Corporate America July 2015

HEALTH IS WEALTH + IS SPORT THE FUTURE OF SUSTAINABLE FOODS?

Corporate America JULY 2015 • WWW.CORPORATEAMERICA-NEWS.COM

Space...

The Financial Frontier

The Federal Aviation Administration has granted permission for the 10th commercial spaceport to be built in the US. Is this money well spent or cash tossed into the air?

PLUS: YOU SHOES, YOU LOSE!

European footwear market gains momentum, with rapid growth helping boost sales in popular US firms.

AMERICA LOSING ITS APPAREL The retail company has announced its strategic turnaround plan, which involves a $30million cost reducing strategy.

What:

We partner with high technology companies to assist in developing intellectual property assets, formulating and executing strategic plans for achieving maximal value for our clients. Our clients have achieved over $1.6 Billion (USD) in market value, either through financing rounds, merger and acquisition, licensing or litigation awards. To achieve this success, we combine professional and technical skills with level-headed business principles and experience. Or practice is devoted to supporting our client’s intellectual property asset development, commercialization and, when necessary, enforcement.

Planning:

The focal point of an intellectual property plan is to secure maximum value for intellectual property assets. This is achieved by first defining the business objectives to be achieved.

Strategy:

Once the IP plan has been identified, a management team, including business, technology and legal expertise, reviews the business objectives, considers the congruence between the plan and the objectives, then pressure tests the plan against identified opportunities to challenge that the intellectual property assets will achieve those objectives. Being dynamic, the plan will be consistently and constantly assessed, revised, and reassessed as new objectives are identified, new opportunities are presented or new challenges arise.

A coherent IP strategy will include IP landscaping to identify and analyze existing IP rights and players in the relevant technology space. The white space opportunities will be identified and an evaluation of the coherence between the IP plan and the white space analysis will be completed. In addition, IP forecasting may be undertaken to predict, based upon a third party’s prior IP behavior, what are the likely IP protection pathways a third party will be pursuing with their IP portfolio. Additionally, licensing and collaborative research and development opportunities may be undertaken, “blue sky” evaluation for next generation products and/or superseding technology and opportunities for developing IP in those areas, freedom-to-operate issues relevant to the pre-commercial products under development to minimize the risk of material liability in litigation should be undertaken and processes for dynamic and real time IP tracking within the technology space, may be implemented.

“

We combine professional and technical skills with level-headed business principles and experience.

”

Who:

Members of the firm have scientific training and regularly work across a spectrum of technologies including pharmaceuticals, medical devices, biotechnology, therapeutics, diagnostics, nanotechnology, organic and inorganic chemistry, biochemistry, materials science, agricultural chemicals, plant breeding, environmental protection systems, semiconductor processing, industrial and medical lasers, computer hardware and software, digital and analog electrical systems, water purification systems, evaporative cooling systems, skin care products, clothing, motor vehicle assemblies and systems, and general mechanical and electrical technologies.

Address: 1480 Techny Road Northbrook, Illinois 60062 Tel: 847-770-6000 Fax: 847-770-6006

info@RosenbaumIP.com www.rosenbaumip.com

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Contents 32 Feature

TEA TIME

New product launches highlight diversification in US drinks market.

14

18

Feature

HEALTH IS WEALTH

Health insurance market set for shake up as mergers and acquisitions are announce.

Feature

YOU SHOES, YOU LOOSE!

European footwear market gains momentum, with rapid growth helping boost sales in popular US firms.

26 4

Feature

IS SPORT THE FUTURE OF SUSTAINABLE FOODS?

News

New report confirms leading sports stadiums serving top teams are promoting sustainable foods through practise.

12 Features

34

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36

Feature

City Focus

Amazon finds retail opportunity for new technology with 3D printing store.

The retail company has announced its strategic turnaround plan, which involves a $30million cost reducing strategy.

NEW DIMENSIONS IN 3D PRINTING

AMERICA LOSING ITS APPAREL

Calendar/ Planner

On the Cover

Feature: Space: The Financial Frontier 22

The Federal Aviation Administration has granted permission for the 10th commercial spaceport to be built in the US. Is this money well spent or cash tossed into the air?

July 2015 • CorporateAmerica • 3

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News

New Cannabis Laws Give Businesses a Boost Laws on sale of the drug implemented this month in Oregon will create business opportunities.

