Ged Carroll

Search results for: “forrester”

  • Omakase and luxury futures

    Omakase and luxury seem made for each other. Think about the core elements of omakase:

    • An expert provides a personalised experience that is about quality, ceremony and theatre.
    • The expert decides what you will have and prepares it for you. You are there from selection to the provision of the item.
    • The ingredients are of fine quality (and often locally sourced).
    Tokyo
    Marc Veraart

    As a trend omakase has expanded geographically with Japanese cuisine. But it has also expanded in terms of categories covered.

    Koreans have taken omakase and pushed it into other areas:

    • Coffee
    • Dessert tasting
    • Barbecue restaurants which are normally a local neighbourhood staple
    • Wine and champagne-tasting

    So how can omakase and luxury come together in the future?

    In order to understand how omakase and luxury in the future it is worthwhile paying a good deal of attention to the pressures that the luxury industry is currently under.

    Luxury is under pressure

    Undoing the mistakes of the past

    Luxury has expanded to be the size of industry it currently is due to ‘massification’ by most of the maisons. The exceptions to this would be the likes of Hermés.

    Massification

    Massification means lowering quality, using globalisation in the supply chain as well as the retail network to manufacture products cheaper. Massification occurred over a three decade period and was covered extensively by former fashion editor Dana Thomas in her book Deluxe.

    Around about 2014, Gucci led the way for luxury brands to do streetwear, leading to a more accessible luxury product. Louis Vuitton did the archetypical collection with its 2017 Supreme collaboration.

    Contrary to what most people believe luxury is aimed at the middle classes rather than the wealthy. But targeting middle class customers rather than the wealthy poses a number of problems:

    • Increased capital outlay due to the scale required.
    • Scale brings challenges in terms of supply chain management and consistency of customer experience. Greater control can be obtained by vertical integration within the supply chain and owning the retail channels. But all of this requires greater expertise and management oversight.
    • Increased economic sensitivity to shocks such as interest rate and cost of living rises.
    • Increased risk of devalued stock during an economic downturn. Gucci earnings were down 20 percent alone in Q1, 2024.

    Bigger might not always be better over a longer view.

    Secondary markets

    Secondary markets have been both a boon and a bane for the luxury sector. At one time pre-owned was seen as an ‘entry-level’ product. I bought my first nice watch secondhand once it had depreciated. It was often said that the best entry-level Porsche was a secondhand one.

    But gone are the days when you may buy a pre-owned Louis Vuitton purse on a second hand market stall in Paris. Now that will be on Vinted, Vestaire or some other platform.

    Secondary market inflated pricing affected luxury businesses in a number of ways

    • You would be interviewed to go on the waiting list for a Porsche or a Rolex.
    • Authorised dealers became order takers and dealer customer service slipped.
    • Your purchasing history would acquire you the rights to buy a Hermés bag over time.

    Luxury groups extended their businesses into the pre-owned market. LVMH owned part of secondhand watch retailer Hodinkee. Richemont owned Watchfinder and Yoox-Net-a-Porter who sold a mix of new lines and vintage preowned items. Rolex rolled out its ‘CPO’ programme selling inspected pre-owned Rolex watches through its authorised dealer network.

    Things looked really good for the luxury industry, they managed to managed to scale, to a point that LVMH is one of the largest companies in the world:

    • Massification through global manufacturing supply chains.
    • Keeping margins high, while letting quality go low.
    • Address a rising middle class in China, Korea, Japan, the Gulf countries and Russia to counteract the hollowing out of the middle class in the US and western Europe.
    • Maximising margins through controlling costs via vertical integration up and down the supply chain, from raw materials to retail.

    Market change

    A few things underpinned the craziness of COVID:

    • Money was put in consumer pockets, for which they had few outlets.
    • Supply chains were disrupted as factories closed down or pivoted to manufacturing essential products. For instances Perfums Christian Dior made hand sanitiser for hospitals for free.

    A Forrester effect (also known as a bull whip effect) resulted, driving inflation that the world’s economies are coming to terms with now. Secondary effects of this event were the increased interest rates used to reduce demand driven inflation.

    Other secondary effects include increased crime levels. London has gone from a luxury shoppers paradise, to having a global reputation amongst elites of being plagued by violent watch and bag robberies. COVID-19 isn’t the only driver of this crime wave, but is a contributing factor.

    It has also had a catalysing effect on reducing globalisation to increase national resilience.

    Consumers know that a good deal of luxury goods don’t match up with the European artisan heritage story that brands try to sell them. Experts like William Lasry has made public which brands make what kind of products where. Luxury brands often make in places like China due to capability and scale – similar reasons to why Apple products are designed in California and assembled in China. (Seriously, check out William Lasry’s channels, I love some of his visits to high-end Japanese manufacturers).

