Home » Articles

1950 posts categorized "Articles"

December 19, 2014

Olam to Become One of Top Three Global Cocoa Processors

John MaddenAnalyst Insight by John Madden - Head of Ingredients Research

As the year ends on a major acquisition in ingredients, we ask what is driving this and does it make good business sense? Archer Daniel Midlands (ADM) announced plans to dispose of its cocoa business in July 2013 – a decision driven by volatility in the cocoa market. Cargill purchased the chocolate business in September 2014 but steered clear of cocoa processing due to potential competition issues. This week Olam broke the news of a US$1.3 billion purchase of ADM’s cocoa business – a deal that will catapult Olam to become one of the top three global cocoa processors.

Continue reading "Olam to Become One of Top Three Global Cocoa Processors" »

Holidays Without Hunger

Cat Dixby Cat Dix - Corporate Social Responsibility Manager

View Cat Dix's profile on LinkedIn

In lieu of mailing traditional greetings cards for the holidays, Euromonitor has made a number of donations, totalling £16,000 to organisations addressing food poverty.  Today people in many countries struggle to feed themselves and their families.  Redundancy, illness, debt, family breakdowns and rises in living costs all contribute to situations which leave people relying on food banks and community kitchens.   Organisations nominated by our regional offices to receive support include:

Continue reading "Holidays Without Hunger" »

Cuba Libre: Latin America’s Final Consumer Frontier?

Sarah-B-Banner

View Sarah Boumphrey's profile on LinkedIn

With the thaw in relations between Cuba and the USA, multinationals are likely to be planning their strategies in the new year to boost business in this frontier market. Even before the thaw, we identified Cuba as a Consumer Market of the Future. In 2013, consumer expenditure totalled Tweet-ThisUS$38.6 billion, and with a population of 11.3 million, albeit in slow decline, the market offers real promise for multinationals. Although the US embargo has not yet been lifted, the time might be right to re-evaluate Cuba’s potential as a consumer market.

Low-income consumers underpin the market

Outside of tourism, the most immediately obvious market is for alcohol and soft drinks. We forecast that these markets will increase by 51.6% and 34.8% in nominal terms between 2014 and 2018. This will be driven by increasing tourist arrivals and rising incomes supported by remittances. Although Cuba has a relatively old demographic profile – the median age was 40.3 in 2013, 10 years higher than Brazil, it has a large proportion of working age population – 70.5% were aged 15-64 in 2013 which contributes to this income growth. The market is currently constrained by rationing and subsidised prices however. Other fast-growing markets in the future include home care and tissue and hygiene. Durable goods such as consumer electronics and appliances are likely to see slower growth. One explanation for this, and something to remember across markets, is that despite growth, overall incomes are low – per capita GDP stood at US$6,788 in 2013, roughly Tweet-Thiscomparable to Peru and Ecuador. Although price-sensitive, Cuban consumers can be targeted with the “traditional” smaller packet sizes aimed at bottom of the pyramid consumers around the globe but also through innovation. As in the rest of Latin America, an approach based on tailoring to local tastes and aspirations, whilst striving to build brand and in some cases category awareness, is likely to have the most success.

 

Forecast Growth Rates of Selected Markets in Cuba: 2014-2018

Forecast Growth Rates of Selected Markets in Cuba: 2014-2018

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

 

History lesson from Eastern Europe

Lessons can be learned from experiences following the fall of the iron curtain in Eastern Europe and the fall of the Berlin Wall, which celebrated its 25th anniversary in November of this year. In addition a look at Myanmar and China could yield insights. However, these lessons cannot be transferred to Cuba in their entirety - rather they should be used to inform strategies in Cuba. Cuban consumers have their unique tastes and preferences so a holistic approach, taking in a thorough knowledge of the market, consumers, economic backdrop, business environment, competitors and partners is crucial for optimum success.

A Cuba strategy should also be seen as a long-term one, gains and change will not be realised overnight. Resistance to commercialism will also be seen in some segments and the mind-set of “being at war” with the USA could take a generation to change. It would also be wrong to see Cuba as an entirely virgin market. Cuba trades heavily with China and Spain and companies from these countries have first-mover advantage in some sectors. It also suffers from serious economic challenges – including crumbling infrastructure, low productivity and a lack of investment – and its economic development should be monitored closely.

