Category: fmcg | 雜貨業務 | 소비재 | 食料品事業

FMCG or fast moving consumer goods sprang out of the mass industrialisation. Brands sprang up originally as a guarantee of quality. Later on as these brands needed to be promoted, we saw the foundation of the what we think of as modern marketing and advertising.

Today media and entertainment takes up an increasing amount of the household spend, as does housing, but FMCGs are a crucial part of their essential and disposable income spend.

They have nostalgia wrapped up in them, distinctive aromas, taste and packaging designs. From the smell of my Granny using so much Pledge on the TV that I was surprised it didn’t burst into flame to the taste of Cidona and texture of Boland’s Fig Roll biscuits in my mouth.

The sound of their advertising jingles was the soundtrack of my childhood. Digital advertising is largely rationale, it lacks the fluent devices that provide the centre to advertising and made FMCG advertising iconic. Fluent devices like the Peperami ‘Animal’, the M&M characters or the Cadbury Smash robots were embedded in deep marketing research. FMCG brands still sponsor the best research in marketing science.

I had the good fortune to work inhouse at Unilever and agency-side for their brands. I also managed to work on Coca-Cola and Colgate during my time in Hong Kong.

  • Hydrogen fuel cells + more news

    Hydrogen fuel cells

    Hyundai and Ineos team up to develop hydrogen future | CAR Magazine  BMW details fuel cell plans | EE News – I think that this move to hydrogen fuel cells makes more sense than lithium ion batteries. Hydrogen fuel cells are well understood, having been used by NASA during the Apollo space mission, the main challenge as been the cost of the cell. Hydrogen fuel cells don’t induce range anxiety and don’t have the environmental problems that you get recycling lithium ion batteries.

    Panasonic finally looks at European battery gigafactory – but this is happening with hydrogen fuel cells being in a more effective decision. Elon Musk is down on hydrogen fuel cells, but ignores the issues with lithium ion batteries compared to hydrogen fuel cells. Lithium ion batteries have their own dangers. Hydrogen fuel cells don’t have the same recycling issues that spent lithium ion batteries have. Given the strategic hold over lithium mining by China; hydrogen fuel cells offer a better option to reduce dependence. The hydrogen lobby does a better job to combat the Tesla showmanship.

    China

    EU braces for battle despite new faces in White House | Financial Times“ There will be a number of easy wins and enhanced co-operation on climate, the pandemic and remedying some of the offences of the past four years,” said Kristine Berzina, a senior fellow at the German Marshall Fund of the United States. “But there are real dangers that disagreements on issues like data privacy and digital taxation will make it more difficult to get agreements on other issues that are very important for both the US and Europe — particularly China

    Germany frets over its corporate dependency on China | Financial TimesRobust Chinese demand has helped Germany’s auto manufacturers and their suppliers to offset weaker European and US markets still afflicted by the pandemic. But it has also revived concerns that German industry is too dependent on China. And it has raised questions about whether Berlin will be willing to respond to growing pressure in the EU for a stronger line towards Beijing and to embrace a new transatlantic partnership on China under a Biden administration. – you can see this in the split between Merkel and her party over China engagement – Daimler, which has two large Chinese shareholders, sells nearly 30 per cent of its Mercedes cars in China. It accounts for about 11 per cent of group revenues. For several companies in the Dax 30 index, China represents at least a fifth of sales including BMW, chipmaker Infineon and plastics manufacturer Covestro. Likewise, Volkswagen is estimated to generate a similar proportion of its sales in the country last year, selling nearly 40 per cent of its vehicles there. All of this leaves you vulnerable to the Australian situation: China sends a message with Australian crackdown | Financial TimesThe message is clear. If your media is overly critical, if your think-tanks produce negative reports, if your MPs persist in criticism, if you probe Communist party influence in your community and politics and if you don’t allow Chinese state and private companies into your market, and so on, you will be vulnerable to Beijing’s retribution as well

    Red Convergence | China Media Project – media policy in China – with implications domestically and internationally. It outlines how the Chinese Communist Party intends to leverage transformations in global communication, both at home and abroad (though the latter is more implied), to sustain the regime and increase its influence internationally.

