Latest / What the Flux / Coles wins the top shelf | Pet Circle's sales are up, profits down | Visa's AI payments

Transcript

Coles wins the top shelf | Pet Circle's sales are up, profits down | Visa's AI payments · What the Flux

• 0:05
  Speaker 1: This is what the blucks.
• 0:06
  Speaker 2: I'm Brett and I'm Justin and it's Friday, the second
• 0:09
  Speaker 2: of eight.
• 0:09
  Speaker 1: What's the old saying? Juzzy Boy, nice guys and girls
• 0:11
  Speaker 1: finish last, Well, it's the same for weirdly nice ai chatbots.
• 0:16
  Speaker 1: Chat JBT users have been criticizing its latest release because
• 0:20
  Speaker 1: supposedly chat jbt is giving touchy feely responses that were
• 0:23
  Speaker 1: oddly supportive for strange and even violent behaviors. So now
• 0:27
  Speaker 1: open Ai has rolled back its latest update and is
• 0:30
  Speaker 1: working on some stronger guard rail.
• 0:33
  Speaker 2: Ma'am, it's Friday again, which means your chance to win
• 0:36
  Speaker 2: fifty bucks in the flux out. Make sure you've downloaded
• 0:38
  Speaker 2: the app, but with notipations turned on because you've got
• 0:40
  Speaker 2: the first person to answer three business all finance questions correctly.
• 0:43
  Speaker 2: You could win the money this week to get ready
• 0:45
  Speaker 2: for quick sticks today.
• 0:46
  Speaker 1: Three high profile stories today, Juzzy Boy, Let's do it
• 0:49
  Speaker 1: for our first. Coles is winning the supermarket war as
• 0:53
  Speaker 1: its private label brands and online sales drive its revenue up,
• 0:57
  Speaker 1: up and up Go Big redbeanan all Right So Coals
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  Speaker 1: is Australia's second largest supermarket chain behind the Big Dog Woolies.
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  Speaker 2: And you might remember it was spun out of West
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  Speaker 2: Farmers back in twenty eighteen and has more than eight
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  Speaker 2: hundred Big Red stores around Australia.
• 1:10
  Speaker 1: And now Coal Supermarkets have seen its sales jump to
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  Speaker 1: nine point four billion dollars for the most recent quarter.
• 1:16
  Speaker 2: And that's a jump of four point seven percent on
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  Speaker 2: the same time last year. Excluding tobacco and Juzzi. The
• 1:21
  Speaker 2: real MVP of this growth has been Coal's online sales.
• 1:24
  Speaker 2: It jumped over twenty five percent this quarter to one
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  Speaker 2: point one bill.
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  Speaker 1: Which is now more than eleven percent of total supermarket sales.
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  Speaker 2: But man, man, if you thought that was the only MVP,
• 1:33
  Speaker 2: you would be wrong.
• 1:34
  Speaker 1: Oh No. Sales for Coal's finest is Bougie private label
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  Speaker 1: also increased nearly fourteen percent this quarter.
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  Speaker 2: It's a surprise that Coals is blowing balloons and popping
• 1:43
  Speaker 2: the shampas.
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  Speaker 1: And to top things off, if you don't mind, more,
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  Speaker 1: shoppers are now calling Coals their main supermarket ahead of
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  Speaker 1: Woolies according to UBS, and it's.
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  Speaker 2: The first time that Coals is above will Worths in
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  Speaker 2: this survey.
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  Speaker 1: When it rains, it pours for Coals yep.
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  Speaker 2: So what is the key learning here.
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  Speaker 1: Private label has had a major glow up in the
• 2:02
  Speaker 1: supermarket space.
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  Speaker 2: Yeah, it's no longer just the land of cheap biscuits
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  Speaker 2: and sad cheeses and basic labels.
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  Speaker 1: Now Coles has rebranded its home brand ranges into something
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  Speaker 1: quite aspirational and it's actually working.
