Robot fights, struggling restaurants, wayward Chambers of Commerce, Gen Z drama, maple syrup panic - plus other Small Business insights in your inbox!
The big news this week is…we have now entered into the new era of browser wars!
Microsoft’s investment in ChatGPT saw their browser Bing integrating AI into search with mixed results. Google, in a blind panic it seems, immediately released Bard, its competitor AI, and began rolling it out to its homepage. OpenAI meanwhile opened up access to ChatGPT for $20 per month…to it’s 100 Million(!) users. Fight! Fight! Fight!
But what does this all mean?
For most Small Businesses this will mean an immediate and accessible boon in terms of the basic automation of tasks. Like we discussed in the Balance Sheet last month, now is the chance to start thinking about automating what you can - emails, sales, articles, blogs, websites, knowledge, imagery - the list goes on. It’s also the beginning of the end for what we currently expect from search on the internet and how we can get our businesses noticed and clicked on by customers. Many things we consider normal now will not be normal in the near future.
This rise of AI has its critics - and quite rightly. Will a simple paperclip overthrow humanity as we know it? Are ChatGTP and its kin just automated bullsh*t generators? Now - it’s too early to claim that we’ll all become paperclips, but there is definitely something in the bullsh*t generator theory (isn’t that just describing what we want from 99% of the internet anyway?) - but change in some form is coming and it’s coming quicker than we all thought.
People around tech tend to be a little ‘overexcited’ at the best of times in terms of their perceived impact on the world, but what’s interesting is - in the world of AI - they’ve mostly been slow to talk up the possibilities. So it means something when the Head of AI at Microsoft, Sarah Bird, admits in public:
“It's the most exciting and powerful technology I have ever touched.”
Tech hyperbole aside, it doesn’t matter if you think this change will affect you directly or not - because it will on some level. Ignore the sci-fi headlines and the talk about it changing the ‘world as we know it’ - for most Small Businesses, just changing the basic way search and SEO works would immediately have a impact on the balance sheet.
So - will we soon be paying our robot overlords to suggest our businesses to potential customers?
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Top story this week☝️
Job growth = inflation? Maybe not.
There’s a general theory in economics that the more the employment numbers rise, so do the inflation numbers. The more spending power people have, the more prices rise. But this theory is being challenged, in part by the strange behaviour of the current inflation numbers. The orthodox approach would be to cool the labour market to lower inflation, but post-pandemic, the three year market shock and supply chain backlog, this approach is being broadly debunked. There’s always been a sense that those in charge of the economy know what they’re doing and that they’re following some form of iron-clad rule book. But we’re in uncharted territory, and it’s taking a lot of the economic theory we took as unshakable truth and turning it to junk. Link
Nova Scotia restaurants sound the alarm
Pandemic restrictions are behind us, but the Restaurant Association of Nova Scotia is reporting that conditions are more challenging than during the years of enforced closures, and things are getting critical. Part of the reason is that Federal Covid loans are coming due, along with an incoming rise in tax on beer, wine and spirits. Another big reason is the inflated cost of food and labour - a cost which is inevitably being passed onto the consumer and putting up the price of…well everything on the menu. The post-Covid surge of consumer spending looks like it’s over for good. Link
Maple syrup taps early as climate shifts
Syrup producers are tapping trees early this year thanks to a ‘unique’ winter starting the season earlier than ever before. As you’d expect, it’s both good and bad news - earlier to tap, but regular temperatures above 5C cause the trees to bud, shrinking the longer harvest potential. This might sound like a strange story, but the maple industry is huge, representing 12,582 jobs and $1.133 Billion in revenue - in Quebec alone (which makes up 91% of Canadian Maple Syrup production). A long term change in climate could have deep economic costs. Link
How Twitter changed the world in 25 tweets. Link
Build a custom ChatGPT bot for your business. Link
Use Google Analytics? Make sure you’re ready for GA4. Link
The Data Room 🤖
Each week, The Data Room provides some insight into Small Business data, and each month(ish) you’ll get a deeper dive in your inbox. Here’s this weeks insight:
Generation kill (advertising)
Generation Z have zero time for your boring online adverts - they prefer genuine engagement instead. Now that the oldest Gen Z’ers are hitting their mid-twenties, it’s time to rethink how we approach our marketing spend.
It’s estimated that Gen Z (currently aged 11-26) controls around $360 billion USD worth of disposable income in North America. When meme stock investors pushed the $BECKY ETF targeted at basic millennials it ended up outperforming the S&P by orders of magnitude – between 2015 and 2020 it climbed 1079% - and that might get some of us wondering what all the basic Gen Zs are up to.
