MarketLine Blog

Posts written in February 2013

ARM Exploiting IP in a Growing End-Market

MarketLine

ARM Ltd is a designer of low-power microprocessors, which generates revenue by licensing its intellectual property to semiconductor manufacturers. It has enjoyed ten years of unbroken profitability, more than quadrupling its revenues during the same period. This case study shows how providing a solution to a technological problem, and consistently executing a simple but effective business model, has brought the company success. The ARM business model is based on intellectual property. The company designs the core architecture of the digital processors that form the heart of many contemporary electronic products…. Read more

Retail-led Strategy by Burberry to Target High Net Worth Individuals in Asia Pacific

MarketLine

During a dark period for retail – when people have become accustomed to hearing about the struggle of many high end brands unable to win market share from more cautious luxury customers – the news of Burberry’s continuing success leaves some wondering how the company is delivering such a strong performance, with a revenue increase of 35%, 105 new stores added and a productivity boost of 11%. “While the luxury industry faces global challenges in the year ahead, we remain confident in our team’s ability to outperform, underpinned by the… Read more

BT buys ESPN’s UK and Ireland channels

MarketLine

BT is proceeding full steam ahead on its mission to rival BSkyB as the UK’s leading sports broadcaster and today announced an agreement to buy the ESPN and ESPN America channels. The deal, the details of which remain scarce, will allow BT to significantly increase its live sports coverage, with ESPN currently holding rights to show FA Cup, Scottish Premier League, Uefa Europa League, and German Bundesliga matches. The deal is expected to complete in July this year and if all goes to plan, will coincide perfectly with the planned… Read more

BMW Case Study: A Year of Success Amidst Economic Uncertainty

MarketLine

BMW and its brands, Rolls-Royce and MINI, announced record sales for 2011, retaining its position as the world’s largest manufacturer of luxury vehicles amidst a backdrop of economic uncertainty. During 2011 BMW experienced double figure growth across all of its automobile brands and set a new sales record for its BMW Motorrad motorcycle brand (however, its other motorcycle subsidiary, Husqvarna, experienced its third consecutive decline in annual sales). All regions that the company operates in experienced growth; however, BMW believes that its European sales will remain flat during 2012, with… Read more

Can the PlayStation 4 Compete with Casual Mobile Gaming?

MarketLine

At a New York press event on 20 February, 2013, Sony took to the world stage to unveil its latest incarnation of the PlayStation line: the PlayStation 4 (PS4). Although the console itself was not revealed, Sony’s main emphasis was on the concept behind the PS4, which was given a vague release window of holiday season 2013. Notably, much attention was paid to how the console will fit in with, and thus compete against, consumer movement to casual mobile experience offered by smartphones and tablets, which typically run on iOS,… Read more

Sustainable Fashion: A Growing Trend

MarketLine

Sustainable fashion, also known as eco fashion, is part of the larger growing trend of creating more sustainable, environmentally friendly and ethical products. Whilst there is a lack of consensus over definitions, the environmental sourcing and manufacture of materials, reduction of carbon footprint, and safety of consumers and laborers, remain important. Christian Kemp-Griffin, chief mission officer at Edun, an eco-fashion brand that focuses on fair trade for its producers in Africa, says, “Ethical companies make thoughtful decisions and sell product thinking about the people who make the clothes – wages,… Read more

What does the Ofcom 4G Auction Mean for UK Consumers?

MarketLine

Ofcom today revealed the results of the UK 4G mobile auction, announcing which providers have won access to the required mobile spectrum bands. The result of the auction is that operators Everything Everywhere Ltd (EE), Hutchison 3G UK Ltd (3), Niche Spectrum Ventures Ltd (a subsidiary of BT Group plc), Telefónica UK Ltd (O2) and Vodafone Ltd have all won blocks of the spectrum on offer, with Vodafone bidding the most to win five blocks of spectrum. Notably, this announcement comes six months after Ofcom gave EE, formerly known as… Read more

India’s HDFC Bank has Launched an Ultra-Premium Credit Card

MarketLine

In 2011, HDFC launched its Infinia credit card, only 5,000 of which are to be issued. This case study examines how and why HDFC aims to meet the requirements of a small but potentially lucrative customer base: India’s ultra-rich. In July 2011, HDFC launched Infinia, an ultra-premium credit card. It is being offered to only 5,000 customers, and its lack of a pre-set spending limit, other benefits, and marketing are all intended to position it as a highly exclusive product for the ultra-rich only. India has a growing class of… Read more

Prada: From Family-Owned Business to Global Luxury Goods Powerhouse

MarketLine

Prada Group (Prada) is one of the world’s leading players in the design, production and distribution of luxury leather goods (including handbags), footwear, apparel, accessories, eyewear and fragrances. The company owns and operates four brands: Prada, Miu Miu, Church’s and Car Shoe. Prada retails its goods through a network of 345 directly operated outlets, 30 franchise stores, and concessions in upscale department stores such as Saks Fifth Avenue (New York), KaDeWe (Berlin) and Harrods (London). The company undertook an Initial Public Offering (IPO) in June 2011 and is now listed… Read more

Impacts of Deepwater Horizon Oil Spill on BP Plc.

