Hey👋,
I'm Giacomo

Have you seen the Ferrari movie?

It was released at a perfect timing, right at the close of a record year for the sports car company.

The movie is excellent and provides an accurate portrayal of Emilia, the Italian region where Ferrari is based, and its people. There's even a scene in a restaurant where Enzo Ferrari is served the boiled meat tray, a peculiar speciality of the Emilia region. As an "Emilian" myself, I can confirm its accuracy!

Unfortunately, the movie mainly focuses on racing and a specific episode in Enzo's life, without addressing Ferrari as a luxury car manufacturer.

2023 was a record year at Ferrari. Some facts:

• Car sales were up 3% YoY to 13’663 units.
• Revenue were up 17% to almost 6bn. Ferrari sold higher-priced cars and more personalised features.
• Sales were mostly driven by the new SUV-like Purosangue.
• The average price of a Ferrari car in 2023 was €397’000, a new record!
• Net profit climbed 34% surpassing 1bn for the fist time in its history.
• 10% of revenue came from sponsorship and merchandise. store.ferrari.com sells Ferrari-branded clothing and accessories, from $200 baseball hats to $5000 leather suits. Ferrari is a luxury brand, not just a car maker.
• It is the first luxury group to have eliminated the pay gap between men and women at a global level.
• Lewis Hamilton, one of the most successful F1 drivers in history, will join Ferrari in 2025.
  
  Not bad for a company out of the small town of Maranello, Italy 🇮🇹

Is Netflix the winner of the streaming war?

In recent years, traditional studios like Disney with Display+ and Warner Bros. Discovery with HBO Max have entered the streaming industry, significantly intensifying the competition in the space.

The streaming business requires huge investments to produce high-quality original content, which is key to "stealing" users from competitors. But with monthly subscriptions starting from as little as $5, streamers need an exceptionally large user base to turn a profit.

Profit hasn’t happened at Disney yet, whose streaming unit lost $420 million in FY23 (down from a loss of 1.4bn the year before). Warner Bros. Discovery does better, finally scoring a profit of $111 million in 2023, up from a loss of $634 million in 2022.

But Netflix does significantly better!

In 2023, it increased users by 13% to 260 million, against a worrying drop the year before. It’s been consistently profitable for over 15 years, delivering almost 5.5bn net profit (after tax) in 2023 at a net margin of 16%.

On top of successfully cracking down on password sharing and launching an ad-supported subscription tier, Netflix has a secret weapon: content licensing.‍

Competitors, under pressure to deliver profit, are (re)starting to license their original content to third-parties, including and especially to Netflix. While this generates easy money for the likes of Disney, it also enriches the Netflix’s catalogue, for the delight of its users.

Netflix is so good at servicing its subscribers that when NBCUniversal licensed “Suits” in June 2023, the show went straight to the number-one most watched, despite being relatively old (originally aired on cable TV in 2011). In fact, according to Nielsen, in November 2023, nine of the ten most streamed programs were licensed content.

With around $17bn spent on content in 2023, Netflix might reduce this expense while still expanding its catalogue with premium, although old, content.

Beware, this is not reciprocal! According to Netflix’s executives, there’s more value in acquiring licensed content, than to sell it. So don’t expect “Ozark” to stream anywhere else.

Also, ad revenue is increasing and projected to represent up to 22% of total revenue in 2027. With this, Netflix won’t have to fight for new subscribers, but rather will extract more value from existing users.

If we add to the mix the recent $5bn deal to livestream WWE, we get the perfect recipe to declare Netflix as the winner of the streaming war.

However, streaming remains a costly and hit-driven business. When compared to YouTube, which spends virtually nothing on content, streaming looks way less appealing.

Stay tuned!

‍

‍

‍

‍

‍

‍

‍

The search war is on!

A recent study by Adobe reveals that 2 in 5 Americans now use TikTok not only for entertainment but also as a search engine. While Gen Z leads this trend, Millennials and Gen X are also on board.

‍

‍

This marks a historical shift in Google's dominance in the search engine market.

In fact, TikTok isn't the only emerging competitor. The study indicates that over 1 in 10 consumers used ChatGPT to search for information they would typically find on Google.

Ai chatbots, especially those capable of web searching like Perplexity or Microsoft Copilot, are becoming extraordinary competitors to traditional search engines.

Even Bing itself is likely to increase its relevance since ChatGPT often refers to it.

‍

‍

Although Google remains the clear leader, its market share is visibly declining in Europe, particularly on Desktop. At the same time, Bing's market share on Desktop rose from 8.5% in January 2022 to 11% in December 2023.

