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Hey, gang. It's Monday, October 19th. Yes, Suzy, Yuri, Max, and listeners, welcome to Behind the Numbers an EMARKETER podcast made possible by Atmosphere TV. I'm Marcus. To join me for today's conversation, we have three people. Living in New York, VP of content, head of the retail desk, Reimagining Retail host, Suzy Davidkhanian.
Suzy Davidkhanian: I am so excited. Two weeks in a row. Thanks for having me. That was a big sigh.
Marcus Johnson: Calling
Suzy Davidkhanian: That's how I know you're desperate. Can I still have
Marcus Johnson: that? Okay. Uh, calling New Jersey home, principal analyst, head of advertising, media, and tech desks, Yuri Wormser.
Yory Wurmser: Hey, Marcus. I'm almost as excited.
Marcus Johnson: That's [00:01:00] what we're looking for, that level.
Uh, and based in Philly, principal analyst covering all things social media for us, Max Willens.
Max Willens: Yo.
Marcus Johnson: Nailed it. Today's fact-
Suzy Davidkhanian: Good thing it's not a game
Marcus Johnson: Why are for you why are they called Ivy League schools? Do we know?
Suzy Davidkhanian: Oh, yeah. I do
Marcus Johnson: Oh, don't tell me or anything
Suzy Davidkhanian: Oh, I was waiting for the Americans to answer.
Marcus Johnson: Oh.
Max Willens: I got nothing. Hit us with it. Go for it, Susie.
Suzy Davidkhanian: I am pretty sure, though maybe this is like an SAT trick question, that those are such old buildings, and on the side they had the ivy that was going.
And so there are some schools that you think are ivy 'cause they have that distinct look, but they're actually not ivy.
Marcus Johnson: Yuri?
Yory Wurmser: I think that's right, but they also, it's a sports league. Um- Yes ... so that it was the old sports league for these exclusive schools.
Marcus Johnson: Well, you're both right. It's, uh, so Ivy Day was a 19th century [00:02:00] graduation tradition, uh, where students planted ivy vines against the college's historic stone buildings, making ivy-covered walls a visual symbol of prestige.
And then in the 1930s, the actual phrase became popularized by sports writers Stanley Woodward and Alan Gould covering college football, using the terms Ivy colleges and Ivy League to describe the cluster of older Northeastern universities that regularly played against one another. The term became official in 1954 when the eight-member schools formally established an NCAA Division I league.
Suzy Davidkhanian: You know what's weird about that statement? It's that Chicago apparently has the oldest football team or, like, the first winners of the Stei- what's that thing called? The Steiman or something? I don't remember, but-
Max Willens: Heisman
Suzy Davidkhanian: Trophy? Thank you. That's the one. Sorry about that. The Steiman? You could tell football's not my thing.
But I do know that Chicago is very proud of that statistic, but they, they're not in the league.
Marcus Johnson: The Steiman? Is that what you just tried to
Suzy Davidkhanian: say? I, it was the wrong word. All right. It was very similar.
Max Willens: That is really [00:03:00] interesting that the, that Chicago's not in the Ivy League. I guess, is it maybe a little young or, you know, uh, newer?
Like, it's not as old as Yale and, and Cornell and, uh, Harvard.
Suzy Davidkhanian: But- Well,
Max Willens: Cornell
Suzy Davidkhanian: I don't think is an Ivy League school technically. It is.
Max Willens: Cornell's an Ivy. Oh, is it?
Marcus Johnson: Yeah. Yeah. Brown, Columbia, Cornell, Dartmouth, Harvard, Princeton, uh, UPenn, and Yale.
Yory Wurmser: They're, I think, um, some of the military academies had an option to joining at one point, like the Naval Academy and the, uh, and West Point, but opted not to.
Marcus Johnson: They said, "Yuck, we're out." Anyway, today's real topic, why Muse can and can't be the agent people want.
All right, remember to, to, uh, check out the takeaways at the end of the episode we have for you. Um, what are we talking about today? Well, "AI agents are offering to run your life. Should you let them?" writes Nicole Nguyen of the Wall Street Journal. She says, "Personal bots such as Meta's Muse, OpenAI's Dots, and [00:04:00] Instinct are raring to take on your to-do lists."
