Shein Influencers Catch Backlash & Why Air Travel Is So Bad

0:01This message is brought to you by AppleCard. AppleCard members can earn unlimited daily cash back on everyday purchases wherever they shop. This means you could be earning daily cash on just about anything, like a slice of pizza from your local pizza place or a latte from the corner coffee shop. Apply for Apple Card in the Wallet app to see your credit limit offer in minutes. Subject to credit approval. Apple Card issued by Goldman Sachs Bank USA Salt Lake City Branch. Terms and more at applecard.com. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby On today's pod, air passenger stress levels are through the roof ahead of the 4th of July travel weekend as cancellations have already caused airport havoc this week.

0:42And we'll discuss why you're going to hear a lot about cheap whiskey, dirt roads, and faded blue jeans on the radio this summer. Then, Xi 'an tried to put together a little influencer trip to one of their factories in China, and it did not go well. Plus, sharing is no longer caring in the cavernous aisles of Costco after the retailer decided to crack down on people going splitsies on their membership cards. Neil, it's Thursday, June 29th. Let's ride.

1:13Alright Neil, before we start the show, I want to tell you about a little experience I had last night. I had the Grimace shake, which for our less online listeners, McDonald's is rolling out this big promotion for Grimace's birthday. Grimace being one of their characters they launched in the mid 70s. And to commemorate his birthday, they made this thing called the Grimace shake. It's a monstrosity. It's kind of bluish, purplish. It's got like a berry vanilla flavor. And I can tell you what, I feel awful right now. Really? It was bad. It was so good that I drank the entire extra large milkshake.

1:48And here's the thing. This is why McDonald's gets you. In order to get one Grimace shake, you have to get the entire Grimace meal. So last night at like 930, I started pounding chicken McNuggets and a large fry and drinking a whole Grimace shake. And I was not happy with my shake. This is an amazing marketing campaign by them, right? It's dominating right now. All over social media, you have these Gen Z people like yourself drinking the Grimace shake. and then posting kind of horror movie scenes after they drink the Grimace Shake? Yeah, it's a crazy trend right now. And so, I mean, I guess I'm a victim of marketing because I wouldn't try it.

2:24Would you try it again? I'm not going to. I'm never going to put that in my body again. But once they come out with like their next themed shake, I'll probably be right back in line. They're killing it. Let's go to our first story. Toby, not only did you drink the Grimace Shake, but you are one of millions of Americans who are planning to fly this holiday weekend. I know you are nervous about making your flight, and you probably should be. Thousands of U.S. flights have already been canceled since Saturday and tens of thousands more delayed in one of the worst stretches for air travel this year.

2:55This week, we both heard stories of friends stranded in cities for multiple days and people camping out in airport terminals, just hoping they'll be able to get to their destination in time. United Airlines, in particular, has taken it on the chin. It canceled 20 percent of its flights yesterday and has scrubbed more than 2 ,300 since Saturday. One source of the trouble is thunderstorms here on the East Coast that have disrupted flights at Newark, which is one of the major United hubs. But United CEO Scott Kirby isn't just blaming the weather. He's picked a fight with the FAA for a shortage of air traffic controllers that have fueled airline chaos.

3:32On Monday, he told staff that the FAA frankly failed us this weekend. They better not fail this upcoming weekend, which ahead of the fourth is expected to be the busiest for air travel this year and potentially even bigger than the same weekend pre-COVID in 2019. Honestly, I could not think of a worse time for this to happen just from a personal perspective and also just from everyone. Literally the busiest day in years, so it could not be happening at a worse time. But I feel for the FAA a little bit because it's just so understaffed. So 77 % of critical facilities like air traffic control are staffed below the 85 % threshold that the agency considers necessary in order to operate.

4:16And then you have the major ones in New York and Miami that are staffed at 54 % and 66%. It's a huge risk to just flights going off and continuity in the airline industry. I know, but you feel bad for them, but maybe they should just change their hiring practices and get more people. It reminds me a lot of the IRS where there's so much attrition and people are leaving the profession and they're not getting enough people. But if you look into the requirements for what it takes to be an air traffic controller or a flight dispatcher or anything, you can't even apply in most cases once you're over 30 years old because of all the stringent training requirements.

4:51And the aviation industry places safety above all else. So you have this blame game going on where the airlines are blaming the FAA. The FAA and Pete Buttigieg, who's the transportation secretary, is saying, airlines, you've got to get your stuff together. If you look at the actual data from the federal government, it seems like the airlines are by far the most responsible for delays and cancellations, whether they don't have enough flight attendants or people are in different cities. This is what happened with Southwest last December when you had crews, you know, the pilot for an airline that needed to be in Phoenix was in Seattle.