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  Speaker 2: In fact, they manned. Late last year, Cole said their
• 2:16
  Speaker 2: premium home brand was growing at double the speed of
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  Speaker 2: overall supermarket sales.
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  Speaker 1: So clearly the Coals faithful want value and quality.
• 2:24
  Speaker 2: And bemaned For Coals, this means they can avoid paying
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  Speaker 2: the markups on third party brands.
• 2:28
  Speaker 1: Yep, this allows them to offer products at competitive prices
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  Speaker 1: while also maintaining healthier profit margins.
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  Speaker 2: And b manned. Coles an't the only company to see
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  Speaker 2: a spike in private label purchases.
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  Speaker 1: Nope. According to Nielsen, forty six percent of Australians say
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  Speaker 1: they're buying more private label products than ever before.
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  Speaker 2: In particular people under the age of forty three.
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  Speaker 1: So clearly Coles is capitalized on the opportunities created by
• 2:49
  Speaker 1: the rising demand of these products.
• 2:51
  Speaker 2: Turns out those under forty three are all suckers for
• 2:54
  Speaker 2: a good deal wrapped in a chic legel.
• 2:56
  Speaker 1: For our second story. Pet Circle, one of Australia's largest
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  Speaker 1: online pet stores, has seen its sales jump to nearly
• 3:02
  Speaker 1: four hundred million bucks, but it is burning cash to
• 3:05
  Speaker 1: get there.
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  Speaker 2: Wolf. That is all I gotta say about this one.
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  Speaker 2: So tell me we'll be.
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  Speaker 1: Man well, Jazzy Boy. Pet Circle was founded in twenty
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  Speaker 1: eleven by an investment banker and data scientist.
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  Speaker 2: The old dynamic duo of the pet industry.
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  Speaker 1: Pet Circles started by offering everything you're too lazy to
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  Speaker 1: get from your local pet store.
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  Speaker 2: Inky kibbles, your squeaky toys, your fully treatments.
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  Speaker 1: And it really has grown since twenty eleven.
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  Speaker 2: Yeah. In fact, a man ten years later, pet Circles
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  Speaker 2: valued at more than one billion dollars.
• 3:30
  Speaker 1: And despite remaining a private company, its latest accounts show
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  Speaker 1: that revenue has jumped to three hundred and eighty five mil,
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  Speaker 1: and that was in twenty twenty four.
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  Speaker 2: While sales went up, the man profits did the opposite.
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  Speaker 1: In fact, it's losses jumped over twenty six mil, or
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  Speaker 1: more than a twenty three percent jump from last year.
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  Speaker 2: But be manned. Despite the growing loss Pet Circle reckons
• 3:48
  Speaker 2: its new pharmacy and insurance arms will drive growth and
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  Speaker 2: will drive profit, a path.
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  Speaker 1: Well travel by other retailers.
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  Speaker 2: So what is the key learning here?
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  Speaker 1: Retailers are increasingly using their very loyal cut customer bases
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  Speaker 1: to shift into higher margin vertical.
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  Speaker 2: For pet circle, we'd be talking things like insurance and
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  Speaker 2: pharmacy and vet consultations as well.
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  Speaker 1: Well. Stables like pet food keep customers coming back regularly.
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  Speaker 1: They don't offer much room for a whole heap of profit.
• 4:14
  Speaker 2: But once a customer trusts your brand, it's easier to
• 4:16
  Speaker 2: cross sell offerings with better margins. So by white labeling
• 4:20
  Speaker 2: these offerings from other providers, companies can boost their margin
• 4:23
  Speaker 2: without needing to invest significantly in the underlying product.
• 4:26
  Speaker 1: We've seen other companies do this as well.
• 4:27
  Speaker 2: Yep, our good friend Coles white labeled Coals Mobile through
• 4:30
  Speaker 2: a partnership with Optors.
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  Speaker 1: They've white labeled insurance to a partnership with Auto and
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  Speaker 1: General Insurance.