    China

    China has been a key focus for luxury brand, but it has changed in a number of different ways:

    • Chinese consumers have changed in their confidence of native brands and have a lower opinion of many foreign brands. This is partly down to a change in attitudes called guo chao. Guo chao can be traced back to the increased confidence in the run up to the 2008 olympics in Beijing. This was partly fuelled by a series of essays published in 1996 by the likes of academic Wang Xiaodong called China Can Say Now which advocated a modern robust form of Chinese nationalism, which was in stark contrast to the Deng-era vision of globalisation and biding one’s time. In the April before the olympics Chinese consumers boycotted French supermarket brand Carrefour. Over time the negativity of these boycotts have become more-and-more performative and extra-territorial in nature. The current Xi administration has seen fit to weaponise this nationalist sentiment by directing (wrangling is a more accurate term, like cowboys with a cattle train in the Old West) public opinion to further its own ends. A more positive aspect of it has been a more open market for domestic ateliers and brands than had been seen previously. Since before 2019, there have been Chinese efforts to build a rival luxury groups to LVMH and Kering and this fits in with Xi’s distaste for irrational worship of the west.
    • Xi-era growth. China under Xi Jinping faces multiple challenges around growth. The population is aging and in decline which has implications for declining consumption. Secondly economic growth has slowed compared to the double digit annual economic growth of the Deng, Jiang and Hu administrations. Foreign direct investment in China has declined for a mix of reasons including unattractive Chinese government policies, decline in China’s country brand and long term economic growth forecasts.

    Regulatory change

    I know what you’re thinking ok, this is very well Ged, but what does it have to do with omakase and luxury futures? Give me a little bit more time and all will be revealed.

    While China is an economic superpower with a desire to export its world view and the United States is a hard and soft power super power; the European Union’s super power is legislative in nature.

    European regulation drove the globalisation of the GSM mobile telephony standards during the 1990s and 2000s. They have also driven increasing internet privacy standards on web services, much to the chagrin of Alphabet, Meta and Twitter.

    Now they are driving environmental standards across a range of areas including:

    • A carbon tax to take into account the use of fossil fuels in extraction of raw materials, transportation, energy as an input to manufacturing and processing materials.
    • Product passports from raw materials to product end-of-life encouraging a circular economy and sustainable manufacturing.

    This means that the luxury sector has new restrictions on how it operates in the future.

    In summary:

    • We’ve likely reached peak massification due to economic and trade changes.
    • Market share in China looks uncertain due to changes in consumer sentiment and tastes, meaning, a more local approach might be required or a strategic withdrawal.
    • Secondary markets show that consumers are open to ownership beyond pristine new products.
    • Product passports and European legislation means re-examining the whole supply chain and the data to better control it through an entire product life.

    Finally, omakase and luxury futures!

    Omakase and luxury look like a happy meeting in the future. Think about the tenets of omakase.

    • An expert provides a personalised experience that is about quality, ceremony and theatre.
    • The expert decides what you will have and prepares it for you. You are there from selection to the provision of the item.
    • The ingredients are of fine quality (and often locally sourced).

    Going back to go forward.

    The future of luxury is about looking back. Tailors who suited generations of families and made alterations to Grandfather’s suit that the son is now wearing. The shirt maker replacing the collars and cuffs. The shoe-maker who refurbishes your shoes and has a set of lasts with your name on, for when he has to make a new set. Getting measured, having your foot cast for a last or getting your watch could be memorable events once again. So there this a precedence for expertise and service levels. But it implies a retail experience that will change dramatically.

    New techniques and questions.

    Previously with the exception of measuring sessions, these processes were largely concealed from the consumer and were difficult to scale. So it’s worthwhile thinking about how luxury’s omakase future could be extended with modern technology? We have some experiments that might give us some ideas. First up, L’Oreal has showcased bespoke make-up manufacture for a while.

    How could high-end perfume makers adapt for products beyond make-up? Improved analysis equipment from the likes of Oxford Nanopore could facilitate individually formulated fragrance products based on skin chemistry.

    Adidas experimented with its Speedfactory concept that blended the retail and shoe assembly together.

    Technologically there is a lot of promising ideas. Adidas have worked with up-cycled plastics retrieved from the debris brought together by an ocean gyre made into 3d printed soles and fibres. (Look for the Parley label, who Adidas partnered with on this.)

    How can additive or automated manufacturing and other processes feel luxe? In what way could they add to the theatre?

    This hybridisation of retail and manufacturing changes the nature of both offline and online retail completely. Would even the largest concession in Selfridges or a shopping mall be big enough, or would fashion houses need a single purpose brand experience?

    Given that there is likely to be a bit more time between manufacture and presentation of the product than there would be in a sashimi restaurant, what else would go into the maison experience? LVMH is already investing in hotels and resorts like Cheval Blanc which gives it a better understanding of more areas in luxury experience and service.

    Localisation would likely to be needed to handle omakase and luxury due to culture and the need for local materials. This might include new materials, such as fungus-derived leather. Of course, this might have negative implications for luxury house supply chains, whether it’s Louis Vuitton’s iconic plastic coated leather, or the Hermés crocodile farm.

