A Prime mover: Amazon’s 36-hour global event brings in big bucks

July 19, 2018

Amazon reported on July 18 that its proceeds from Prime Day 2018 surpassed its sales on Cyber Monday, Black Friday, and Prime Day 2017—making it once again the biggest shopping event in website’s history. Prime members worldwide were offered more than one million cut-rate deals—and purchased more than 100 million products the 36-hour exclusive promotion.

Shoppers from 17 countries participated—among them, “newbies” from Australia, Singapore, the Netherlands, and Luxembourg

Best-sellers worldwide included the Fire TV Stick with Alexa Voice Remote and Echo Dot; and Kindle e-readers—making it a big day for devices. In the United States, Ring had its biggest day ever on Amazon on July 16, with the Ring Video Doorbell Pro selling out.

Customers also purchased more than 5 million items in each of the following categories: toys, beauty products, PCs and computer accessories, apparel, and kitchen products. And for the first time, Prime Members were offered a week of savings at Whole Foods Market.

Finally, Amazon’s vendors also had one of their best days ever. Small- and medium-sized businesses selling on Amazon far exceeded $1 billion in sales this Prime Day. Products from these unique sellers increase variety, selection, and contribute to the ever-expanding inventory available to Prime members worldwide.

“Prime Day offers us a unique opportunity to thank Prime members with our best deals,” said Jeff Wilke, CEO Worldwide Consumer–Amazon. “Extending Prime Day to a day and a half this year allowed us to further reward members with unbeatable deals, access to exclusive new products and unforgettable experiences that highlight the many benefits of a Prime membership. All of this was made possible because of our many valued associates – the global team that continues to make Prime Day bigger and better.”

Research contact: Amazon-pr@amazon.com

McDonald’s joins Starbucks in envisioning ‘the last straw’

July 18, 2018

The NextGen Cup Consortium and Challenge—launched in March and convened by the Closed Loop Partners—announced on July 17 that McDonald’s is joining Starbucks as a founding member. Together, they have pledged to develop a global recyclable and/or compostable cup solution.

The challenge was started after ecologists realized that, in the USA alone, 500 million straws become unrecyclable waste each year.

McDonald’s is committing $5 million in partnership with Closed Loop Partners to help launch the NextGen Cup Consortium and Challenge—bringing the total contributed to $10 million. The Challenge kicks off in September and invites innovators, entrepreneurs, industry experts, and recyclers to submit their ideas for the next generation of recyclable and/or compostable cups. Awardees will receive acceleration funding of up to $1 million based on key milestones. Up to seven of the awardees will enter a six-month accelerator program to help scale their solutions. 

“McDonald’s is committed to using our scale for good to make positive changes that impact our planet and the communities we serve,” said McDonald’s’, SVP and Chief Supply Chain Officer Marion Gross. “We are excited to join Starbucks and Closed Loop to help solve this pressing challenge as collaboration is key to finding a scalable, lasting global solution.”

“We are proud to come together with industry partners like McDonald’s to drive innovative, scalable solutions for cup waste,” said Colleen Chapman, VP of Global Social Impact focused on sustainability for Starbucks. “A better cup will benefit the entire industry and we invite others to join us as we move these efforts forward.”

NextGen builds on years of work in the industry and is a critical step in the development of a global end-to-end solution that will potentially allow the 600 billion cups globally to be diverted from landfills and given a second life.

NextGen is building a robust advisory council including leaders in environmental NGOs including WWF; human-centered design, academic leaders, the paper and plastic industry, recyclers, composters, and municipalities. This council will ensure that the work is grounded in the needs of the entire value chain and the cups make it from shelf to consumer and back through the recovery system to another high value use.

“There has never been a greater need to tackle the ways in which we source and recover materials. McDonald’s participation is a strong step forward in building momentum from major brands to come together and develop innovative approaches to materials waste,” says Erin Simon, director of Sustainability Research and Development (R&D) and Material Science at World Wildlife Fund–U.S. “Working together across the entire value chain of these major companies will allow us to create a comprehensive and lasting solution to this critical conservation challenge.”