Recreational cannabis use was legalised in Oregon on 1st July, with regulations to allow retailers to sell the drug due to be in place by next year, leading shops and business to take advantage of the change in legislation when marketing and distributing products.

One such firm is Green Technology Solutions, Inc, which plans to capitalize on the new laws by cultivating growth in their products and services to take advantage of the recent increase in business they have seen across the US. The firm has a strong growth strategy and has recently acquired cannabis edibles developer Elevated Industries in order to expand in that sector, as well as working towards growing their own range of products to cater for the ever expanding industry.

Wallace W. Browne, Chief Executive Officer of Green Technology Solutions, was optimistic about the firm’s growth following the ruling in Oregon.

‘We’re very pleased, obviously, that the law is changing in Oregon and around the country.

We are engaging potential business-to-business partners and clients in Oregon now, and we’re confident that we can help make cannabis production and retailing easier and more profitable for everyone involved.’

The new laws will give business the go ahead to sell cannabis and cannabis related products to customers for recreational uses, and will offer a growth industry for retailers to diversify into.

Small businesses selling cannabis and related paraphernalia will also benefit from the introduction of the Small Business Tax Equity Act of 2015, which is in the process of being passed and which acts as ‘an exception to Internal Revenue Code section 280E to allow businesses operating in compliance with state law to take deductions associated with the sale of marijuana like any other legal business’.

It is estimated that the US cannabis industry could be worth as much as $10 billion by 2018.

Over half of US states have legalized the sale of cannabis for recreational purposes including Washington and Alaska.

4 • CorporateAmerica • July 2015

Alliant Insurance Services Continue Expansion with Preferred Concepts Insurance firm continues to grow its managing general agent practise by acquiring Preferred Concepts.

Alliant Insurance has announced that they have made their fourth managing general agent acquisition this year by purchasing Preferred Concepts, the leading insurance program underwriter and wholesale broker which has offices in New York, New Jersey, and Connecticut.

Tom Corbett, the Chairman and CEO of Alliant Insurance made it clear that the new acquisition was essential to maintaining growth, which was clearly key to the firm’s strategy over the coming months.

‘As the MGA business continues to experience growth nationwide, Alliant has made a commitment to expanding its reach through the acquisition of companies with proven industry expertise. Preferred Concepts has the underwriting discipline and broker-centric service that defines Alliant and solidifies our leadership position in both the real estate and MGA business.’

The new acquisition will also benefit Preferred Concepts, which will be able to grow in its own industry using through its association with Alliant, as the Chairman and CEO of Preferred Concepts, Stuart Farber, was keen to emphasise.

‘For more than 25 years, Preferred Concepts has been dedicated to providing retail brokers with powerful and sophisticated solutions that address the ever-changing risks of the real estate industry. Alliant’s national reach and extensive resources are an ideal fit for our service platform and will enable us to continue our commitment to leadership in program business.’

Preferred Concepts will join the insurance firm’s subsidiary Alliant Specialty Insurance Services, however Preferred Concepts will retain its current leadership and operate under its existing name. The client services and business development teams of the company will also remain in place, but further details of the full terms of the acquisition are yet to be disclosed.

The move will increase the California based insurance firm’s status in the managing general agent market, which they have been moving into for some time, acquiring three other MGA firms in 2015 alone. These were acquired through the firm’s purchase of QBE US Agencies, a group of three MGA agencies comprising of the Community Association Underwriters of America, Deep South Insurance Services and SIU Managers. These represent a significant section of the American MGA market.

However the firm has stated that they are still ‘actively committed to pursuing additional acquisitions within the MGA space’.

Alliant is already one of the largest insurance brokerage firms in the United States, with their main focuses being risk solutions, employee benefits, industry solutions and co-brokered solutions. The firm claims to have over 26,000 clients nationwide, with clients ranging from public entities to tribal nations, healthcare firms to energy providers, and law firms to real estate businesses. This latest acquisition will increase their reach and allow both firms to grow in their respective markets.

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News

GLOBALFOUNDRIES Close Deal to Buy IBM Semiconductor Business The acquisition was completed on 1st July and will ensure that GLOBALFOUNDRIES becomes IBM’s exclusive semiconductor processor technology provider for the next 10 years.