    Which means that product line-ups could no longer be global in nature. So luxury companies may revisit that the creative process looks like. Should there be a single global vision anymore? Luxury maisons instincts would be to say yes, but could this be an opportunity to own local ateliers in markets like China or the US?

    • Will there be more local brands instead?
    • What will a maison’s heritage mean in the future? A luxury maison is about what remains the same as much as what changes. What will happen to long-standing motifs?
    • Will there be a greater opportunity for more auteurs who are closer to the customers?
    • How to bridge the tension in terms of choosing for the customer and creativity as well as quality?

    We’re talking a very different profile of creative in terms of thinking, attitudes and skills compared to the present.

    Service, repair and reuse could learn a lot lessons from traditional tailors and the service networks of watchmakers like Rolex or luggage maker Rimowa.

    I could not think of a more exciting or scary time to be setting the brand direction for a luxury maison, let alone the overall direction or the likes of LVMH. But by wrapping local materials, expertise, ritual and a bit of theatre the future could look like a fusion of omakase and luxury.

    More information

  • Boutique e-tailers

    The luxury sector is undergoing a transformation, and nowhere is that more apparent than in the world of boutique e-tailers. I am of a generation that grew up with boutiques, carefully curated fashion looks from multiple brands.

    Farfetch_8
    TAKA@P.P.R.S

    Exclusive

    As a child, my Mam would get me jumpers as I grew up from different small stores like this. To this day, the ultimate compliment she would give any item of clothing was that it was ‘exclusive’.

    As I started buying my own clothes I pivoted between sports shops for my footwear, Ellis Brigham for layers, Caran D’Ache – a menswear boutique in Birkenhead at the time for jeans and ‘going out’ clothing. (Having known the owner/manager quite well, I suspect that the store was named after the Swiss writing instrument company, rather than the pseudonym of French satirist Emmanuel Poiré). This was where I got my first down jacket (by Naf Naf), Oshkosh B’gosh dungarees and Champion sweatshirts. At the time Ellis Brigham was a sea of Polartec and Gore-tex with no down jackets in sight.

    I started venturing further afield and went to Quiggins in Liverpool, Affleck’s Palace in Manchester and what’s now the Victoria Quarter in Leeds. I’d also started coming down to London with friends to find brands I couldn’t get at home.

    Famous high-end boutiques like Browns built a reputation for championing up and coming womenswear designers like Hussein Chalayan and Alexander McQueen. They also helped the likes of Ralph Lauren, Jil Sander and Calvin Klein start seeing in London. At their best boutiques moved culture as curators and taste makers. I got my love of American workwear from Caran D’Ache and Japanese streetwear from the late lamented Hideout which was just off Golden Square.

    Department stores were the first aggregators of boutiques with a mix of single brand and multi-brand concessions under one roof. Brands like Selfridges, Harvey Nichols, Isetan, Lane Crawford, Mitsukoshi, Neiman Marcus, Saks Fifth Avenue, SEIBU and Shinsegae.

    These established businesses have their place, indeed LVMH owns a number of selective retail businesses like DFS (often known as T Galleria), Le Bonne Marché and Starboard Cruises. So multi-brand distribution has a place in the luxury retail mix. Over time the premium department store brands and LVMH’s select retail brand would both have boutique e-tailers within their brands providing an omni-channel experience.

    In the run up to COVID, multi-brand retail counted for 57 percent of luxury sales, management consultancy Bain expect this to decline to 36 percent of luxury sales by 2030.

    Online

    Online continues to disrupt retailing over a quarter century after it landed. The first casualties were book stores and music stores. Twenty years ago, one of the most enjoyable activities that I did in my spare time was rifling through record store shelves, digging for surprising or elusive vinyl records, CDs and DVDs.

    Some of the places were I did this are long gone, like Tower Records in Piccadilly Circus. On the flipside, new businesses sprang up to be online first, or online only. Amazon started as a book store and eventually became the modern-day equivalent of the Sears Roebuck catalogue.

    Luxury was no exception and a variety of dedicated boutique e-tailers sprang up:

    • Matches
    • MyTheresa
    • Net-a-Porter
    • YOOX
    • Farfetch

    In the same way that mobile operators were the key determinators of whether mobile phone shops were successful, luxury brands had the whip hand over multi-brand boutiques. Phones4U died when its relationships with EE and Vodafone came to an end. The FT article The implosion in luxury ecommerce implied a similar pivotal moment between Farfetch and Kering, but with Farfetch managing to sell itself to Korean e-tailing business Coupang instead of going into administration.

    One brand / one store

    Luxury brands have looked to gain more control over their customer experience and get closer to the customer overall. This has seen many brands open single brand stores. Up until the 1980s, Louis Vuitton sold mostly through department stores, now it’s mostly through its own brand channels. Some brands like Audemars Piaget, now only sell through their own single brand showrooms.

