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November 20, 2014

The Recovery from the Global Financial Crisis of 2008: Missing in Action

Daniel SolomonAnalyst Insight by Daniel Solomon - Economist

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The speed of the recovery from the 2008 global financial crisis has been unusually slow. The slow recovery is a symptom of the permanent decline in GDP following a financial crisis, since the economy never fully rebounds from the initial recession.  We estimate long term output losses from the crisis ranging from almost none in Germany to almost 20% in Italy and Spain. This article highlights several factors behind the slow recovery and the large long term effects of the crisis:

  • The financial crisis made the economy more vulnerable to other negative shocks.

  • Trend growth may have been slowing down before the crisis.

  • Financial crises lead to big drops in labour productivity that take a long time to reverse.

Figure 1: GDP Per Working Age Person in Advanced Economies since 2007

Source: Euromonitor Macro Model and International Statistics

Note: 2007 level normalised to 1 for all countries. Forecast starts in 2014.

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Starbucks Promises To-Your-Desk Delivery in the US by 2015, But What Does This Mean For the In-Store Experience?

ElizabethFriendAnalyst Insight by Elizabeth Friend - Senior Consumer Foodservice Analyst

After relatively disappointing results in the most recent quarter, Starbucks has announced a plan to begin offering delivery service in the US through its mobile payment platform, a combination CEO Howard Schultz is calling, “delivery on steroids.”  As early as the second half of 2015, customers in select cities will be able to order food and drinks from their mobile phones to be delivered to their homes, offices, or even directly to their desks.

In theory, this strategy sounds promising. The on-demand economy in developed markets is only gaining momentum, and foodservice customers are demonstrating more and more that they want what they want, when and where they want it, and requiring as few clicks as possible. Online and mobile ordering has been growing rapidly in foodservice markets all over the world, and delivery demand is growing just as quickly among high-income consumers who can afford to spend a few extra dollars on convenience-based luxuries.

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November 19, 2014

What’s Happening in Tobacco – October 2014

Don2Analyst Insight by Don Hedley - Contributing Tobacco Analyst

…Numbers trying e-cigs ‘levelling off’ in US… Asian customers switching to economy brands according to JTI… WTO postpones plain packaging complaints judgment… Swisher International to acquire Drew Estate Tobacco…PMI seeks pay per puff patent…Special consumption tax to be raised in Vietnam… PMI’s first reduced risk product factory starts up in Italy… Santa Fe Natural Tobacco outperforms for RAI… Swedish Match reports best growth in cigars and chewing tobacco rather than snus in 3q… PMI reports lower outswitching to OTP in EU in 3q results… Research suggest E-cigarette may be smoking gateway in Poland… Majority want e-cig public usage ban in UK… FCTC supports e-cig marketing restrictions ….Public smoking ban to be extended in Macau…80% coverage health warnings on packs decreed… Regulations to further restrict flavoured cigars in Canada to be introduced… Florida jury awards smoker US$ 41.1 million damages

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Going Vegan for Weight Loss and Heart Health

Simone_BarokeAnalyst Insight by Simone Baroke - Contributing Analyst

Can a diet totally devoid of animal protein be healthy for humans who are, by design, omnivores? Common sense would suggest not, but research begs to differ. A new study is just out, attesting to the fact that a stint of vegan eating boosts both heart health and weight loss, and without imposing restrictions on caloric intake. Could the annual January diet craze be in for a vegan overhaul? This would indeed be music to the ears of purveyors of carbohydrate foods, may they be potato growers, bakery manufacturers or noodle bars.

Healthier in just one week

Rarely has a diet come under such sustained and fervent criticism as the vegan diet. Not enough iron, zero vitamin B12, too little protein, lack of variety and, perish the thought, no dairy – surely this can’t be a healthy way to live?

However, plenty of evidence, much of it gleaned from population studies that reach back decades, suggests otherwise. For example, there is the oft-quoted Danish example, where, due to post-WW1 rationing, animal protein, fats and alcohol were severely restricted, forcing the population to subsist largely on potatoes, bread, barley and vegetables. As a result, the country recorded the lowest mortality rate from non-infectious chronic disease (this includes cardiovascular disease) in its entire history.

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November 17, 2014

Global Population Trends: The 100 Million Club

Sarah-B-Banner

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Population dynamics continue to redraw the world map and with it market opportunities. Understanding and being able to harness population trends enables new market entrants to maximize their profitability by targeting the right people in the right place at the right time.

In 2030, 16 countries will have a population of over 100 million, up from 11 countries in 2013. These 16 countries will account for almost two-thirds of the global population. Half will be in Asia, and one quarter in Africa and the Middle East; none will be in Western Europe.

The World’s Largest Countries: 2030

The World's Largest Countries 2030

Source: Euromonitor International from national statistics/UN

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November 16, 2014

China and India: The Powerhouses of the Asia Pacific Cocoa Market

Helen ReavellAnalyst Insight by Helen Reavell - Contributing Analyst

Asia Pacific is currently the third largest region for cocoa ingredients (liquor, butter and powder) worldwide after Western Europe and North America; however, it is set to become the second largest region, overtaking North America by 2017, with consumption exceeding 688,000 tonnes. Regional sales are dominated by China, which accounted for 40% of volume sales in 2013, while the second largest market is India, with 11% of volume. Both China and India have seen strong growth in the cocoa ingredients in recent years, with China posting an average annual growth rate of 6% and India 16% over 2008-2103. Similarly, forecast rates are also strong at 5% and 11% over 2013-2018. However, this growth is being driven by quite different consumption patterns in these two countries.

