Mass-Market Brands Could be a Gateway to Luxury Opportunity in Emerging Markets

With more than one million millionaires, China is a core driver of growth in the global luxury goods market.  Click to tweet! Yet, Western manufacturers often fall short of their full growth potential in China because they struggle to understand the complexities of its consumption culture, and are thwarted by complicated routes to market. Paradoxically, by developing new positions in locally made mass-market brands, luxury goods manufacturers could unlock a solution to both problems. 

When luxury goods meet fast fashion

Eyebrows were raised in luxury goods circles when it was reported last month that L Capital Asia, a private equity fund backed by LVMH Moët Hennessy Louis Vuitton, the world's biggest luxury goods company, had snapped up a 10% stake in a Chinese fast fashion manufacturer called Trendy International Group, paying an estimated US$200 million.

Top 10 Consumer Trends for 2012: Smartphone Universe

Displacing computers worldwide, in 2012, smartphones are reaching out to the lower end of the mass market so expect apps to reflect this.

This piece is the seventh in a weekly series of consumer comments exploring each of the trends Euromonitor International identified in the recent Top 10 Trends for 2012 article.

Worldwide, smartphones are the communications accessory of choice, including in emerging markets where consumers are taking up new, more basic models as this prop moves from being a luxury item to a necessary lifestyle aid. According to Euromonitor International data, annual smartphone sales surged from US$7.9 billion to US$83.3 billion between 2005 and 2010, with China surpassing the USA as the largest national market during 2009. Real global smartphone sales are forecast to reach US$137.4 billion in 2012. For many developed market consumers, PCs and laptops are beginning to take a backseat as most smartphone owners use these convenient devices to surf the internet and watch TV anywhere from parliaments to buses. New aids such as Hive Dock, designed to assist elderly people with visual impairments to use smartphones will expand the population of smartphone users still more. 2012 will see more consumers using their smartphones to make transactions, using mobile, cashless technologies from Near Field Communication to QR codes to personal card readers.

Ukraine's Population in Rapid Decline

With ultra-low fertility rates and high death rates, Ukraine will experience the single largest absolute population loss in Europe between 2011 and 2020. Although the resulting labour shortages will push up real wages and thus benefit consumers, lower competitiveness and output will adversely impact the country's long-term economic growth.

 

Population Growth Index in Selected Eastern European Countries: 1990-2020

Source: Euromonitor International from national statistics/UN

Bulgaria Has Highest Proportion of People at Risk of Poverty in the EU

Bulgaria has the highest share of people at risk of poverty or social exclusion in the European Union (EU). Click to Tweet! The main reason for this has been rising unemployment and declining government expenditure on social security and welfare in the context of a contracting economy. The recovery of the Bulgarian economy will be highly dependent on the performance of the rest of the EU, on which it is heavily dependent for foreign investment, trade and remittances.

Persons at Risk of Poverty or Social Exclusion: 2010

Russia's Communications Market Largest in Eastern Europe

Russia's large size, population and continued economic development made it the dominant communications market in Eastern Europe in 2011. Click to tweet!  The country's burgeoning high-income households and falling rates for telecom services are driving consumer market growth, while its urban centres and large swathes of territory offer communications businesses diverse opportunities. However, Internet access remains limited in rural areas, while high income inequality restricts consumer market potential.

Top 10 Consumer Trends for 2012:Tech Lifestyles Versus Slow Living and The Best of Both

Some consumers are embracing an 'always-on' lifestyle while others are trying to disengage.

This piece is the eighth in a weekly series of consumer comments exploring each of the trends Euromonitor International identified in the recent Top 10 Consumer Trends for 2012 article.

For the 2012 consumer – from toddlers upwards, technology is part of life with a lot of simultaneous tech consumption (watching TV and using a computer at the same time, for example). Access to the internet has extended to accompany people as they go about their daily lives, at work and on holiday. We're moving into a technology space where mobility is becoming less about devices, and more about the mist of data that we each generate with every interaction on the internet.

Datagraphic - Debt: The Developed, Developing Dichotomy

Debt (external and public) has been cited as a central factor dragging global economic growth down between 2008 and 2012. Following the 2007/2008 global financial crisis a major imbalance in debt levels between developed and developing economies emerged. High debt levels in developed economies have stifled growth as consumer expenditure, investor confidence and employment have declined, while lower levels of debt in developing economies have supported stronger growth.

Debt Levels in Selected Countries



Note: External and public debt figures for India and Brazil are equivalent.

Global Oil Prices

Oil prices have been on the rise since 2001, and have recently reached levels achieved during the global economic crisis. Daniel Tarling-Hunter, economist at Euromonitor International, states that while market speculation is certainly a reason behind high oil prices, global demand for oil and crises in the Middle East are more to blame. Emerging markets are also using more oil than ever before, and as a result, the world is potentially moving towards a period of oil scarcity. 

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The green economy looms ever larger

Both large and small companies are turning greater attention to the implications of climate variability and change on their businesses. The green economy is increasingly framing decision making with low-carbon, resource-efficient and socially inclusive growth one vision of the future. Volatile costs of raw materials, supply-chain disruptions and changing consumer preferences and demands can weigh heavily on strategic planning.

Eastern Europe in 2030: The Future Demographic

In 2030, the population of Eastern Europe will fall to 316 million.  Click to tweet! The population is ageing rapidly. This is compounded by a falling birth rate and increasing life expectancy. Elderly population aged 65+ years will account for nearly 1-in-5 of the region’s total population in 2030. Moscow is the region’s biggest city and will be home to 5.9% of the region’s urban dwellers in 2030.

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