December 1, 2011

New World Order.

We study people’s behaviour, analyse major cultural developments and connect them to identify behavioural change.

Some people describe these as trends - for us these trends are better referred to as TABS as trends is only one component part.

Behaviour and culture.

When America sneezes...

Is this still the case?

China is the largest consumer market for:Bikes and motorcycles 7%Shoes 12%Automobiles 22%Mobile phones 22%Luxury goods 19%

Trendwatching asked the question are these markets Emerging or Emerged?

Are we still in control of our own destiny?

Economic shift - Asian labour costs rise and a major domestic market.

Purchasing power of the West falls.

Uncontrollable inflation in the West, shrinking import market.

In the UK, 62% believe the US is losing influence as a superpower on the world stage

What if the world didn’t look like this?

But instead looked like this?

Does that change your perspective?

Consider the diaspora.

This is not a good time to be xenophobic.To deliver economic growth embracing skilled workers is crucial. Always has been. Study by Duke University found immigrants made up1/8th US population but founded 25% of the technology and engineering firms.

There are 215m first generation immigrants around the world (3% of world’s population). There are more Chinese people living outside China than French people in France.

America (and Britain) educate foreign students as scientists and engineers and then expel them.

Sensible?

The Mayor of New York describes this as National Suicide.

Chinese tech industry is dominated by ‘sea turtles’.

Middle classes are on the rise.

In India strong growth.

In 2001 /02 just 59m households had income of $4k+

By 2009/10 this was around 200m.

While millions live in rural poverty, millions more are moving to urban centres and adopting middle-class lifestyles.

The expanding domestic markets in BRIC countries will create demand both internally and externally.

In Brazil 5% of the population own 85% of the wealth.

Emergence of the C-class, a lower middle class.

The result? Strong domestic consumption.

73% of wealthy consumers in China are under 45.

China consumes 28% of the world’s luxury goods.

64% of Chinese consumers equate luxury to success.

41% believe that showing off luxury brands exhibits poor taste.

The middle class is estimated to be 157m people - only the US has a larger middle class.

Within one generation the Chinese middles class will be 4x larger than America’s.

By 2030 China will have 1.4bn middle class consumers.

Compared to 365m in the US and 414m in Western Europe.

We are already interested in China, Brazil and India.

The Beijing Olympics was a milestone and marked the opening of China to the world.

There is already a cultural exchange - not just political and economic - Dialogue Cafe.

Increasingly we look to the East for guidance.

RichemontAsia Pacific revenue climbed 48% and 41% of their revenues come from the area. The company now has 323 stores in China.

Prada Floated on HK stock exchange in 2011. 43% of the brand’s global earnings comes from China.

Unilever56% of Unilever’s business comes from outside the US and Europe. Expect this to be 70-75% by 2012.

Starwood Personalized Travel program.

Includes:

In-hotel Chinese specialist.

Chinese translated collateral.

Convenience of home - including instant noodles.

Chinese friendly menus.

Will roll out across all Starwood hotels in 2012.

Harrods London has made itself more Chinese friendly:

75 Mandarin speaking staff.

Recently installed Chinese bank-card terminals allowing customers to make payments from domestic accounts.

Scour Chinese social networks for feedback.

The result?

40% rise in sales to Chinese tourists in Q1.

Mind your Ps and Qs.

Opened in December 2009 and got it spectacularly wrong.

Expensive - more than US“Hey guys” greetingHalf naked torsosModelled on Greek / Roman concept of beauty. Waspy aggressive image. Pumped perfume.“Display It, Don’t Spray It”No Asian shaped design.

Paul Smith. Culturally sensitive and respectful.

Paul Smith made Japan its commercial cornerstone over 30 years ago. 200 outlets in Japan15 outlets in the UK

We have a pick ‘n mix Global Mindset.

Lahore Café BarServes typically ‘Asian’ fare, keema and tikkas alongside sticky toffee pudding and jam roly poly

For breakfast? A ‘Full Muslim.’

“We are not losing our culture, we are creating a new one”Ashgar Ali, owner, Lahore

Smirnoff Nightlife Exchange.Pride in your own culture and a curiosity of others’ - take your nightlife and share it with other cities.This is a cultural exchange.

It’s about pride in your own culture and heritage...

...and a curiosity about others - Conflict KitchenConflict Kitchen is a politically motivated NYC takeaway restaurant that rotates cuisines and identities every four months to highlight a different country the US is in conflict with.

These signs are gaining traction: Life in a DayLife in a Day is a user generated film by Ridley Scott and Kevin MacDonald that encouraged people to upload video footage of their lives on July 24. 4,500 hours of film was submitted.

The Global Mindset attitude is most prevalent amongst millenials.

Young people travel more than any other generation before them and find it easy to adapt to, and feel affinity with, foreign cultures.

“Millennials, more than any generation are eager to understand perspectives that are different, event antithetical, to their own, rather than push them away”Torrey Taussig; Strategic Communications, Glover Park Group

When we travel we are increasingly seeking local immersive experiences: in just three years AirBnB users have booked 1.9m nights across 184 countries...

...more than that, there is a real appetite to explore and learn: 78% of millennials have stated a strong preference for learning something new when they travel.

Early signs include: PackabookPackabook encourages people to explore the world through fiction. It’s a free website which allows users to discover novels set in locations they intend to visit.

Understanding the brand opportunity - Prada ‘Made In’The ‘Made In’ campaign exposes the global narratives behind Prada products and offers insight into changing perceptions; ‘Made in India’ comes to mean interesting, not cheap.

Pride in cultural icons and national brands and branding.

The West as much as the East is uncomfortable with the idea of a McWorld.

Increased pride in national icons and an emergence of soft powers - Titan. The largest brand no-one seems to have heard of.

In China the spirit Baijiu accounts for more than 30% of the alcoholic drinks market.

The top brands in Brazil are all Brazilian. From Itau (financial services) to Petrobras, to Skol, Natura and Brahma.

Ever wonder why the McFalafel flopped?

This guy makes them better.

Israelis go to McDonald’s for a taste of Americana.

That said, with Global Mindset, how would a McFalafel have fared in NYC?

Expect cultural collisions.

As the West loses confidence, it will increasingly be challenged and increasingly face cultural collisions.

Rejection of patronising western grasp of world cultures - ‘world music’ and ‘Bollywood’ will become faux pas and become increasingly culturally sensitive and worldly.

Shomichelin, Ghana Think Tank.

English will remain the business language of choice despite spending more than €1bn in translation services a year in the EU alone.

Asia first.

Levi’s launched dENiZEN as their ‘global’ brand.

Asia first, US second.

Hermès launched a range of high end saris.

Mumbai first, Paris second.

British Airways launched their new First Class cabin on the Shanghai - London route.

China first, US second.

- Consider the diaspora.

- The middle classes are on the rise.

- We are already interested in China, Brazil and India.

- Mind your ps and qs.

- We have a pick ‘n mix Global Mindset.

- Pride in cultural icons.

- Expect cultural collisions.

- Asia first.

Round-up

Contact.

Twitter: @canvas8 Email: nick@canvas8.com