    Lessons from China’s decision to halt Ant Group’s giant IPO | Financial Times – interesting points from WeBank about a sweet spot from Rmb 8,000 – 200,000 were debtors do not have an incentive to run away or speculate. SMEs are focused on having a good credit record

    Q&A: Gareth Richardson – Western Brands No Longer Have an Easy Ride in Asia | Branding in Asia MagazineIn China, there’s no access to Google and Facebook but consumers are immersed in WeChat. This is a playground where western brands have no inherent advantage. In fact, many Chinese consumers don’t know or much care about where the brand originated (save for a few specific categories such as Infant Milk Powder). In western culture individuals are heroes and this is reflected in the approach to brand storytelling. However, in Asia, the culture is more collectivist and storytelling celebrates multiple heroes. Asian brands should celebrate their cultural values. Examples include brands built on traditional values of Asian hospitality, such as Mandarin Oriental. There’s a paradox though. Asian culture is collectivist and yet Asian businesses are very hierarchical. There’s often a significant power gap between the C-suite and the frontline staff. This makes branding more challenging to implement even when its value is properly understood by the leadership – this also happens within agencies. True story: I was asked to go and present to the Chinese subsidiary of a US multinational. The global digital lead had gone in there previously with the global client ambassador and made a mess that couldn’t be cleared up. Firstly, they hadn’t recognised the great firewall. Twitter doesn’t matter in China. Secondly, they thought that democratic political campaigning experience was an example of great marketing. At the time, the person who was the global data lead had also worked on the first Obama presidential campaign. All of them had come from a political background and were clueless about brand marketing. Finally, they’d unintentionally priced a measurement solution ludicrously low. It was a shit show. We had lost the client already, but the client lead had held out hope that hanging on in there churning out a monthly report with no actionable insight would somehow provide a way back in. But at least I got to Guangzhou for the first time.

    Consumer behaviour

    Right-wing populism with Chinese characteristics? Identity, otherness and global imaginaries in debating world politics online – Chenchen Zhang, 2020The past few years have seen an emerging discourse on Chinese social media that combines the claims, vocabulary and style of right-wing populisms in Europe and North America with previous forms of nationalism and racism in Chinese cyberspace. In other words, it provokes a similar hostility towards immigrants, Muslims, feminism, the so-called ‘liberal elites’ and progressive values in general. This article examines how, in debating global political events such as the European refugee crisis and the American presidential election, well-educated and well-informed Chinese Internet users appropriate the rhetoric of ‘Western-style’ right-wing populism to paradoxically criticise Western hegemony and discursively construct China’s ethno-racial and political identities. Through qualitative analysis of 1038 postings retrieved from a popular social media website, this research shows that by criticising Western ‘liberal elites’, the discourse constructs China’s ethno-racial identity against the ‘inferior’ non-Western other, exemplified by non-white immigrants and Muslims, with racial nationalism on the one hand; and formulates China’s political identity against the ‘declining’ Western other with realist authoritarianism on the other. The popular narratives of global order protest against Western hegemony while reinforcing a state-centric and hierarchical imaginary of global racial and civilisational order. We conclude by suggesting that the discourse embodies the logics of anti-Western Eurocentrism and anti-hegemonic hegemonies. – This is interesting especially when the Communist Party of China is adopting a more Han nationalist stance (and in some respects reaching back into historic integration of Mongol and Manchu rulers). Secondly, Communist Party academics and legal academics from Beijing University have been drawing heavily on the work of Carl Schmitt. As have far right organisations and Russian nationalists. Schmitt was Nazi Germany’s leading legal theorist. He was known to be hostile to parliamentary democracy and supported the power of an authoritarian leader to decide the law. Schmitt’s rejection of attempts to take politics out of the operation of the law or economic policy implementation – have appeals to diverse audiences.

    Design

    Top 3 reasons why Nokia N97 failed: The “iPhone killer” that actually killed Nokia – Gizchina.comNokia N97 has a slide-out design with a three-line QWERTY keyboard displayed below the display. That was an advantage at the time, but it was just another manifestation of Nokia’s outdated ideas. With the improvement of input methods, touch screen keyboards have become more accurate and soon eclipsed physical keyboards. – the keyboard was very poor compared to the Nokia E90 Communicator that I used to use. I also remember that the address book feature used to crash the phone if you loaded more than 999 contacts into it. Even their ‘E’ series business handsets like my E90 Communicator and the later E71 devices. I moved to the iPhone because I wanted an address book that worked. If the iPhone ever came in a Nokia Communicator type format, I would be ecstatic. More gadget related content here.