    The big name department stores continued to hold a position in the marketplace due to their own brand power, even while smaller mid-market stores in provincial cities folded.

    Over time, brands extended their shop front into the online sphere. This was done once two things were able to happen:

    • An all-up online and offline view of a given customer and CRM systems allowed this to happen. This wasn’t for efficiency reasons to go online only, but to provide an omnichannel service to match customer’s omni-channel lifestyles.
    • Getting this all-up view will also help with future EU legislation moving towards a circular economy.
    • The ability to provide a high level delivery experience for online purchases. This mattered less with fragrances than it did with watches and handbags. High security logistics providers like Ferrari were able to provide this to the main luxury brands.

    One small chink of hope for multi-brand stores is that single brand stores may be forced to either change business practices, or insulate themselves from legal action via authorised dealerships. A court case brought by two women against Hermés in the US claims that having to buy other products to get a crack at purchasing a Birkin bag is a violation of antitrust laws.

    The obligation to buy other products first, is what the women claim is an ‘illegal tying arrangement’ which is why Hermés might be in violation of antitrust laws. Other brand who have authorised dealers rather than their own showrooms are less likely to be at risk.

    Compressed middle-class

    One of the first things that I learned when doing LVMH’s INSIDE LVMH certificate was that the bulk of luxury purchases are made by the middle classes.

    Robert Gordon’s Rise and Decline of American Growth outlined how the middle classes in America (but also many other western countries). Income inequality, automation and globalisation drove a stagnation and decline in middle class numbers, even as the number wealthy increased.

    Globalisation elevated a new middle class in Asian countries like Japan, Korea, Hong Kong, Taiwan and Thailand. Energy drove middle class growth in the countries surrounding the Persian gulf and Nigeria. Louis Vuitton opened their first show rooms in the US in 1914, in Japan in 1978 (though department stores had been selling their products for years). The first Korean shop opened in 1984 and China eight years later.

    Over the past few decades this was compensated by new middle classes growing. They don’t necessarily have the earning power of a middle class westerner, but the purchasing power level may vary considerably. So a middle class consumer in a country like Thailand, Malaysia or Singapore might have more disposable income than someone in the UK.

    Japan’s middle class quickly reached stagnation due to the lost decades of economic growth after their 1989 asset bubble. Korea has gone through a similar challenge, it has seen raised consumption, but recently this is driven by household debt rather than prosperity.

    China

    Quantity is a quality of its own, which is a reason why Chinese consumers have been so important to luxury brands since the early 2000s when China joined the WTO and its economy took off. Once there was even a small growth in middle class numbers that represented a big increase in global luxury sector sales. The decline in economic growth due to the property sector bubble has dampened luxury sales to China. It is not only about the decline in ability to purchase, but also the decline in being seen to purchase western luxury goods.

    This less conscious consumption started early on during the Xi administration’s desire to combat corruption and aspire to a more equal society. Gifting declined. Economic decline accelerated this Chinese macro-trend.

    COVID and after

    COVID changed consumption. Money that would have previously been spent on experiences such as restaurant meals or travel transferred into things. Both single brands and boutique e-tailers got a lift in this environment. But a wider economic effect is still working its way through the economy. This effect is known as the bullwhip or Forrester Effect.

    This resulted in a number of economic distortions:

    1. Partial shutdown – Consumers no longer went to work or high traffic retail hotspots. Non-essential workers didn’t go to work. Logistics systems buckled under the weight of packages and luxury businesses diverted production to support medical needs such as LVMH’s perfumes businesses making hand sanitiser.
    2. Unusual increase in demand – Home working drove an increase in demand from media consumption and home improvement to buying more stuff from all that money they saved from not going out.
    3. Supply chain disruption – Air cargo prioritised medical supplies while existing stock sat in empty shops.

    All of this disruption which drove inflation, this reduced demand as consumers had less to spend.

    Above inflation price bumps for luxury goods

    Luxury brands focused on their inflation proof ultra-high net worth customer base and raised prices to compensate for the reduction in sales volume. The fight for that reduced volume pitched multi-brand boutique e-tailers against their suppliers and the results weren’t pretty.

    Boutique e-tailers are going to the wall, or consolidating to weather the fiscal storm until such time as middle class consumers can start spending aspirationally again.

    Some of these businesses can’t be saved. Matchesfashion, which was bought out by Frasers Group didn’t have much chance.

    Financial decline of Matchesfashion

    You can find similar posts here.

