How MrBeast's new content format caused me to cry and How Prime saved Amazon

0:00Neil and I have an agency owners group called the Agency Owners Association. All you have to do, just go to marketingschool.io slash agency. Once again, it's marketingschool.io slash agency to learn more. And now back to the show. Did you also see Mr. Beast's new content format, his new video this past weekend? I didn't see his new video, but you told me about a new format a few episodes ago where he was doing a longer format, less craziness, less choppiness, like, you know, ADD type of attention span. Yeah. Is that what you're talking about? So he's got even harder now. So he made his first 40 minute video.

0:34So Mr. Beast makes this 40 minute video. And I actually teared up a couple of times watching it because there's a storyline to it, right? It's basically one through 100. Back up. Talk about, I want to know why you cried. What was the video about? Like break everything down. I'm literally telling you right now. No, you said one to a hundred. I want to know what the video is about. Yeah, exactly. It's about people ages one to 100. And if you like step out of the box, like everyone gets their own box, right? If you step out, you're eliminated. the last person standing they will get$250 ,000 and he throws in like a bunch of wrenches along the way um you know people like pair up with each other people vote each other out and stuff like that actual wrenches no not wrenches not actual wrenches it's like he's like oh um guys if you guys don't pick the next uh 10 people to eliminate i'm going to eliminate 30 of you and so nobody picks anybody right so he eliminates 30 people so the the trick to this game is um or the catch to it is everyone has to vote on the winner at the end.

1:29So at the very end, as people are getting eliminated, I start crying or not crying. I start tearing up. I guess that's crying because the old people, there's people up to a hundred years old there. Right. And then when the old person gets eliminated, it's just so sad. Right. Or there's like little kids or like someone's mom is dying from, you know, some disease or something. And they want to use that money to take care of them. So everyone has a story. Right. And then there's some people that are nasty too, where it's like, they just want the money for themselves. And so there's a storyline and you get to see the characters develop.

2:00And so there's emotion tied to it. And at the very end, there's only five people left. And then they couldn't, there's like, you guys have one hour to decide on who the winner is. Right. And nobody could decide who should win, who should win. And at the very end, people just voted like top one through five, and they just combined the ratings. And then people, you know, rank five walked out, rank four walked out, rank three walked out, and then all the way to rank one. and then that person won$250 ,000. Wow. But there's a lot more to it. And how long did they have to stand or stay in a box? Four days.

2:34When you mean a box, you're talking about a room or like a cardboard box? It's like this with a bed in it. Oh, okay. Yeah. And it's not like dirty conditions or anything like that? No, and they're like, you know, Mr. Beast is staying engaged. He's feeding them, obviously. Is that like a jail cell? It's kind of, but it's like a clear jail cell. You can see each other. And he did this little, he threw in this other wrench over here where he blocked everyone's cage basically. And he's like, okay guys, I'm going to offer you$250 ,000 right now. Here's the catch. Only one person can leave and you're not going to know who leaves, right?

3:07So anybody can say, hey, like you can say, I want the 250K. And if you step outside and nobody else steps outside in 10 minutes, you win the 250K. And so one guy steps out immediately. He's like, guys, I'm stepping out. I'm trying to win the 250K. Nobody else step out. and basically there's only two seconds left and someone else stepped out. And so they both got eliminated and they didn't win anything. But why the other person step out? That's stupid. Because he's like, oh, I feel like winning. And so he stepped out. He eliminated the other guy. But you wouldn't win because it... Yeah. And the other guy was just like, dude, are you stupid?

3:39Like I literally have been saying the whole time, like I'm going to step out. And he like wanted to kill him. So yeah. Dude, that sucks. Now, do they get paid to do this other than the winner? No, I don't think they do. I think, okay, so Mr. Beast will like, like the four runners up, right? He paid him 10 grand each and he'll like try to throw in these side prizes and stuff. But my take on it is he doesn't pay everyone or like he doesn't announce it. Like if I were him, if you're giving out so much money, I might try to allocate like$5 ,000 per person. Yeah. You have to, I think you should do that.

4:13He probably pays people something to do this. I think like$2 ,500 or$5 ,000 just to get them to play. which isn't bad that's a lot of money for four days people like i feel so bad they're like 96 year old he's like in this you know the walker thing it's like it's tough to watch dude i can't watch it based on what you're saying i'm gonna feel bad for you should watch it with your kids no i can't because the kids eliminate themselves immediately why because they're so like add yeah yeah i didn't say that you said it i was like i should not say that but you said it so you're talking about little kids right like three years old the one-year-old just walked out immediately yeah they don't know any better yeah like if well yeah of course you can't have like a three-year-old just sit there and be like, you got to stay in this room for four days.

4:50It doesn't work. Anyone who has kids knows that one. Yeah, so I'm keen to see where he's actually doing a good job. And just to parlay this, one more thing. He signed a deal with Amazon Prime. And so he's going to do a game show with them. Very similar to this. So he's kind of practicing his chops right now. And he wants to make it the biggest prize pool ever. And so I'm like, oh, you seem like you have potential here. this seems really cool i've never i never have seen you watch tv you should watch it later yeah amazon prime actually has decent shows after they acquired mgm i felt that the content started getting better and if you see some of the new shows it'll be like amazon prime mgm or something like that they combine oh do you want the amazon prime story let me give you the prime origin story this this leads up well to it okay so this book i've been reading i told you to read it right working backwards no okay okay i'll check it out it's a great okay it's basically i'm pretty sure sure I told you about it.

