Author: Mei Ling Tan

  • Matching mom-and-daughter outfit is a new trend

    Matching mom-and-daughter outfit is a new trend

    The luxury childrenswear market is forecast to reach $6.6 billion in 2018, up by 3.8 percent year-on-year, presenting ample growth opportunities as spending power increases and parents dish out upwards of $500 for a pair of miniature Gucci loafers to match their own.

    Brands from Gucci and Balenciaga through to Burberry have their own multi-million dollar childrenswear lines (the latter made £117 million in revenue in 2017, about $153 million) which largely shrink runway looks from ready-to-wear collections to fit young children rather than designing them from scratch, hoping to bank on a mother’s desire to wear matching pieces with her daughter.

    But putting celebrity power to one side, as Kim Kardashian West signaled that mini-me dressing is once again big business by stepping out in a matching outfit with her daughter, what else is driving this phenomenon that seems to reappear every few years?

    “Childrenswear is increasingly trend-oriented,” says Nathalie Christen-Genty, the founder of Paris-based Melijoe, the luxury e-commerce site dubbed “the Net-a-Porter for childrenswear.” “A few years ago, childrenswear was dictated by just a few kids-only brands and parents’ motivation to buy was first and foremost driven by practicality,” meaning pieces for children were designed specifically for them with a timeless and classic design in mind.

    In the recent past, matchy-matchy ensembles were considered passé, reminiscent of bygone eras like the 1960s when women would make garments for themselves and their children from the same piece of fabric.

    When luxury brands began launching childrenswear lines in the 2000s, “they didn’t think it would be big business,” says Giuliana Parabiago, a consultant at Pitti Bimbo, a key international childrenswear trade show where the latest trends are often discovered. They would use past-season styles that would be delayed by six months or a year, she says, but now childrenswear and ready-to-wear runs at the same speed. “This new generation wants to be young — and matching.”

    Chloé launched its children’s line in 2010 with licensee Children Worldwide Fashion (CFW), which also makes lines for Givenchy, DKNY and Little Marc Jacobs.

    For the current season, stand-out pieces include a velvet bomber jacket with horse embroidery and a pair of suede ankle boots — mini-versions of products creative director Natacha Ramsay-Levi sent down the runway.

    “The pieces which are obviously Chloé, [for instance] the horse pattern, tend to perform better,” says Geoffroy de la Bourdonnaye, the brand’s chief executive who credits the success of mini-sized versions to the fact that some “mothers take pride in seeing their daughters look like themselves” and that others want “to share the brand’s DNA of being ‘free’ with their children.”

    “The [childrenswear] business has consistently grown for the last eight years,” he adds. “The countries that spend a lot of money to dress their kids tend to be Russia and the Middle East, along with China. Countries in Latin America also invest in their kids.”

    While Chloé’s relationship with its licensee means there is constant contact with the ready-to-wear design studio and the capacity for CWF to select the runway pieces it wants to adapt for children, Dolce & Gabbana’s approach was to take its line in-house allowing it to have complete control like Ralph Lauren, Burberry and Dior Baby who also go it alone.

    However, such arrangements are still unusual; most luxury brands sign with a handful of specialist licensees. Simonetta produces childrenswear for Balmain and Fendi Kids; Kidiliz Group has the license for Kenzo Kids, Paul Smith and Levi’s Kids; and Brava Kid takes care of the brands under the OTB umbrella which include Diesel, Marni and Trussardi Junior.

    The reason that the license route is so popular is that childrenswear requires an expert hand since it is not as simple as it may seem to scale down a garment pattern to fit the body shape of a child. The specialist experience on offer by the licensed manufacturers means they also understand intuitively how to make an outfit appropriate for children.

    The movement has also helped drive childrenswear into the same trend cycle as womenswear as brands respond to demand by bringing out more novelty.

    “Children’s lines [now] have their long-awaited collections as much as the ready-to-wear for the parents,” says Emi Ozmen, the mother of one of the child vloggers behind Silver and Lux.

    Source: @beyonce

    Dolce & Gabbana launched a four-week kids pop-up at Net-a-Porter, including a £1,100 tiered fil-coupé silk-blend dress for ages two to six, a £775 satin-trimmed brocade suit for ages two to five and an array of handbags and footwear.

    “When [the mini-me trend] is executed well, it’s incredibly fun and expressive,” says the site’s global buying director Elizabeth von der Goltz. “It’s performed particularly well in the Middle East.” Having launched Gucci and Dolce & Gabbana capsules, Net-a-Porter’s next collaboration is with Moncler for miniature-sized puffer jackets.

    However, not everyone sees the trend as a harmless way for kids to bond with their parents; some find it incredibly uncomfortable and question the subtle messages it seems to underscore.

    “Two troubling phenomena converge in this mommy-and-me thing,” said Natalia Mehlman Petrzela, an associate professor at the New School in Manhattan. “There’s the infantilisation of women to look like little girls and, on the flip side, [the pressure] for young girls to always look older— to wear bikinis and crop tops.”

