MarketLine Blog

Posts tagged to Consumer

Rapid growth in Asia-Pacific organic food market set to change global market shares

The global market in organic food expanded between 2012 and 2016 at a compound annual growth rate (CAGR) of 10.9%, and is forecast to accelerate to a value of $187.6 billion by 2021, representing a CAGR of 13.8%, according to research firm MarketLine. The company’s latest report states that the US will remain the largest single market, rising from $44.9 billion in 2016 to $63.4 billion by 2021 at a CAGR of 7.1%, underlining the country’s pivotal role in driving global growth. Christopher Leyman-Nicholls, Analyst for MarketLine, says: “Although the… Read more

Keep calm and take advantage. Deflation, good for the consumer, not so good for business

MarketLine

On Tuesday, May 19, 2015, it was announced by the Office for National Statistics (ONS) that the UK had fallen into deflation for the first time since 1960. The Consumer Price Index (CPI) fell by 0.1% in the year to April 2015, compared to no change (0.0%) in the year to March 2015. According to the ONS, this is the first time the CPI has recorded a decline over a year since official records began in 1996, and is the first instance of deflation when using comparative data since 1960…. Read more

Marks & Spencer: apparel retail dressed for success?

MarketLine

Marks and Spencer is one of the oldest names on the UK high street, with a reputation among consumers as a dependable but slightly staid retailer, ideal for those middle-aged, middle-income clothes shoppers who don’t want to embarrass their children by dressing inappropriately. But its FY2014 financials released today (May 20) show falling profits, as a core revenue stream continues to perform less strongly than hoped. The company’s two main segments are food and general merchandise, the latter largely apparel plus some homewares. Over the 2012-2014 period, its UK food… Read more

The sweet smell of success

MarketLine

Fragrances and perfumes have now evolved into a mainstream business within the cosmetics and personal care industries. The global fragrance industry has experienced moderate growth over the period spanning 2008-2012 with a (CAGR) of 3.7%. According to MarketLine, this industry grew by 4.4% in 2012. Growth in the industry is driven by trends towards urbanization which can enable emerging nations to sustain economic growth, as populations move toward larger cities and take up non-agricultural work, a new class of consumers will contribute to growth; and also increased importance of personal… Read more

Xbox One-80: Microsoft backs down on controversial DRM policies

MarketLine

Microsoft’s U-turn on its Xbox One DRM and Internet connectivity policies has completely changed the dynamics of the upcoming battle for next generation console dominance. The decision to go back on previously asserted policies has meant that many of the competitive advantages held by competitor Sony’s machine, the PlayStation 4 (PS4) have been negated. However, the decision has also confused Microsoft’s strategy, and the Xbox One’s higher price tag remains an issue. One step forward, two steps back: Microsoft’s initial DRM policies, which placed restrictions on the lending of physical… Read more

Coconut Water Consolidating Growth in a Burgeoning Segment

MarketLine

Coconut water has experienced a lot of initial success in the US due to its unique taste profile and sports nutrition benefits. Now is a pivotal time to further consolidate and grow the market, lest it be dismissed as just another ‘fad’ category. The myriad of health benefits associated with consumption means that a natural positioning for coconut water has been a healthier alternative to sports nutrition drinks. This has particular appeal to athletes who have become reticent in recent times to consume some of the more commercially popular sports… Read more

Seasonal Packaging Tapping into Consumer Trends Beyond the Visual

MarketLine

In recent decades, seasonal packaging has emerged as a promotional tool used by manufacturers to establish a point of difference in a consumer landscape overloaded with choice. Today, however, seasonal marketing no longer represents a novel promotional tool but rather a necessary strategy used by the majority of brands. This article will examine ways in which various brands have successfully developed innovative seasonal packaging designs, which go beyond the visual and respond to core consumer needs. For consumers faced with too much choice, packaging plays an integral role in awaking… Read more

Craft Beers in the US & UK: How Mainstream Brewers can Benefit From the Trend Towards Craft Beers

MarketLine

Amid data showing that the craft beer sub-sector has posted strong growth in an otherwise dismal US beer category, brewer MillerCoors has pooled all its craft-style domestic and international brands into a new craft-focused division called Tenth and Blake. The UK real ale sub-sector is also showing positive growth in a poor overall environment. The success of craft beer has arisen as it dovetails with various important consumer trends: it fits with the general trend towards trading up; it capitalizes on desires to purchase authentic products; it goes with the… Read more

Greek government privatizing infrastructure and energy

MarketLine

Following a contraction in Greek domestic product worth at least 15%, the country has, since 2009, been hobbled by market reaction to negotiations with creditors culminating in an (overall) bailout worth $310bn. Greek debt now stands at 171% of GDP.  In part a reaction to this, the Greek government, led by prime minister Atonis Samaras, has put up domestic industry for tender or sale to the private sector. Depa, Greece’s natural gas corporation, is the subject of a bid by Gazprom: the Russian company, which already supplies 90% of Greek… Read more