Uh, and so, um, what's happening here is there are these agents which people can, uh, use to help them, uh, with everything, a lot of personal tasks. Um, and Suzy, you and Yuri were discussing these, uh, which was what, uh, spawned this episode. What about this, uh, story, uh, did you guys want to discuss today?
Suzy Davidkhanian: I'm, I'm only gonna say me.
No, I'm not gonna put Yuri into this bucket, but I was saying the Muse commercials, the ads keep coming up on my games And they're kinda cute. That, like... It's not a teddy bear. I don't know what their mascot is, but it's cute. Little jolly? And it's endearing. Jolly. And the user sort of interface feels like it's very approachable.
And then you and I didn't talk about this, but you and I talked about I love those ChatGPT ads with the old biddies, and now the latest one is where they're trying to figure out the yacht situation. And the three [00:05:00] ladies are on the yacht, and they're like, "Okay, how do we, how do we drive it now?" I just think these companies are trying to become more approachable, and that's what we were starting to talk about.
But then the elephant in the room, which I think is the episode, should I say what it is?
Marcus Johnson: Yeah, that's what we're here for.
Suzy Davidkhanian: Can Meta actually deliver that, or does it need to be someone else?
Marcus Johnson: Mm-hmm.
Yory Wurmser: Yeah. Yeah. I mean, we, it, the, the interesting thing about Muse is it's really the first of these consumer personal agents that has taken off to s- some extent.
I mean, we're very... I think both of us are a little dubious on long-term prospects, but it's the first one that's actually gone beyond the tech world. I mean, there's Instinct, and Google had Sparks. It, um, but th- this is the first one that's actually gotten some conversation going.
Max Willens: And I wonder how much of that conversation is down to the gigantic media blitz that, uh, Suzy alluded to earlier, right?
I mean, uh, they're running ads during, [00:06:00] uh, Sunday night football, I, you know, on the home screen of, of my Roku, uh, in mobile ads, uh, or other mobile game, games ads. They're, they're going for it. Um, and, you know, they've gotten f- they got to five million downloads pretty quick. Uh, when you think about the size of their user base in North America, that's, uh, a little less impressive seeming in my estimation.
But it's, you know, five million people is five million people. I think the thing that's gonna sort of decide whether these things work or not is whether people are comfortable in trusting these things with real responsibility in their users' lives, right? I mean, like- Mm ... I feel like one of the things that...
Whenever I think about the, the concept of an AI assistant, you know, not, not even specific to Dots or Muse or, or Gemini or Alexa, the thing that I routinely rub up against is the fact that- When i- if I had an assistant, you know, virtual, uh, agentic or, or, you know, [00:07:00] in person, I want that, that entity to take care of stuff that I find irritating and inconvenient.
Um, and, and a lot of cases in my life, that, that involves stuff that's quite personal, right? Like, it involves, you know, sending emails that I keep putting off because they'll, they'll take too long. It involves, you know, rescheduling my doctor's appointments for my, you know, truly horrific and embarrassing medical conditions.
It involves, um, you know, coordinating stuff in- with my, uh, family members and with my, my children's, uh, friends' families. And all of that stuff is the sort of thing that if you, if an AI goes rogue and does something embarrassing or illegal or, um, you know, financially irresponsible, that makes me... That puts me in a horrible position.
And I think that everyone, even though everyone is still kind of at the very beginning of understanding how AI works and how large language models work, the, the idea or the concept of [00:08:00] hallucinations has become, I think, broadly generally understood. And the, you know, to their minimum amount of credit, all the systems now, when you open them up, the windows have a, a, some kind of language usually at the top of the box that say, "AI gets stuff wrong, and you're responsible for, you know, uh, double-checking it or whatever."
And so those, those two, uh, you know, I, I guess kind of like facts are, are I think kind of a structural, uh, you know, structurally at odds with one another. And so I think that's kind of what we as a group have to sort of, uh, sort out over the next, you know, few minutes on this episode.
Marcus Johnson: Is part of the hesitation here, Max, what you're saying, that lack of accountability?
Because if a person makes a mistake, then they're personally at fault, and there can be some, some ramifications. There was one example, Shane Mack, uh, he's a, um, CEO of a, of a company. He said his SpaceX AI Grok bot agent posted a screenshot of his personal bank balances to the company Slack channel. [00:09:00] Now, if your personal assistant does that, I don't know if they have a job anymore.