IBM’s successful semiconductor business has been sold to international semiconductor manufacturer GLOBALFOUNDRIES. IBM, which has conducted research into semiconductors and other materials and has produced breakthroughs which include as copper chips, silicon germanium and quantum computing research, will continue to utilise this research to improve their leadership in mainframe, power and storage systems as well as future cloud, big data and analytics systems. The deal also secures IBM’s supply of semiconductor materials for their systems as they have made GLOBALFOUNDRIES their exclusive semiconductor processor technology provider for the next ten years.

Tom Rosamilia, the Senior Vice President of IBM Systems stated that the firm has sold the semiconductor arm of its business to allow them to research into further new products and look towards long term product and service developments.

‘This announcement is the next step in our long-standing relationship with GLOBALFOUNDRIES. IBM continues to invest in systems leadership, innovation and talent for the long-term. IBM is designing and developing IT systems for the digital era -- including servers, storage and middleware that will empower our clients to drive new workloads and new business models.’

GLOBALFOUNDRIES is a world leader in semiconductor manufacturing based in Silicon Valley.

The firm, which began in 2009, holds one of the largest semiconductor patent portfolios in the world. They which took over Chartered Semiconductor in January 2010 in order to expand the business, which is primarily concerned with manufacturing products using semiconductors, which are a technology that involves substances which can conduct electricity only under certain conditions. The business provides specialist technology and design solutions within the technology manufacturing industry.

Sanjay Jha, the Chief Executive Officer of GLOBALFOUNDRIES, made it clear in his statement that the acquisition is an important step in the company’s expansion. ‘Today we have

significantly enhanced our technology development capabilities and reinforce our long-term commitment to investing in R&D for technology leadership. We have added world-class technologists and differentiated technologies, such as RF and ASIC, to meet our customers’ needs and accelerate our progress toward becoming a foundry powerhouse.’

The aquisition gives GLOBALFOUNDRIES 16,000 patents and applications, an impressive workforce which includes scientists and engineers with many years of semiconductor experience and numerous facilities which will drastically increase the company’s manufacturing scale. The deal also expands on investments the firm has already made in the Northeast Technology Corridor, where there industry presence now exceeds 8,000 direct employees and includes joint activities with SUNY Polytechnic Institute’s College of Nanoscale Science and Engineering in Albany, NY. GLOBALFOUNDRIES will also receive direct access to IBM’s future semiconductor research as part of the deal to be IBM’s ten year semiconductor supplier.

“Investors Should Not Focus On Long Term Issues” Says Fisher Investments CEO Ken Fisher has urged investors to focus on the short term and use the political cycle to their advantage.

Fisher made his comments during an interview with Share Radio’s Investment Perspectives Programme on 30th June.

He insisted that investors had to focus on the short term, because the markets ‘really only care about things that happen between the next 6 and 30 months’. However, he also urged for caution in analysing the immediate, instead pointing investors towards an equilibrium where they keep aware of issues and events but react with the market.

‘Likewise there is an incessant tendency for us to be fixated on what is happening now myopically and immediately in front of us, like all of the blather about Greece, which has now been going on since 2010. That causes market jitters but doesn’t actually cause the market to do anything important because the markets are always looking past the immediate future.

Today’s market is only going to react from 6 to 30 months in the future.’

Greece was a key focus of the interview, with Fisher making it clear that the crisis would not affect markets in the US, because although the markets have allegedly kept the issue on the periphery, they have equally taken steps to minimise the risk.

‘Take Greece, if you look at its economy it’s not as important as people think. With Greece everyone has been expecting it for years so they put off the risk. It’s the surprise that moves markets. It’s the six to 30 months that people didn’t see which moves markets.’

The important factor, in this is surprising the markets, although Fisher declined to elaborate on what form these surprises should take.

The CEO, whose firm Fisher Investments operates as an independent, privately-owned money management firm, also advised moving with the

political times when investing. He suggested that investments could be made by watching carefully during the elections because the political parties affect the markets differently.

‘If you look at US political cycles there is something that you can make money on. The back half of a President’s term is always positive in the markets, whilst the volatility in US markets is always in the front half of a President’s term. In the election year if we elect a Republican, markets tend to do above average. If we elect a Democrat markets do below average. The markets are hopeful of a Republican President being pro-business, but they are afraid a Democrat President being anti-business.’

