his platinum membership, which meant his breakfast wasn’t included. This opened a discussion about the worst ways to manage your loyalty program.
The problem with most tiered loyalty programs is that the top two tiers are not discernible from each other. The exceptions are Qantas and Marriott, with the latter providing 24-hour hotel stays.
Adir gave the QuietComfort Ultra Wireless Noise Cancelling Headphones a thumbs down, and gave a thumbs up to the Apple iPhone 16 Pro because it’s much easier to charge with USB-C.
Raygun Jumps the Shark
Adam was initially supportive of Rachael Gunn, or “Raygun”, the Australian breaker who infamously scored a zero at the 2024 Paris Olympics and went viral for her unique routine. But her brand has taken a hit after she sued the producer of a parody musical, ‘Breaking: The Musical’, before it launched.
Adam: “The comedy club that was showing the musical was going to give the proceeds to a women’s abuse shelter. You have this person who kind of got through and built an okay brand, but in the space of two days has taken a bomb and destroyed her brand and looks like one of the worst people in the country for suing this person who was sympathetic to her.”
Adam labelled this “The Streisand effect”, which is an unintended consequence of attempts to hide, remove, or censor information, where the effort instead increases public awareness of the information.
Google AI Dominates
Adam has been really impressed with Google’s AI overviews, which launched in Australia recently and haven’t been viewable for all users.
With generative AI, this is made possible by a new Gemini model customised for Google Search. It brings together Gemini’s advanced capabilities (including multi-step reasoning, planning and multimodality) with Google’s best-in-class search.
Adam: “I was shocked how good it was. A massive thumbs up to Google, who were obviously fast off the mark with DeepMind and then lost the plot for a bit. They’ve come right back and a lot of people think Google may overtake OpenAI in terms of just where they're going to get to.”
Is DEI Dead?
Prominent politicians have recently increased their attacks on workplace programs that promote diversity, equity and inclusion, or DEI. They claim that initiatives that seek to be inclusive are divisive and lack merit.
Increased scrutiny about the field of DEI has reached a fever pitch over the last year, with companies like Walmart, Boeing, Harley-Davidson, and Lowes among others, rolling back their DEI efforts and initiatives.
Adir: “DEI to me is extremely rubbery. I can say openly, I don't care if people hate me for this. I do not believe in the DEI movement. I think it's pernicious and I think it is often just used for cancel culture. But really what it means is suppressing dissent like it's authoritarian, in my view.”
Adam: “All of the principles are right. But the problem is when do-gooders and agencies get paid 500 grand a year to enforce these rules that you shouldn't need someone to. It should be every employer operates this way because that's how you operate, because you actually perform better.”
Myer's Big Deal
The AFR reported that an independent expert engaged to assess Myer’s proposed takeover of a portfolio of brands owned by Solomon Lew’s Premier Investments said the emergence of Chinese fast-fashion players has hurt the outlook for department stores and made it essential for the company to expand.
The 124-year-old department store has proposed its most radical transformation and wants to acquire Premier’s Apparel Brands business, which includes casual wear chain Just Jeans, women’s fashion retailers Jacqui E, Dotti, Portmans, and Jay Jays.
Adir: “There's definitely some problems going on in retail too. The next thing I'll say is the independent expert could have said it was unfair, but reasonable. I think an owned brand strategy for Myer is not a dumb strategy at all. I think trying to create a rewards program that spans as many brands as possible is not a dumb thing at all. I think the days of department stores selling other people's stuff like those are not that's not something that you want to be a part of that because I can just go buy out on the internet more cheaply somewhere.”
Your key to unlocking extraordinary dining?
A US startup, Access, creates “coveted dining and social experiences” by charging restaurant subscriptions.
Access charges $1,788-per-year-and-up subscription fees for reserved tables at top restaurants, only in NYC to start. The app’s cheapest tier, besides a limited-time free “guest plan,” includes up to two reservations per month, as well as a “concierge service” and curated picks.
Adir: “This booking thing for exclusive restaurants is definitely a thing that people will go to significant lengths to secure. And in America, you can basically buy your way out of any problem with cash. If there's a long line waiting to get in somewhere, you can go up to the person and say, here's $200. Let me just skip the line and come in and like it will probably it will certainly happen for a price.”
Five other stories worth following:
Donald Trump announced, “For purposes of National Security and Freedom throughout the World, the United States of America feels that the ownership and control of Greenland is an absolute necessity."
The Biden administration said it launched an investigation into China's semiconductor sector, which officials claim threatens U.S. national security. It is a first step toward possible measures, like tariffs, that might seek to squeeze China-made chips out of U.S. products.
Slater & Gordon staff will get wage increases of up to 22% over three years under a deal that ends a long-running dispute and does not include an initial union demand that would have extended its reach at the Labor-aligned legal firm.
Luigi Mangione, the 26-year-old man charged with murder in the killing of UnitedHealthcare’s chief executive, pleaded not guilty on Monday as he was arraigned in New York State Supreme Court. The Manhattan district attorney’s office has charged Mr. Mangione with first-degree murder, a terrorism-related offence, as well as two variations of second-degree murder and weapons charges.
Macquarie Group chief executive Shemara Wikramanayake has topped Australia’s highest-paid CEOs for the fourth year in a row. This year, her pay packet was reported to be $29.4M, taking her total pay to almost $300M during her six years leading the investment bank.