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Global Perspective - News Worth Sharing

  • Britain Prime Minister Theresa May has made it clear that Brexit pain lies ahead as the country looks to exit the European Union. May said that the wrangling (and the logistics) of getting the country out of the EU will likely prove to be “exceptionally painful.”

    However, this week brought in some good news despite the uncertain times.

    In this week’s Brexit Tracker, Snapchat casts a vote of confidence in London, U.K. consumer spending is on the rise and house prices in the country show signs of strength.

     

    Snapchat’s London Move

    The social networking app announced Tuesday (Jan. 10) plans to make London the home base of its international operations, a move that shows a certainty in a post-Brexit environment.

    Rather than routing sales through lower tax jurisdictions, Reuters reported that Snapchat will book sales in countries where it has no local entity in the U.K. The company told Reuters that Britain’s strong creative industries make it “a great place to build a global business.”

    London’s status as a global FinTech center also presents the opportunity for startups to raise funding and bigger companies to gain capital.

    “We believe in the U.K. creative industries,” Claire Valoti, general manager of Snap Group in the U.K., told Reuters.

    “The U.K. is where our advertising clients are, where more than 10 million daily Snapchatters are and where we’ve already begun to hire talent.”

    With nearly 150 million daily users globally, the messaging app also has big plans this year to go public — ensuring it will have the biggest stock market debut since 2014.

     

    Spending Still Soars

    If consumers are concerned about Brexit, it’s not showing in their buying habits.

    New research from Visa showed cash withdrawals and card spending in the last months of 2016 grew by an average of 2.8 percent. This was twice as much as the average rates measured in Q2 and Q3.

    Despite the concerns and challenges that have arisen since last year’s Brexit decision, U.K. consumer spending is on the rise. The results show the fastest quarterly growth since the last three months of 2014, Business Insider noted.

    “Growth was once again led by the experience sector, with consumers going to Christmas markets, traveling to visit loved ones or venturing to various parts of the country to celebrate. Food was, unsurprisingly, another sector which performed well, with spend up 2.9 percent,” Kevin Jenkins, U.K. and Ireland managing director at Visa, said in a statement.

    Jenkins noted that the overall growth was boosted by Christmas-related activities and a national sales drive. While the U.K.’s vote to leave the EU has created uncertain conditions for retailers, online sales in December remained strong, and even brick-and-mortar locations saw an improvement.

     

    Can Housing Prices Ride The Wave?

    The good news: Housing prices in the U.K. ended 2016 on a strong note.

    The bad news: Economists aren’t sure how long the streak will last.

    Over the course of 2017, mortgage lender Halifax pointed out, slower growth and rising inflation could work together to reduce demand for home buying.

    “The relatively wide range for the forecast reflects the higher-than-normal degree of uncertainty regarding the prospects for the U.K. economy this year,” Martin Ellis, an economist at Halifax, told Bloomberg. “Slower economic growth, pressure on employment and a squeeze on spending power, together with affordability constraints, are expected to reduce housing demand.”

    Surprisingly, Bloomberg noted, both the housing market and the U.K. economy have remained relatively stable since the official decision was made last June that set in motion Britain’s plans to leave the EU.

    But the year ahead may give way to more challenges in the form of rising inflation and the beginning of formal exit negotiations.

  • An influx of holiday orders overwhelmed the retailer and consumer brand manufacturer, and e.l.f. Cosmetics’ warehouse is working overtime to catch up.
  • Alibaba is at the forefront of a bid that would take Intime Retail Group private, with a price tag of as much as $2.6 billion, part of a larger strategy to broaden its brick-and-mortar reach.

    Several news outlets reported that China’s largest internet retailer is expanding its efforts to counteract slowing sales growth seen online, while, as Bloomberg said, the privatization of Intime might help Alibaba “explore ways to modernize a $4.5 trillion industry that hasn’t adapted well to the growing popularity of online shopping.” By reducing middlemen, said the site, the retail juggernaut would be able to strip out costs, boost efficiencies and, by extension, pricing and margins.