“To date we have received more than 1,000 inquiries from companies and individuals interested in participating in the challenge and we anticipate some exciting and impactful proposals,” says Kate Daly, executive director of the Center for the Circular Economy at Closed Loop Partners. “In our experience investing in circular economy innovation, we find the most successful path to scaling a systems-changing solution is to bring together key players along the entire value chain in a pre-competitive collaboration. This is the type of partnership we need to foster innovative solutions without sacrificing profit. We are working with consortium members to build a robust shared set of technical, performance, and environmental criteria that we will announce later this summer.”

While NextGen intends to work on the entire cup system, including cups, lids and straws, its first challenge will focus on the fiber-based hot and cold cup, as this is the most significant challenge faced by the industry.

Research contact: @K8_Daly

Beauty shoppers spend 80% of ‘purchase experience’ looking at ads, articles, social media

July 17, 2018

A relatively self-serving study sponsored by Condé Nast—publisher of such magazines as Allure, Glamour, Self, Vogue, and W—has found that, in the beauty category, consumers spend 80% of their time in the “pre-search” or “influence” phase of shopping, with a spate of publications, social media, advertising, and celebrities affecting their final purchases.

The study, fielded by the research firm Tapestry and posted on Retail Dive on July 16, found that, similarly, fashion consumers spend 69% of their time in the pre-search stage and are most motivated by advertising; as compared to tech consumers, 65% of whom are influenced by ads “outside of their buying needs.”

Interestingly enough, both beauty and fashion buyers say a couple of brands are “top of mind”—even before they start looking. Fully 79% of respondents admitted they had brands in mind before their search—and 69% pay more attention to ads from sources they know and trust. In fact, more than half of shoppers (52%) spend their full decision time deciding between just two brands.

The outliers? Fifty-three percent of fashion consumers and 64% of 13- to 17-year-old shoppers purchase the brand they first considered.

With influential beauty and fashion publications in its inventory, Condé Nast found that its brands have three times more influence on consumer decisions than Google and Facebook, with three in four respondents saying they trust Condé Nast brands to recommend products. More than 90% trusted Glamour, GQ and Vogue for fashion recommendations; as well Glamour and Allure for cosmetics. Indeed, Consumers were 50% more likely to list a Condé Nast brand in the pre-search phase and think more highly of brands that advertise with Condé Nast, compared to Google and Facebook. Specifically, Condé Nast is 26% more likely to drive purchase intent than tech giants Facebook and Google, based on the study findings.

Other research has revealed that social media plays a major role in driving purchases, especially among younger consumers. A Yes Lifecycle Marketing report released last year found that 57% of consumers across different generations say social media influences their shopping decisions; while 80% of Gen-Zers and 74% of Millennials said social channels influence their shopping. Instagram was a key driver of fashion, beauty and style-focused purchase for 72%, a 2017 Dana Rebecca Designs survey found.

Research contact: @CondeNast

Trump tries to walk back ‘brutal’ comments on Brexit

July 16, 2018

As the POTUS and FLOTUS prepared to meet Queen Elizabeth II at Windsor Castle on July 13, Britain’s Prime Minister Theresa May was still recovering from an icy meeting with Trump at the NATO summit in Brussels—and from the president’s disparaging comments about her Brexit strategy in a newspaper interview published the same morning.

In a world exclusive interview with The Sun—characterized as “insulting” by the British public—President Trump said that May’s Brexit strategy was “soft” and that, “If they do a deal like that, we would be dealing with the European Union instead of dealing with the UK, so it will probably kill the deal.”

He also “tore into” London Mayor Sadiq Khan “for not standing up to terrorists,” and insisted that former Foreign Secretary Boris Johnson would make “a great Prime Minister.”

Informed of the diplomatic damage he had done, the president then tried to walk it back at a press conference at Chequers, the prime minister’s 16th-century official country residence, The New York Times reported.

