Luxury in China - social responsibility and increased sales go hand-in-hand

Trying to promote your brand in China, the world’s second largest luxury market? Most labels instinctively turn to ads – print, outdoor, TV, online, mobile or radio. But a new study points to a more powerful tool: promoting corporate social responsibility. More than two-thirds of Chinese consumers said a luxury brand’s CSR would affect their decision to purchase decision, according to a new report. Asian market research company Albatross Global Solutions, and Ruder Finn Asia  surveyed 1,100 luxury consumers earlier this year in China, Hong Kong and Taiwan to produce their China Luxury forecast 2010. CSR was found to be particularly important among the more educated shoppers with higher incomes.

Jean-Michel Dumont, chairman of Ruder Finn Asia, says the earthquake in Sichuan two years ago “was a turning point for CSR in China, whichever sector you are in.”

Local companies donated millions of dollars immediately after the quake. But some multinationals were criticised for not doing enough. Bloggers labelled companies like Louis Vuitton, Nokia, Coca Cola, McDonald’s and KFC as tie gong ji, which literally translates to “iron-roosters”, meaning scrooge. Foreign companies were quick to respond. Now consumers expect more, says Dumont.

“Consumers are looking at what companies do beyond donations. They want to know how companies are getting the society involved,” he says, adding that “when you talk about luxury in China, you are talking about European brands.”

The study found that among the 15 most popular brands in China, Hong Kong and Taiwan, 14 are from Europe, with the most sought-after being Louis Vuitton, Chanel and Gucci. The only American label that made it to the list is Estee Lauder, the cosmetics company.

A notable exception from the list is Japanese brands, says Christophe Cais, executive director of Albatross.

There are two main reasons for the prejudice. Firstly, the Japanese are big in cosmetics, which is a small segment of the luxury market in China. The other, more sensitive reason is a long and bitter history between China and Japan. The two countries were war enemies and “some consumers are still resentful of Japanese products in China,” says Cais.

Foreign iron-roosters take note, Chinese luxury consumers now expect more than just a great brand.

This article first appeared on the FT’s blog here.

Liverpool Street Flash Mob

Communities in the West are increasingly splintered and media channels increasingly fragmented – making the cohesive engagement of groups more difficult and challenging. For the advertising industry, which at times still struggles to throw off the organisational shackles of above, below or through-the-line, the introduction of ‘transmedia story telling’, ‘augmented reality’ or ‘blended reality’ adds even deeper layers of complication to an already complex communications story. Against this backdrop, experiential advertising through group mobilisation becomes an incredibly powerful branding tool.

So how can brands and agencies mobilise groups to their benefit and use these powerful forces to engage people with their brand?

Barack Obama, an Australian with a lost camera and the T-Mobile flash mob advert all share a common characteristic – they all successfully mobilised large groups to help them achieve their end goal. In 2008 Barack Obama compelled millions of black voters to visit the polling booth and in doing so became the first black president of the USA. In 2009 an Australian tourist visiting Greece found a French person’s lost camera and managed to harness over 250,000 people through Facebook to help him find the owner. In 2007 T-Mobile mobilised a 13,000 person flash mob and in doing so created an iconic piece of advertising.

To understand the forces at work in mobilising groups it is important to recognise the human triggers for joining these groups in the first place:

1. Fun

2. Share values

3. Reward

4. Herd instinct

Canvas8 subscribers can read the full report here.

An estimated 80% of Brazil's construction activities are independently-run Creative Commons, nateone (2008) ©

In Brazil, the buoyant construction market means there aren’t always enough qualified construction workers to go around. Majoritymarkets.org estimate that 80% of housing projects in the country are independently-run, often by unskilled labourers. Although it’s been running since 2006, Construction Doctors is a clever and ethical way of educating and empowering the local community – and boosting profits for local retailers in the process.

Canvas8 subscribers can read the full Focus article here.

Perpetuating the 'bad bank' image © Creative commons

It’s not surprising, given the very loud dissent towards the global banking industry, that there’s a flurry of activity among mainstream banks to rebrand and repair some of the damage. In doing so, however, they should be wary of superficial gestures that will make little difference in the long term. Caja Navarra is one institution redefining the industry at a grassroots level and delivering a genuinely different customer experience.

Canvas8 subscribers can read the full case study and opportunities for the banking sector here.

02 have pitched the Joggler as the "new fridge door"

There was a time when the fridge door and post-its were the tools that helped organise family life. Scribbled notes reminded mum and dad about dentist appointments, football practice, guitar lessons and parent-teacher meetings. The landline telephone helped the family stay in touch with their distant loved ones. Photos had to be picked up at the photo lab before they were glued into a leather-bound photo album and shared with family and friends.

With digital cameras, smartphones, networking sites, Skype and Gmail, it seems those times are long gone.

Representing nearly 20 percent of the online population in the US, the so-called ‘Power Mums’, who rely on technology to stay connected with their families and organise their busy lives, wield more influence than ever before.

Canvas8 investigate the trend for ‘digital mums’ and the role that technology has in their lives. Canvas8 subscribers can click here to read the full article.

Homes of the future?

Amidst our interactions with PCs, mobiles and games consoles to conduct everyday activities, there is a new trend emerging: such technology is being adapted to control energy use and improve home security, increasingly blurring the lines between consumers’ online and offline worlds.

Read the full report on Canvas8 here.