    Some mini-me dressing is criticised as a gimmick; there is a fine line between matchy-matchy dressing and ill-fitting clothing to be worn once and thrown away.

    “It’s clever marketing and appeals to emotional values,” says Jane Lewis, the founder of womenswear line Goat.

    In August, the brand launched a mini-me line of dresses for girls with the design remaining unmodified bar reducing the size — the crepe dresses have a timeless feel to them. “Again, it depends — I’m not going [to do] a pink bomber jacket. There’s going to be a distinction between viable mini-me childrenswear and the theatrical element.”

    Foraying into theatre is something SemSem founder Abeer Al Otaiba is also weary of.

    The Emirati entrepreneur launched the brand after seeing a gap in the market — there was an absence of stylish yet understated occasionwear for mothers and daughters. “It’s more of a lifestyle, and mothers in [markets like Russia and the Middle East] enjoy elegant pieces for themselves and their daughters all within one brand. It’s unique to find a brand that caters to both,” she says.

    SemSem’s Spring/Summer 2019 collection features matching lamé mother-daughter dresses and shirt dresses made from the same cotton fabric. Rather than shrinking women’s dresses to children’s size, Al Otaiba prefers to play around with fabrics and silhouettes.

    A far cry from Kardashian’s more literal matchy-matchy approach.

    Yet, social media and Instagram influencers continue to be the main driver of mini-me mother-daughter dressing.

    While the trend has long been popular in the Middle East and Russia, it has rapidly expanded to the US thanks, in part, to celebrities like Beyoncé, whose Instagram in matching Gucci with her daughter Von der Goltz cites as an example of celebrity culture popularising mini-me.

    Indeed, mommy-and-me looks drive likes and engagement, becoming good reasons for multi-brand retailers such as The Tot, a Dallas-based childrenswear store founded by Nasiba Adilova, to approach companies and ask for small-sized pieces of womenswear best-sellers.

    “The era when childrenswear was entirely functional is over,” says Christen-Genty. “It’s now firmly in the territory of fashion.”

  • BreadTalk Opens New Concept Store In KL

    BreadTalk Opens New Concept Store In KL

    Boutique bakery franchise BreadTalk Malaysia has opened a new concept store in Kuala Lumpur’s Avenue K Shopping Mall. The new outlet is situated opposite the KLCC LRT station and is offering a promotional tote bag to early customers spending more than RM20. It opens from 8 am to 10 pm daily.

    BreadTalk Malaysia is preparing to launch several more concept stores in other Kuala Lumpur locations, including KLIA2, before opening a flagship at Star Boulevard on Jalan Yap Kwan Seng next year.

    The Singaporean brand has spread throughout Asia and the Middle East since opening in 2000, basing its products on premium ingredients such as Japanese-milled flour and New Zealand butter.

  • Malaysia Aviation appoints Philip See as Firefly CEO, as Ong out

    Malaysia Aviation appoints Philip See as Firefly CEO, as Ong out

    Malaysia Aviation Group (MAG) has appointed Philip See as the new CEO of Firefly, effective Jan 1, 2019. Philip will replace Ignatius Ong who joined Malaysia Airlines as group chief revenue officer in June 2018. Ignatius has been double-hatting as CEO of Firefly and group chief revenue officer.

    Philip, whose appointment was announced internally earlier, is currently the Head of Strategy and Network for Malaysia Airlines, reporting directly to the group CEO. He joined the airline in 2015 from consulting firm McKinsey & Company, where he was an associate.

    He is however, no stranger to the group having previously served in the Turnaround Management Office (TMO) in Malaysia Airlines, back in 2004. Under the TMO he was responsible for implementing the Business Turnaround Plan and consequently the Business Transformation Plan. Philip left the airline in 2010 and rejoined Malaysia Airlines in 2015 as a Network Planner.

    In his role as group chief revenue officer, Ignatius oversees Sales and Revenue Management for the entire group. Ignatius has almost 15 years of professional experience in the aviation industry and is no stranger to revenue management having previously covered route and revenue under the then Turnaround Management Office. He has also headed the whole portfolio of Sales, Distribution and Marketing under the Project Management Department of Malaysia Airlines.

    Other changes in the management also include Ibrahim Mohamed Salleh as CEO of MABKargo effective Sept 1, 2018 and Hazman Hilmi Sallahuddin as CEO of Project Amal effective Oct 1, 2018.

    Ibrahim has over 20 years of experience in various fields within Cargo Handling with the company. Prior to his appointment as CEO MABKargo, he was COO of PT Jasa Angkasa Semesta (a subsidiary of SATS Limited, Singapore).

    Hazman was with Khazanah Nasional Bhd where he served in various roles across the organisation. This included Senior Vice President of Khazanah Europe Investment Limited based in London.