At the very least, they get reprimanded. Uh, the AI agent just goes, "Well, you should've... I told you I might mess things up." So is that what's really slowing things down
Yory Wurmser: here?
Suzy Davidkhanian: There are mistakes in everything we do. You go to a store. Something has the little sticker that it's on sale. You go to point of sale.
It's actually not on sale. You walk the person back to the thing to show them that it was actually two for one. Yeah. Then they have to override the system. I mean, there are errors in everything we do all the time, right? Yeah. And we've accepted that. It's part of our shopping, our daily routines.
Unfortunately, doctors make mis- Like, it's just everywhere, so I don't know about the perfection. Accountability sort of matters, but I do think it's about, uh, for me, what Max said was the m- the critical sort of like help me do... Assuming that you unders- uh, assuming we all agree that people make mistakes and that's life- Mm-hmm
help me do the [00:10:00] things that I don't wanna do. Help me save money. Value means different things to different people, so like understand what value means to me- Yeah ... and help me get there so that I could do the fun things, like look for a new bag. Like, I don't want you to tell me what bag to buy. I think that's a whole different like biases and sort of like an echo chamber that I'm worried about.
But the like help me understand that there's gonna be a traffic jam so that I go in another direction or, you know, like this-
Marcus Johnson: The prob- yeah, the problem is you're, it, it seems as though there's a higher standard. We p- have placed a higher standard, uh, on machines. Like with driverless cars, 40,000 people a year in America die because of traffic accidents all caused by humans, and if driverless cars, um, could reduce that even slightly, you would think people would be open to the idea.
The problem is we expect when we get into a driverless car because of that ar- arguably lack of control, we expect things to be basically perfect before, before we [00:11:00] adopt, um, uh, c- certain technologies.
Yory Wurmser: I think the, and part of what people are really reacting to is not just accountability, but the, the sharing of information and the threat to their person, you know, personal information and privacy.
Mm. Um, and I think that's a particular hurdle for Meta and for Muse because, um, Facebook and Instagram, the other Meta prope- properties have, have a reputation for not You know, people don't trust them as much as they trust some other, uh, tech, tech offerings, um, in part for, you know, what's happened in the past in terms of leaks, but also how, how the data has been used for advertising or political targeting or s- so forth.
So I think people have a level of trust in Meta that might not be enough for Muse particularly, uh, to take off, even if they resolve some of the agency issues that we've been talking about, about accountability.
Max Willens: Mm-hmm. There's this, a great piece of [00:12:00] research that, um, Oppenheimer did, uh, where they polled a bunch of consumers and asked which of the following companies would you trust, um, your, you know, sensitive passwords to?
And Meta was among the companies, uh, on the list, and just 8% of the respondents said that they would trust Meta with those things. And Google, which I don't think shook out terribly well in the grand scheme of things either, but I think that the, the share that s- said they would trust Google with them was more like 30%.
So on a relative basis, they're better. Um, I mean, I think it's, uh, the really, both of you have hit on something that's really important, which is this kind of like thresh or this, um, you know, kind of like, uh, overcoming of inertia where people have to go, "Okay, fine. You can have access to X," you know? Um, and it's, that's one of the reasons why I think Meta is going to have trouble getting a scaled amount of people to use this in the way that they imagine people using it.
And it's also why I think, when I think about who might have a shot at kind of getting to that, that use state, [00:13:00] a- and I s- I feel kind of boring saying this, but I think it's Google. Mm-hmm. And part of the reason is that they've kind of got access to that stuff already, right? Like, they're already helping you, Suzy, get to work with Google Maps.
They're already, they already are your email inbox. Uh, for a large insign- for a not insignificant number of people, they control, like, you know, the thermostats in your house, and they have, uh, access to your health information, uh- Your phone. That's right. They already, they're inside your phone already. So, like, there's no kind of, "Ooh, can, do I give them access to this?"
'Cause they've already got it. Mm-hmm. And so I think that- If we're, if we're gonna sort of, you know, handicap who gets there, if anybody gets there at all, I, I think I would, uh, give Google the best odds presently. But I wonder what you guys think about that.
Suzy Davidkhanian: I mean, I'm all in on Google personally, b- and I- you guys have heard me tell the story about like 10, 12 years ago, I heard that my flight was delayed because I got a notification from Google before I did from the airline, before I heard from the Weather Channel.