 

Have a question or a thought to add? Leave us a comment below.

December 18, 2014

Rouble Trouble: Impact of Currency Volatility on Russian Apparel Market

Magdalena KondejAnalyst Insight by Magdalena Kondej - Head of Apparel and Footwear Research

Faced with sharp devaluation of the rouble, Apple has already halted its online sales in Russia while some luxury brands, including Cartier, are raising prices to counter deflation. If Russia’s financial and economic instability continues, fashion and sportswear brands are inevitably set to suffer too. 

adidas Group under increased pressure

adidas clearly leads in Russian sportswear, over Nike. But what was once adidas’s significant advantage, is now becoming a hindrance. Russia accounts for almost 7% of adidas’s global sales compared to only 1% for Nike.  Earlier this year, the company had already issued profit warnings, partly blaming the situation in Russia and its share price has slid by 25% since July.

Continue reading "Rouble Trouble: Impact of Currency Volatility on Russian Apparel Market" »

Diplomatic Normalisation Promises Cuban Evolution for US Cigar Market

Shane_MacGuillAnalyst Insight by Shane MacGuill - Tobacco Analyst

The almost total thawing out of diplomatic relations between the US and Cuba, announced yesterday, 17th December by President Barack Obama, could lead to the smouldering of Cuban cigars from coast to coast in the US$8 billion dollar US cigar market. The biggest winners from the relaxing of the trade embargo with Cuba are likely to be Imperial Tobacco plc, the world’s 4th largest international tobacco company and part owner, with the Cuban government of the state cigar company Corporacion Habanos and the US tobacco specialist stores which currently supply around 40% of the country’s cigars and through which high price point Cuban offerings will largely be distributed.

Imperial Tobacco inherited  a 50% holding in the Cuban state cigar company Corporacion Habanos through its purchase of the French-Spanish tobacco giant Altadis in 2007. It is thought that the company, which distributes the Cohiba and Montecristo premium cigar brands outside the US and non-Cuban brands such as Romeo y Julieta within it, has been anticipating the relaxation of the trade embargo for some time and has plans to ramp up production by 50% to meet increased demand. However, in an analyst briefing in November 2014, Imperial CEO Alison Cooper made reference to some supply issues in Cuba which may or may not impact this target:

Continue reading "Diplomatic Normalisation Promises Cuban Evolution for US Cigar Market" »

December 17, 2014

FOSHU Gives Hint of Life to Japan’s Soft Drinks Market

Hope.LeeAnalyst Insight by Hope Lee - Senior Beverages Analyst

Many soft drinks companies in Japan face gloomy prospects as most categories are expected to continue to decline over the next few years. Despite various economy stimuli, one thing no politician or economist can change is the nation’s ageing population. As staples, soft drinks products require a sizeable consumer base and periodic sales peaks, for example during spells of warm weather, to maintain volume sales. In this highly saturated market the shrinking population is causing volume sales to decline and is a challenge to manufacturers seeking to sustain their businesses. However, the concept of FOSHU beverages has given manufacturers a glimpse of hope in recent years.

Continue reading "FOSHU Gives Hint of Life to Japan’s Soft Drinks Market" »

December 16, 2014

The Rise of Social E-Beauty

Nicole_TyrimouAnalyst Insight by Nicole Tyrimou - Beauty and Personal Care Analyst

View Nicole Tyrimou's profile on LinkedIn

November is arguably the most important month of the year for internet retailers and brands alike. There is “singles day” in China, which reportedly generated US$9 billion in sales this year, and, of course, the shopping weekend mayhem that is Black Friday and Cyber Monday at the end of the month. Despite Black Friday and Cyber Monday principally being a US phenomenon, with revenues reported at US$1.3 billion this year, they have been expanding into Europe and, specifically, the UK, which has the highest penetration for beauty e-commerce among mature markets at 9.1% in Tweet-This2013, while the global average remains below 5%.

However, the phenomenal rise of social media platforms that are hoping to turn their popularity into a commercial opportunity means that they are looking at the beauty industry as a good entry point for social commerce.