This information can then be used by investors to decide whether to invest in private or public sector businesses accordingly. Policies could also be used to determine where investors should place their money, by analysing where the Government will be putting the most focus and investing in similar industries.

July 2015 • CorporateAmerica • 5

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News

Rewarding Good Neighbors There are many people who work to make our communities better, frequently for little pay and often at great risk to themselves. They give themselves to our cities and towns, and the U.S. Department of Housing and Urban Development (HUD) has a little-known program that attempts to give back to them.

The Good Neighbor Next Door program is specifically for law-enforcement officers, firefighters, emergency medical technicians (EMTs), and pre-kindergarten through 12th grade teachers.

Through this program, these community-service workers that meet the program’s eligibility requirements can purchase a HUD home for 50 percent off of the list price. In return, they must live in the house for three years as their only residence.

These homes are offered in HUD-designated revitalization areas, which often are in large urban centers like Los Angeles, Baltimore or Phoenix.

But in order to participate in this program, you have to know about it first. And therein lies the problem. Laura Key, a REALTOR® with Carrington Real Estate Services in Long Beach, California, has been working with the Good Neighbor program for nearly 10 years, and when she reaches out to community-service workers about the program, she finds that most have never heard of it.

“It is really important for the public to at least know that this program is available,” Key says.

“It seems like nowadays we don’t help the people who are vital to our community -- the people who take care of and educate our children, who take care of our community and often risk their lives.

This program has a special place in my heart because I believe it builds community.”

With few homes being offered, buyers interested in the program should enlist the help of experienced real estate agents who know how the system works and can better their chances at coming away with a home at a steep discount.

“There are a lot of people who don’t want to deal with it, because the program is kind of hard to work,” Key says, “but once you know it, you know it inside and out.”

In her nearly 10 years of working with the Good Neighbor Next Door program, Key has seen interest grow, thanks in part to her own outreach efforts. “I would like to see more growth with HUD,” she says. “This really is such a wonderful program, and I believe that these community-service workers deserve to be helped, because they help the community out of the goodness of their hearts.”

6 • CorporateAmerica • July 2015

Goldberg Law PC Has Announced a Class Action Lawsuit Against Uranium Energy Corp Investors are being advised to contact Goldberg Law PC following the announcement that the legal firm is perusing Uranium Energy Corp for alleged violations of the federal securities laws.

In the official announcement Goldberg Law stated that investors who purchased or otherwise acquired shares in Uranium Energy Corp between October 14th 2014 and June 17th 2015, inclusive, have until August 28th 2015 to contact them and serve as a lead complainant in the class action.

The firm of lawyers has stated that any investors with concerns can contact them free of charge by: Michael Goldberg or Brian Schall, of Goldberg Law PC, 13650 Marina Pointe Dr. Suite 1404, Marina Del Rey, CA 90292, at 800-977-7401.

Until the case is certified anyone who does wish to be involved will not be represented by an attorney.

Interested parties who do not wish to involve themselves in the case can choose to take no action and can remain an absent class member.

Goldberg Law PC, which specialises in corporate fraud cases, is taking action against Uranium Energy Corp, a Canadian uranium exploration company which is believed to have made false and/or misleading statements and failed to disclose that their stock achieved an unsustainable valuation by using paid stock promoters, yet failed to disclose the use of such stock promoters in its regulatory filings. This is a breach of the Securities Act of 1933, Section 17(b).

The law firm’s statement also alleges because of this, the Uranium Energy Corp public statements were materially false and misleading at all relevant times. The firm also cited an article published on The Street Sweeper, an investigative news website whose article is available here. The article alleges that Uranium Energy was using undisclosed paid stock promoters to increase the value of its shares. After this was revealed, the stock dropped causing damage to investors. The article indicates that Uranium Energy’s problems fiscal problems stem from external problems.

‘UEC and other uranium companies were hurt after the Fukushima nuclear disaster hit in March 2011.

Public pressure mounted and the negative effects have lingered and lower oil and gas prices have made the situation worse as of late for uranium companies.’

However, the article alleges that the firm has been using a combination of social media hype and ‘insider buying’ to increase their share price despite their failing finances and lack of business.

Goldberg Law PC has stated that anyone who believes themselves affected by this should get in touch with them for advice.

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News

Pinterest to Transform Social Network Industry with New Shopping Function The image based social network will now allow users to use buyable Pins to purchase products, leading to a revolution in the social network market.

ers to purchase products. The buyable Pins will only be available on iPad and iPhone for users in the US, with the firm due to release the service on other platforms and countries if successful.