    Malaysia Aviation Group CEO Izham Ismail said, ”I am confident that the new leadership will bring new energy and purpose to the business. The diversity of our new leaders, their backgrounds and experience will help us reach our goals as a group.”

  • Who is Hong Kong’s new luxury shopper?

    Who is Hong Kong’s new luxury shopper?

    As one of Asia’s leading retail hubs, Hong Kong has long been a mecca for luxury shoppers. Despite being home to APAC’s most expensive retail real estate (second globally to New York City’s 5th Avenue), there’s a reason why large, sprawling luxury shopping malls continue to dominate in a crowded city.

    Hong Kongers will be glad to know, though, that it holds its own when it comes to homegrown luxury spending, which recently overtook foreign consumption at 55% of total purchases.

    This figure is staggering when considering the total population of Hong Kong is roughly 7.3 million people, less than a quarter of the 60 million visitors it hosts each year.

    For these locally based consumers, luxury isn’t a one-off, aspirational purchase — it’s an innate part of their lifestyle, which explains why 93% of shoppers intend to maintain or increase spending in luxury goods in the next five years.

    This holds true especially for the younger millennial shoppers who will be driving the majority of the growth going forward.

    Source: Think with Google

    The evolving nature of consumers is a common challenge for many marketers, and the luxury industry is no exception.

    The task at hand for brands in Hong Kong is to understand this distinct group of younger customers and the behaviors that shape their expectations when it comes making high-value purchases.

    A curious and demanding bunch

    Reportedly, 90% of luxury shoppers conduct research online before making a purchase, and brand websites and search engines are the two most popular sources people turn to. In fact, they’ve become the digital storefront for this generation of digital natives.

    Source: Think with Google

    Having grown up with readily available information online, millennial and Gen Z consumers spend more time on research than ever before.

    In fact, 89% of shoppers aged 18-34 spend up to three weeks researching a luxury purchase. And they’re not alone: 64% of consumers over 45 will spend the same amount of time on research leading up to a purchase.

    Source: Think with Google

    Retailers may have once treated online as a separate channel to physical stores, but this notion is quickly becoming outdated.

    Whether customers are online or offline is a distinction made by businesses, not consumers.

    Online and offline consumer behaviors are increasingly blurring, and the respective experiences need to follow suit, particularly when it comes to the inspiration and research phases.

    In short, consistency across the two worlds is key.

    It’s hard to imagine a luxury label leaving a customer linger unattended to in its boutique, so, by the same token, a customer should never be left unanswered or ignored on Google, YouTube, or social.

    More is more

    With a more exploratory consumer mindset, brand loyalty may be more elusive for brands targeting younger shoppers.

    Engaging potential millennial and Gen Z luxury shoppers constantly by trying to stay top of mind and being always on will be crucial to gaining consideration.

    In today’s environment of fast fashion and overnight style sensations — while couture brands used to produce two collections per year, they now produce five to six — one of every three consumers surveyed said they make luxury purchases to keep up with trends.

    The tendency to shop more often is evidenced among shoppers aged 18-34, of whom 52% reported making premium purchases once every three months, compared to just 41% of shoppers 35+ who did the same.

    Source: Think with Google

    In addition to a higher frequency of purchase, our research also shows that millennial and Gen Z shoppers are likely to consider a wider breadth of brands. On average, this group owned products from a repertoire of four to six brands; compared to more brand-loyal 35+ shoppers, who owned between one and three brands.

    Source: Think with Google

    Inspiring online with offline

    When it comes to in-store shopping, the aspects that customers value most are: 1) guaranteed authenticity, 2) the ability to touch and feel the product, and 3) personalized customer service.

    How might these values translate online? With 63% of people expecting the same high-touch brand experience online and offline, the challenge is to emulate these qualities and provide satisfying digital experiences.

    Offering free shipping on returns, for example, gives peace of mind to customers wary of counterfeit goods. Similarly, detailed product videos on the brand site or as a pillar of content on YouTube can help shoppers inspect items for quality while engaging them in a rich experience.

    Leveraging customer data, such as previous purchases, to create individualized interactions and recommendations is no longer a nice-to-have, but a must. Just as consumers expect personalized customer service in store, personalization is fundamental for designing a top-notch digital brand experience.

    Source: Think with Google
    The shopping experience begins online for Hong Kong’s luxury consumers.
    Search and brand sites are key because 90% of purchases are digitally influenced.

    Millennial and Gen Z consumers spend the most time on research, so it pays to provide as much information as possible to this group. They also purchase more frequently, and they consider more brands when they do so.

    To stay top of mind, brands should ensure that they are present at as many touch points as possible and that their media strategies are always on.

    Expectations for online shopping are growing higher by the day, and this is especially true for premium brands.

  • Ikea to open first Japanese Tokyo store in 2020

    Ikea to open first Japanese Tokyo store in 2020

    Ikea Japan is preparing to open its first central Tokyo location. The 2500sqm store is planned for the fashionable Harajuku district, a central focus point for young local shoppers and tourists.