They've been, they've been dabbling [00:14:00] in this sort of like help- let us help you make your life easier. And I think for a lot, including me, at, at first blush, maybe Apple seems more obvious. But Apple's not, from what I understand, that advanced on an AI side, which I think you'd need to be- Mm-hmm ... to be, well, obviously to be an agent.
But like the underpinning of the technology is really critical. You know, like we give a lot of people our credit card information, and we give them guardrails. Amazon does Subscribe & Save, right? The guardrail is every three months I select. Every three months you send me the toothpaste. Every six months you send me the water thing.
L- so I don't think it's that big of a leap if you feel good about being able to set sort of the permissions, the amount of access. As you said, I don't think anybody sits back and thinks just how much information Google has about you, but it really does have a ton. So make my life easier.
Max Willens: Mm-hmm.
Yory Wurmser: Yeah. No, I, I, I agree totally about Google.
I mean, they, they were [00:15:00] pursuing something like this 10 years ago, Google Now, which obviously was nowhere, you know, wasn't using LLMs, wasn't nearly as sophisticated. But that was the idea of anticipating needs. Um, I, I think I'm more optimistic about Apple. I think Siri, Siri is running on Gemini now, so they have access to pretty- solid, uh, AI.
And they've got a vision for Apple Intelligence that would look like that. I don't know if they can execute, and I don't know when they'll execute on it and if they're gonna be too late to the game. But I think they're, they're a potential player too because they already have access to all the information.
They already have people, uh, accustomed to using Siri. Mm. Um, so I could see them succeeding. I could also see Amazon, uh, as a, as a more specialized agen- agent just sort of-
Marcus Johnson: Mm ...
Yory Wurmser: paying attention to the shopping part of it, um, and, and having them sort of own a, a slice of this, this pie as well.
Marcus Johnson: Yeah.
Max Willens: Mark Gurman at Bloomberg, uh, got the news that Apple is developing, uh, like home smart [00:16:00] devices essentially.
Yeah. So like control your thermostat, control, uh, the lights in your house. And to me, it doesn't take a rocket scientist to see that you do that because you, you want to give more surface area to an agent, right? Like who cares if your thermostat is Apple branded? That's a completely ridiculous premium to, uh, you know, graft into your house.
But if it allows you to say, "Hey Siri, turn the, the temperature in my house down five degrees," that's pretty useful. Um, and so that it seems clear that Apple's, you know, in it to win it, but the, the timing and the execution questions you already raised are super legitimate. I think though, um, maybe we'll talk about both of these and maybe we'll just talk about one, but I, I feel like one of the, the things that's important here is that there's like s- it's really hard to kind of have this conversation without getting to shopping, and I personally feel like the odds that one company will win the shopping thing, whatever the shopping thing turns out to be is, is probably pretty unlikely.
Um, and I just think about it through the, the lens of [00:17:00] my own, you know, uh, e-commerce activity, right? If I need to buy toilet paper, I go to Amazon. If I need to buy some, a cool shirt, uh, I go to Etsy. If I need to buy, uh, you know, a, a Dutch oven, I go to sh- the Shopify app or whatever it happens to be. And I think that all of these, even though Google has done its best to sort of ingest shopping catalogs and data from a lot of different, um, you know, retailers and merchants, I, I think that we're gonna see a lot of specialization there, and so I wonder if that's m- maybe part of, uh, w- what we might even see just on the kind of AI level altogether, right?
Like maybe, maybe it'll get to the point where, you know, I don't have one assistant for everything, but when anytime I have to deal with my insurance company, I, you know, talk to Uh, Siggi, the Cigna app or whatever the, the heck it is, and then they, they help figure out why, you know, someone's rejected my prescription refill- Mm
or whatever happens to be.
Marcus Johnson: Yeah.
Suzy Davidkhanian: So-
Marcus Johnson: Yeah, will it be one agent to rule them all or will it be, you know, a handful?
Suzy Davidkhanian: I, so for me, I [00:18:00] think a- as an individual, the, uh, premise of many agents brings me back to I just go to the different websites and the different chatbots, and so it's not helping me make my life easier.
Yeah. But on the shopping front, I think the scary thing... I mean, you kinda said it, right? So like toilet paper, any of the replenishment goods, in theory, your assistant could do it just like your human assistant can do it. Anything that, as you said, your cool shirt, I think you would keep doing that yourself, right?