    Ideas

    I have been watching more David Hoffman films recently, looking back to the past to try and understand the present. What becomes apparent was that there was a schism of values in the late 1960s America. What’s less apparent was how, or even if; that schism was eventually healed.

    Online

    China tightens grip on booming livestreaming sector | Financial Times – this needs to be viewed in the wider aspect of reining in internet companies

    Style

    Good Collaborations Are Art, Great Ones Are Kitsch | Highsnobiety“You know it’s art when the check clears,” said Andy Warhol. With Roy Lichtenstein and Robert Indiana, Warhol made his way into museums by turning the mundane world into works of art by enriching it with pop references, connotations and associations. Warhol’s art is commercial and his commercials are art (a Warhol ad launched Absolut vodka in 1986)

    Technology

    A little automation goes a long way in distracting drivers | INPUT – technology creating more problems than it solves in the car driving experience.

  • 5G tipping point + more things

    Telecoms industry looks to Apple for 5G ‘tipping point’ | Financial Timeseven with the launch of Apple’s 5G-enabled iPhone — there is as yet no “killer app” that will immediately transform the way consumers use their smartphones; creating a 5G tipping point. – I don’t think its about consumers, I think it makes sense in the enterprise. The lack of killer applications in the consumer space reminds me a lot of 3G. And I don’t believe that Apple is the harbinger of a 5G tipping point

    Why a new generation of challenger brands need to rethink how to challenge | A Little West of CentreBlands. That’s what Ben Schott, writing for Bloomberg, coined them. And what a coining it is. The new generation of humble, conscious, in-it-to-sell, underdog companies, sporting D2C models, consumer champion narratives, minimalist aesthetics, affordable luxury positionings and post-choice selling techniques (this is THE mattress, that is THE toothbrush).

    Indonesia’s central bank hints burglary in e-wallet playerconsumers should look at the track record of providers before using them to save large amounts of money. Indonesia’s total e-wallet transaction value size is expected to reach US$15 billion by 2020, according to a recent report by The Asian Banker

    Problem Solved #13: A lesson in tackling bloody taboos from Bodyform | The Drumthe result was to present the viewer with flame-engulfed apartment of a perimenopausal women; a monster ripping at an endometriosis sufferer’s uterus; a ‘flood gate’ moment following an unexpected sneeze; a woman who has chosen not to have children; and the often-turbulent journey of trying to conceive

    Diane von Furstenberg: Interview | Vanity FairThe iconic wrap dress, designed in 1974 and sold more than 15 million times since, made von Furstenberg an overnight sensation and began a dialogue with women that she has maintained ever since, in a large part through admirable philanthropic efforts, including the annual DVF awards. Now she’s taking that dialogue to the podcast, a medium she champions for its value in shifting the focus away from appearance.

    Shenzhen — Justin McGuirk – pretty much nails how I found Shenzhen over the decade that I visited regularly. More on Shenzhen here.

    Anonymous site ramps up ‘doxxing’ campaign against Hong Kong activists | Hong Kong Free Press HKFP – guessing this is another reason why China and Russia have cooperated on cyberwarfare

    Japan’s Sekisui struck by espionage using social media – Nikkei Asia – LinkedIn implicated yet again

    iPhone 12 launching without earbuds or wall chargers is compared to eating without chopsticks in China | South China Morning Post – I was expecting this reaction as Chinese consumers are value orientated so the green explanation won’t wash

    Shenzhen/Huawei: the other Bay Area | Financial TimesThe impression of military manoeuvres by alternative means was reinforced by Tencent, another Shenzhen resident. It was among big Chinese social and video platforms including iQiyi and Weibo, that simultaneously cancelled the livecast of Apple’s iPhone 12 launch

  • Weight lightening + more things

    Midgards Messer Shop – interesting weight lightening techniques in their product designs. It reminds me of the weight lightening techniques racing cars used to use. Drilling out metal on parts like bonnet hinges to retain strength but not the weight. More design related content here.