    Threatened by the rise of raw materials costs, Ikea is expected to struggle to maintain its low price points against strong online competitors such as Amazon. The brand’s parent recently registered a significant drop in annual profits as a consequence of the price increases in wood and metals.

    The new store is scheduled to open in the spring of 2020.

  • LG U+ IPTVs get Netflix in Korea

    LG U+ IPTVs get Netflix in Korea

    Netflix content will be available on LG U+ internet protocol TVs (IPTV) today. Under an exclusive IPTV deal inked with LG U+, Netflix content, including Netflix Originals, will be aired through LG’s platform, the carrier said Wednesday.

    LG subscribers won’t have to replace their existing set-top boxes as they will be automatically upgraded, though services will be first offered to the 1.07 million users of LG’s latest set-top box, dubbed UHD2, and gradually rolled out to other set-top boxes.

    Considering Netflix offers over 22,000 movies and television shows, including its big-name original content like “House of Cards,” “Stranger Things” and “Orange Is the New Black,” this is a good chance for the smallest carrier in Korea to steal some subscribers.

    By next month, the carrier will also reform the user interface of its IPTV so users have easier access to Netflix content as well as its own kids’ content platform, dubbed “Kid’s World,” that is gaining popularity among customers in their 30s and 40s with children. LG is banking on both services for the further growth of its IPTV business, according to Song Gu-young, senior vice president and head of home and media business at LG U+.

    The revamped interface could look similar to the Netflix app. When a user selects a video, an image related to the video will fill up the whole screen and a preview will run automatically, which is similar to how video previews are played on the Netflix app.

    The partnership between LG U+ and Netflix is no surprise as the market has long been expecting the announcement, but what’s still not clear is whether the carrier will offer a phone plan centered on Netflix. Without a useful plan, existing users of Netflix might not feel the urge to migrate to LG just for the IPTV service because it would only mean they get better access to Netflix content on the LG platform, but for the same monthly fee.

    LG is reportedly planning to roll out phone plans with a Netflix discount, according to an industry source, but it might take some time as new plans need government approval.

    For the time being, LG U+ is giving out free three-month Netflix trials to new subscribers of its IPTV plans worth at least 15,400 won ($13.50) per month until the end of this year.

    Korea’s mobile carriers have shifted their focus to the IPTV business as sales from traditional mobile phone subscriptions faltered after the government pressured them to make monthly phone bills cheaper last year.

  • Hanoi revives $500 million horse racing, entertainment complex

    Hanoi revives $500 million horse racing, entertainment complex

    A $500 million complex including horse racing in Soc Son District is off the shelf after 10 years. Hanoi authorities have approved the addition of the long-delayed Soc Son multi-purpose entertainment complex and horse racecourse project to the city’s master plan on socio-economic development to 2020 with orientation until 2030.

    The total investment for this project is currently estimated at about $500 million. The project is expected to go into operation after 2021.

    The planned site is mostly agricultural land. Once put into operation, the project will employ an estimated 5,000 direct laborers and 20,000-25,000 indirect laborers, generating a relatively large, regular revenue for the city’ budget.

    The project, which will be built in a planned tourist area about 40 kilometers north of Hanoi, will add a high-quality tourism product to Soc Son District in particular and the capital in general, the city stated.

    According to Hanoi authorities’ data, the capital has received over 26 million visitors this year, including 5.7 million foreign visitors, which are a 9 percent and 16 percent increase compared to last year respectively.

    The project to build a horse racecourse in Hanoi was first researched in 1999, with the racecourse’s proposed location in the southern districts of Hoang Mai and Thanh Tri.

    However, as Vietnam’s legal framework for sports betting and horse racing was incomplete at the time, the city’s foreign partner eventually withdrew from the project.

    The project was then revived in 2007 when the travel company Hanoi Tourist and South Korea’s Global Consultant Network asked for the city’s permission to research it, and was told by the government that it would be approved once the legal framework for sports betting is completed.

    Vietnam’s legislative body, the National Assembly, approved a bill legalizing sports betting last year and the government earlier this year promulgated a decree regulating the sports-betting business, throwing open opportunities for foreign investors to build racecourses in the country.

    In addition to the racecourse in Hanoi, foreign firms are also said to be pursuing plans to build horse racecourses in the northern provinces of Bac Ninh, Vinh Phuc and in Ho Chi Minh City.

  • Number of Cinema Screens in Indonesia Expected to Double Over Next 3 Years

    Number of Cinema Screens in Indonesia Expected to Double Over Next 3 Years

    The head of the Creative Economy Agency, or Bekraf, said he expects the number of cinema screens in Indonesia to double over the next few years, amid growing interest in the national film industry.

    “We expect to see at least 3,000 screens – twice what we have today. This is because local films thrive in small towns, but that’s also where we face a lack of theaters,” Bekraf chairman Triawan Munaf said on the sidelines of the World Conference on Creative Economy in Nusa Dua, Bali, last week.

