Dec 4, 2019

Axios Future

By Bryan Walsh
Bryan Walsh

Welcome back to Future. A huge congrats to my colleagues Alexi McCammond and Sara Fischer who made the Forbes 30 under 30 Media list. Check out Alexi's work here and sign up for Sara's Media Trends newsletter here.

If you have thoughts on today's newsletter, just reply to this email or reach me at erica@axios.com. Kaveh, who anchors Saturday's Future, is at kaveh@axios.com.

I've got 1,237 words for you — a 4.5-minute read. To start...

1 big thing: The techlash zeroes in on Amazon

Illustration: Sarah Grillo/Axios

On the big shopping days of the year — Black Friday, Cyber Monday and, of course, Prime Day — Amazon once shined with its hyper-efficient apparatus for commerce on full display.

No more. Heightened scrutiny of the consequences of its bigness is beginning to supplant the glowing coverage of its success.

Driving the news: Last week, during the kickoff of the holiday shopping frenzy, three big stories about Amazon revealed the human toll of its speedy delivery push.

  • A blockbuster investigation from Reveal dug up records from 23 Amazon warehouses and found that the injury rate was "9.6 serious injuries per 100 full-time workers in 2018, compared with an industry average that year of 4." An Amazon spokesperson told Reveal that its injury rates are high because the company is aggressive about recording these incidents.
    • Reveal's deep dive also found that officials in Indiana "quietly absolved Amazon of responsibility" in a worker death case while in the middle of the bidding process for HQ2.
  • Gizmodo got internal documents from Amazon's Staten Island warehouse, one of the newest ones, and discovered that injury rates there are more than three times the industry average.
    • Amazon says, “It’s inaccurate to say that Amazon fulfillment centers are unsafe and efforts to paint our workplace as such based solely on the number of injury recordings is misleading given the size of our workforce.”
  • And an NBC story featured accounts from Amazon delivery drivers who said they were overworked or driving without credentials. “Those are close calls every single day, worrying you're going to hit a car or a person," Ami Swerdlick, a former delivery driver, told NBC.
    • “Amazon operates a safe delivery network and to state otherwise is simply not true,” the company says.

Compare those stories to years past...

  • During the 2018 holiday shopping season, the New York Times wrote about how when it comes to last-minute purchases, customers only trust Amazon. "[I]ts dominance is never more pronounced than in the nail-biter last-minute sprint before Christmas," the Times wrote.
  • And six years ago, when Amazon CEO Jeff Bezos was interviewed on CBS' 60 Minutes about drone delivery, the company was given an even glossier treatment. "If there is such a thing as Santa's workshop, this would be it," the show said of an Amazon fulfillment center.

The big picture: A perfect storm of trends is working against Amazon.

  1. Amazon is getting more powerful. As e-commerce takes a bigger piece of the retail pie, Amazon remains the dominant player. This past Monday was Amazon's biggest sales day ever. And the company delivers products three days faster than the average competitor, per Supply Chain Dive.
  2. There’s a growing backlash against all Big Tech. The other tech giants — Google, Facebook, Apple — are facing increasing scrutiny. Among them, Amazon is the No. 1 company called out by 2020 candidates.
  3. And within the techlash, there's a growing focus on how tech giants harm workers and cities. Stories from Amazon’s warehouses fit right into that narrative.

But, but, but: It's not likely the bad PR Amazon is amassing for its fulfillment centers will significantly dent its profits, experts say.

  • "There is substantial consumer dissonance when it comes to linking outrage with actual change in consumer behavior," says Scott Galloway, a professor at NYU's Stern School of Business. "People want convenience at the best value. They will, however, elect people to, hopefully, address these issues."
  • On top of that, "Amazon has been steadily replacing people power with technology," Ryan Hamilton of Emory University says. "If the number of human workers doing these jobs decreases, so will the injuries associated with those jobs. Robots don’t get injured sorting packages."
Bonus: A package theft epidemic

Speaking of the consequences of online holiday shopping, there's a package theft crisis in cities across the country.

Staggering stat: 90,000 packages disappear daily in New York City, reports the New York Times.