    In U.S. and UK, Globalization Leaves Some Feeling ‘Left Behind’ or ‘Swept Up’ | Pew Research Center – which gives a good idea of where populism came from

    Rolex Panerai 3646 Service Invoice from 1955 – Vintage Panerai and other iconic timepieces under the loupe at Perezcope – interesting implications on brand provenance and heritage

    Mulberry warns on sales after falling to £14m loss | FT – the comments on online shopping by the CEO in my opinion don’t ring true.

    Facebook to defy new Turkish social media law | Financial Times – Facebook must feel that the Turkish market isn’t worth taking negative PR in the US and EU. It must have relatively meagre advertising revenues for them to make this decision. Why put their foot down in Turkey and not in other markets like Hong Kong or Russia?

    People love products with rituals – Ariyh – the role of rituals in product consumption can drive sales, interesting research. Examples would be:

    • The different ways one would eat a Cadbury’s Creme Egg
    • Twisting to separate the biscuit from the filling on an Oreo
    • Waiting for the head to settle on a pint of Guinness
    • Cadbury’s Flake bath adverts the emphasised enjoying the bar in private ‘me time’ moment

    Facebook Says Government Breakup of Instagram, WhatsApp Would Be ‘Complete Nonstarter’ – WSJ – interesting that the 14-page briefing document was leaked to the Wall Street Journal. Tim Wu’s takes on the claim are interesting ‘A government antitrust case against the company would likely rely on the argument that Facebook made serial acquisitions to reduce competition, a question that wasn’t considered when the Federal Trade Commission originally chose not to oppose the Instagram and WhatsApp deals

    Reebok teams up with fashion brand Yoshiokubo for traditional-culture-inspired sneakers | SoraNews24 -Japan News – interesting how they’re incorporating Japanese culture motifs

    Winston Privacy – ad blocker as hardware appliance

  • Tech cold war + more things

    The US-China tech cold war has turned hot – but would a Biden presidency change things for Huawei and others? | South China Morning Post“No president will want to be accused of being soft on China,” said James Andrew Lewis, senior vice-president and director of the technology policy programme at the Washington-based Centre for Strategic and International Studies (CSIS). “Trump’s policies are disorganised, but consistently move to cut economic ties with China. Biden’s policies will be better coordinated, less abrupt, but move in the same direction.” – the tech cold war isn’t new. You could trace it back to the beginning with coercive IP transfer and massive industrial espionage. It kicked off in earnest with the Golden Shield Project 金盾 工程 censorship system. Where we are now was not a case of if, but when

    TikTok becomes a case study for Chinese companies planning global expansion | South China Morning PostZhang’s relationship with the ruling Communist Party is complicated. He must walk a fine line between keeping Beijing happy but not be seen as too close to raise concerns outside China. Zhang, who told Atlantic magazine in July that he was not a party member, was approached by Beijing a year ago with an offer to help when TikTok faced political troubles in India. However, Zhang sent mid-level staff to meet government officials, signalling he did not want Beijing to get involved – whether entrepreneurs like it or not, they’re likely to find the government inserted into the business like a helicopter parent. You’re likely to see coercive business development as part of Chinese diplomats wolf warrior patter; a la Huawei 5G network equipment and the Faroe Islands

    Allegations of deception dog Nikola’s lofty aims | Financial Times – my worst fear is that this will tarnish hydrogen fuel cells in the market. Hyundai are already doing interesting things with hydrogen fuel cell wagons

    Interesting report from Watches & Wonders (aka SIHH), Shanghai – Watches & Wonders Shanghai: The Future of Fine Watchmaking? | Luxury Society – more luxury related posts here.

    BJ Fogg on this old but good video explaining persuasion through technology in very simple terms

    FAA, Boeing Blasted Over 737 MAX Failures in Democratic Report – WSJ – really nice oral history of the Boeing 737 Max scandal

    Money-launderers use Chinese online shopping sites to funnel cash offshore | Financial TimesMoney launderers have used some of China’s leading online shopping sites to transfer billions of dollars to offshore gambling sites, police raids have revealed. People wishing to evade China’s strict capital controls, for example to gamble on offshore websites, have been placing fake orders on the shopping sites, including on Pinduoduo, China’s second-largest platform by users. A corresponding sum is then credited to their gaming account.