Pinterest, the social network which allows user to Pin posts which they like to their profile wall, has announced the launch in the US of buyable Pins which will allow users a safe and easy means to buy products from the site.

The new payment service will revolutionise social media usage, with other picture based social media platforms such as Tumblr yet to create a service allowing users to buy directly from the site. Currently, customers on other platforms can see items which are posted as for sale but have to contact the user selling them directly to arrange a PayPal purchase and shipping.

The scheme will be rolled out over the next few weeks, allowing customers in the U.S. access to 30 million products available for purchase from a variety of different brands such as Macy’s, Neiman Marcus and Nordstrom, as well as retailers powered by the payment software Demandware such as Gardener’s Supply Company and Michaels. Thousands of stores which use Shopify, an online selling website, such as Poler Outdoor Stuff and SOBU will also be available under the scheme.

The service will work by allowing retailers to attach buy buttons to Pins which will allow custom-

Pinterest, which is often used by firms to showcase products and to cultivate customer interest, will not allow retailers to promote their products on the site. Instead they will have to rely on organic traffic through users sharing the pins with others across the site, allowing customers more control over the shopping experience and giving the online purchases a more personal edge, with recommendations coming not from faceless business but from friends and family.

However, there will be opportunity for firm’s to highlight their newest products as the social media platform will offer two new services which will provide users with a convenient means of finding the buyable Pins, ‘Shop our picks’ a curated selection of seasonal goods, and ‘Shop’ for the latest buyable Pins available.

The social network also offers app Pins, recipe Pins, article Pins and place Pins which gives the users the opportunity of assigning categories to posts, a feature which is unique among social network sites. Facebook allows users to mark themselves at a location or to attach an emotion to a post and Tumblr allows users to post titles on their entries but the unique nature of Pinterest’s categorisation will open them up to a new consumer market, as customers who spend an increasing proportion of their leisure time browsing social media websites adjust to being able to shop whilst socialising.

Toyota Managing Officer Resigns After Japanese Drug Arrest Toyota have announced that they have accepted the resignation of Julie Hamp, their Chief Communications Officer, following her arrest in Japan in late June for attempting to import the painkiller Oxycodone, which she had sent to herself from America in a package. Oxycodone is available on prescription in both Japan and the US but its importation into Japan is strictly controlled.

In a statement the Japanese car firm, which had previously been eager to support Hamp, made it clear that the firm was still devoted to its diversity drive, of which Hamp had previously been a symbol.

‘On June 30, 2015, Toyota Motor Corporation (TMC) received notification from Ms. Julie Hamp of her intent to resign her position of Managing Officer. TMC has accepted her resignation after considering the concerns and inconvenience that recent events have caused our stakeholders.

Because the investigation of Ms. Hamp is ongoing, there is little Toyota can say at this time. However, we intend to learn from this incident to help ensure a secure working environment for everyone at Toyota around the world as we continue to take the steps necessary to become a truly global company. We remain firmly committed to putting the right people in the right places, regardless of nationality, gender, age and other factors.’

Hamp, who was the Managing officer and Chief Communications Officer of the Toyota Motor Corporation for the firm and whom Toyota described as ‘the first woman named to these positions globally’, was part of Toyota’s new plan to make their top level management less dominated

by Japanese men. The American was appointed in March, alongside Didier Leroy, a Frenchman who became Toyota’s first non-Japanese Executive Vice President.

Toyoda, initially defended the American, calling her ‘a close friend of mine’ as well as an ‘invaluable member of Toyota’s team’. He also stated that the firm were ‘confident that once the investigation is complete, it will be revealed that there was no intention on Julie’s part to violate any law’.

The firm’s statement on her resignation describes this as an ‘incident’ and states that the firm intends to learn a lesson from it, suggesting that the firm feels they did not properly prepare Hamp for her integration into Japanese culture.

Hamp is still in Japanese custody, where there is a high prosecution rate and the police can detain suspects for up to twenty three days without allowing bail or issuing formal charges. There is rife speculation that Hamp may serve time in prison over the charges, since Japan has a high rate of successful prosecutions for drug charges.