5:25And then, you know, the flight attendant crew was in Boston when they needed to be in Austin. And that like it's this crazy domino effect that happens in airlines where it's held up by this house of cards. And if one domino falls, I'm mixing my metaphors here. But everything kind of collapses. And then you get people waiting, you know, sleeping at airports at 3 a.m. Yeah, this is my big takeaway is I can't believe this house of cards doesn't fall more often because you think about one little ripple effect and the effect it can have on everything. But then also I can see why this is making people extra mad.

5:58Not only is missing your flight just the worst thing in the world, but if you go back to the pandemic when airlines were really struggling, $54 billion of taxpayer money was kind of funneled by these airlines to prop them up. And yet they're still understaffed. They laid off or they didn't lay off. They like furloughed a ton of employees during the pandemic and they haven't really brought enough back to catch up to demand. So the airlines got the money to keep them afloat and then haven't prepared for a time when flight volume returns to normal. So, yeah, tons of horror stories. Like people are so there's nothing that gets people as mad as like missing your flight.

6:33And I don't blame not even missing your flight, having it canceled right before you get on. And there's even another wrinkle happening this weekend, which is that telecom companies are allowed to turn on their 5G C-band networks, which sounds pretty technical. But the point is that it might interfere with some plane navigation thing. So basically you won't – some planes that aren't retrofitted with modern equipment may not be able to land in low visibility weather, which is, I feel like, all the kind of weather that we've had recently. And there's smoke coming in. So there's possible more disruptions that could happen starting on July 1st.

7:12They say that Thursday and Friday, today and tomorrow are going to be the busiest days for air travel. I think you're flying out tomorrow. Come on, Newark. Come on, Allegiant. You got me. I am a big AV geek, so I want to just provide our listeners with some apps if they want to track flights. Flight Radar 24 is the GOAT of all the industry. If you want to just like look at where planes are going or see if your plane's coming to your airport, definitely check FlightRadar24. It's super fun just to play around with. And then if you want to see the broad view of cancellations and delays, go to FlightAware.com.

7:47They have this fun map. Not fun, but they have a map called the Misery Index. It's fun to you. The Misery Index, and it shows an entire map of the U.S. and where delays are happening. Seems like New York is kind of the epicenter with all the thunderstorms we've been having. All right, Neil, bookmarking those now. All right, let's move on to the world of fashion, where a lot of people are very mad at a group of influencers who many feel have been used as propaganda by the Chinese fast fashion company, Xi 'in. Now, Xi 'in is huge. It did 100 billion in sales in 2022, up from 10 billion in 2020, but it has a bit of an image problem.

8:24A lot of people think that Xi 'an exemplifies the worst of the world of fast fashion. It's cheap clothing, bad environmental impact, and an exploited labor force. But Xi 'an is eyeing an IPO. So in an effort to clean up that image a little bit, they invited a bunch of fashion influencers out to visit one of their 6 ,000 factories in China. Here's a quote from one of the influencers. Honestly, everyone was just working like normal, sitting down. They weren't even sweating. And everyone in her comments just absolutely ate her up saying you're only seeing what they want you to see and that your integrity is worth more than this trip is and the backlash came in swift and fast so much so that some of the creators were actually deleting some of these paid posts in partnership with Shein and Shein comes out looking worse from a consumer perspective than they went in we've seen these influencer trips go awry but this one seemed to really strike a nerve Neil Right, because what it was wasn't usually influencer trips.

9:23And I have to say, I didn't know a lot about influencer trips before reading about this. It's you go and you try on the actual products. You're like, look at this shirt. You know, this is a cool shirt or this is a cool pants or this is a cool product that I'm trying out. This was influencers like talking about the labor practices and the social culture of a company. And people were like, this is a very ambitious move by Sheen to clean up its image. And it completely backfired. I mean, I saw one TikTok that satirized this trip. It was an influencer saying that they went to the Triangle Shirtwaist Factory in New York, which infamously burned down and killed over 140 people.

10:02And this influencer was parroting this Sheehan trip was like, oh, my God, the labor practices are so good here. Everything's so clean. You can leave. And that was kind of the vibe that the backlash took. Yeah. And another layer too is like, this was a very carefully curated group of six content creators who they represented like an array of different body types and backgrounds. And so a lot of people were like, Shein is clearly just exploiting like diverse influencers in order to advance like this narrative. And so that's another reason, like another layer to it, why people were just really seeing through like this ploy from Shein.