We all know that Gen Z is entrenched in the online world, but a recent study aimed to find out what’s been grabbing their attention. Some of the outcomes wouldn’t raise eyebrows - who’d be surprised that 67% use TikTok and 16% are on it “almost constantly” - but there was a major outlier in that Youtube has a grip on 95% of teens. 95%! That’s a huge number, right!? Could we draw some conclusions and say that if a generation is known for a preference for online shopping, bases many of their purchasing decisions from social media, and has a quickly growing wellspring of disposable income should have some pretty serious pull with advertising spend?
Back in the day, social media became a monoculture when Facebook entered the scene, and Meta (owner of Facebook and Instagram) still dominates with $135 billion USD in digital advertising revenue. Meta’s magnetizing effect on ad cash completely overshadows other household names like Twitter ($6.1B USD), TikTok ($5B USD), or Snapchat ($3.6B USD) - even Youtube can’t keep pace with their respectable $28.8B USD.
Even though Meta is a cash cow, they’re not hitting the right marks with Gen Z – since 2014, GenZ interest in the app has slumped from 71% down to only 32% who say they interact with the service. This is despite the generally accepted opinion that social media companies like Meta have ‘perfected’ the art of hyper-niche ad targeting - and so many businesses are therefore willing to pin their whole marketing spend on one or two companies because of the simple fact that they’re told ‘it works’.
We’ll undoubtedly see changes in Gen Z’s habits - brand loyalty and social media don’t really go hand-in-hand, and the fickleness of users is something that these apps depend on. Social media platforms allow generations to carve out their own space and ultimately influence their tone, values, and interface. But choosing which platform to build into your marketing strategy is becoming more difficult as the cross-generational volatility increases.
We can’t expect things to follow a completely linear track – who would’ve expected a digital camera from the 2000s to be sought after – but it’s fair to say that ad revenues aren’t yet reflecting Gen Z’s preferences and it’s only a matter of time before someone will make a strategic move. Which platform it will be that will end up grabbing the Gen Z dollar, however, is still unknown.
The Balance Sheet 💬
Each week, The Balance Sheet, provides Small Business opinion, voices and futures, and each month(ish) you’ll get a deeper dive in your inbox. Here’s this weeks insight:
A TBS Discussion: What should a Chamber of Commerce be in 2023?
Many Chambers of Commerce are seeing a reduction in memberships, and pandemic-related business failures certainly caused some of that churn. But are Chambers really providing value for their members in the modern marketplace?
Maybe you're a member of a Chamber of Commerce. Maybe you've struggled to justify the fees. Maybe you're confused by what your return on investment might be. Maybe you're just confused what they do - and why they exist.
Here’s why they exist - in Canada, the various provincial Chambers of Commerce fall under the association of the Canadian Chamber of Commerce. The Canadian Chamber of Commerce has a long history, dating back to 1750, where a group of business leaders in Halifax came together to form an alliance to try to promote the needs of business owners to a country yet to found it's first real government. This founding Chamber or Commerce turned into the Canadian Chamber of Commerce in 1925 after the growing business community realized a unified, national need for business support.
Since then various geographical areas of Canada created subsidiary Chambers in alignment, and most operate now in recognized business hubs offering their members support, promotion and community.
But as business hubs spread ever thinner with remote work, and technology increasingly dominates Small Business strategy, what purpose do Chambers serve the modern business owner - and what should they be now focused on to maintain relevancy and value?
We'd love to hear your thoughts on Chambers of Commerce. Are you a member? What could they be doing better? Are they even relevant anymore? Let us know!
Space Camp 🚀
Each week we highlight some news, insights or updates aimed specifically at those starting a new business, or considering a new startup venture. If that’s you, you should also check out our Startup and New Business Programme.
Shopify launches new features, tries to boost value
New fulfillment networks and marketplace features will support the next generation of e-commerce business owners - or so Shopify hope. What’s interesting in this latest release is how Shopify is starting to muscle into Amazon territory, along with lower friction payments and a ‘Prime’-like experience. If e-commerce is a big part of your model, it’s worth a look. Link
Why I killed my startup
We always talk about the process of startup growth, but rarely the pain of closing the business you put everything into. Here’s a podcast about the end of the road and what it means to kill the business you love. Link
Market at-a-glance 📈
BOC Indicators (Link):
BOC Prime Rate: 6.70%
BOC Unemployment Rate: 5.0%
BOC CPI Inflation Rate: 6.3%
BOC $USD Exchange Rate (Link):
Low: 1.3362 CAD [0.7484 USD]
Average: 1.3419 CAD [0.7452 USD]
High: 1.3442 CAD [0.7439 USD]
Best GIC Rates (Link):
1-year GIC: 5.30%
3-year GIC: 5.08%
5-year GIC: 5.08%
Best 5Y Mortgage Rates (Link):
Prime Rates (Link):
TD Bank: 6.70%
National Bank: 6.70%
CRA Canadian Pension Plan Rate: 5.95%
CRA Employment Insurance Rate: 1.63%
CRA Minimum Wage per Province: Link
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