MarketLine

The Deepwater Horizon Oil spill took place in the Gulf of Mexico in 2010. The spill emanated from a seafloor oil gusher caused by an explosion of the Deepwater Horizon semi-submersible Mobile Offshore Drilling Unit, which was owned and operated by US company Transocean. Transocean was drilling for BP in the Macondo Prospect oil field about 40 miles (60km) southeast of the Louisiana coast. The explosion took place on 20th April 2010 and resulted in the Deepwater Horizon oilrig sinking two days later. An average of over 50,000 barrels of… Read more

Alcoa Case Study: Benefiting from Saudi Economic Planning

MarketLine

In 2009, the multinational aluminum producer Alcoa announced a joint venture with the Saudi mining company Ma’aden. Together, they are constructing an integrated bauxite mine and aluminum smelter in Saudi Arabia, pioneering production of this metal in the Kingdom. The project sheds light not only on Alcoa’s commercial strategy, but also on the economic strategy of the government of Saudi Arabia, a country with the mixed blessing of abundant natural resources. Alcoa is a large multinational aluminum player. Like many of its peers, it is vertically integrated, with interests in… Read more

Texas Instruments Case Study: National Semiconductor is TI’s Latest Strategic Acquisition

MarketLine

In September 2011, Texas Instruments (TI) acquired National Semiconductor (NatSemi), a leading manufacturer of analog semiconductors. The deal significantly increases TI’s share of the buoyant and highly profitable analog market. It is also the latest in a series of acquisitions and divestments that over the course of more than a decade have helped transform TI from a diversified technology company into one highly focused on semiconductor manufacturing. TI has been using acquisitions and divestments to focus on its core competence of semiconductor device manufacturing. In 2011, TI acquired NatSemi, a… Read more

Barclays Announces 3,700 Job Cuts & a Plunge in Pre-Tax Profits

MarketLine

Barclays was today the first of the UK’s big four banking groups to announce its 2012 results and they did not make for pretty reading, at least at first glance. The headline grabbing figure was £246m ($394.5m) which represented the bank’s statutory profit before tax. This is a huge fall from the £5.9bn ($9.5bn) seen in 2011, due in the main to compensation for mis-sold products and a loss on the value of its own debt. There was also the not-so-insignificant matter of a £290m ($465.1m) for its role in… Read more

G4S Olympic Fine Stands at £70m

MarketLine

G4S is the world’s leading security firm and remains dominant in its market despite some recent turbulent public image issues. At the London 2012 Olympic Games the company was originally awarded the huge security contract, but couldn’t fulfil its promise of 10,000 security personnel and subsequently the UK’s military was drafted in as a replacement. The resulting furore in the media and fines and costs incurred by failing to complete its contract should have affected the company adversely, however this doesn’t seem to have been the case. G4S controls some… Read more

Dexcom Case Study: Launching a Continuous Glucose Monitor

MarketLine

Continuous glucose monitors (CGMs) promise certain diabetics more effective self-management of their condition. Medtronic is a leading US supplier of CGMs, but since 2006 it has faced competition from a small start-up, Dexcom. Management of diabetes often requires electronic blood glucose testing. Until recently, this was done using meters that offered single measurements. Continuous monitors came on to the US market in 2001 and offer certain diabetics the prospect of improved management of their condition, by detecting abnormal glucose levels more rapidly. Medtronic and Dexcom are the only players in… Read more

The OTC Healthcare Market has Become Increasingly Attractive in Recent Years

MarketLine

In recent years, a number of major healthcare companies including Pfizer, Roche, and Bristol-Myers Squibb (BMS) have sold their over-the-counter (OTC) healthcare divisions in a bid to focus their attention on pharmaceuticals. Bayer acquired Roche Consumer Health in 2004, while BMS sold its OTC unit to Novartis in 2005. Pfizer sold its Consumer Healthcare business to Johnson & Johnson in 2006. However, more recently this trend has reversed with companies re-entering the OTC healthcare market. For example, Pfizer marked its re-entry to the market in 2009 with its acquisition of… Read more

John Lewis Partnership Case Study: UK Retail Chain is Owned by its Employees

MarketLine

John Lewis Partnership is one of the UK’s most well-known and successful retail chains. Whereas most retailers of its scale are owned by shareholders, John Lewis Partnership is owned by its employees. John Lewis Partnership is owned by its employees via a trust. Financials for the past ten years show JLP performing strongly, even in difficult market conditions. This is reflected in the structures in place for workplace democracy, and in the annual profit-share bonus given to all employees. Company strategy focuses on long-term planning, brand strength, and employee partnership…. Read more

Benecol Case Study: A Leader in Cholesterol-Reducing Food

MarketLine

Benecol is a brand licensed by Finnish company, Raisio Group. Branded products include a range of cholesterol-lowering food goods such as fat spreads, yogurts, milk, bread, and soy drinks. Benecol has become one of the market leaders in cholesterol-reducing foods. Benecol was developed after Raisio Group was approached by a Finnish university, which was looking into the use of plant stanols, a class of compounds derived from the phytosterols found in many plants, as a way to combat high cholesterol levels amongst the Finnish population. Benecol margarine was introduced to… Read more

Cadbury’s brand name fading?

MarketLine

In 2010 Kraft took over British company, Cadbury for $19.5bn (£11.5bn). Kraft’s  CEO, Irene Rosenfeld said that the company would be spending heavily in countries such as India and China with the aim that such countries will generate annual revenues of around $1bn. Emerging markets have seen double digit growth, particularly in India and China within the chocolate confectionery market where further growth is anticipated in the future. Cadbury Dairy Milk is considered the ‘gold standard’ for chocolate in India. After the takeover the Cadbury team also looked at innovations… Read more

Can BlackBerry 10 challenge Google and Apple?

MarketLine

Research In Motion Ltd. (RIM), having changed its name to BlackBerry, has finally unveiled its latest BlackBerry 10 mobile operating system to compete with Apple’s iOS 6 and Google’s Android 4.2 Jelly Bean. Notably, BlackBerry 10 aligns BlackBerrry’s devices much more closely with high end Android mobile phones and Apple’s latest offering, the hugely popular iPhone 5, in terms of software capabilities. However, time will tell if Blackberry is able to make up the ground which it has lost to its rivals over the past few years. As noted by… Read more