10:39Maybe we should talk about what the criticisms of Xi 'an are. There's sustainability criticisms that, you know, most of their clothing just ends up in landfills, which is a criticism that's been lobbed at the broader fast fashion industry. And then the big one here that actually U.S. Congress is looking into is that they're using cotton from the Xinjiang province in China, which uses forced labor by the Uyghur Muslim minority. And the U.S. has banned imports from that region. And because of there's this particular loophole that if you ship a product to the U.S. that's below$800, it doesn't get checked by Customs and Border Protection.

11:19And most Sheehan hauls are very cheap, like$3. So they're not subject to that. And therefore, they can kind of use sketchy materials and things from places that the U.S. has banned to get in. And then when Bloomberg kind of tested the products, they took it into the lab. They were like, yep, this cotton is from Xinjiang province. And, you know, Sheen is completely skirting the rules. So lawmakers from both sides of the aisle are trying to crack down on this. Yeah, we'll definitely see how kind of this controversy plays out in context of their impending IPO. There's no like set date for it or anything, but they want to IPO.

11:56Is it a U.S. IPO? They were looking at because Congress wants the SEC to look into it. So I do think it would happen in the U.S., but it was valued at one point at$100 billion. So this is a big, big company we're talking about. So it's crazy. Again, the ripple effect of one influencer trip could factor into a$100 billion IPO. All right, Neil, let's move on. Everyone's favorite big box retail store, Costco, has been struggling a little bit this year with weak sales. So it's taking a page out of your local college bars playbook and IDing more customers. Yes, I said IDing. Costco has been suffering an epidemic of non-members using members cards to shop at its stores.

12:41And Costco memberships are one of one. You're not allowed to borrow your mom's and cop some sweet deals on 54 tubes of toothpaste. I've tried. But that's exactly what shoppers have been doing. often sneaking away to the self-checkout aisle so they can get away with their dastardly impersonations. So now Costco has warned customers it will be more consistently asking for a photo ID as a cross-reference with the membership card. Neil, can you imagine stress shopping for a 12 gallon bin of peanut M &Ms and the checkout clerk goes, yeah, I'm going to need to see some ID here? Yeah, I mean, there have been all over Reddit, there have been people posting about seeing this crackdown in action i mean there's signage across stores now being like only paid members are allowed to shop personally i feel like you know shopping at costco is a little intimidating anyway you have to flash your badge everywhere and i'm just kind of like looking over my shoulder being like i'm just shopping here but you know somebody i feel like somebody's looking at me and you have to get your receipt signed and it's a very you know yeah intimidating process it's also everything is jumbo size too you feel like you're you're shopping in like the the jumbo aisle but it's kind of like Like in other countries of the world, you don't necessarily have to pay for a subway ticket, but you have inspectors come along and it's kind of like spot checks.

13:58And that's kind of what they're doing at Costco too. So you're always looking over your filter. Yeah, it's going to be nerve wracking. But the reason why Costco is so concerned with this is because their membership revenue is a big part of what allows Costco to exist at all. So they made$4.4 billion in membership fees in the year ending last August. And that is what allows them to offer these big ticket items at really, really low prices because it is subsidized. So you can get the wholesale prices even though you're getting the full goods. So that's why it's really a page out of Netflix's playbook, by the way.

14:33Let's talk about Netflix because a few weeks ago they started cracking down on password sharing. And it's been an incredible success. Yeah. I mean, the first couple of days that they cracked down on password sharing were their best for U.S. acquisition, you know, ever. Or, yeah, in a long while. Yeah, that was hyperbole. But yes, it seemed to have worked at Netflix and I think a bunch of other subscription services. So we gave a lot of people a free lunch for a long time. It's time to crack down. Yeah. Literally, in Costco's case, a one dollar and 50 cent hot dog. Well, you can get it. Have you gone on a Saturday?

15:07You can get a free lunch. I mean, if you just walk around, do like three laps, you're going to get chicken periyaki. You're going to get a taquito. Now we're going to get. Now we're thinking. You're just going to. Yeah. I used to fill up all the time on Costco on Saturday. Let's have a little Costco sample lunch date. But I need to get a membership first. I won't. I won't tell on you if you don't tell on me. All right, Neil, before we jump into the next story, we're going to take a quick break. This episode is brought to you by State Farm. listening to this podcast smart move being financially savvy smart move another smart move having state farm help you create a competitive price when you choose to bundle home and auto bundling just another way to save with a personal price plan like a good neighbor state farm is there prices are based on rating plans that vary by state coverage options are selected by the customer availability amount of discounts and savings and eligibility vary by state starting a business can seem like a daunting task unless you have a partner like shopify they have the tools you need to start and grow your business from designing a website to marketing to selling and beyond shopify can help with everything you need there's a reason millions of companies like mattel heinz and all birds continue to trust and use them with shopify on your side turn your big business idea into sign up for your one dollar per month trial at shopify.com slash special offer.