    More information

    The implosion in luxury ecommerce | FT

    Case Study | Selling Luxury to the 1% | BoF

    Matchesfashion axes half its staff after going into administration | FT

    Harvey Nichols staff face redundancies as it eyes return to profitability – Retail Gazette

    LVMH-Backed Luxury Watch Site Hodinkee Cuts a Fifth of Jobs – Bloomberg

    Who Gets to Buy a Birkin Bag? | BoF

    The Rise and Fall of American Growth: The U.S. Standard of Living Since the Civil War (The Princeton Economic History of the Western World) by Robert J. Gordon

    Canada Goose is cutting 17% of its corporate staff | Quartz

    What’s up with 10-year-old kids in Sephora? Why the question itself is driving controversy | CBC News

    US Luxury Purchases Fell 15 Percent in February, According to Citi Credit Card Data | BoF

    Why Frasers Group Shuttered Matchesfashion | BoF

  • Enquire Within + more things

    Enquire Within Upon Everything

    Enquire Within tends to appear in book collections for people of a certain age, or, where the book collector has inherited part of their collection. Spending time on the family farm in Ireland during my childhood, I used to see a copy of an early 20th century vintage sit next to a dog-eared copy of Old Moore’s Almanac (not to be mistaken for a separate UK publication: Old Moore’s Almanack), Old Moore’s was used for deciding what to plant in the garden besides potatoes.

    During the bank holiday weekend, staying with my parents, emergency works on a water main managed to take out the broadband and electricity along their road. I went back though my Dad’s boxes of books and leafed through my parents copy of Enquire Within. My Dad thinks he had received the copy as a gift from a the owner of a second hand book store in Birkenhead market right after he had moved into the first house that my parents had bought. But he can’t be certain. Given that the outer gloss paper wrap around the hardback inner cover uses a font that looks similar to Eurostile and the price is in decimal – I guess it’s from the early to mid-1970s.

    Enquire Within could be thought of as a primer for everyday life. Topics included how to play a variety of card games, basic first aid, the basics on taxation and education with the addresses of the UK government departments responsible. There was a travel section with a few paragraphs on every western European country, which had been written by the Financial Times travel correspondent. The gardening section went into much more depth explaining what a hardy annual and hardy perennial were, alongside the correct way to build a compost heap, how to dig drills and prune roses.

    At the back there is an exhaustive list of children’s names together with their meanings.

    Enquire within

    Enquire Within and the origins of the web

    What I didn’t find out until later on was that Tim Berners-Lee was partly inspired to create a predecessor to what would become the world wide web by a Victorian vintage copy of Enquire Within that was in his parents house when he was growing up. The system was called ENQUIRE and seemed to be similar conceptually to HyperCard or a Wiki. The World Wide Web came out of Berners-Lee’s efforts to integrate disparate systems including ENQUIRE together to facilitate better collaboration between CERN research projects.

    Beauty

    Digital culture is changing our face: How South Korea is inspiring new cosmetic trends | Culture | EL PAÍS English 

    Economics

    MIT Economist Daron Acemoglu Takes on Big Tech: “Our Future Will Be Very Dystopian” – DER SPIEGEL – The rich and powerful have hijacked progress throughout history, says Daron Acemoglu. They did so back in the Middle Ages and also now in the age of artificial intelligence.

    Decoupling isn’t phoney – by Noah Smith – Noahpinion

    Energy

    The Japanese Companies Pursuing a Hydrogen Economy – The Diplomat 

    Bosch starts production of 800V EV technology | EE News Europe 

    Finance

    This video on money laundering is as much of interest for the phenomenon of quality documentaries on YouTube as it is for recycling known truths about HSBC.

    Gadgets

    Global Smartphone Shipments Will Hit Lowest Point in a Decade, IDC Says – CNET – likely to be a mix of market maturity and indicative of inelastic pricing in the premium sector

    Hong Kong

    Language Log » Language and politics in Hong Kong: National Security and the promotion of topolect and Hong Kong national security police target Cantonese language | Quartz 

    Bigger, better, smoother? Hong Kong, Shenzhen border zone blueprint hopes to offer best of both worlds, as Beijing ‘exerts pressure’ to spur cooperation | South China Morning Post – Leonard Chan Tik-yuen, chairman of the Hong Kong Innovative Technology Development Association, said the blueprint amounted to directives from Beijing that told both cities to become more integrated.

    Innovation

    Startup uses MEMS ultrasound to improve audio speaker | EE News Europe 

    Japan

    The Japanese student dorm that governs itself – The Face 

    Marketing

    First-Party Data Is Retail’s Next Growth Engine | BCG and CPGs may have embraced data collaboration, but they need to take it further | LiveRamp | Open Mic | The Drum. Yet more from The Media Leader: Retail media: were we right to get so excited? – The Media Leader  

    Media

    Podcast: Why OOH audiences have not hit a ‘new normal’ yet – with Route’s Denise Turner – The Media Leader

    Changes in the nature of the music industry

    Goldman Sachs Exchange

    Online

    Yahoo, taken private by Apollo Global, finds a new renaissance 

    Retailing

    The Forrester Wave™: Commerce Search And Product Discovery, Q3 2023, Surfaces The Challenges Of AI Unchecked – Don’t let buzzwords distract you from what your customers — and your business — need. Vendors often use their own terminology, especially in a market that hasn’t had a Forrester Wave evaluation in place already. One will talk about how extremely relevant their results are, while another will scoff at “relevancy” as outdated methodology. You’ll hear semantic, vector, hybrid, ML, AI, and all sorts of branded names for products and functions

    Security

    The Cheap Radio Hack That Disrupted Poland’s Railway System | WIRED – the ability to send the command has been described in Polish radio and train forums and on YouTube for years. “Everybody could do this. Even teenagers trolling. The frequencies are known. The tones are known. The equipment is cheap. – This reminds me of the blue boxes used for phone phreaking decades ago.