‍

‍

Keep in mind that in the huge search engine market, every percentage point is a big deal!

This shift represents an incredible challenge, but also an opportunity for marketers quick enough to adapt to the new changes. SEM will inevitably evolve, but how exactly it’s still too early to tell.

Sunday reads: "Office politics is not optional: learn to play the game or you’ll be its victim" by the Financial Times.

There are two types of office politics, as explained in this video by Harvard Business Review.

👍 Positive office politics

This happens when managers and employees engage in politics to enhance their reputation and build long-term partnerships. This way, they know who to ask when they need something, and vice versa.

In this context, a positive can-do attitude may be more important than actual competence. I would better describe this as "office life" rather than "office politics", as office work inherently requires teamwork and partnerships.

👎 Negative office politics:

This is typically what people think of when they mention office politics.

Negative office politics involve individuals who are solely interested in their personal gain, often disregarding the company, its vision, its people, and even their actual work. This is obviously not exclusive to offices, but it's common also in normal politics and life in general.

‍

Both forms of office politics require hard work and lead to career advancement. However, while the first type can be learnt, the second is exclusive to certain individuals.

I'm definitely not part of the second group, but I do acknowledge that pursuing "negative politics" can lead to rapid career progression.

For people like me, there are two options:

We can either continue to complain and live in frustration, or accept that certain skills cannot be learned, because contradict our personal values and attitudes.

Like many things in life, we must accept reality and set rhetoric aside. Quoting a friend, "sure, it's possible to skip the queue, but are you really that kind of person? just stay in line and wait for your turn."

‍

AXA Switzerland removes hierarchy. This is a landmark move!

While some level of hierarchy will remain, many intermediate titles such as vice-president will be eliminated, marking the shift from a "status hierarchy" to a "hierarchy of responsibility”. The goal is to enable employees at all levels to make critical decisions about their work, instead of only adhering to top-down directives.

As Daniela Fischer, Head of HR, told NZZ recently, "Bosses don't always know everything best.”

Historically, money and status have been the primary motivators for employees. However, this concept is becoming outdated.

In today's job market, companies not only compete against each other, but they also compete with a wide range of self-employment opportunities. For example, working as a content creator, which is becoming easier to get into and more profitable, also thanks to Ai.

AXA has recognised that especially younger generations are not necessarily motivated by status and money, but rather by long-term purpose and the actual nature of their day-to-day work. If it were solely about money, they could easily work online probably making more than in any regular job. Instead, they’re looking for their skills to be valued and to be respected, no matter of their job title. Being taken seriously is what truly matters for them I believe.

We will see if AXA will be successful in this massive cultural change. Regardless, I hope more companies will test similar structures to adapt to a job market that has undoubtedly changed.

Third-party cookies are going away, so what?

There seems to be a lot of confusion about the implications of the third-party cookie's deprecation. It's not an armageddon, nor the end of the internet as we know it. Yet, some things will change, but only for some.

Let me explain:‍

POV you are an advertiser

If you advertise on platforms such as Google Ads, Meta, TikTok, or Apple Search Ads, there will be little change for you.

Why?

Because those companies are walled gardens.

What does it mean?

They don't need third-party cookies to target users effectively, since they already own sufficient first-party data.

Users generate first-party data whenever they log in. Google knows everything about its logged-in users on Chrome desktop or Android and can track them across any website or app as long as they remain logged in. Sure, not everyone logs into to a Google account, but hey.

The same applies to Apple on iOS (any iPhone user has to be logged-in with an Apple account).

The story is slightly different for Meta and TikTok.

They won't be able to track users outside of their platforms, but there's already huge data to be collected within their apps.

For instance, TikTok determines your preferences by the videos you watch on the platform. Using this information, it can display the right ads to the right users directly within the app. It doesn't require tracking outside of TikTok.

If you were buying ads via other vendors, well, you should probably move to big tech.. what a news! 😄‍

POV you are other vendors

Yes, third-party cookie deprecation is indeed a problem.

Let’s take Criteo for example.

Criteo is just a technology vendor and does not own any user, browser or device. Their specialty lies in retargeting ads, which do require third-party cookies to identify the same user across different websites. While they might find some technical workarounds, their business model is at risk.‍

POV you are a publisher

The deprecation of third-party cookies is a problem for small publishers who depend on programmatic ads revenue.

Without third-party cookies, their audience is worthless to advertisers. After all, why should brands purchase ads from small publishers if they don’t know anything about their users?

Different story goes for the large publishers.

Large publishers often own multiple popular websites, providing them with valuable first-party data. This data can be sold directly to advertisers.