Fairy Liquid Using Evocative Marketing Techniques to Boost Product Sales

MarketLine

In 2010, Procter & Gamble’s (P&G’s) Fairy Liquid brand recorded particularly impressive growth rates in both the auto and hand dishwash product categories in the UK. The growth in sales has been attributed to a heritage marketing campaign designed to celebrate the 50th anniversary of the brand. This article analyzes how Fairy Liquid has successfully managed to introduce a nostalgia-based marketing campaign while also leveraging superior efficacy benefits compared to competitors to enhance value perceptions of the brand. The article also looks at how P&G plans to launch another evocative… Read more

US Laundry Care Market: How Leading Manufacturers Can Enhance Perceptions of Value

MarketLine

Even though the US laundry care market is commonly characterized by consumer inertia, the recession did bring about changes in buying behavior as shoppers looked to obtain maximum value for money, and this change is continuing in the post-recessionary market. This article examines that how Procter & Gamble (P&G) and the Dial Corporation have looked to reposition their brands in order to capitalize on these changing buying patterns. Reduced levels of financial wellbeing brought about changes in buying behavior as consumers looked to obtain greater value for money from the… Read more

Cadbury Maintaining Sustainability and Traditions in UK Chocolate Market

MarketLine

In 2009 Cadbury trialed a new packaging format for its Roses chocolates brand, replacing the standard 975g metal tin with a carton box pack. However, a poor sales performance resulted in the company reverting to the tin format for the 2010 Christmas season. This article analyzes the reasons behind Cadbury’s decision, and explores the hypothesis that consumers’ actions relating to sustainability may be at odds with their intentions when brands evoke strong emotions of tradition and nostalgia. This article examines the reasons behind Cadbury’s original packaging switch and subsequent reversal,… Read more

Where all the Cash is

MarketLine

US corporates, especially tech corporations, represent the most liquid corporations in the world. Moody’s has estimated that the US tech sector holds $550bn in cash reserves, a vast proportion of 38% of all corporate cash reserves in the US. To further narrow this insight, Apple alone held $137bn in cash at the end of 2012. For context, any prospective Cyprian bailout is estimated to cost under €20bn; the British government’s immediate bailout of the banking sector in 2008 was £50bn; and the entire EU budget in 2007 equated to €120.7bn…. Read more

A Realistic Budget on Assumptions of Austerity

MarketLine

Taking “24m people out of tax”, a freezing of the alcohol duty escalator, and more realistic growth forecasts seem to be the big headlines, or rumoured to be headlines resulting or will result from the 2013 budget in the UK. There seems to be little mention of investment, save in social housing – something which, of course, seems to be completely consistent with any conservative growth estimates for the economy. Indeed, the coalition can only take 24 million people out of tax — with a raising in the tax-free allowance… Read more

Bank deposit levy rejected by Cyprus MPs

MarketLine

Prior to the last week, the word ‘Cyprus’ probably conjured up images of an idyllic holiday destination in the Mediterranean or, at a push if you’re a football fan, APOEL Nicosia’s heroic run to the Champions League quarter final last year. This week however, it has become associated with one thing and one thing only: a bank deposit levy. As part of a €10bn bailout package agreed in Brussels, a one-off tax on savings was to be levied, but the plan was today left in tatters as MPs voted against… Read more

Sainsbury’s and Tesco: Retaining market share during the credit crunch

MarketLine

Sainsbury’s looks to be gaining ground on Tesco, at least in terms of sales revenue as the third largest (following Asda and Tesco) supermarket group announced a fourth quarter sales increase of 7.1% (excluding fuel). This, in conjunction with Tesco’s shrinking grocery market share, seems to make Sainsbury’s the biggest ‘winner’ following the horsemeat scandal, as consumers flock to the seemingly better quality meats and provisions in the iconic orange branded stores. Whenever an industry-wide scandal or external shock racks a market or industry, it is a race for PR… Read more

John Lewis faces backlash after it demands rebate from suppliers despite announcing record profits

MarketLine

The John Lewis Partnership is made up of 84,700 permanent staff, or Partners, who own 39 John Lewis shops and 290 Waitrose supermarkets. The Partners also run a John Lewis e-commerce and catalogue business, a production unit, and a farm. The Partners share in the company’s benefits and profits. On March 7th, the company’s financial results for the year ended 26 January 2013 were released. The release pointed to a company that was outperforming with strong results, even in the current economic climate, when many other companies were struggling to… Read more

Farnell acquires CAD company

MarketLine

Premier Farnell (Farnell) is a leading distributor of electrical and electronic components. In 2009, it acquired CadSoft Computer, a publisher of computer-aided design (CAD) software for the design of printed circuit boards (PCBs). While sales of CadSoft products will in themselves contribute only a small amount to Farnell’s revenues, the acquisition shows how Farnell and its rivals are competing on service as well as price. Farnell is a leading high service technology distribution company. This means that it offers customers a wide range of electronic parts, with rapid order turnaround… Read more