    I Tracked an NYC Subway Rider’s Movements with an MTA ‘Feature’

    Software

    Adobe’s AI diversity auditor | Patent Drop – is seeking to patent a system for “diversity auditing” using computer vision. Essentially, this system uses facial detection and image classification to break down photos of employees and slot them into categories based on certain physical traits and characteristics. Adobe’s system looks through several images and detects faces in each one, then classifies each face based on a predicted “sensitive attribute” relating to “protected classes of individuals,” such as race, age or gender. For example, Adobe noted, this system may classify images from a company’s website, then compare its predictions to a “comparison population.”

    Technology

    Mexico’s Microchip Advantage | Foreign Affairs – there are significant hurdles to making Mexico a bigger player in supply chains for chips and advanced technologies. The country lacks its Asian rivals’ existing networks of high-technology firms. Until now, investments in the sphere have been sparse. To change this situation, Mexican political and business leaders need a clearer strategy for attracting semiconductor investment. The dividends, both for Mexican industry and for U.S. supply chain security, could be significant. Today’s large-scale shift away from China-focused assembly operations offers a once-in-a-generation opportunity to create a more fully integrated North American semiconductor and electronics supply chain. Despite the United States’ major involvement in many segments of the chip industry, there is at present hardly any semiconductor packaging or assembly in the country and very little anywhere else in the Western Hemisphere. The United States maintains a leading role in R&D-intensive segments of the semiconductor industry, including chip design and manufacturing equipment. The CHIPS Act is intended to increase the amount of chip fabrication in the United States. Yet neither the United States nor any country in the Western Hemisphere plays a major role in the final stages of the chip manufacturing process—assembly, testing, and packaging (ATP)—in which semiconductors are tested and assembled into sophisticated packages. The Western Hemisphere also does relatively little assembly of advanced electronic systems that require a lot of chips, such as consumer electronics.

    Web of no web

    Surfings equivalent of a dive computer: Search GPS Test User Signup

  • Mispress + more things

    Taylor Swift Happy Land mispress

    I was taken back to to memories of Skeleton Records in Birkenhead during the early 1990s due to a Taylor Swift album mispress. As a young record buyer I used frequent secondhand record shops to pick up promo copies of records. A rock orientated shop would often not realise what they had, this was before widespread internet access.

    The gaunt middle-aged shop assistant was sat behind the counter looking at a picture disc of Fish – State of Mind on picture disc. Fish had recently left then popular rock band Marillion and State of Mind was a single from his first solo album Vigil in a Wilderness of Mirrors.

    Apparently one of his customers worked as an assistant shop manager, realised what they had and ‘lost’ the record before the distributor came to collect all the copies of the mispress. The reason why the distributor would want to collect the records? Because they played Madonna’s Cherish instead. The shop assistant said to no one in particular, that will be worth something one day. He wasn’t wrong, I have seen prices quoted as high as 650 dollars paid – if the right Madonna or Marillion completist collector actually finds a copy for sale.

    Taylor Swift Speak Now - Pittsburgh
    Taylor Swift Speak Now Concert at Heinz Field by Ronald Woan

    A similar thing happened to Taylor Swift fans this week, who ordered her latest album and ended up with Taylor Swift artwork, but songs from the early 1990s electronica compilation Happy Lands volume 1 playing instead.

    This mispress became know as the ‘cursed version’ presumably because of its dark electronic sounds featuring Cabaret Voltaire and others. They might be able to take heart when they realise the such mispresses have become collectors items in the past with an appreciating value.

    Beauty

    Australian prebiotics haircare brand Straand begins international expansion push | Cosmetics Design Asia

    Business

    Does private equity improve companies? | Financial Times – TL;DR evidence suggests not

    China

    China’s youth left behind as jobs crisis mounts | Financial Times

    Consumer behaviour

    Most white Americans do not think their ethnicity affects their success | Financial Times 

    Economics

    Everyday inflation clues for investors | Financial Times 

    Third Wave of Hotel CRE Defaults Has Started, Triggered by CMBS Maturities and Variable-Rate Mortgages | Wolf Street 

    China on brink of consumer deflation | Financial Times 

    Energy

    Fab to build miniature solid state batteries | EE News Europe 

    Back when I was a child, the oil refinery was a cathedral to industry rather than a climate crime scene and working in the oil industry was a cut above working in other industries.