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  Speaker 2: Company, and the white labeled credit cards with that.
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  Speaker 1: So while pet circles currently fetching losses, the real game
• 4:40
  Speaker 1: is long term loyalty.
• 4:42
  Speaker 2: For our third and final story, these Are has announced
• 4:44
  Speaker 2: it's teaming up with open Ai and Microsoft's co Pilot
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  Speaker 2: to let AI run your payments.
• 4:50
  Speaker 1: You know, I wouldn't be opposed to AI booking my
• 4:53
  Speaker 1: travel flights, Juzzi boy, But tell me more.
• 4:55
  Speaker 2: Okay. So this is the global payments giant see processing
• 4:58
  Speaker 2: payments since nineteen fifty eight.
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  Speaker 1: In fact, it processes over two hundred billion transactions each
• 5:03
  Speaker 1: and every year. Yep. But now Visa has leaned into
• 5:07
  Speaker 1: something very radical for this you know, conservative company.
• 5:10
  Speaker 2: It's partnered with leading AI platforms like OpenAI and Microsoft
• 5:13
  Speaker 2: and even Samsung to roll out what they call intelligent.
• 5:16
  Speaker 1: Commerce, which is effectively agentic AI.
• 5:19
  Speaker 2: And be man with all that mumbo jumbo that means, well.
• 5:22
  Speaker 1: Let me put it this way for you, jazy boy.
• 5:24
  Speaker 1: I'm like older AI which just suggested options. This AI
• 5:28
  Speaker 1: can complete the purchase as well.
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  Speaker 2: Like organize a weekend away in Melbourne, and the AI
• 5:32
  Speaker 2: will do the whole thing.
• 5:34
  Speaker 1: Your flight to your hotel, your dinner bookings, even the ubers.
• 5:36
  Speaker 2: And as the user b man, you choose levels of control.
• 5:38
  Speaker 2: You might want to approve every step of the journey
• 5:40
  Speaker 2: or let AI go full autopilot.
• 5:42
  Speaker 1: And this agentic AI is expected to go live in
• 5:46
  Speaker 1: the quote near future.
• 5:48
  Speaker 2: We love a vague and ambiguous roadmap to get you excited.
• 5:51
  Speaker 1: We do, so what is the key learning here?
• 5:52
  Speaker 2: Agentic ai is shifting AI from being a helpful assistant
• 5:55
  Speaker 2: to an almost full blown concierge.
• 5:58
  Speaker 1: For the last couple of years, AI I could suggest
• 6:01
  Speaker 1: what to do.
• 6:01
  Speaker 2: He's had to write an email or appeal a parking infringement.
• 6:04
  Speaker 1: But with agentic ai, it can actually do things for you.
• 6:07
  Speaker 2: Like reschedule your dentist appointment for the third time and
• 6:09
  Speaker 2: b man. This new partnership with Visa is so big
• 6:12
  Speaker 2: because these AI agents can actually engage in your financial
• 6:15
  Speaker 2: life as well. In fact, the global market for agentic
• 6:18
  Speaker 2: ai is expected to reach over seventy billion US dollars
• 6:21
  Speaker 2: per year by twenty thirty, which is a nearly forty
• 6:24
  Speaker 2: three percent growth year on year from now until then.
• 6:27
  Speaker 1: So jazy boy, The age of sitting back while your
• 6:29
  Speaker 1: AI planned your life and spending has officially begun in
• 6:32
  Speaker 1: the near future.
• 6:34
  Speaker 2: But dam if you've been listening to the pod all
• 6:36
  Speaker 2: week and you want to test your knowledge on finance
• 6:38
  Speaker 2: and business, there is one place to be. It's in
• 6:40
  Speaker 2: the fluck up today with quick sticks. Make sure to
• 6:42
  Speaker 2: turn your notipatients on because you could win fifty bucks today.
• 6:45
  Speaker 2: Thanks for listening, and we'll see you on Monday.