Bottom line:

✅ If you're an advertiser, you're okay. Simply reallocate your budget from smaller ad vendors to big tech.

✅ If you're a large publisher, you're mostly okay.

❌ If you're a small publisher, you’re in trouble.

❌ If you're a small/medium ad vendor, you’re also in trouble.

🎉 If you’re big tech, cheers!

Big wins, small loses.

Or am I missing something?

Global minimum corporate tax has finally gone live and it's a big deal!

The minimum 15% rate, now active in the EU, Norway, Switzerland, the UK, and other countries, surpasses the previous lower rates in tax havens like Ireland, where it was 12.5% until recently.

I lived in Ireland for several years and the topic of a possible bubble ready to burst at the first tax rate increase, was a frequent subject among expats.

In fact, Dublin is home to many multinational corporations' EMEA HQs, that employ thousands of European expats. Foreign direct investment is worth a staggering 285% of the country's GDP!

I believe this new rate will change nothing. If anything, it will increase tax revenues and further aid the country's development.

The appeal of Ireland for multinational companies extends way beyond its low corporate taxes:

1. Only English-speaking country in the EU post-Brexit.
2. Proximity to the US, with Dublin being the EU's closest capital by flight time.
3. An exceptionally welcoming culture.
4. This makes Ireland a welcoming home for many European expats/immigrants.
5. Therefore, a wealth of multilingual, skilled talent.
6. A stable political environment.
7. A stable climate (yes it rains all the time, but at least you know and it never changes 😁).
8. Even at 15%, it remains the lowest possible rate, lol :)

Bonus point: With global warming, Ireland will become an amazingly beautiful seaside destination! 😅

I created my first public GPT! Find it here.

It's called "Improve Text" and well, what it does is improving text 😁

I specifically designed it for professional online content like #blog articles or #Linkedin posts.

It uses advanced vocabulary, but it ensures the text is always to the point and easy to read for everyone.

Simply copy and paste a paragraph with no additional prompting to get started!

Oh, and let me know how you like it!

Breaking News: The SEC has finally approved Bitcoin spot ETFs in the US, but is it really a cause for celebration?‍

The Irony

‍The essence of Bitcoin was to sidestep traditional banking and financial systems. Yet now, it's embraced and sold by the world's largest financial institutions.‍

The Reality

The move doesn't symbolise an institutional endorsement of Bitcoin's philosophy. Instead, it represents a simple business and marketing strategy aimed at capitalising on the ongoing craze.‍

The Financials

According to the Financial Times, big players like BlackRock and Greyscale will charge 0.5% and 1.5% fees respectively. Their goal is to generate real US dollar revenue 💵 and upsell other high-margin products to new young clients.‍

The Impact

For Bitcoin believers, this is bad news. The philosophy of Bitcoin as an alternative to traditional finance has essentially failed.

For speculators and Wall Street, this is a win. Bitcoin price will likely go up, while institutions will cash-in large fees in the meantime.‍

The risks

‍Dennis Kelleher, speaking to the Financial Times, said the approval “is a historic mistake that will not only unleash crypto predators on tens of millions of investors and retirees but will also likely undermine financial stability”.

So what's left of Bitcoin other than speculation?

💡 Any thoughts?

We live in a world where social media users and fans believe they know more than industry experts and lawyers, often ignoring facts and legal principles.‍

Here's the situation

Taylor Swift's decision to re-record her first six albums to reclaim the rights to her music has inspired her global fanbase. They are now urging other artists to follow suit.‍

The facts

When discussing "music ownership," we're referring to the rights to the "masters" - the original recordings of songs. In the past, masters were tangible, typically stored as tapes in record label warehouses, making physical ownership clear. Today, these masters exist as digital files, but the concept of ownership remains unchanged.

Recording an album to a professional standard is costly, often amounting to tens of thousands of dollars. Collaborating with top-tier engineers and musicians, and using high-quality equipment doesn't come cheap.

This raises a critical question:

Who pays?

Whoever pays the bill gets ownership of the "masters". This is because the financier aims to recoup their investment - the music industry is not a charity.

Traditionally, record labels have born the cost of album production and promotion, acting like today's VCs in the tech industry.

Taylor Swift's case is unique, as her masters were re-sold to a third party she disapproved of, who refused to sell them back. Her frustration is understandable.

But it doesn't have to be this way: Paul McGuinness, the legendary manager of U2, used to negotiate reduced investment from record labels to retain masters' ownership.

The value of a recording is easy to determine in retrospect. But when a record label invests in a debut album, the financial risk is extremely high, and it's only logical for the label to expect something substantial in return.