The U.S.-based news outlet described Trump’s attitude as “by turns defiant, fawning and dismissive about the interview,” saying, “He first tried to deny he had criticized the prime minister and blamed the embarrassing episode on the news media. When that rang hollow, he then tried to compensate by lavishing Mrs. May with compliments and, in the end, claimed that the slights were so insignificant that she had waved off his attempts at an apology.”

 “I didn’t criticize the prime minister; I have a lot of respect for the prime minister,” Mr. Trump told reporters during an outdoor news conference after he and Mrs. May had met for talks. He blamed “fake news,” claiming the report — in a right-wing, pro-Brexit, Murdoch-owned tabloid — had omitted his praise of Mrs. May. “I think she’s doing a terrific job, by the way,” Mr. Trump said, calling her “tough” and “capable.”

According to the Times report, President Trump admitted, “I did give her a suggestion — I wouldn’t say advice — and I think she found it maybe too brutal. As far as negotiating the deal, I probably would have done what my suggestion was to

Research contact: @JulieHirschfeldDavis

Twitter to remove inactive accounts, rolling back users’ follower counts

July 13, 2018

Twitter Legal, Policy and Trust & Safety Lead Vijaya Gadde announced on July 11 that the social media giant will start removing tens of millions of locked, inactive accounts this week—a global initiative that she said would reduce the number of followers displayed on many profiles.

The company has opted to do so, Gadde said, because “we want everyone to have confidence that the numbers are meaningful and accurate.”

Why does an account get locked in the first place? Twitter detects changes in tweeting behavior—and shuts the account down in order to contact the owner to confirm that he or she still has control of it.

Among the suspicious changes in behavior:

  • Tweeting a large volume of unsolicited replies or mentions;
  • Tweeting misleading links;
  • Blocking of the account by a large number of other members; or
  • Use of email and password combinations from other services that could jeopardize the security of an account.

Most people will see a change of four followers or fewer; others with larger follower counts will experience a more significant drop.

The frozen accounts being deleted represent “about 6% of follows on Twitter,” Ian Plunkett, a Twitter spokesperson, told Politico.

According to the political news outlet, “The move could stoke conservatives’ ire, particularly if President Donald Trump, with his roughly 53.4 million followers as of today, is among the users that lose a large number of followers. Twitter faced heaps of criticism from the right in February for silencing scores of accounts it said were spam or ill-intentioned bots. Conservatives, alleging censorship, branded the episode “#TwitterLockout.”

Will the initiative expand to include Tweets, Likes, and Retweets? Gadde says, “Our ongoing work to improve the health of conversations on Twitter encompasses all aspects of our service. This specific update is focused on followers, because it is one of the most visible features on our service and often associated with account credibility. Once an account is locked, it cannot Tweet, Like, or Retweet—and it is not served ads.”

Research contact: @vijaya

Flying trains could disrupt travel industry

July 12, 2018

Can you imagine taking a train to the airport—which then, fully loaded with passengers, crew, and luggage—rolls out of the terminal onto the tarmac and hooks up under a pair of wings for takeoff? Hours later, upon arrival at its destination, that same plane lands on a runway, shrugs off its wings, turns into a train and rolls on to rails to drop you off at your local station.

This disruptive new technology —a modular airplane with removable wings—is being hawked by a French entrepreneur as the next big thing in travel, according to a July 11 report by Bloomberg. Maurice Ricci, Group CEO of Paris-based Akka Technologies currently is pitching his company’s invention to U.S. aerospace company Boeing, as well as others in the sector.

If it works, the new Link & Fly technology, Akka’s flagship aircraft design, promises to hasten turnover at airports and make boarding easier and closer to passengers’ homes.

“After cars go electric and autonomous, the next big disruption will be in airplanes,” Ricci said in an interview with Bloomberg in Paris.

With Akka’s futuristic concept, passengers would board a train-like tube at a neighborhood station and have their retinas scanned for security during the ride to the airport. Wings would be attached at the airport terminal to the pod for take-off. The company has showcased the idea in a 3D mock-up video called “E-mobility redefined,”gathering interest from potential customers in Asia, Ricci said, without naming any company.

