The Best One Yet
🧾 “wtf is that?” — Say Hello to Tariff Fees. Costco’s 1st beer dupe. Return of the Mascots.
Mon, 21 Apr 2025
You’re about to see “Tariff Fee” on your receipts… But the phrasing is about to get political.Companies are embracing mascots again … Jake From State Farm just beat the Kardashians. Costco’s one weakness? It’s never successfully sold a Kirkland beer… until now.Plus, we’ve got Duolingo’s CEO on tomorrow’s pod… and he’s announcing something big.$COST $MCD $DUO $SPYWant more business storytelling from us? Check out the latest episode of our new weekly deepdive show: The untold origin story of… the Super Soaker 🔫Subscribe to The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinks to listen.“The Best Idea Yet”: The untold origin stories of the products you’re obsessed with — From the McDonald’s Happy Meal to Birkenstock’s sandal to Nintendo’s Susper Mario Brothers to Sriracha. New 45-minute episodes drop weekly.—-----------------------------------------------------Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/ Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
Chapter 1: What is the tariff fee and how will it affect consumers?
Well, with 145% tariffs, they just added a specific tariff fee at the checkout. In fact, Jack and I think this tariff fee could trickle down even to the restaurants you eat at. Even if they offer the same menu, their ingredient prices are probably going to rise because of these 10% across-the-board tariffs. so restaurants might add a tariff fee. Now, tariffs raise prices. It's an economic reality.
The question is, though, who absorbs those prices? Is it the manufacturer, the retailer, or does it get passed all the way down to you and me, the consumers? Well, all righty, massive this weekend. It looks like companies are starting to pass higher prices on to us. And they're doing it transparently. They're sticking it right on the receipt like it's a separate tax or something.
Like you have the subtotal, the state tax, the city tax, the automatic gratuity, and the tariff fee. The receipt yetis, the checkout cart, all of them are valuable real estate because we look at those final prices, which leads to our takeaway. So Jack, what's the takeaway for all our buddies who are out to see the tariff fee? These tariff fees are going to get political.
Yeah, these higher prices are coming. It's an economic certainty. Even our Fed chairman, Jerry Powell, said so last week. What's not certain is how these higher prices will be labeled. Okay, here's how this could play out. On the one hand, companies want to be transparent that these higher prices are out of their control.
Basically, if you add a tariff fee, you're telling the customer, this isn't our fault. It wasn't our idea to raise prices. So some brands, especially brands controlled by non-Trump supporters, they could call this the Trump tariff surcharge. Give it a little political angle. But others might want to show support for President Trump.
and use a fee like liberation fee or china fee or patriot free remember the freedom fries renaming that happened in the early 2000s same rebranding concept jack but i gotta point out having a label that feels political jack that could also alienate customers on the other side just by having the fee okay so maybe you just call it tariff fee and like try to be neutral with your fee labeling but then jack even just calling it a tariff fee that
could be perceived as an anti-Trump move as well. Yeah, Trump probably wants no attention on this at all when it comes to consumer prices. So, Basties, add it all up, and you're going to start to see the tariff fee, and they are going to get political. For our second story, Costco's wildly popular Kirkland brand finally has a good tasting beer.
But the biggest winner of this Kirkland brew might be one Oregon craft brewery. Now, yetis, as we've told you, we have a weekly show. It's called The Best Idea Yet. And on that show, Jack and I tell you the most viral products of all time, how they came to be. And our most popular episode is the one about Costco. Yeah. Specifically, the Kirkland brand.
Costco's private label brand that makes up a quarter of Costco's revenue. Get this. Just Kirkland brings in $66 billion of sale a year for Costco. Kirkland's signature brand brings in more revenue every year than Boeing, America's biggest airplane manufacturer. More than Amex and a whole lot more than Lyft. We won't even get into that. This is the cult of Kirkland's signature. You...
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Chapter 2: Why are companies starting to add tariff fees to receipts?
And because of that guaranteed demand from the cult of Costco, Deschutes didn't have to spend a dollar on marketing it. All those cost savings from the marketing, that let them keep high-quality ingredients in the beer for a low price. As Deschutes put it, it would have taken them 20 years to scale this fast. if they had done it on their own. This was all about scale.
Honestly, it reminds us of the deal we did with Robinhood years ago. Selling to Robinhood exposed our podcast to a giant audience. It might have taken us 20 years to scale our podcast that fast if we'd tried to do it on our own. Because, as Major Tom said to Ground Control, when you grab onto a rocket ship, you get a free ride.
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For our third and final story, the biggest marketing trend of the year is, shockingly, mascots. Corporate mascots are being born across America because the best influencers are the ones you control completely. All right, Jack, let's whip out the whiteboard here, because we have been keeping track of the rise of mascots like we're bird watchers.
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Chapter 3: What is Costco's latest venture into beer?
And it's not just cartoon characters thriving as mascots today. Because who happens to be Gen Z's favorite influencer on TikTok these days? Jake from State Farm. I believe it's Jake from State Farm, Jack. No, it's, okay, Jake from State Farm, what are you wearing? Um, khakis. Red shirt, solid belt, pleated khakis. That's who we're talking about. Get this.
Jake from State Farm has 1.4 million TikTok followers. He has 300,000 Instagram followers, and he has 100,000 followers on Twitter. He's an insurance mascot. At this point, we need a new TV show on HBO. America's Next Top Mascot. Now, Yetis, you probably think to yourself, look, mascots are dead. Tony the Tiger? When was the last time you saw him? What was his phrase? They're great?
I mean, mascots are so dated, the whole concept is corny. Why are they trending right now, Jack? We've found a few reasons. First, we're all living in the attention economy. Yeah, mascots, they catch your attention really quickly in your Instagram feed. Boom! It's the Trix bunny. Okay, that captures my attention. But it's not just the attention, it's also the cost.