Continue reading "The Rise of Social E-Beauty" »

Investing in Women Business Leaders: Good for Business, Good for Communities - Part II

Cat Dixby Cat Dix - Corporate Social Responsibility

View Cat Dix's profile on LinkedIn

In October I wrote about the support we were providing to Vital Voices Global Partnership’s fellowship program in the Middle East and North Africa (MENA).  Here Samer Altaher, Vital Voices MENA Program Manager talks about the impact having exposure to Euromonitor’s market data had on the participants:

"Thanks to our partnership with Euromonitor, the VV GROW Fellows were able to access the Passport database during the in-person training in Amman, Jordan. The tool added breadth and depth to their market analysis. The Fellows were invited to a roundtable discussion lead by myself and I demonstrated the uses and features of the Passport tool. The Fellows discussed specific issues pertaining to their industries and market research needs, and were given the opportunity to locate relevant information using the tool. 

Continue reading "Investing in Women Business Leaders: Good for Business, Good for Communities - Part II" »

European Banks in 2015: What to Expect?

Vita KrasodomskyteAnalyst Insight by Vita Krasodomskyte - Industrial Analyst

View Vita Krasodomskyte's profile on LinkedIn

The EU’s monetary intermediation industry still remains sluggish, growing by 2-3% per year in 2013-2014. Increasing regulation, slow economic growth and rather weak financial health is projected to remain among the major challenges for the European financial institutions in 2015.

 

Increasing European Central Bank role

Eurozone countries, in order to improve their banking activities, have established the banking union with common regulation and, by November 2014, the ECB had become the supervisor of all banks in the Eurozone area (around 6,000 in total). Increasing regulation is expected to continue to be seen in 2015 as well. The European Banking Authority will be increasingly focusing on risk assessment, which will remain a key priority for the European banking industry. Moreover, the development of the Single Rulebook and growing regulation in such areas as recovery and resolution, consumer protection and financial innovation will also continue throughout 2015.

EU banks still suffer from the slow economy

Economic growth is projected to remain weak over 2015. Total GDP in the EU is expected to only grow by less than 2% in 2015, thus further creating strong pressure on the financial market. Restructuring will be one of the key factors for an improvement in the performance of banks. In order to increase profitability, banks will have to sell capital-intensive loss-making units and focus more on just a few of the most profitable market segments.

Nearly 20% of EU’s largest banks fail the stress test

A total of 24 out of the 123 largest EU banks failed the stress test, coordinated by the European Banking Authority to measure the financial health of the EU banks by the end of 2013. The results of the stress test, published in October 2014, showed that the EU banks had a capital shortfall of close to EUR25 billion, meaning that close to 20% of the largest EU banks are not fully prepared for possible difficult economic conditions. As a result, following the instruction to cover the shortfalls, the year 2015 will remain challenging for the EU banks seeking to improve their financial health and cover their capital shortfalls.

 

Want more market research insights? Sign up for our email bulletins.

Have a question or a thought to add? Leave us a comment below.

December 15, 2014

Rationalising Intel’s Collaboration with Luxottica on Smart Glasses

Chloe WuAnalyst Insight by Chloe Wu - Personal Accessories and Eyewear Analyst

It has not been more than a year since Google Glass was first sold commercially to the public, and, despite an overall tepid reaction towards Google Glass, Luxottica is now forging ahead with yet another attempt at smart glasses.

This time, the eyewear juggernaut has teamed up with semiconductor giant Intel to produce smart eyewear. Essentially, Intel will provide engineering know-how, so that Luxottica can focus on industrial design, thereby keeping costs down and shortening the time to market.

Continue reading "Rationalising Intel’s Collaboration with Luxottica on Smart Glasses" »

Subscribe

 RSS Feed

Receive New Posts via Email:

 

Join us on...


View our YouTube Channel Follow Euromonitor on Twitter Become a Fan on Facebook Connect with Euromonitor on LinkedIn




Filter by Category

Filter by Geography

Filter by Industry

Recent Posts

Olam to Become One of Top Three Global Cocoa Processors

Holidays Without Hunger

Cuba Libre: Latin America’s Final Consumer Frontier?

Rouble Trouble: Impact of Currency Volatility on Russian Apparel Market

Diplomatic Normalisation Promises Cuban Evolution for US Cigar Market

FOSHU Gives Hint of Life to Japan’s Soft Drinks Market

The Rise of Social E-Beauty

Investing in Women Business Leaders: Good for Business, Good for Communities - Part II

European Banks in 2015: What to Expect?

Rationalising Intel’s Collaboration with Luxottica on Smart Glasses