Similar to Airbus’ A320 jet in size and target usage, the Akka Link & Fly carriage for short-range flights carries 162 passengers and the seats can be taken out to move freight instead. With the wings clipped on, and the engines fixed on top, the design has wingspan of about 49 meters (160 feet), is 34 meters long (112 feet) and 8 meters high (26 feet).

While Akka’s not banking on convincing a plane maker to necessarily build the entire  Link & Fly concept, the company is betting on the design to be an attention-grabber and a showcase, parts of which are likely to end up in customers’ commercial aircrafts down the line.

Akka, which has a market value of 1.1 billion euros (US$1.3 billion), employs engineers that customers can hire on a project basis as consultants. The company developed an autonomous car concept in 2008; and in 2014 partnered with Dassault Systemes to offer services to carmakers.

“Planes need to become more efficient, less polluting and less noisy,” said Ricci. “Our role is to point our customers to technologies of the future.”

Several U.S. air hubs—among them, Denver, Atlanta, Newark, and New York City—already use a train-to-plane infrastructure that could be converted to the new Link & Fly platform.

Research contact: @Akka_Technologies

Americans want U.S. goods, but won’t pay a premium for them

July 11, 2018

Fully 70% of Americans say they love to buy products that are “Made in the USA,” based on findings of a Reuters/Ipsos poll. They are less enthusiastic, however, about paying a premium for them.

The poll, fielded in late May, gathered responses from 2,857 people nationwide, including 593 U.S. adults who made less than $25,000 annually; 1,283 who said they earned between $25,000 and $74,999 per year; and 805 who claimed they earned more than $75,000.

Out of that sample, more than one-third (37%) of respondents said they would refuse to pay more for U.S.-made goods versus imports. Of those who were willing to shell out slightly more money, 26% said they would only pay up to 5% more to buy American, and 21% capped the premium at 10 percent.

Lower-income Americans were the most enthusiastic about buying U.S. goods, the poll showed, despite being the least able to afford paying extra for them.

Indeed, the biggest U.S. retailer is well aware of the priority that buyers place on price, above all else. A spokesman for Wal-Mart Stores told Reuters that its customers are saying “that where products are made is most important, second only to price.”

The good news for U.S. factories is that Americans like the quality of many domestic goods. Thirty-one percent of respondents said American-made cars are the best in the world. German cars were voted best by 23% of respondents. What’s more, 38% said U.S.-made clothes were best.

Still, domestic manufacturers could be in trouble if they fail to capitalize on perceptions about the quality of their products while also keeping a tight lid on costs. Factors such as cheaper domestic freight and a desire among retailers to carry lower inventories can help make up some of the cost differential.

To be sure, some manufacturers can command a big premium for American-made products. Klein Tools—a privately held company based outside Chicago with annual sales of $500 million—makes hand tools that are highly sought after by electricians and other workers. A pair of 9-inch Klein pliers sells for about 30% more than a comparable import.

But betting on the allure of American-made goods can be risky. In 2012, High Point, North Carolina-based Stanley Furniture brought back production of cribs and other baby furniture from China to a U.S. plant—wagering that parents worried about a string of Chinese factory quality scandals would pay $700 for cribs nearly identical to imports selling for $400, the pollsters said. Customers refused to bite, however, and the High Point factory closed in 2014.

Still, Stanley’s CEO Glenn Prillaman said the Trump administration’s emphasis on American-made goods is a hopeful sign that resonates with “people that work for a living,” because they can see how it impacts their own jobs. “The lower-end consumers certainly care, and that’s a good thing,” he said. “But they’re also not in a position to pay the premium.”

Indeed, U.S. President Donald Trump rode into office on promises of bringing back manufacturing jobs and boosting economic growth; and has criticized companies—most recently, motorcycle producer Harley-Davidson—that move their own production overseas, Reuters reported.

Research contact: maurice.tamman@reuters.com

Americans have had it with two-step verification

July 10, 2018

Secure or simple? Millions of Americans are fed up with overly complicated web and phone security measures, based on findings of a poll released on July 9 by data analytics firm FICO.