    In an interview, Bloomberg Intelligence Analyst Catherine Lim said: “This deal shows that there is still value to brick-and-mortar stores, enough to interest eCommerce players. What it’s shown is that department store chains are still relevant and of value. We could be seeing renewal of a sunset industry.”

    The $2.6 billion price tag would offer up a 42 percent premium for Intime, as paid by Alibaba and Intime Founder Shen Guojun, at HK$10 a share — and Alibaba already owns three-quarters of the company’s stock. This privatization also marks Alibaba’s first deal of the new year, folding into Alibaba the 29 department stores and 17 shopping malls owned by Intime.

    Bloomberg reported that the partnerships with brick-and-mortar retailers would “pioneer” a new model of hybrid online and offline sales, as technology can be harnessed for better inventory control and pickups in-store.

  • Independent Chinese designers want to avoid getting lumped together with the cheap goods that are still largely associated with the “Made in China” phrase in the West. Helping make this differentiation much clearer is a handful of platforms designed to support small-scale designers, creating a space for industry professionals to collaborate and address issues encircling a fashion scene that’s developing at top speed.

    One of the newest is Uncover Lab, which debuted at Beijing Design Week in the fall. An undertaking by a team of longtime supporters of indie creatives and sustainability initiatives in China, Uncover Lab aims to create a space for exploring issues for the future of fashion and giving designers a chance to discuss ways in which they can improve the cycle.

    Uncover Lab's presentation of the founders' clothing brands at Beijing Design Week. (Courtesy Photo)

    Uncover Lab’s presentation of the founders’ clothing brands at Beijing Design Week. (Courtesy Photo)

    The collective has notable names in China’s fashion scene on board, including ffiXXed Studios, which is making waves in Japan and has done collections for Opening Ceremony and Lane Crawford, as well as NEEMIC, a high-end clothing brand that has been at the forefront of eco-friendly fashion efforts in China, bringing style-minded consumers clothing made with natural and organic-certified fabrics.

    Uncover’s founders are Markus M. Schneider, founder of Beijing-based multi-brand shop for local designers The Product Republic, Stephanie Lawson, the designer behind new premium performance denim brand Zodiac Active, fashion consultant and designer Kevin Tallon of Capitale Nord, as well as NEEMIC co-founder Hans Martin Galliker.

    Hans Martin Galliker of NEEMIC. (Courtesy Photo)

    Hans Martin Galliker of NEEMIC. (Courtesy Photo)

    Uncover serves as a “showcase and hub to connect brands and designers with a broader audience among media, retailers, and consumers,” and it comes at a time when China’s fashion industry is exploding. Galliker speculates that there are five to 10 times as many designers in China now compared to when he first started NEEMIC in 2011. (He emphasizes, though, that the real numbers depend on how one defines a brand. “There are tons of new brands, many being only available on Taobao, some really independent and some just a new outlet for big fashion companies where this fact is not being made transparent,” he said.)

    Of course, many designers may have convenient access to factories in China to do small-scale production or low-quality mass production, but to make a long-term bid for a quality, sustainable brand makes the process more complicated, which is part of what indie fashion platforms attempt to explore. The industry is also faced with the fact that there are more high-end local labels that threaten international luxury brands, not to mention technology and social media are quickly changing the way consumers view fashion, and the rise of e-commerce is paving the way for innovative business models.

    It’s not the first platform to try to bring these ideas together. Galliker also led in the creation of the similar “Beijing Fashion Collective” in 2013. There is also, of course, numerous online and offline sales platforms for supporting up and coming designers in China, such as Xinlelu, Yetang, and D2C, which gives newcomers a chance at a direct to consumer model, but many of them don’t go much further beyond offering sales and marketing support.