    According to the agency’s 2019 Creative Economy Outlook, there are currently nearly 1,700 screens across the country. Triawan expressed hope that this could be nearly doubled over the next three years.

    The report further states that film is currently the fastest-growing subsector of Indonesia’s creative economy.

    However, as imported films still drive demand among moviegoers, the industry must figure out how to get local films to compete with those from abroad in terms of screening and scheduling.

    Triawan said the national film industry is growing rapidly, as illustrated by the fact that 40 percent of films screened in the country are local.

    This year, teen drama “Dilan 1990” attracted more than 6.3 million viewers nationwide, making it the second best-selling Indonesian film of all time after the 2016 reboot of the popular 1980s comedy franchise, “Warkop DKI Reborn: Jangkrik Boss! Part 1,” which boasted more than 6.8 million viewers.

    The number of moviegoers in the country has meanwhile also increased to more than 42 million by 2017 from around 16 million in 2015.

    More screens in other parts of the country can therefore facilitate this growth, as 183 of Indonesia’s 488 theater complexes are located on Java Island, Bekraf said.

    Cineplex 21, CGV Cinemas and Cinemaxx currently dominate the movie theater industry in Indonesia with 1,003, 275 and 203 screens, respectively.

    In her speech at last week’s conference in Bali, Finance Minister Sri Mulyani Indrawati also highlighted the importance of more vocational training to support the creative economy, of which the film industry is part.

    Despite the large number of moviegoers, many of them are less enthusiastic about local films because there are limited choices in terms of storyline and variety, which shows that there is a need for more quality screenwriters.

    “Indonesia has huge potential when it comes to writers and screenwriters, and this is an area we must explore further,” the minister said.

    Sri Mulyani also said that she was keen to learn more about the creative economy and how she could assist in its development.

  • “Falling Stars Challenge” has striked Asia

    “Falling Stars Challenge” has striked Asia

    The Falling Stars Challenge, a meme that has rocketed through Asia, features people posing as if they’ve fallen out of their luxury cars, with the luxury contents of their luxury bags spilling out on the pavement for all to see. The expensive goods are meticulously arranged so followers can admire the makeup, jewelry, shoes and other items that have oh-so-embarrassingly been laid bare.

    But the meme has become democratized, spreading from its beginnings as a way to take the humble out of humblebragging.

    It now encompasses any number of chosen identities, becoming a way to display the physical items and pursuits most closely associated with oneself.

    It’s popular among beauty and photography bloggers, fitness and food enthusiasts, and artists of all sorts.

    Hospital workers have shown off the tools of their trade, while others, with a touch of self-deprecation, have offered their more accessible collections of yoga mats, junk food and trash. They don’t even need to fall out of cars.

    The challenge originated in Russia and has spread throughout Asia, especially in China, where thousands of people have participated on Weibo, a popular social network.

    Even rigid government departments have joined in.

    The Consular Protection Center of China’s Ministry of Foreign Affairs posted a photo that showed a worker falling into a pile of paper.

    A police school photographed a fallen officer surrounded by bullets.

    The challenge has spread beyond Russia and China, with tens of thousands of posts from various countries appearing on Instagram.

  • Vaping Maker Juul Sounds Out Asia for Expansion

    Vaping Maker Juul Sounds Out Asia for Expansion

    United States-based Juul Labs is exploring selling its compact vaping devices in Asia and has sounded out government officials in Indonesia, one of the world’s most smoker-friendly countries, although gaining approval there could face significant hurdles.

    Expansion into Asia would provide the fast-growing firm with new markets at a time when it faces increased regulatory scrutiny in the United States and Israel over the potential health risks of its products’ high nicotine content.

    Juul representatives held discussions with the Indonesian government last month about introducing its vaping devices, finance ministry officials said.

    Indonesia has one of the world’s highest rates of smoking among adults and teenage boys and imposes no penalties for selling cigarettes to minors. Its population of 260 million also makes it a highly attractive market for tobacco and vaping firms.

    A person familiar with Juul’s plans said executives for the San Francisco-based company are concerned authorities may be reluctant to grant approval due to likely opposition from the traditional tobacco industry, which provides much of the country’s tax revenue.

    Tobacco taxes accounted for nearly Rp 150 trillion ($10.2 billion) or about 11 percent of national tax revenue in 2017, government data showed. Each province also imposes taxes on cigarettes.

    Juul also worries its argument that vaping is healthier than smoking will not hold much sway in Indonesia, which is not as concerned as other countries about health issues, said the person, who declined to be identified as the discussions were not public.

    Juul representatives reached out to the Ministry of Finance to discuss how it would be taxed on any sales of devices there, the officials said.

    The government needs to examine the domestic e-cigarette market to determine how a foreign player such as Juul could hurt local small and labor-intensive e-cigarette firms, said Sunaryo, a senior official at the Directorate General of Customs and Excise.