    Kraft Heinz sells parts of cheese business for $3.2bn | Financial Times – surprised if more assets aren’t sold as the 3G Capital model isn’t working

    EU tests platform to link up coronavirus tracing apps | Reuters – really interesting development in interoperability

  • Dark stores and coercive diplomacy

    I came across a couple of interesting terms recently: dark stores and coercive diplomacy.

    Dark stores

    Gartner for Marketing (formerly L2 Inc.) were talking about a new development at Amazon’s Whole Foods subsidiary. It was what Gartner called digital dark stores. The first one has been established in Industry City to serve much of Brooklyn, New York.

    Amazon themselves called it a ‘permanent online-only store‘ on their blog.

    So whats the difference between dark stores and the ‘last mile’ warehouses that Amazon uses for fulfilment in places like London?

    • Looking at the limited amount of photos available, this doesn’t feel warehouse-like. There wasn’t obvious automation in the pictures. Instead it feels like a supermarket that’s well stocked, but lacking price tags and shopper marketing accoutrements. Gartner describe it as ‘technically a grocery store’, which implies that there might be zoning or planning regulations that they might be working around
    • It is only for the Whole Foods brand; rather than fulfilling Amazon Fresh and Amazon Prime Now items

    This isn’t just an Amazon thing. Gartner points out that American supermarket brands Kroger and Giant Eagle have also embraced the order-only store model. More at Gartner for Marketing here.

    Coercive diplomacy

    The Australian Strategic Policy Institute published a report on September 1, 2020 called The Chinese Communist Party’s coercive diplomacy. It was written by Fergus Hanson, Emilia Currey and Tracy Beattie. Hanson, Currey and Beattie analysed ten years of Chinese government diplomacy. In there words:

    The Chinese Communist Party (CCP) is increasingly deploying coercive diplomacy against foreign governments and companies. Coercive diplomacy isn’t well understood, and countries and companies have struggled to develop an effective toolkit to push back against and resist it.

    The Chinese Communist Party (CCP) is increasingly deploying coercive diplomacy against foreign governments and companies. Coercive diplomacy isn’t well understood, and countries and companies have struggled to develop an effective toolkit to push back against and resist it.

    This report tracks the CCP’s use of coercive diplomacy over the past 10 years, recording 152 cases of coercive diplomacy affecting 27 countries as well as the European Union. The data shows that there’s been a sharp escalation in these tactics since 2018. The regions and countries that recorded the most instances of coercive diplomacy over the last decade include Europe, North America, Australia, New Zealand and East Asia.

    There seems to be an escalation of economic and non-economic measures deployed. Economic measures would include:

    • Trade sanctions – such as the recent ban on German pork products. This was rolled out just a few days in advance of a trade negotiation meeting between China and the European Union
    • Investment restrictions in strategic industries such as the ‘agreement‘ that Yahoo!, Softbank and Alibaba had over Alipay (which included what would now be Ant Group). Strategic industries like state security is notoriously (and deliberately) ill-defined in China
    • Tourism bans
    • Popular boycotts such as Korean corporate Lotte being driven out of China and the 2012 anti-Japan protests where the public smashed Japanese stores, attacked factories and burned Japanese cars

    Coercive pressure is also applied at below state level on businesses. It may also be applied on individuals, based on the data leak provided from Zhenhua Data seems to imply.

    Non economic measures include:

    • Arbitrary detention. The best example of this would be Michael Kovrig and Michael Spavor detained as part of China’s dispute with Canada. Another example might be Australian citizen Karm Gilespie. China didn’t admit it had detained him for over six years, until they announced his death sentence in the summer
    • Restrictions on official travel
    • State-issued threats which are usually issued on a regular basis as part of wolf warrior diplomacy. (Wolf Warrior is a set of two films with a Chinese action hero, a la Rambo – but with less humour).

    Some of the imputus for coercive diplomacy might come from the Chinese Communist Party’s continued rancour over Qing dynasty-era unequal treaties. More China related content here and more on retailing here.