JD Wetherspoon hurt by inflation not tax

MarketLine

JD Wetherspoon has called for “tax parity” with British supermarkets citing that the large supermarkets benefit better from the current tax system than pubs. Now, a business calling for tax parity, i.e. equal treatment fiscally, with reasons for doing so limited to the same reasons any other business can give, i.e. inflation, can only be solipsistic. For it is not just JD Wetherspoon and their 800 or so pubs which suffer from a decline in the value of the £, or currently surging inflation, but all other actors in the… Read more

Current events bad for business

MarketLine

As the Cyprian government seizes private assets, and as freedom of speech in the press is about to be curtailed in the UK, a global downturn has proven to be sufficient for various entities to erode the very structures necessary for good business. Above all, business values consistency. And although business has reacted in the UK, in general, quite well to the drop in corporation tax and other supply-side measures, business especially international business does not appreciate hasty reform especially in fundamental areas of the law, in this instance freedom… Read more

Asda rates HMV for brand

MarketLine

With Deloitte administrating the sale of HMV’s stores and assets, Asda has expressed interest in the company’s brand, an intangible which had gone largely unrecognised by previous suitors. Assuming Asda, a wholly-owned subsidiary of Walmart, have done their maths or cost-benefit analyses correctly, the prospect of HMV stores run by, or even situated inside large Asda stores raises questions about the conventional institutional-investor’s approach to “dying” brands and firms. For example, the specialist investor Hilco, reputed for its experience in large divestment operations, has built its own brand on liquidating… Read more

Play.com to leave the UK market

MarketLine

Play.com, the online retailer owned by Rakuten, is closing its UK direct retail store business and became an online marketplace. From March 2013, the company will no longer sell directly to customers and will instead, employ a business model similar to Amazon and eBay, allowing its users to list their own items (e.g. DVDs, video games, and electronics), on its website for sale. The closure is a result of the closing of a tax loophole, which exempted items under £15 (around $24) in value being imported to the UK from… Read more

Boeing: The 787 Dreamliner

MarketLine

In 2011, Boeing made the first commercial delivery of its 787 Dreamliner. It is designed to offer airlines enhanced fuel efficiency and long-haul capability in a mid-sized jetliner. This article shows that how Boeing responded to customer demand in order to make the Dreamliner a reality, and how its strategy differed from that of Airbus, its chief rival. Fuel is a major cost for airlines, and its price is likely to continue to rise. This is generating demand for fuel-efficient planes. Boeing’s new 787 was designed to offer ‘super-efficient’ fuel consumption…. Read more

Are we witnessing the death of the traditional book?

MarketLine

Thursday 7th March 2013 is World Book Day; a day when the joy of reading is celebrated and promoted. Numerous events will be held in schools, nurseries, libraries, and book shops across the UK and Ireland. Many children will dress up as their favorite storybook characters and numerous World Book Day tokens will be exchanged for one of eight World Book Day new book releases. A smartphone app will also be launched aimed at young adults, featuring stories from leading teen authors. This delivering of content digitally highlights the era… Read more

Play.com: The Rapid Rise of the Internet Retailer

MarketLine

Play.com, is a Jersey-based, privately owned online retailer. Its main product lines include DVDs, CDs, books, gadgets, video games, DRM-free MP3 downloads, and other electronic products, as well as clothes and accessories. Amongst the largest e-commerce retailers, Play.com was the one recording the most rapid growth, since its establishment in1988. Starting with a focus on selling CDs and DVDs mainly to young, tech-savvy men, the company quickly evolved into one of Europe’s most successful e-commerce retailers. Since the acquisition in second half of 2011, Play.com is a part of Rakuten… Read more

EADS: Life after BAE? Flying High after the Failed Merger despite Challenges in the Defense Sector

MarketLine

The much vaunted merger of BAE Systems and EADS failed to materialize in October 2012 because of political deadlock, generating uncertainty regarding the future of both companies. The full results for the financial year 2012 show that EADS seems to be doing just fine. 2012 saw a 15% increase in revenues for the company, driving it to €56.5bn ($78.6bn) against 2011’s €49.1bn ($68.3bn). Airbus, Eurocopter and Astrium provided the boost, with defense remaining flat. Net income was up 20% to €1.9bn ($2.6bn). Order books were also up 5%. Shares peaked… Read more

Is a Public Preference for Cheap Food Behind the Horsemeat Scandal?

MarketLine

On January 16th, the Food Safety Authority of Ireland said beef burgers with traces of equine DNA were being supplied by subsidiaries of the ABP Food Group. One product was found to be classed as 29% horse. The finding resulted in ten million burgers being taken off the shelves of retailers including Tesco, Lidl, Aldi, and Iceland. Over the next week, Burger King switched supplier from ABP Food Group as a precautionary measure, while Sainsbury’s, Asda, and the Co-op removed some frozen products from their shelves, though none were found… Read more

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