    “We will need it to study it,” he said, adding that he was not sure Juul would comply with a regulation that requires e-cigarette devices and liquids to be sold separately.

    Juul also would need approval from the Food and Drug Monitoring Agency (BPOM). Officials at the agency said Juul had yet to be in touch.

    Other Asian countries the three-year-old firm is actively considering for expansion include India, South Korea and the Philippines, the person familiar with Juul’s plans said.

    In addition to Indonesia, Juul filed trademark applications for those countries between April and October this year, as well as in Malaysia and Singapore, according to a review. It opened its first Asia office in Singapore in July.

    So far Juul, currently valued at $16 billion, is available only in the United States, Canada, Britain and Israel. It has plans to enter Russia later this year.

    Juul said in that it is “proactively learning more” and engaging with local officials in Asia “to understand and hear their views.” It does not have immediate plans to launch in any Asian country, it said. Juul spokeswoman Victoria Davis declined to elaborate.

    A Taxing Question 

    Indonesia is one of only a handful of United Nations member states that has not signed on to the World Health Organization’s global treaty that sets standards for tobacco control.Roughly two-thirds of Indonesian men smoke tobacco daily, and more than 21 percent of boys aged 13-15 smoked cigarettes regularly, according to a WHO report last year.

    E-cigarettes, available in Indonesia since at least 2013, is a small but growing market. The customs office estimates that there are about 300 unsupervised liquid makers, known as brewers in Indonesia, producing various liquid products to more than 4,000 vape stores and 900,000 smokers.

    Philip Morris International, maker of Marlboro cigarettes, which now controls about a third of Indonesia’s market through its stake in Sampoerna, does not offer any of its noncombustible cigarette products in Indonesia.

    That includes its IQOS device, a heat-not-burn tobacco product, according to a company spokesman, who declined to comment on why it has not introduced the product.

    In October, the government imposed a 57 percent tax on e-cigarette liquids, on par with taxes on traditional cigarettes. But tax collection, particularly from smaller companies, is difficult in Indonesia and new rules are often ignored.

    Juul now commands a nearly 75 percent share of the US e-cigarette market, up from 13.6 percent in early 2017, according to a Wells Fargo analysis of Nielsen retail data.

    Its products, like most electronic cigarettes, vaporize a liquid containing nicotine. One Juul pod contains as much nicotine as a traditional pack of 20 cigarettes, according to the company’s US marketing.

    Juul liquid in the United States has a nicotine concentration of 59 milligrams per milliliter, much higher than the liquids typically sold in earlier versions of e-cigarettes and nearly three times the allowable limit in the European Union.

    In August, Israel banned Juul devices with nicotine concentration of more than 20 mg/mL, citing “a grave risk to public health.” Juul is appealing that decision and currently offers a lower nicotine-strength electronic cigarette in Israel.

    In September, the US Food and Drug Administration opened an investigation into Juul and other electronic cigarette companies, citing the rising number of teens who appear to be using Juul and other vaping devices. This week it is expected to issue a ban on fruit and candy-flavored e-cigarettes sold in convenience stores and gas stations.

    In its statement, Juul said its products are intended for adult use only, and that it aims to “improve the lives of the world’s one billion adult smokers” by providing an alternative to cigarettes.

  • Tencent closed to buy sports firm Amer

    Tencent closed to buy sports firm Amer

    Social media conglomerate Tencent Holdings is believed to be close to joining a Chinese investment group bidding to acquire Finnish sports goods firm Amer. The consortium, spearheaded by Anta Sports Products, would see Tencent participating as one of a few minority investors under the proposal. Its involvement would serve to boost considerably Amer’s brands in the Chinese market.

    In a statement made two months ago, Anta spoke of joining with local buyout company FountainVest Partners to offer a potential €40 (US$45.60) per share for Amer, a target value of around €4.7 billion ($5.3 billion). The consortium has sought at least €3.5 billion ($3.99 billion) in loans. Anta has a market value of about $11.6 billion.

    The acquisition agreement could potentially be complete within several weeks.

  • J.Crew’s CEO Jim Brett is leaving the firm

    J.Crew’s CEO Jim Brett is leaving the firm

    J.Crew chief executive Jim Brett is exiting the company, the retailer said, and a committee of four executives will step in to manage operations until a replacement is found. The statement said the decision had been mutual between Brett and the board of directors.

    “Returning J.Crew to its iconic status required reinventing the brand to reflect the America of today with a more expansive, more inclusive fashion concept,” said Brett. “However, despite the recent brand relaunch already showing positive results, the board and I were unable to bridge our beliefs on how to continue to evolve all aspects of the company.”

    Brett will be replaced by four executives: chief operating officer Michael Nicholson, chief experience officer Adam Brotman, chief administrative officer Lynda Markoe and Libby Wadle, president of the Madewell brand.