    “The challenges for indie fashion designers are tremendous,” Galliker said. “There is just so much to take care of, from sourcing to creation, sales, distribution, and customer care, with an increasing trend towards e-commerce and automatization along the whole supply chain. To cope with those challenges, indie brands can either invest in growing their organization or they can unite with other indie designers. That offers ways to share experiences, sourcing together, and presenting themselves together to be better heard in the market as a good alternative to fast fashion and imported luxury brands.”

    Galliker said he always felt like there was a gap in the market for a platform like Uncover. “Designers were not collaborating enough because they were just so busy with realizing their vision,” he said. “Also, society doesn’t give them any successful example of a loose collection of brands.”

    But he does give a lot of credit to another new platform in China that serves to give designers advice for every piece of the fashion puzzle, from manufacturing, to sales, to production, and sourcing. YCO Foundation, founded by Fan Yang, gives members access to a system that allows buyers and designers to communicate directly, provides a library of fabric sources, offers opportunities for collaboration, and gives users access to a WeChat blog that provides inspiration and interviews with designers doing quality work. They also have an offline showroom, Coda, that gives a space for 10 select designers for an off-schedule event at Shanghai Fashion Week.

    It’s this type of holistic, integrated support that helps designers build a good foundation in the industry, where there’s a temptation to move quickly. Many designers fizzle out after one or two years, while others go big, with some getting international recognition after just two seasons. YCO’s focus is producing brands that uphold the “Designed in China” name. “We believe the future of Chinese fashion business belongs to good products, which means not only good design, but also good quality, good delivery, and good pricing,” Fan said.

    With just a year behind them, YCO’s B2B system, which is similar to platforms like New York City’s Joor or Le New Black in Paris, was recently officially adopted by Shanghai Fashion Week.

    Going forward, the Uncover organizers, meanwhile, are working on plans for a second, expanded project, and in the process of defining criteria that keeps incoming designers to the platform at a high caliber, which is all too critical for a team that wants to set itself apart in an increasingly saturated industry.

    The post Indie Fashion Catalysts Launch New Platform for China’s Sustainable-Minded Designers appeared first on Jing Daily.

  • New research from Samsung Electronics France revealed that more physical stores in France are opting for digital screens to help enhance the customer experience.

    According to the study, 60 percent of the 301 physical retailers surveyed said they already has used display screens in-store and another 15 percent expressed plans to do so.

    Touchscreen displays or interactive kiosks are offered by more than half (53 percent) of larger retailers and 36 percent of their smaller counterparts, Emarketer reported. Thirty-six percent of respondents said they provided their in-store employees with connected devices in order to help improve the service they offer customers.

    But many retailers said they were still just beginning their digital journey.

    While just 4 percent felt they had reached “digital maturity,” another 43 percent perceived their understanding and implementation of digital options as “weak” or “very weak.”

    Many retailers (54 percent) cited their biggest reason for installing digital devices was to help make the store more attractive and drive foot traffic. Other reasons included wanting to put some “magic” back into the shopping experience (42 percent) and to collect data from customers’ interaction with the screens (30 percent).

    “While the digitization of distribution has clearly progressed, especially with regard to the rate of equipment, there is still a long way to go before actors can take full advantage of digital transformation. As the study shows, most of them are aware that their digital maturity remains low. The implementation and review of indicators for monitoring the performance of installed devices could, for example, enable them to improve the customer experience — a goal that appears [to be a] priority according to the results of the first barometer,” Gary Guillier-Marcellin, director of display division at Samsung Electronics France, said in a translated statement.

    “The store of the future is taking shape before our eyes. Thanks to digitization, it should offer a personalized customer experience, to improve the rate of consumer satisfaction. Another trend is mobile payment. If only one store has four today or will soon have mobile payment solutions, one in three is developing a project in this direction,” Guillier-Marcellin concluded.

  • As retailers continue to build their digital capabilities and work towards a completely unified approach they are placing an increased emphasis on e-commerce firepower. See the major trends that will have the greatest impact over the next year.
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