5:43So the chief of staff for Jeff Bezos, and then this other guy who worked for the Amazon digital division for 15 years, they wrote this book. It's basically all of Amazon's processes and how they do things, right? And the origin of Amazon Prime was, this was like 2002, 2003. And they were growing really quickly, right? This was after the dot-com crash. And here's the problem. They were growing really quickly. This was like November. So it's October, actually. It's leading up into Christmas, which is like their busiest season. Right. And Jeff Bezos is like, we need to create a new offering. Right.

6:15But everyone's like, dude, like their numbers are going up. Everything's looking good. But what most people didn't see is that their growth rate year on year was, was decelerating each month year on year was decelerating. Right. And it's because a lot of these, these online retailers were catching up with Amazon. Right. You can, you can yawn. You're about to yawn. You should yawn. I'm good. Okay. So then they're like, okay, so we need to create a low-priced offering. What is it going to be? We need to create an offering that's going to keep people in. And eventually, they land on this free two-day shipping thing to keep people engaged.

6:49They were thinking about a lot of different offerings, and people were struggling with this. And Jeff Bezos was like, we need to launch this by February. By my next investor update, we need to launch this, my next shareholder update. And they launch it, but the biggest lesson I learned from this one, this Amazon Prime story, was they needed to do something because their business was decelerating. But the other thing is this bet, this is a type of bet where you don't know if it's going to pay off for five to seven years or so. And you have to have a lot of guts to launch something like this. Nobody knew how this would go.

7:20And even like you launch it, a year later goes, but you don't know how it's going, right? And so their philosophy at Amazon is instead of having like a indefinite or indefinite no philosophy where people just say no to new things, it's more of an indefinite yes philosophy because when you think about companies like Nokia, for example, or when you think about companies like, you know, Microsoft was struggling for a little bit, right? They missed mobile. And for Amazon, they just didn't want to miss stuff. And so a lot of stuff they'll launch. And then this whole thing was like waiting five to seven years when you're a big company like that, it takes balls.

7:54This message is brought to you by Leveling Up Founders. And Leveling Up Founders is an invite-only event for founders. It happens once a year, usually during August. and past attendees include people such as Ali Abdaal, Cody Sanchez, Neil Patel, Vanessa Lau, and the list goes on and on. And ultimately it comes down to the quality of the group with the people. We tried to keep the group high caliber. That's why it's invite only. So if you are a founder at the top of your game, you can go to levelingup.com slash founders to learn more about it. And then you can apply and we'll see you on the other side.

8:25Totally agree. But you want to know the funny thing about Microsoft when they were struggling for quite a bit, their financials weren't struggling. The market just didn't like their vision and their belief of where they're going through that, uh, that whole antitrust a long time ago, antitrust monopoly, splitting them apart. And they were fine with that in the, at the end of the day. But the big issue with Microsoft was once they shifted leaders, they're already big and printing tons of cash. They were just not valued that highly based on their profit. And a large reason was, is Wall Street didn't believe in the vision.

8:59If you look at Microsoft right now, their earnings and their PE ratio isn't bad. What is it? I think it's close to 30. I could be wrong the last time I checked. Oh, that's not insane. For a company of their size? Yeah. PE, 37. That's a good PE ratio. That's a high PE ratio. What do you think Apple is? I'm looking at Facebook now. If you look at Apple is 26. But the reason Microsoft has performed better, a lot of it is because people buy into the vision. What they're doing with the cloud, what they did with AI. These are the things that have really shifted Microsoft and making them a powerhouse.

9:41It makes sense. I mean, you think about in 2022 when Meta dropped all the way down to$90 or something like that. And their PE was like$14. I should have bought it. Me too. I was just going to ask you, did you go there? When it went low, what were you thinking? It's like, oh, I guess this is the end. No, so what I was waiting, I was going to buy Meta. Not at that moment. So Meta crashed a few years ago because of the Apple iOS changes. It really hurt their ad revenue. And people were like, what's this guy doing betting on the Metaverse? Exactly. Yeah. And I still say, what the heck is this guy doing betting on the Metaverse?

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12:40Google hasn't released a lot of this stuff yet, but it should have an impact on their revenue in a negative way. But they kept delaying that date on when they were going to release it. So what I was hoping is as Apple goes out, Google does it pretty quick, which they never ended up doing. They just delayed it again. And then boom, a one-two punch. The revenue gets hit even harder. And then I was going to go buy the stock. This is what happens when you try to time the market. So Neil and I, we should have just bought it. We should have just bought it. But you know what? I don't live in regret because I'm okay.

13:13I could just go and buy more businesses and I'll make more money. Yeah, I'll make double my money on the pot. You know how often my parents bug me about buying a house? And I'm just like, okay, my mom was like, you know, if you buy a house, let's say round numbers, right? You buy a house for$2 million and then in 20 years it becomes$10 million. I was like, mom, let's do the math on this, right? And then it turns out, I was like, mom, what's the cap rate on that? What's the return on that basically, right? Over the next 20 years, 5%. I'm like, what are we doing, mom? Why don't I just put in a CD and I don't have to worry about this crap, right?

13:45It's better to focus on what you actually understand. Yes. You and I are on the same page, but the problem that you end up facing is not everyone believes that. No, they're talking their book. Yeah. Just look at me in real estate. I went through so many homes and stuff like that and now I live in a tiny home. And I'm like, oh, this is great. Not for long. we'll see what I can end up swinging but hopefully I can stay here for a few more years so that is it for today go to marketingschool.io slash agency to learn more about the agency owners association please don't forget to rate, review, subscribe we meet in person for this we've got Brad from recordeditpodcast.com and yeah we'll catch you in the next episode