The big picture: The online world has a massive physical footprint — and the rise of e-commerce is choking city streets with delivery vans and trucks. New York City alone gets 1.5 million package deliveries a day.

  • And a steady influx of packages on doorsteps means lots of them will get stolen.
  • In some of the glitzier New York buildings, e-commerce has transformed the jobs of doormen, who now spend the bulk of their time lugging endless deliveries into their lobbies.
2. Mayors are the new grocers

In the produce section. Photo: Creative Touch Imaging Ltd./NurPhoto/Getty Images

In hundreds of American towns, mom-and-pop grocers and shops are closing their doors — leaving an increasing share of Americans with no retail options beyond dollar stores.

But, but, but: One town found a different solution. After its only grocery store closed, the mayor of Baldwin, Florida, opened a market run by city hall to help limit the community's reliance on fast food and dollar stores, Axios' Marisa Fernandez reports.

Why it matters: Dollar stores are thriving as local retail decays (there are more than 30,000 such stores in the country today), so several cities are starting to push back and either ban or limit the opening of new dollar joints in town.

  • As we've reported, Birmingham and Oklahoma City both passed laws against dollar stores. More recently, the residents of Empire, Michigan, banded together to keep Dollar General out.

Baldwin could become a model for these places that are looking for alternatives to the discount chains. Beyond Florida, locally owned groceries have already popped up in Vermont and Kansas, says Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a nonprofit research and advocacy group that opposes concentrated economic power.

"Most of the cities and small towns that are confronting this problem see restricting dollar stores as only half of the answer. The other half is having a plan to bring in a real grocery store."
— Stacy Mitchell
3. Confused by Coke

Empty coke bottles in Shanghai. Photo: Duan Wendi/Visual China Group/Getty Images

Apps like Robinhood and Stash have blown up — marketing themselves as accessible, easy-to-use tools for laypeople to play with stocks.

  • But as those without experience start to get into the stock market, we'll see more and more cases of amateur investors getting duped.

One company potentially confusing people is Coca-Cola Consolidated Inc., which has the ticker symbol COKE, Bloomberg's Matt Levine writes in his Money Stuff newsletter.

  • COKE isn't actually the fizzy, sugary drink that goes well with burgers. That Coke is Coca-Cola Co., with a market capitalization of $228 billion and the ticker symbol KO. COKE is just a bottling company for the soda giant, worth around $2.5 billion.
  • But, but, but: When you search Coke in the Robinhood app, COKE appears first and KO second, writes Levine. So there are definitely people out there buying COKE when they mean to buy KO, right?

What to watch: COKE has a crazy high stock price for a bottling company (it's trading at 47 times its earnings per share, notes Levine). The ticker symbol may have tricked people, but some investors mistakenly buying COKE wouldn't be enough to drive up the price, so we don't really know why it's so high — and some short-sellers are betting against it.

4. Worthy of your time

Illustration: Sarah Grillo/Axios

The techlash could spur the next generation of startups (Dan Primack — Axios)

A disrupter on the edge of Stanford's campus (Steven Johnson — California Sunday)

Supermarket survival means matching Amazon (Matthew Boyle — Bloomberg)

How neural networks became a big business (Timothy Lee — Ars Technica)

Climate change is reshaping Iceland (Kendra Pierre-Louis — NYT)

5. 1 fun thing: The future of the first date

Illustration: Axios Visuals

First, dating apps moved the experience of bumping into a good-looking stranger online. Now, the apps are coming for first dates.

Driving the news: The League, an exclusive dating platform that requires users to link to their LinkedIn accounts and wait for approval to join, is out with a new service called League Live. Those who sign up can go on three speed video chat dates within the app every week — it's yet another iconic step in courtship being relegated to smartphones.

The big picture: Per Amanda Bradford, the founder of The League, the first date as we know it will soon be a thing of the past.

  • “In-person first dates will definitely be replaced by digital dates, as the stakes are lower and with video chatting you can figure out whether or not you click within the first few minutes,” she told Quartz.

Go deeper: My colleagues did a fascinating deep dive into all aspects of the future of dating.

Bryan Walsh

Thanks for reading!