So like d- let's not forget 80% of sales are in a store. So I think there, there will be this like tiered shopping experience where what makes it more scary for the retailer, a- assuming that there's just the one assist- we all buy into this premise that we need one assistant that is multitask oriented, right?
Then for the like brands, the CPG brands and the retailers, the scary thing will be that they're competing on price. So there'll be a sea of sameness and then they're gonna have to start figuring out, "How do I make my product better? [00:19:00] Do I..." Like toilet paper, do I have more rolls, more sheets? Do I then think about where I send what assortment to Amazon versus Walmart versus Target?
The underpinnings of retail will change. For you as a consumer, you will probably get the best value, whatever that is to you. But I do think it's scary for retailers. And then you add, we didn't talk about this, you add ads. Like I think I, I'm gonna be like, "Oh, if you're gonna start surfacing me ads that I don't care about, then I, then you're not helping make my life easier.
You're adding a friction point that I'm not interested in."
Marcus Johnson: Mm-hmm. Yeah. Yeah, where the ads come into, to all of this. Um, there was... I wanna ask you guys a bit about whether the internet is ready, uh, for something like this, and starting with an example from shopping. Uh, there was one example in, um, in Ask I was reading.
It was saying someone's agent bought a swimsuit without asking their permission. It was able to bypass the approval link because it was using store credit, not a credit card that needed, uh, an approval, uh, link. [00:20:00] And so, um, that- ca- use case, um, wasn't ready, um, for, for an agent to, to buy something. There's an argument the internet was, was built for people, built for humans, and that it's maybe not ready to be, uh, um, uh, flooded by a, a bunch, a bunch of agents.
Um, and there was a interesting thought from Nicole Nguyen of the Journal again saying, "Agents can do a lot, but the web isn't optimized for them. My agents were often blocked by human verification checks on websites such as the airline Lufthansa and hair tools maker T3 Micro. As corporate rivalries intensify, compatible services may come and go.
Amazon, which has its own AI, blocked Muse, ChatGPT, and Claude from making purchases on its website." Um, do we think the internet is ready? And if not, what needs to change to make it so?
Max Willens: I mean, the thing that's crazy about this is that I feel like the internet as we understand it as a cultural object is supported principally by advertising.
And [00:21:00] I think that there's a very big, very unresolved question of what happens to the internet, again, as a sort of like, um, you know, cultural object or destination, uh, if ad revenue, uh, doesn't necessarily go away, but goes into sort of different, you know, into different directions. Um, so I... And that, that to me is a really big, really, uh, complicated question.
There's a, the, a possibility because again, like the, a lot of the LLMs and the, the large language or AI developers understand that they do need to compensate, uh, publishers for retrievals and a, and a market for that is very slowly developing. But I, I'm not super confident that a sort of, you know, uh, big complicated m- micro payment, uh, market can be s- scaled up fast enough to replace the, the ad revenue that's, um, that these publishers are losing so-
Yory Wurmser: This is [00:22:00] like one more Nick against Tim.
Mm-hmm. Um, but I agree that the, the open web to, is, uh, under existential threat because of, you know, the AI. I, I think- Publishers with strong direct traffic who have, you know, good premium content and loyal readers or viewers are gonna be okay. Um, they can either get subscriptions or they can still generate decent amounts of ad revenue, but the, the, the mid-tier publishers are gonna be in trouble.
And then of course, AI simplifies the creation of long tail open web. So y- I think we're gonna see a hollowing out of that middle, middle tier, which is important.
Suzy Davidkhanian: I don't think things are gonna ... I mean, everything is happening fast, and if you think about it, three years ago we were talking about ChatGPT and people having the app, and now we're, uh, talking about autonomous shopping and nobody's ever gonna shop again.
And I think w- these are like, that's too fast. It's not gonna happen so fast. There will be some changes to websites, like we're already seeing it. People are gonna go [00:23:00] search on an LLM, sent to a product page. Your product page now has to do double duty on the retail front, right? It has to be both inspirational, cool, but also all the information for the LLM to understand.