It's cheaper to create a fictional character than to pay Brad Pitt to endorse your packaged goods product. The bigger reason, we think, for this mascot mania is control. Because you can make your mascot do anything. Okay, planters killed their Mr. Peanut mascot and then replaced him with a baby nut mascot. You can't do that to our Kardashian.
Chapter 4: How does Costco's Kirkland brand compare to competitors?
Also, Duolingo's Duo the Owl, they also had the owl fake his death last month. And that thing is more unhinged than any paid celebrity would ever be. So basically, if you are a company, you can go God mode on your mascot and no one's going to stop you. That's why every CEO is telling their marketing department, they need a cuddly mascot on my desk ASAP.
Now, the key here is that brands are investing in creative to build out multifaceted mascots with real personalities. That's why customers like us genuinely like these mascots. These little quirks give them humanity, like Geico the gecko is successful because he is cheekily and vaguely British. But this mascot mania goes even deeper because it's all a response to one specific force.
So Jack, what's the takeaway for all our buddies staring at these mascots? Mascots are influencers minus the risk. It's a simple equation because yetis, we've said before, live by the influencer, you die by the influencer. It's a risk to your business sometimes working with influencers. Publicly listed companies literally list influencers as one of the top risks to the brand.
I mean, Jack, remember the fall of Bud Light two years ago? How could I not? It began with drama over one of their influencers. Well, this mascot renaissance is the response to this influencer risk and politics fatigue. A mascot is how a company can play on social media and beyond, but control the narrative the whole time. Cobb's new PETA chip isn't going to share an opinion on vaccine mandates.
No. Customers want less politics from their brands right now, and businesses want less controversy. Yes, mascot mania is the solution. Almost like an emotional support animal for both. Mascots. They're influencers, minus the risk. Jack, can you whip up the takeaways for us to kick off the week? Tariff fees have already arrived. Tariffs are getting a separate surcharge on your receipt.
Oh, tariff fees, they're coming. We've seen them, and they're going to get political. For our second story, it's Kirkland Signature Lager. They're winning praise from beer critics, but Deschutes is the real winner. Because when you grab onto a rocket ship, you get a free ride! And our third and final story. It seems like every day a new Fortune 500 mascot is born.
Because mascots are influencers minus the risk. They're Kim Kardashians without the sex tape. But yetis, this pod's not over yet. Here's what else you need to know today. First wild story from the Wall Street Journal you may hear at the water cooler this week. Elon Musk has 14 kids. There was deep reporting from the Wall Street Journal on how Elon manages what he calls his legion of offspring.
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Chapter 5: What are the implications of corporate mascots in marketing?
Chapter 6: What can we expect from the upcoming Duolingo product announcement?
are a Kirkaholic. But that cult has been beer-less for seven years, haven't they, Nick? It's what Jack and I found fascinating about this story. Costco has one surprise weakness no one would have expected. They've never figured out how to get a good store-branded beer. Like years ago, Jack, didn't Costco have like a 48-pack Kirkland signature light you could crack open in the garage?
Yeah, 48 light beers for 20 bucks. And even though it was 50 cents a can, They had to discontinue it. It tasted that bad. Ah, the elusive Kirkland beer. It's been Costco's Achilles heel for decades. But here's the news. Kirkland finally has a keg worthy of the Costco brand. It's called Kirkland Signature Lager. And this one Kirkland beer is seeing accelerating sales. Let's talk numbers here, Jack.
That failed beer, the Kirkland Signature Light from years ago, it got a two-star review on Untapped, the beer drinking app. But this new beer has a 3.6 star review and apparently sales are doing really nicely. Now the key when it comes to the Kirkland brand, here's the business model. They don't make the products. They're just the brand.
So they basically vet some great food manufacturer and say you're worthy of the Kirkland brand. So Jack, who is the beer worthy of the Kirkland brand in this case? It's Deschutes Brewery over in Oregon. They're the company behind this new Costco beer that is selling 12 packs for 14 bucks. Believe it or not, Kirkland branded coffee beans sold at Costco, those are actually Starbucks coffee beans.
And Kirkland's new successful beer is actually Deschutes Craft Brewery beer with a Kirkland label. But Nick, these beers are sold as a 12 pack for just 14 bucks. So that's just over a dollar a can. I'm doing the math here, Jack, and for a little over a buck a beer, that must be a low-quality brew, right, man? Wrong.
Kirkland's beer is actually the same Deschutes beer that won a gold medal last year at the Great American Beer Festival. And here's the key reason how. Kirkland's brand actually has a very specific financial rule. They will never set a price that has a profit margin higher than 14%. Now, that 14% profit margin magnate is unique in the industry. Other companies don't typically do this.
No matter the product, though, Kirkland will never set a profit margin higher than 14%. But still, Jack, I got to ask, $1.20 for a can of beer? They must be diluting the ingredients for Costco's version. False. because of our takeaway jack what's the takeaway for our buddies over at costco when you grab onto a rocket ship you get a free ride Yeah, it is. Deschutes beer has a problem.
This craft brewery made a gold medal beer, but it was expensive. A fancy German malt is pricey. If Deschutes had tried to scale that gold medal beer like all their other beers, it would have been tough to do because of that high premium price. So instead, they partnered with Costco. Because once Costco blesses a product, then its 100 million members start buying that endorsed product.
And because of that guaranteed demand from the cult of Costco, Deschutes didn't have to spend a dollar on marketing it. All those cost savings from the marketing, that let them keep high-quality ingredients in the beer for a low price. As Deschutes put it, it would have taken them 20 years to scale this fast. if they had done it on their own. This was all about scale.
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