Cocoa ingredients in India, more closely matches that of the worldwide market. Cocoa liquor takes the largest share at 43% (37% worldwide), cocoa butter 29% (33%) and cocoa powder 27% (30%). Meanwhile, China is quite different, with cocoa liquor only accounting for 23% of total cocoa volumes, cocoa butter 17%, but cocoa powder reaching 60%.

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November 15, 2014

Charging Ahead: China to Become the Largest EV Market in the World

Neil-KingAnalyst Insight by Neil King - Automotive Analyst

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In my recent piece, China’s EV Push Could Reap Rewards in Europe, I alluded to the “growing campaign in China to promote electric vehicles.” I thought I’d elaborate on the numerous government initiatives in effect and also on consumer attitudes, ultimately explaining why China is on track to become the largest EV market in the world, possibly already in 2015.

Government Initiatives

One of the Chinese government’s initiatives to combat rising pollution is the introduction of brand-average fuel economy targets of 6.9l per 100km from 2015 and 5l per 100km from 2020. According to a comment piece by Yang Jian in Automotive News China, manufacturers that assemble vehicles in China “can easily reach their target of 6.9 liters next year by diversifying their product mix with more small vehicles, electric cars and plug-in hybrids.” In addition to these fuel economy targets, there are also central government and city-specific subsidies in place which can amount to discounts of up to CNY100,000 CNY (approximately US$16,000). Another boost to the fortunes of electric vehicles will come from the restrictions imposed on the number of cars that can be registered in certain cities (currently six cities to be precise but many more are expected to follow suit), from which electric vehicles are exempt. Finally, the latest initiative is that “China, the world's biggest carbon emitter, is mandating that at least 30 per cent of new government vehicles be powered by alternative energy sources by 2016 in the government's latest move to combat pollution” according to a Bloomberg article on October 24. To put this into perspective, government vehicles are commonly reported as accounting for 20% of vehicle sales in China.

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Disruptive Innovation Proceeds Steadily in Online Travel: the Key Trends

Angelo RossiniAnalyst Insight by Angelo Rossini - Contributing Travel and Tourism Analyst

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Online travel is currently going through an exciting period of growth and innovation, which is changing the way travel products are booked and travel companies communicate with their customers, and it is also increasing the power consumers have, not only to find information about products, compare and choose them, but also to reshape the whole industry. This article summarises what are today the key disruptive forces in this sector.

 

Mobile channel increasingly central

The rise of the mobile channel, which is seeing consumers increasingly use their smartphones and tablets to book travel and seek customer service, is the most powerful force changing the travel industry today in terms of consumer behaviour, and it is also, as a consequence, requiring companies to change their business models.

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Europe’s Leading Health Trends: What is Driving Innovation and Opportunities for Functional Ingredients?

Ewa HudsonAnalyst Insight by Eva Hudson - Head of Health and Wellness Research

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More natural, more protein and more nutritional content in general; this is where the European health and wellness market seems to be heading in the immediate future. In this article, we look at those health and wellness prime positioning platforms that are predicted to achieve the highest growth performance in Eastern and Western Europe over the 2014-2019 forecast period.

 

Weight management: All about nutrient density and protein

After general wellbeing, weight management is the largest positioning platform for health and wellness food and beverages in both Eastern and Western Europe, with value sales amounting to US$57.1 billion in 2014. Due to market saturation, particularly in Western Europe, growth expectations over 2014-2019 are not exactly overwhelming.

However, since obesity is set to remain a foremost public health concern in Europe for the foreseeable future, the market for products that address this issue will continue to evolve, even if it will not gain much in size.

Continue reading "Europe’s Leading Health Trends: What is Driving Innovation and Opportunities for Functional Ingredients?" »

November 14, 2014

HTC Corp and Sony Corp Earnings Paint a Bleak Picture for Smartphones

MykolaGolovkoAnalyst Insight by Mykola Golovko - Senior Consumer Electronics Analyst

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While Sony has a much more diversified product portfolio than HTC, both companies are highly dependent on demand for their smartphones for revenues and profit. Therefore, slowing growth and intensifying competition in smartphones have been particularly detrimental for both companies, and results announced on 31 October indicate that despite making headway in their turnaround efforts, Sony and HTC are still in an extremely difficult position. 

Deteriorating market conditions

For both companies, the source of all difficulties is the lacklustre performance of their respective smartphone lines, particularly the high-priced models. While both companies have released very competitive line ups that received praise from critics and reviewers for design and build quality, both companies were too small to compete with the marketing budgets of Samsung and Apple. Exacerbating the problem for high-end devices was slowing growth in developed markets.

Continue reading "HTC Corp and Sony Corp Earnings Paint a Bleak Picture for Smartphones" »

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Recent Posts

The Recovery from the Global Financial Crisis of 2008: Missing in Action

Starbucks Promises To-Your-Desk Delivery in the US by 2015, But What Does This Mean For the In-Store Experience?

What’s Happening in Tobacco – October 2014

Going Vegan for Weight Loss and Heart Health

Global Population Trends: The 100 Million Club

China and India: The Powerhouses of the Asia Pacific Cocoa Market

Charging Ahead: China to Become the Largest EV Market in the World

Disruptive Innovation Proceeds Steadily in Online Travel: the Key Trends

Europe’s Leading Health Trends: What is Driving Innovation and Opportunities for Functional Ingredients?

HTC Corp and Sony Corp Earnings Paint a Bleak Picture for Smartphones