    FMCG

    The march of the mash-up enters increasingly bizarre territory | Financial Times 

    Germany

    Germany’s chemical groups look outside Europe to build new plants | Financial Times – interesting that they are going to the US and China

    Health

    Exclusive: Most patients using weight-loss drugs like Wegovy stop within a year, data show | Reuters

    Klick Wire | 84% of HCP telemedicine users are weekly+ 

    Hong Kong

    Hong Kong police question family of exiled activist Nathan Law — Radio Free Asia

    Hong Kong’s crypto grey zones lure Chinese visitors | Financial Times – are the shops are a capital flight vehicle and will they be regulated?

    Innovation

    3D printing industry gripped by intrigue, litigation and churn | Financial Times – 3D printing or additive manufacturing is currently used for small batch manufacturing by the likes of GE, Rheinmetall, Airbus and Lockheed Martin. You had a similar set up with CNC milling (including multi-axis machines) and multitasking machines which were confined to manufacturing ‘cells’ until Apple went out and bought thousands of them and had them running in parallel on Foxconn lines manufacturing iPhone chassis’. Additive manufacturing needs its ‘iPhone moment’ to cross the chasm to mainstream use. That is reliant on an innovative client rather than supplier innovation and the current players like Stratasys aren’t in a position to drive this next stage of innovation, but their customers might be.

    Luxury

    Xin zhong shi, and the rise of the made-in-China movement | Financial Times – disappointed that Shanghai Tang and its founder Sir David Tang didn’t get a mention

    Marketing

    CULT LDN + NYC | FFFACE.ME first official partners of Metaverse Beauty World – fashion isn’t giving up on VR and AR, as for the Metaverse read more about it here.

    Inclusive Advertising Requires A Process, Not Just People | Forrester Research

    Media

    How The X-Files foresaw the chaos of our post-truth times | Dazed 

    Online

    ChatGPT web traffic falls 10%, analytics show • The Register – will it fade away like Clubhouse?

    Security

    A Former Insider on What’s Happening in China – The New York Times 

    Abu Dhabi Secrets: How Qatar Seeks to Leverage Its Influence in Europe – DER SPIEGEL

    Singapore

    Sequoia China’s push into Singapore sets up fight against Indian arm | Financial Times – this was inevitable given the the declining opportunities in China and the move of UHNW Chinese from the mainland to Singapore

    Software

    Letter Statement March2023 | DAIR – Tl;dr: The harms from so-called AI are real and present and follow from the acts of people and corporations deploying automated systems. Regulatory efforts should focus on transparency, accountability and preventing exploitative labor practices.

    Technology

    Samsung Q2 2023 – Supercycle pt. XII – Radio Free Mobile worthwhile reading in conjunction with South Korea, China Locked in Intense Battle for Display Market Dominance – could BOE displace Samsung and LG? They are giving it a very good attempt

    Cryo memory test chip tapes out for quantum computers | EE Times Europe 

    Web of no web

    Google’s AR software leader is out over the company’s ‘unstable commitment and vision’ – The Verge

  • Hyundai + more things

    Hyundai

    Hyundai have pushed out a campaign to teach British people how to pronounce the companies name properly. This is a well trodden path for foreign brands like Hyundai. My childhood featured ‘Nestle’s Milky Bars’ as the advertising jingle ignored the é at the end of Nestlé. I can only presume that it would be assumed to be too sophisticated for our palates rather than a playground staple.

    More recently, I spent a couple of minutes coaching Arsenal footballing legend Ian Wright on how to say Huawei prior to him shooting some online video content for a smartphone launch. So I can relate to the challenge that Hyundai faces in gaining the correct pronunciation.

    Getting the pronunciation right will allow Hyundai to use global English language assets, rather than having to do localisation. A small but important saving as it looks to compete for the UK and Irish electric car markets.

    The advertising plays on the common pain-point of Siri and Google Voice failing to pick up on pronunciation in order to use humour to get Hyundai across correctly.

    Branding

    How Brand Loyalty Creates The Future – Branding Strategy Insider

    Business

    Shipping groups press Chinese counterparts for sanctions-proof contracts | Financial Times – concerns about sanctions due to Russia and Taiwan

    The Business Case for DEI Reinforces Anti-Black Sentiment – Non Profit News | Nonprofit Quarterly – ‘The business case for DEI reinforces the anti-Black sentiment, systemic exclusion, and underrepresentation embedded in capitalism.‘ Apparently the solution is socialism, while not recognising class struggle

    China

    Exclusive: US consulting giant Bain & Company offers China staff 6 months of voluntary leave, sources say | South China Morning Post – Some employees have been given the chance to take part in a half-year ‘career enrichment programme’ outside the office. The move comes after Chinese police visited the American company’s offices in Shanghai and questioned its staff – more in the Mintz and Bain police raids here.