16:32Okay, Toby, first of all, just did a fact check. It is the best four days of Netflix US acquisition ever. I should never doubt you. Do not doubt me. I wasn't 100 % sure when I said that, but it is true. All right, let's get to Neil's numbers, which is our Thursday segment where I read a ton of news over the week and I bring you the three most interesting facts that I read. Here we go. Are Airbnb's revenues plummeting? One analysis suggests that they are. In a tweet that went really viral, the CEO of Reventure Consulting posted a chart that showed that revenue per available Airbnb listing had plunged in certain cities.

17:10In Phoenix, they're down 47%. In Austin, 46%. In Asheville, North Carolina, a pandemic boomtown, they're down 43%. This suggests that struggling Airbnb hosts might have to sell their homes, which could cause shockwaves, not in the good way, to the broader housing market. There are about 1 million Airbnb or VRBO rentals on the market compared to 570 ,000 homes for sale. But others were skeptical of this Airbnb data, which came from analytics company All The Room. in one vacation town in Tennessee, the hometown of Dolly Parton, who we'll get to in a bit. All the room's data show that Airbnb revenue dropped 48 percent.

17:50But the chief economist of another real estate data company called BS and said that Airbnb revenue in that city only dropped 9 percent. So he doesn't think there's a calamity going on. But still, if you take the midway point of these data sets, it is not good for Airbnb and a sign that the COVID boom of everyone working remotely from a cabin in Montana for a month is maybe coming to an end. It's really sad for a lot of people to have that dream of owning an Airbnb, like renting it out, having that as their second stream of income or dual stream of income. And it's such like a TikTok mentality of like, why aren't you buying an Airbnb and like a multifamily home and renting it out?

18:30Because times aren't always so good for Airbnb and the company warned of a booking slowdown. But I think the reason it went so viral, this data was because there's seems like a bit of a backlash to Airbnb has been jacking up their prices. And, you know, you have to do all of this work to leave the house. Team hotels, baby. So hotels are kind of taken a little over mindshare of Airbnb. And I think there's this pent up anger toward Airbnb. So people are looking at this with a little schadenfreude. Our Neil number number two, that was a mouthful. Luxury watches. If there are any luxury watch collectors listening to this pod, There is a Bed Bath & Beyond level sale going on right now.

19:09Prices for luxury Swiss watches on the secondary market have fallen to their lowest levels in almost two years and are down almost 20 % over the last 12 months. Just like a bunch of other types of collectibles, prices of luxury watches soared to records in 2021 with limited supply and raging demand. But as interest rates shot up and recession talk heated up, prices have cooled by a lot. But this is the interesting part. There's one other factor driving prices of watches specifically lower, and that is the crypto wipeout. Newly minted crypto millionaires were major buyers of Rolexes during peak COVID.

19:44But now that crypto is in its winter era and investors aren't feeling as flush as they were, they're going with Casio's instead. And this is a real phenomenon. The online watch trading platform Chrono24 said that the crypto downturn has directly impacted pricing of luxury watches from brands like Rolex and Patek Philippe. It's so, again, butterfly effects. But also I'm now thinking, what's the luxury item that you want to store your money in that appreciates? Because if watches aren't going up and it's got to be Birkin bags, right? Birkin bags are undefeated as stores of value. Or some sort of Grimace memorabilia.

20:20Neil, I don't want to talk about it. I'm already feeling bad. Okay. Our third number. For everyone headed on a road trip this weekend, which is definitely a smart move given the state of air travel, expect country songs to be blasted into your ear holes morgan wallen's last night and luke combs's cover of fast car are number one and number two on the billboard hot 100 list this is the first time country songs have landed in the top two spots since 1981 when dolly parton was singing about the nine to five the the country pop singularity has arrived i hear it all the time i have a couple friends who are big country music listeners and i'm done pretending that i don't like it these songs are good like they're a good vibe like if you if you're truly hating on country music at this point like you're just being a hater it's definitely country is just pop at this point with some country instrumentation like a slide guitar or something but if you listen to the melodies it's very poppy there's a lot of hip-hop elements that have been exploded by uh old town road in 2019 um which really put you know put hip-hop and country in the same boat together so there's a lot of fusion going on a lot of pop stars are touring right now not putting out new music country is filling the void i've liked country for a while so um i'm happy um let's move on uh i want to talk about a particular headline that seems to pop up once every month and always spreads like wildfire it goes something like this european country will pay you to move to our breathtakingly beautiful town with rustic old world charm uh sounds pretty great huh most recently it was ireland which is offering up to$92 ,000 in renovation reimbursements if you move to its gorgeous remote islands, one of which was featured in the movie The Banishes of Ineshiran.

