Introduction: What is this?
As we develop our "curated content" model, we would like to share some of the most interesting material from our Catalyst Asia site with you. These may be articles, reports, visualizations, videos, or other media that has been posted here by associates, or suggested by our Catalyst colleagues and fellows.
Intelligence, in this instance, is knowledge and insights--usually from the outside--that we believe could be useful to our Mars colleagues. We have read it, and provided very brief summaries of the content so you can decide if you would like read the details. We are launching this via a blog and bullet-format email in order to make this resource as widely accessible as possible.
We hope you will enjoy these notes, and that you will tell us how we can improve them and tailor them to your requirements. Thank you.
– Catalyst Asia
Catalyst Asia Intelligence Breifing - June
The world economy continues to fail to inspire…though conventional wisdom regarding Chinese growth has changed little. For example, even as the Economist Intelligence Unit lowers its global growth projections further—with pointed downgrades for India and Brazil—in the wake of the latest Euro crisis, its expectations for China remain relatively high.
With this in mind—and in the interest of avoiding “groupthink”—we turned to Michael Pettis for some alternative analysis. Sticking with China, we have also selected several pieces providing cultural perspectives on how consumers in that country are evolving in unique ways, and a number of press reports about how one global food company (Kraft) is seeking to grow its China market share.
Rounding out this month: an interesting take on improving the wisdom of crowds, an analysis of what is driving the growth of emerging market-based companies; and a plea against the use of annoying business jargon.
Professor Michael Pettis takes a firmly contrarian stance with his criticism of the Chinese growth model and his predictions for the next decade of economic performance in “Everyone Is Wrong: China Is Not Rebalancing, And Consumption Is Still Being Repressed.” His analysis is useful for anyone interested in a macro perspective on the future of the Chinese consumer market.
Views of Society
The New Yorker magazine profiles the online dating site Jiayuan, and provides a great example of how Chinese consumers approach this service in a unique way: “In America, [internet dating] has the power to expand your universe of potential mates; in China, a nation of 1.3 billion people, online dating promises to do the opposite.” Read about it in The Love Business.
The FT recently reviewed a collection of three books that attempt to answer the question “What makes Chinese people tick?” And, specifically, what makes them buy products. A Slice of the Chinese Market.
And a short piece in Foreign Policy touches on the challenges facing Chinese families facing separation and relocation as fathers and mothers pursue stability and economic success by taking jobs far from home. China’s iPad Generation.
Competitors in the news
We’ve captured a trio of articles focused—in whole or in part—on Kraft’s drive to increase its business in China, and the steps the company is taking to meet its growth targets. Kraft appears to be following a playbook that includes at least these three elements: develop products tailored to local tastes; broaden distribution channels, and improved marketing. Perhaps because it’s the best “hook” to capture Western reporters’ attention, regional specific flavors get the most ink here. Kraft Craves More of China’s Snacks Market, Wall Street Journal; Crab Chips, Fruity Oreos? They’re Big Overseas, AP; Rectangle Oreos and Cucumber Gum, Made in China for China, Reuters.
Food for thought
Opposites may not attract…but they might produce better forecasts. Researchers at INSEAD build on the idea that while individual forecasting is notoriously biased, averaging collective forecasts can produce accurate results. Their research looks the effect that diverse personality types have on the accuracy of collective judgments. Diverse Personalities Make for Wiser Crowds.
An analysis for McKinsey & Co attempts to discover why companies based in emerging markets grew about twice as fast as multinationals based in developed economies suggests that the main drivers were: higher reinvestment rates; agile asset reallocation; and growth-oriented business models. The authors found little of their growth advantage to attributable to starting from a smaller revenue base. Read the full article here: Parsing the growth advantage of emerging-market companies.
Uncomfortable with the phrase “drinking the Kool-Aid?” It topped 31 competing nuggets to claim the title of the most annoying business jargon in a recent contest at Forbes.com. Read the full story (with links to the full Jargon Madness bracket) here: The Most Annoying, Pretentious And Useless Business Jargon
Webinar, 26 June: “Does Asia have the talent to lead innovation in the 21st century?” This is part of The Asia Innovation Series, an ongoing series of Singapore Sessions with Harvard Business Review, where experts from diverse backgrounds focus on tomorrow's business challenges in Asia, to answer the question 'what's next? You can register your interest here - http://online.krm.com/iebms/coe/coe_p2_details.aspx?oc=10&cc=0011408&eventid=19086&m=SP1