The researchers, who polled 2,000 U.S. adults, report that 81% of respondents don’t see the need for what they consider unnecessary safety methods, according to a story posted on SWNS Digital. In fact, nearly one-half (47%) are sick of having to answer endless security questions whenever they call customer service departments. And over six in 10 (64%) are riled by the need for elaborate passwords featuring a mix of numbers, symbols and capital letters. Indeed, 78% said they struggle to keep track of all their passwords.

Forty-eight percent are fed up with the use of two-step verification and seven in 10 (71%) are frustrated by CAPTCHA codes —because, they say, the codes tend to feature illegible words.a

All in all,  more than two-thirds (71%) think there just are too many security measures nowadays.

T.J. Horan, a vice president for Fraud Solutions at FICO, comments, “There’s a real discrepancy here: Consumers are glad their bank{s are] protecting them, but frustrated that the protection is making it harder for them to open accounts and make purchases.

“When it comes to digital transformation, a smooth customer experience is going to be vital. The winners will be the firms that can balance this against the need to stop fraud.”

Interestingly enough, 46% of respondents said they even consider airport security to be an inconvenience and 38% regard mobile phone PINs as a somewhat of a hassle.

And perhaps it’s no wonder, as those polled have 34 different online accounts on average—including email accounts, shopping accounts, social media accounts, bank accounts, and more.

Finally, the security measures associated with banking appear to be particularly frustrating to those polled—especially when it comes to opening a new account online. Twenty-two percent said they would either give up on opening a bank account
completely, or give up and try at a different bank if they were forced to jump through too many hoops (such as having to post documents or travel to a branch in person)

“This survey shows the conflict between consumers’ desire for greater protection and their desire for easy processes,” said FICO’s Horan.“As we move to more instant transactions, including real-time payments, it’s clear that the industry has a lot of work to do to get this balance right.”

Research contact: greg.jawski@porternovelli.com

Watch this space: In Hong Kong, a parking space just sold for $765K

July 9, 2018

Talk about “space travel.” Parking spaces now are so expensive in Hong Kong, that one car collector is thinking of storing his vehicles in Los Angeles, where annual spaces average less than one-tenth of the price.

“It’s crazy,” Darrin Woo, a classic car collector, told Bloomberg recently.  Although he is wealthy, Woo just shipped his 1968 Mercedes-Benz 600 Pullman limo and a fiery red 1957 Fiat Abarth to California to save money on storage.

“Buy a space? No way. I could buy five cars for that much.”

Indeed, there are more cars than spaces in the confines of Hong Kong’s crowded 424square-mile territory—and those who can afford to buy one might pay more than the rest of us would consider shelling out for a house. A single spot in a luxury development in Kowloon’s Ho Man Tin district changed hands recently for a record US$765,000, according to a July 5 report by the business news outlet.

The number of parking spaces increased just 9.5%, to 743,000, within the decade between 2006 and 2016; while the private car population surged 49% to 536,025, according to a report by the city’s Transport Department.

Today, the average Hong Kong parking space goes for about US$287,000—a more than sixfold increase since 2006. That makes the city’s housing market, the world’s least affordable, look tame by comparison. Home prices increased a mere 3.4 times over the same period. In the first half of this year, some US$1.3billion worth of spaces changed hands—up from US$838 milion in the same period a year earlier, according to Midland Realty Services, a Hong Kong-based real estate broker.

Car owners in New York and London face similar problems. In Manhattan, spaces at a luxury condo at 42 Crosby St. in Soho were advertised for US$1 million, according to The New York Times. A real estate agent who handles sales for the property declined to comment. However, prices are lower elsewhere in the city—pegged at an average of US$225,000.

In London, you can buy a space for about $130,000—or could in 2011, according to the Daily Mail.

Based on the Bloomberg report, Hong Kong developers are partly to blame. They make more money building apartments than garages, so the ratio of parking spots to housing units has declined, said Denis Ma, head of Hong Kong Research at consulting firm Jones Lang LaSalle.

Research contact: @Frederikbalfour