22:04Other European countries have dangled similar incentives, particularly in some Sicilian towns, which are selling abandoned homes for a dollar. Why are they doing this? Well, young people are moving out of these rural villages, and the idea is that luring foreigners to move there through generous subsidies could help revive these towns. The question is, Toby, is this too good to be true? Is this happening? Would you do this? I mean, it's too good to be true in some senses, but it's also doing pretty well in others. So we talked about Ireland. There's been more than 500 applications for that particular program.

22:37And then over 300 homes have been sold in that program in Italy. So it is working to the sense that it is driving people there. But a lot of people arrive or apply thinking that they'll handle everything, like they'll help with immigration, they'll help get you resettled. But in reality, it's a renovation budget. So there's just like a little bit of loss in translation here. And it's totally exacerbated by these headlines that you see that go viral because yes, the companies are technically paying you. The countries. Yeah, the countries are technically paying you, but it's not like, here's$200 ,000, like come live here.

23:13And it's as simple as that. So imagine, I mean, you know, working with contractors here is tough. I've heard a lot of headaches. Imagine going to a rural Sicilian village dealing with home renovation, which is already such a headache and so frustrating and a very high stress thing. And, you know, there's so much loss in translation. You don't know the language. So this seems like a little tough. But the problem is very acute. I mean, in this one Sicilian town that's doing this program, they have 40 ,000 homes, but only 10 ,000 residents. I don't think that this foreign exchange thing that they're doing is a sustainable solution.

23:50It might, you know, get a, you know, provide a little uptick on the margin, but they need to do something just to keep their young people from leaving, like create more jobs. Yeah. All right, Neil. Last question on this one. Would you move to Sicily or would you move to Ireland? Oh, Sicily. You're a Sicily guy. Oh, my God. I thought you loved the banish. You know, all I want to do when I retire is just like sit on a Mediterranean beach and eat tin fish and drink wine and play all day. Like that is all I want to do. All right, Neil. Our final story is one that is very near and dear to me because it involves cramping on a soccer field.

24:24This week, a couple of videos of NWSL players getting stretched out by a trainer went viral. As they're getting stretched, the trainer hands them this little shot that looks like a five-hour energy bottle. But when they take it, they immediately start gagging and rolling around and making a face that looks like they just ate the last wings on hot ones. And they kind of did because the liquid they are drinking is called a hot shot, and it's supposed to instantly get rid of cramps. All right, ready for a little science, Neil? Let's do it. Hot shot uses three primary active ingredients, cinnamon, ginger, and capsicum, which is that compound that makes hot peppers hot.

25:00and when you take the shot, the nerves in your mouth and throat get triggered, which makes your brain send calming signals to that area of your body. In doing so, it inhibits the nerves in your cramping muscles from overfiring, which can provide that instant relief from a cramp. I've never seen this before, Neil, but gosh dang it, I wish I had it during my playing days because that would be very clutch. Is it supposed to actually work? It's supposed to instantly relieve it. I mean, again, like this is a claim that's made by Hot Shot, the company. But the science in my head makes sense. Like, of course, if it's just neurons over firing in a muscle, that's what a cramping muscle is.

25:39It's just sending pain to a different part of your body, right? Right. But it's getting rid of that, of the over, the hyperactive neurons in your hamstring. I know, but looking at these players talked about it afterwards and they were like, I'm never doing that again because it just tastes so disgusting. Here's the rule I want to institute. It's a big thing in soccer. at the end of the game time wasting you go down with a cramp in parentheses right and if it is clear that someone is time wasting they should have to take a hot shot and if you go down it's got to go the hot shot has to go down as well i like that the whole point of this is like when you stub your toe and it hurts and then your brother comes up to you he's like let me punch you in the arm so that you forget about this your stubbed toe that's basically what hot shot is uh But we will keep track of that.

26:23That is our show. We have one more before the break. Who's counting, though? I'm not. Thanks for listening and watching. If you want to get in contact with us, our email is morningbrewdaily at morningbrew.com. Huge shout out to our crew who puts this show together. Sam Wolf joining the crew. Editor and producer Samantha Veles and Raymond Liu are the associate producers. Yuchenawa Ogu is our technical director. Billy Menino is on audio. Hair and Makeup said they thought working at Morning Brew would be filled with people slaving away, but they were pleasantly surprised by the labor practices and that every product is handled with care.

26:58I can confirm they were not given talking points. Devin Emery is our Chief Content Officer, and our show is a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow.