Friday, October 23, 2009

Big Black Hole

Blink:
It’s Friday morning and you are probably asking yourself; wow, how did my week evaporate? The other day, I was sorting through some old papers and came across a survey I once read that was taken amongst ten thousand executives in 1992 titled Ten Major Time Wasters. What has changed?

Read On:

1.) Meeting-itis.
2.) Telephone interruptions.
3.) Shift in priorities.
4.) Lack of priorities.
5.) Attempt too much.
6.) Ineffective delegation.
7.) Drop-in visitors.
8.) Cluttered desktop – lose things.
9.) Lack of self-discipline.
10.) Inability to say “no”.

What has changed since 1992? A no brainer; the Big Black Hole – the Internet/Intranet. Think about how much time you spent emailing, responding to email, Googling and staying linked via social media this past week. Time management has become an enormous challenge thanks to the expansion of the Big Black Hole.

On a personal note: Wednesday marked the one year anniversary of my blog, SMARTKETING Reflections. Candidly, I consider myself a novice of blogging. Still learning, realize I have a ways to go, but I am definitely having fun. Thank you. I anticipate your continued readership.

Friday, October 16, 2009

Luxury Brands Rock Asia

Blink:
Imagine, Louis Vuitton (
http://www.louisvuitton.com/) and Ermenegildo Zenga (http://www.zegna.com/) just opened shops in Mongolia’s capital, a country of 2.7 million people, one of the poorest nations in Asia. It’s GDP of approximately $1,800 in 2008 places it 164th in the world, just ahead of the Gaza Strip. What makes luxury brands rock?

Read On:
Similar to world leading brands Coca Cola, P&G and McDonald’s to name a few, luxury brands understand the advantage of moving first into any new geography that can sustain business profitability, is a real benefit. They leverage their brand DNA to tap into the local affluent market. Despite Mongolia being known for nomadic herdsmen that produce some of the world’s finest cashmere, it is rich in minerals – gold, copper and uranium. As a result, affluent elite has slowly emerged.

What is brand DNA? It consists of two components. The first being “Code”, which is what the brand stands for in the psyche of its users. Once the “Code” has been established, it is all about the “Cue”, the sensory signals that alert consumers the benefits they are looking for from the brand. Leading luxury brands’ DNA clearly communicates wealth and status to the elite. Consequently luxury brands are now targeting Asia. Gucci has 28 stores in China. Bulgari, the jeweler, has one of its flagship stores in Taipei, the city where Hermes will open a store next month. High-end brands fill the new ION shopping center in Singapore – Christian Dior, Louis Vuitton, Cartier and Rolex.

Luxury brands is a topic I first wrote about back on 11/8/08 in a blog titled Premium Choices: (http://smartketingreflections.blogspot.com/2008/11/premium-choices.html).
Bottom-line, despite the unsteady global economy, the luxury market continues to prosper with luxury brands now rocking Asia, excluding Japan.

Year to year comparisons: The Gucci Group reported Asian sales up 25 percent in the first quarter. Richemont, the group behind Cartier and Chloé indicated that despite overall sales being down 16 percent, Asia was up 5 percent for the first half of the year. Hermès worldwide sales for the first half were up 7.6 percent, with revenues in Asia; again excluding Japan up 30.8 percent. Analysts predict that the growth of the luxury market in Asia is not a short-term fluke. It is projected that China and India will grow 6 to 7 percent in the next year compared to a 5 percent estimated decline in Europe and a 10 to 15 percent decline in the United States and Japan.

Oh yes, if you are playing geography with your kids the capital of Mongolia is Ulan Bator.

Monday, October 5, 2009

Burgernomics

Blink:
Yesterday I withdrew 200 Euros from a cash machine in France. Later when I went on line, I learned that equated to a $291 checking account withdrawal not including the service fees. I could only grimace. For years now, as an American, I have been experiencing bad burgernomics in Europe.

Read On:
The Economist magazine coined the word burgernomics back in 1986 when they introduced the Big Mac Index as a semi-humorous method predicting exchange rate movements between two currencies. The concept was to select a product that is readily available around the world to determine its Purchase Price Parity. I will not bore you with the details of the complicated formula, but the American dollar is seriously under valued here in Europe. According to my calculations, 25%. No surprise the Economist later created other global currency measures, the Tall Latte index and the iPod index.

Reflecting on the bad burgernomics I have experienced over the years here in France, I decided to create my own index to justify one of the reasons I keep coming back. It is called the Géant Food index. Géant is France’s leading supermarket chain. A 1.5 liter bottle of Evian is .66 Euros or the equivalent of $.96 for one and a half large bottles in the States. An average baguette is .92 Euros or $1.33 in the States, considerably cheaper than the baguettes at Whole Foods. Candidly, I do not come here to live on bread and water alone. Overall all the food is considerably cheaper than the States – the produce, cheese, fish dripping from the Mediterranean, etc. Let’s not forget the wine. Why is the Géant Food index favorable here? A majority of the food is local, thus I am not paying for the transportation. Remember, the average food travels 1,500 miles from source to plate in the States. So today, not only am I going to eat some great fresh food, I am also going to be environmentally responsible eating a locally sustainable meal with a favorable carbon footprint.

Just paid 5.80 Euros for a Big Mac
Translates to $8.43 at today’s exchange rate
Ate it and had a Big Heart Attack