    Brett joined the specialty retailer in July 2017, at a time when the company was struggling with looming debt payments and declining consumer sentiment toward the brand. Over the next year and a half, he overhauled the executive team, bringing in former colleagues from West Elm — where he was CEO — and URBN — where he worked at both Anthropologie and Urban Outfitters — to revamp the brand identity and restructure the business. In 2017, the company was able to bide a bit more time to implement a turnaround, negotiating with creditors to push back the maturity of $566.5 million in debt from 2019 to 2021.

    He lowered prices, launched new brands and tried to reposition J.Crew as an inclusivity-driven, one-for-all label not so tied down by its preppy heritage, especially as it had most recently been interpreted by agenda-setting designer Jenna Lyons.

    In a sharply worded email sent to senior staffers in July 2018, he dismissed Lyons’ work, which turned polarising near the end of her tenure, while laying out his own priorities.

    “PRETTY always sells. A glen plaid jacket with a graphic tee and camouflage pants is anything BUT pretty,” he said. “The new feminist fashion movement is enjoying the POWER of femininity (see latest Dior shows) vs. the last feminist movement which was about women finding power in dressing like men. Femininity is critical — pretty is critical — femininity is powerful. These things are in starch [sic] contrast to Jenna’s masculine, sexual and overtly aggressive J. Crew.”

    While Lyons’ vision had stopped resonating with consumers, Brett’s fix was viewed by some analysts as a watering down of the product. There were too many changes at once — from the introduction of a bare-bones loyalty programme to changes in fabric suppliers to the implementation of a marketplace — all with varying impact. He also continued to discount heavily, something many of J.Crew’s competitors are trying to move away from. Talk of a decline in morale also permeated Brett’s run, with multiple corporate-level employees leaving, including one of Brett’s own hires, chief marketing officer Vanessa Holden, who recently announced her departure.

    In the second quarter of 2018, the group — which also includes Madewell — reported that same-store sales rose 1 percent from a year earlier after 15 straight quarters of decline. Star performer Madewell, which drives about a fifth of sales, saw comps jump 28 percent. Total sales at the company were $588 million, up 3 percent from the same quarter in 2017. The company still experienced a net loss of $6 million, compared to a $19 million loss during the same period last year.

    Whether the company has managed to keep up the momentum will be revealed imminently, as third-quarter earnings are expected to be released this month. The period was marked by J.Crew’s official September relaunch, including the rollout of its #meetmycrew marketing campaign. Just this past week, J. Crew launched another brand, Nevereven, which is also being sold at multi-brand retailers such as Fred Segal in Los Angeles.

    But talk of the company giving up more of its corporate office space to Facebook and Instagram — which occupies the same building — and news of a “for rent” sign in the window its popular men’s concept shop, the Liquor Store, indicates that the J.Crew is still in cost-cutting mode.

  • Korea’s gas prices fall quickly thanks to fuel tax cuts

    Korea’s gas prices fall quickly thanks to fuel tax cuts

    The government fuel tax cut, which was implemented to ease the burden on rising crude oil prices, has turned out to be more effective than initially expected. According to the Ministry of Trade, Industry and Energy on Sunday, the average price of gasoline at gas stations nationwide was 1,575.2 won ($1.40) per liter during the second week of November. This is an 85.2 won, or 5 percent, drop, from the 1,660.4 won average just a week earlier.

    Diesel prices have also dropped to an average 1,419.2 won per liter, down 56.2 won, or 3.8 percent, from the first week of this month, when it was an average 1,475.4 won for the same amount.

    On Saturday, the ministry said the average price of gasoline had further fallen to 1,556.8 won per liter – 133.5 won less than the 1,690.3 won it sold for on Nov. 5, the night before the government’s fuel tax cut went into effect.

    On average, the government cut 15 percent off of all fuel taxes including gasoline and diesel in the hopes of easing the burden created by rising international crude prices. It was the first fuel tax cut adopted in a decade.

    “As the situation [of low-income households and small and medium-sized enterprises] becomes more difficult with rising international crude prices, we have decided to aim for a psychological effect that will help the economy by increasing disposable incomes,” Ko Hyoung-kwon, deputy finance minister said in late October.

    Among gas stations, the government-supported Altteul Gas Station saw the biggest drop in prices – its gasoline costs 135.5 won less than it did on Nov. 5.

    Other major brands including SK, GS, S-Oil and Hyundai Oilbank have cut gasoline prices by 133.3 won.

    By region, Jeju lowered its gasoline prices the most. The island has seen a 169.4 won drop in average price compared to Nov. 5. Daejeon followed, as prices have fallen an average of 149.6 won, while Incheon came in third after seeing a 142 won drop.

    Seoul gas stations on average lowered their prices by 134.9 won while Gyeonggi gas prices fell by 137.2 won per liter.

    Seoul and Gyeonggi account for 39 percent of all fuel sold in the country.

