November 21, 2014

Wait Marketing: The Perfect Marriage between Advertising and Selling

Mylan NguyenAnalyst Insight by Mylan Nguyen - Retailing Analyst

Rapid consumer adoption of smartphones impacts retailers in many ways. While store-based sales can be hit by the rise of m-commerce through showrooming, there are still positive outcomes as, thanks to smartphones, retailers with a multi-channel strategy also have the option to create a point of sale virtually anywhere. Using below-the-line advertising outside stores is a good way to promote new brands or products; it also represents a favourable environment for impulse purchases.

The power of wait marketing

Wait marketing means to engage with consumers where and when they are most available and receptive. An example of wait marketing includes Ikea revamping bus stops and underground stations in many cities, furnishing the public transport space with its furniture and the slogan “Good design can make the everyday a little better”.  Similarly, wait marketing is also evident with Canadian home and garden retailer Canac installing palisades between public urinals, together with the message “For more intimacy with your neighbours”. This type of advertising coupled with mobile internet retailing could potentially transform such wait marketing interactions into sales.

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Huge Potential in India’s Yet Uncharted Tea Market

Dana LaMendolaAnalyst Insight by Dana LaMendola - Beverages Analyst

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In India, like other emerging Asia markets where tea consumption is high, there is a lot of focus on the value opportunity from the transition from unpackaged (unbranded) tea to packaged tea products. Indeed, between 2008 and 2013, tea increased by 118% in retail value, reaching US$1.9 billion. Yet, retail volume growth has been less impressive, increasing by 20% in the same period. This discrepancy suggests that to date, the primary shift in the Indian tea market has been towards more value-added packaged tea products, rather than a substantial shift from unpackaged to packaged tea products on the whole. According to industry sources, unpackaged tea still accounts for at least 50% of the overall Indian tea market, indicating a significant opportunity for tea manufacturers.

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Swedish Match Evokes World Without Cigarettes in 3Q Results

Don2Analyst Insight by Don Hedley - Contributing Analyst

In its third quarter report Swedish Match announced a new corporate vision - ‘A world without cigarettes’.  Entry into this brave new world is enabled by the availability of products ‘recognised as safer alternatives to cigarettes’.  As a non combustible tobacco product snus may be unofficially be so regarded but officially this product is lumped together with cigarettes in terms of dire health warnings.  The company is currently seeking to change this situation having submitted a lorry load of data aimed at refuting two of the health warnings compulsorily carried by its products in the US.

How this turns out will be of great significance for the global moist snuff business: a positive result would also help in Sweden’s ongoing crusade to get the EU oral snuff ban lifted. Meanwhile the obvious question is whether current progress of Swedish Match’s oral snuff products and particularly snus, and the performance of smokeless tobacco in general, justifies its vision of a world without cigarettes.

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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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Added Value in the Brazilian Toilet Paper Market

With increasing average incomes and industry sophistication, consumers in Brazil are beginning to trade up to higher quality products, increasing the overall value of the market.

Video features Leonardo Freitas - Research Associate

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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Consumer Electronics Sales Forecast: Holidays and Beyond

2014 has been a rather difficult year for the major consumer electronics brands and they are all looking forward to holiday season sales.  This video looks at sales projections across major consumer electronics product categories and markets.

MykolaGolovkoVideo features Mykola Golovko - Senior Consumer Electronics Analyst

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November 18, 2014

Just a Drop Provides Much Needed Resources in Uganda

Caroline Bremnerby Caroline Bremner - Head of Travel and Tourism Research

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Taking advantage of being in Uganda, I combined my speaker engagement at the Africa Travel Association's World Summit with a trip to local projects run by our global charity partner, Just a Drop.  Just a Drop currently receive 1% of all our online sales.  The experience was inspirational, humbling yet shocking and, despite the abject poverty, I came away with a sense of hope for the future of these communities.

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