MarketLine Blog

Posts written in June 2014

Extensive marketing campaigns do little to improve Marks and Spencer’s sales

MarketLine

M&S’, one of the leading apparel retailers in the UK; clothing sales have declined for the 10th consecutive quarter.  As discussed in the MarketLine case study, High street fashion retailers: Survival of the fittest, this was partly because of heavy discounting over the Christmas period. 2014 is also proving to be a difficult year for M&S; the company reported underlying pre-tax profits had dropped by 4% to £623m (approx. $973.9m) in the 52 weeks to March 29 2014. The drop in profits was driven by a 1.4% fall in like… Read more

Despite the doom mongers, the media industry finds itself in generally rude health

MarketLine

Across the 2009-2013 period, the global media industry has continued to find room to grow despite the ever looming spectre of the financial crisis. The advertising sector has been particularly susceptible to austerity as companies have continued to cast a critical eye across their costs, looking to wield the dreaded “cutback” scissors, asking themselves “do we really need to spend X amount on advertising when we can do a lot of it in-house?” Cue that competitive threat to seemingly every industry on the planet, Google and its AdWords service, not… Read more

Inglot refuses to play by the rules and wins a share of global make-up market

MarketLine

Founded over 30 years ago, in the small Polish town of Przemysl, Inglot Cosmetics started as a chemical manufacturer, producing cleaning fluid for cassette players and cheap eye shadows. Within only a few years, taking advantage of the changing political situation in the country, the company became a large cosmetics manufacturer with a presence at all major beauty gatherings and events around the globe, from the runways of Fashion Week to the stages and sets of TV and Broadway musicals. As examined in the MarketLine Case Study ‘Inglot Cosmetics –… Read more

Investors still not sweet on Candy Crush creator King Digital Entertainment

MarketLine

As explored in the MarketLine case study King Digital Entertainment plc: Sweet success of Candy Crush but doubts remain King Digital Entertainment plc’s (King) initial public offering (IPO) was preceded by a great deal of fanfare and publicity but failed to reach its target price as investors feared an over-reliance on smash-hit mobile casual game Candy Crush Saga (Candy Crush). Originally incorporated as Midasplayer.com Limited in 2002, King has experienced a period of rapid growth, both in terms of revenues and profits, in recent years. 2013 saw revenues soar by… Read more

Womenswear – Industry Analysis

MarketLine

Introduction Clothing is an essential item, with consumer choice being influenced by factors such as fashion and a desire to signal social status. Demand patterns are susceptible to branding and advertising, which, despite the lack of significant switching costs, tends to weaken buyer power. Industry figures The global womenswear market had total revenues of $638.1bn in 2013, representing a compound annual growth rate (CAGR) of 3.2% between 2009 and 2013. The Asia-Pacific and Middle East and African markets showed particularly strong growth, in comparison to Europe over this period, with… Read more

Global Music & Video – Industry Analysis

MarketLine

Introduction On-going financial difficulties being experienced in many nations around the world, and the rise in illegal downloads have contributed to the continuing poor performance of the global music and video market. Industry figures The global music & video market shrank by -0.5% in 2011, to reach a value of $56.6bn, representing a compound annual rate of change (CARC) of -2.5% for the period spanning 2009-2013. Decline was primarily driven by the largest markets: the US and Europe, which both posted the biggest declines. The US, representing $27bn of global… Read more

Consumer Electronics – Industry Analysis

MarketLine

Introduction The global consumer electronics market contracted from 2011 to 2013 and has performed poorly in recent years in most regions throughout the world with the exception of some. In general, consumer electronics are deemed as a non-essential item and is sacrificed at the cost of more essential items in times of austerity. However, the market has had some form of redemption from a strong performance from countries within emerging markets such as China and India leading the way. With the economy turning the corner, the consumer electronics market will… Read more

Industry Analysis – Food Retail

MarketLine

Introduction Despite the financial differentiation of wealth in the continents the food retail industry is almost equally spread between Americas, Europe and Asia-Pacific. This is due to food production surpluses in North America, Australia and Western Europe that the global food market is close to equilibrium. The global food retail industry grew by with compound annual growth rate (CAGR) of 4.8% over last five years, to reach a value in excess of $5.5tn. The greater amount of food is being sold by Supermarkets and Hypermarkets, with the distribution share of… Read more

Nintendo toppled by Sony as Wii U sales slump

MarketLine

A report from Japan’s Nikkei Asian Review has revealed that, for the first time in eight years, Sony’s console sales outstripped those of Nintendo to take top spot in the console sales charts (FY ending March 31st 2014). The release of the PS4 console last year helped boost Sony’s console sales both in terms of unit sales and revenue – which increased 38.5% to JPY 979 billion. Meanwhile Nintendo saw a slump in net sales, partially caused by markdowns of Wii U hardware in the US. Growth in higher margin… Read more

For relaxing times; future of Suntory’s Beam Inc. acquisition far from on the rocks

MarketLine

Suntory’s surprise $16bn acquisition of American spirits manufacturer Beam Inc., one of the largest outbound deals in Japanese history, catapulted the company from a relatively obscure food and beverage company to the third largest premium spirits company in the world. Announced in January 2014, the deal took the industry by surprise. However, faced with a shrinking domestic market, the acquisition was a culmination of Suntory’s efforts to expand its foreign operations after large-scale takeovers of Frucor and Orangina Schweppes in 2009, and Lucozade and Ribena in 2013. Furthermore, the company… Read more

Publicans to be given “fairer deal” under new statutory code

MarketLine

The British government is to introduce a new statutory code that will give publicans a “fairer deal” after a Campaign for Real Ale (CAMRA) survey concluded that 57% of landlords in tied tenancies earned less than a National Minimum Wage equivalent salary of £10,000 a year. The reforms on the current laws means that tied tenants will be able to request a rent review if they have not had one for 5 years and also be given access to the information the pub owning companies have used to calculate increases… Read more