    Consumer behaviour

    Older women and younger men relationships explored in this documentary. Prior to going to college in the mid-1990s I worked for a company that put coatings on materials to make stickers, stamps and labels. My boss there was a guy called Mark who married the PE teacher from school, once he’d finished his university degree. At that time Mark’s relationship was considered unusual in nature.

    Design

    Great film compilation of retrofuturist footage

    Watching this film on the intersection of military clothing design and fashion reminded me of William Gibson’s Zero History novel.

    Economics

    The financial structure of motor vehicles is broken and electric vehicles are too expensive. The short life of electric vehicles is also interesting with an average lifespan of about 3 and a half years at the moment – New cars, SUVs, pickups aging: Average age of vehicles hits all-time high 

    Energy

    A Chicken and Egg Problem: How Germany’s Hydrogen Boom Stalled – DER SPIEGEL and similar position for the UK (and Ireland for that matter) – UK at risk of falling behind in race to become green hydrogen global leader, Johnson Matthey says | Business News | Sky News 

    Honeywell looks at synthetic fuel to combat the decarbonisation of the airline industry

    Ethics

    Volkswagen defends China record at turbulent shareholder meeting | Reuters 

    Finance

    Andreessen Horowitz saw the future — but did the future leave it behind? – The Verge – interesting article that looks like the harbinger of a VC winter. I have mad respect for Connie Chan at A16z who really digs into some ecosystems without the BS

    FMCG

    BAT: Jack hits the road as vapes focus fails to ignite valuation | Financial Times

    Fake meat: has-beans suffer a market panning | Financial Times 

    Hong Kong

    ‘My time in the UK has been a disaster’: Hongkongers fear deportation after years left in limbo | Human rights | The Guardian – visa processing issues

    New China-focused think tank staffed and advised by a number of prominent Hong Kong dissidents: China Strategic Risks Institute

    Mainland Chinese visitors start to return to Hong Kong after Covid-19 restrictions lifted, but most tours low-cost and short stay, figures reveal | South China Morning Post – Tourism figures from February to this month show 86 per cent of tour trips from mainland China lasted one to two days and 54 per cent cost less than 500 yuan. Travel Industry Authority confirms it is investigating allegations of cigarette smuggling by mainland Chinese tour groups – it will be only a matter of time before the impact of this behaviour change ripples out to Hong Kong’s retail landlords and the luxury brands who have stores in the city. Hoteliers and the hospitality industry haven’t benefited from opening up the borders

    Indonesia

    Indonesia is an economic powerhouse in the making, but there are forces ripping away at its society that could leave it as inequitable as its neighbour Malaysia – which has been suffering from a brain drain and political stagnation. Indonesia like Malaysia before it seems to be coming under the sway of Gulf Arab traditions of Islam rather than the indigenous variant of the belief. Singaporean news programme CNA Insider did a good documentary on it all.

    Luxury

    Variety shared this story: Johnny Depp Signs $20 Million-Plus Dior Deal, Marking the Biggest Men’s Fragrance Pact Ever (EXCLUSIVE). Not convinced that men are going to be falling over themselves to smell like Johnny Depp – in that I don’t think celebrity endorsement works in that way. Fragrance is a deeply personal choice 

    To My Studio Team. 3.21.2023 | by Tom Sachs | May, 2023 | Medium – just waiting for the ‘Gordon Ramsay’ moment.

    Marketing

    A nice bit of retail design experience done by my friends at Shanghai agency Orangeblowfish

    Materials

    Merck KGaA aims to build domestic supply chains in China | Reuters 

    Life inside the South African gangs risking everything for copper | Financial Times – copper theft and the dysfunction of South Africa

    How Carbon Fiber Fabric is Being Used in Fashion: Trends and Unique Applications | Carbon Fiber Gear

    Robotic automation and how it can enhance additive manufacturing

    Media

    Hong Kong newspaper axes political comic strip after government criticism — Radio Free Asia

    Online

    Streetwear legend Bobby Hundreds thinks NFTs are a scam–and the future | Fast Company

    Ex-ByteDance worker claims TikTok owner stole content, inflated user numbers in lawsuit over firing | South China Morning Post – Roger Yu Yintao claims ByteDance fired him for reporting concerns about a ‘worldwide scheme’ to steal content and fabricate user engagement metrics. Yu, a California resident, joined ByteDance as head of engineering in the US in 2017 and was terminated the following year

    Daring Fireball: Heather Armstrong, Writer of ‘Dooce.com’, Dies of Suicide at 47 – Heather Armstrong was the original mommy blogger. Prior to that she’d shared details of her creative career in California. She was fired by her boss for sharing too much and being ‘dooced’ verbed.

    Security

    Historian Niall Ferguson the strategic vulnerability of Australia to Chinese aggression. Much of the commentary could equally apply to Europe as well.

    Software

    Volkswagen’s Woes Remind Us That Combining Hardware With Software Is Hard | Forrester Research

    AiLONE | No Mercy / No Malice

    Technology

    Why do we use GPUs for AI? | Digits to Dollars 

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