You know, it has to be crystal clear what you're getting so that it's easy to be cr- I use the word crawled. I don't know if that's the technical term, but you know, so that it all understands what's happening. I think much further down the line, assuming, 'cause I don't think we- anybody is really 100% ready for the LLM to do all your shopping for you Even if we go with do your replenishment shopping, I don't think most people are ready for that, though many people do have Subscribe & Save.
It's just like that next level, right? I think there will be sort of, I don't know what to call them, like dynamic catalogs that a human will never see, that the LLM will just have access to for the toilet papers of the world, for ba- And I guess retailers will have to choose to opt in, but you would be f- I don't know, like you opt in, and then you're price cutting each other, so your margin, there are [00:24:00] margin issues.
But if you don't opt in, then you lose the customer. So it becomes very complicated. But I think the, the retailer websites and apps as we know them today will evolve, but I don't think they'll disappear. And we'll rebuild them so that there are more entry points of aspire, inspire, sort of like, uh, aspirational luxury.
That cool shirt from Etsy, now everybody knows that that's where Max goes to shop for cool shirts. He will start to see more, more cool shirts showing up on his homepage. Like, I don't know, 15 years ago, dunnhumby worked with Macy's on trying to better understand like one-to-one, one-to-one personalization.
None of this is new. I think we just have to reimagine what it looks like.
Yory Wurmser: I think that's exactly right, that two-tier web experience where there's, uh, one side geared towards humans and is inspirational and very much looks like what it is today, um, although probably much more dynamic. Um, and then you have the, the type of, you know, the, the machine-readable web, [00:25:00] um, that every retailer is going to have that's not gon- It's gonna be much more specific on what it can do, and also maybe have, um, you know, bot-specific promotions and things like that to, to attract, um, to attract the crawlers, so.
Max Willens: I worry a lot about like what this does to, you know, how much more this creates margin pressure, right? Because I feel like, you know, if I'm buying toilet paper and, you know, there is a certain sort of base amount of, you know, like I don't want single ply, you know, I don't want something that, you know, feels like just like repurposed newspaper, but like there's a whole kind of galaxy of companies that fit in that.
And s- and at that point I'm just, I just want the cheapest one, okay? And like, I just feel like there's going to... This is retail and CPG stuff is usually such a miserably low margin space already, like I just feel like this is going to squeeze so many companies. That to me is a really interesting question, and one that I, I feel like we're gonna be talking a lot about over the next couple of years.
Marcus Johnson: Mm-hmm.
Suzy Davidkhanian: So that's where I think [00:26:00] like you're saying, there's gonna be this weird friction around consumer loyalty to a product versus loyalty to a retailer, which makes the product the most important piece, and that'll push more retailers to have private label.
Max Willens: Hmm. That's interesting.
Marcus Johnson: Unfortunately, that's all we've got time for.
Uh, we'll throw up our top takeaways, uh, before we close out. I think we've got three here. Number one is I think Avi Greengart, an analyst at Techs Potential, a research firm, summed this up quite well. "The most interesting thing about Muse might be that just Meta got there first." So first mover advantage, very important.
One of their arguments as to why they released theirs now, um, is because they saw the competitors releasing theirs and decided to get there first. Second, Nicole Nguyen of the Wall Street Journal, "People would like to avoid the grueling stuff," um, plane ticket refunds, insurance policy contracts, mortgage applications, um, people would gladly accept AI's agents and AI agents help with that stuff.
And then third, uh, coming from, [00:27:00] uh, Thomas Germaine of the BBC, "The internet was built for humans, not AI. As bots overwhelm websites, businesses, and services, the web may become harder to use before we rebuild it for an AI-driven world." Uh, but that's all we've got time for, for today's episode. Thank you so much to my guests for hanging out with me today.
Thank you so much to Suzy.
Suzy Davidkhanian: Thank you.
Marcus Johnson: And to Uri.
Max Willens: Great to be here.
Marcus Johnson: And to Max.
Max Willens: Always a pleasure, Marcus. Thank you.
Marcus Johnson: And to the production crew, we have Luigi and John helping us out with this one. Thanks everyone for listening to Behind the Numbers, the marketing podcast made possible by Atmosphere TV. Suzy will be here Wednesday speaking with Christy Carlson, VP of Digital at Kendra Scott.
The In the Game show on Thursday will be discussing if marketers should care about baseball anymore. And on Friday for Behind the Numbers we'll be talking about how ad spending is doing.