    However, as of Saturday, 173 gas stations around the country – 1.5 percent of the nation’s gas stations – have not taken part in lowering fuel prices. The ministry said that these gas stations failed to deplete all of the gas that they had stockpiled before the Nov. 6 fuel tax cut was implemented.

    The fuel tax cut will be applied for six months.

  • Malaysia’s Central Bank confident of 4.8% GDP growth in 2018

    Malaysia’s Central Bank confident of 4.8% GDP growth in 2018

    Economists have mixed views on Malaysia’s full-year gross domestic product (GDP) growth despite the central bank’s confidence the economy will expand 4.8% this year. Sunway University Business School’s Professor of Economics Dr Yeah Kim Leng expects GDP growth for 2018 to come in at 4.7% to 4.8% while growth in 2019 could be better than this year if there is sustained global demand.

    “For 2019, GDP (growth) would be closer to 5%. It may exceed that if the global economy holds up, in terms of lessening trade tension and strengthening of China’s economy,” he said.

    However, Inter-Pacific Securities Sdn Bhd head of research Pong Teng Siew said this year’s GDP growth is unlikely to hit 4.8%, as the quarterly expansions have been on the decline.

    “We had 5.4%, 4.5% and 4.4% for the first three quarters (respectively) this year. It would require substantially stronger growth than what we saw in Q3 to hit 4.8% full-year growth,” he said.

    The Malaysian economy grew by 4.4% in the third quarter, Bank Negara Malaysia (BNM) announced on Friday.

    Pong said the final quarter of the year does not have the tail wind that would boost consumption and expects full-year growth to come in at 4.5% to 4.6%.

    “For 2019, it is quite a challenge to forecast due to global growth slowing. We face headwinds from global growth as we are an export dependent economy. Net exports from goods and services are fluctuating,” he added.

    Pong expects GDP growth in 2019 to be similar to 2018’s, due to the unpredictability of global trade.

    Commenting on the economic performance in Q3, Yeah said it was softer than expected, which weighed down on growth momentum.

    “In the third quarter, services (sector) was good, largely due to private consumption. Growth was largely driven by the services and manufacturing sectors. As long as we can sustain the current growth momentum, a lower oil price will not affect GDP growth,” he said.

    On the supply shocks that affected growth in the first nine months, Yeah said the situation is likely to improve as the unscheduled maintenance shutdowns are over, with less disruption and gradual rebound projected.

    Pong, who expected Q3 GDP growth of 4%, said the 4.4% achieved was better than projected in view of the high base of 6.2% a year ago.

    “In Q3, the challenge was the high base in Q3 last year, when we achieved GDP growth of 6.2%. It is difficult to achieve strong year-on-year growth. Many expected Q3 to be strong due to consumption spending following the removal of Goods and Services Tax (GST).

    Retail numbers were stronger than what I expected. Consumption was stronger, therefore services was stronger,” he said.

    He noted that private consumption was stronger at 9% in Q3 (8% in Q2), which is a rare occurrence, while public consumption was also stronger at 5.2% (3.1% in Q2).

    Both Yeah and Pong cautioned that the softening in the plantation sector, especially palm oil prices, could affect smallholders’ income, which would in turn affect consumer spending.

    “If commodity prices fall, it will hit GDP. If CPO (crude palm oil) continues to be weak, it will have a negative impact on consumption. In particular, CPO and rubber. As it is now, commodity prices are weak and are still falling,” said Pong.

    However, Yeah said the impact on consumer spending would not be that large in view of the government’s spending and policies that remain supportive of consumption.

    At a media briefing last Friday, BNM governor Datuk Nor Shamsiah Mohd Yunus said private consumption expanded strongly during the quarter following the zerorisation of GST.

    “On the supply side, the services and manufacturing sectors supported growth, while the mining sector continued to be affected by production shocks.”

    She said growth could have been 0.5 to 0.7 percentage point higher in the absence of commodity shocks, as 17% of the economy (agriculture, mining and quarrying) contracted by 1.3%.

    Nonetheless, Nor Shamsiah believes the economy is on track to register a growth of 4.8% for 2018, supported by private sector activity with gradual recovery in commodity production lending support to growth.

  • Malaysia’s October vehicle sales up 0.5% to 47,273 units in Oct

    Malaysia’s October vehicle sales up 0.5% to 47,273 units in Oct

    Vehicle sales in October 2018 were up marginally 0.5% to 47,273 units from 47,041 units in the same month a year ago, according to the Malaysian Automotive Association (MAA). However, MAA said the sales volume in October 2018 was 51% higher than September 2018, due to availability of stocks replacing the depleted post-zero Goods and Services Tax (GST) period.

    In addition, it said year-to-date, the total industry volume (TIV) was 6% higher than the similar corresponding period in 2017.

    The sales volume for November 2018 is expected to be slightly better than October 2018 on the back of new model launches and aggressive year-end promotional campaigns, it added.