The resignation has highlighted cultural issues within Toyota’s new diversified senior management. The firm’s founder and President, Akio July 2015 • CorporateAmerica • 7

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News

DemandJump Expanding into Indiana The market intelligence firm intends to create over 80 new jobs in the region by 2018.

mandJump more than $1,800,000 in conditional tax credits and training grants.’

Rapid growth bin Indiana has fuelled a $1.2 million investment in the area by DemandJump LLC, a Marketing Intelligence Platform.

The firm’s Co-Founder and CEO Christopher Day made it clear that the company has vast expansion plans and has been well supported in their move into Indiana.

The firm announced that they intend to expand into Hamilton County and create over eighty new jobs. The firm was started in Carmel in 2015 as a privately held company whose main customer base is Fortune 1000 and SMB clients. The business has seen a rapid serge in growth recently, which has led to these expansion plans.

The firm’s growth strategy includes expanding their existing leased space and investing in their Actionable Intelligence Marketing platform as well as their workforce, in the near future.

‘We have found marketers are craving actionable data across all digital channels to drive revenue. Our mission is to understand the world’s competitive digital data and make it actionable for marketers everywhere. It’s not only about big data – it’s about understanding how to transform that data into specific, insight-rich actions to show marketers strategically what to do next and why. We want to thank the Indiana Economic Development Corporation and Hamilton County who have been very supportive of our expansion.’

According to the firm’s statement ‘The Indiana Economic Development Corporation offered De-

Indiana’s Secretary of Commerce, Victor Smith, echoed this supportive message in his statement

8 • CorporateAmerica • July 2015

on the business’s move into Indiana. He was also keen to portray how much his area had to offer the firm.

‘Indiana offers tech firms like DemandJump a competitive advantage over the competition due to our state’s low cost of doing business. Our Hoosier workforce is responsible for building today’s tech momentum and, with the help of DemandJump’s growing team, we look forward to this industry continuing to expand and create more great jobs for Hoosiers.’

Tim Monger, the President and CEO of Hamilton County EDC was also keen to state how important DemandJump’s investment was.

‘DemandJump’s expansion is another example of the continued growth of the Hamilton County IT industry cluster. Our high educational attainment and quality of life make Hamilton County, Indiana an ideal location and we appreciate DemandJump’s investment in the county.’

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Back to School Could Break the Bank Parents set to spend record amounts of money sending their children back to school after the summer holidays, new study predicts.

Chris Sukornyk, Head of Buyer Cloud at Rubicon Project, made it clear that these results had clear implications for businesses.

The summer holidays have barely begun and already parents have planned a shopping spree to send their little darlings back to school with all the newest products and best clothing, a recent study highlights.

‘Back to school is big business and Americans will spend billions of dollars getting their children ready for school in the fall. Parents are spending earlier, spending more and going online in ever greater numbers to research products and to make purchases. Agencies and brands hoping to shape back-to-school shopping plans need to begin reaching out now with customized and engaging advertising that targets both parents and students with the right messages at the right time.’

The research is a new Consumer Pulse survey from Rubicon Project, and was conducted by global polling firm Penn Schoen Berland. The study was produced by holding one thousand online interviews with parents of students in grades K-12 and in college in the US between June 12th and 15th, 2015.

The study has indicated that 56% of parents surveyed intend to spend more money per child than they did last year on preparing to send them back to school. Parents with K-12 children intend to spend on average $873 per student, whilst parents of college students are planning to spend in excess of $1,100 per student.

In some cases this shopping has already started, with results showing that 23% of K-12 student’s parents have already begun to buy products for their return to school and plan to continue to spread their purchases throughout the summer.

These results are indicative of an improving economy, which has led parents to buy their children new products instead of re-using old equipment.

Another factor in this increased rate of spending is the growing pressure on parents to buy their children tablets and laptops as technology use in the classroom increases.

These results indicate that there is a growing demand for learning centred technology as computers become more integrated into classrooms, which will impact on the business environment as producers of software work to create products designed around a classroom environment. Also, security products aimed at satisfying parents that their children are safe when using the internet and game based learning tools will become important products as technology takes over learning.

The study found that 83% of parents claimed to decide where the shopping takes place, with mothers being the key decision makers even if their children were at college. However, 73% of parents claimed they take their children along with them to shop, which suggests that the children possibly have influence over the purchases.

Parents are also embracing online and mobile purchasing for back to school products. Mari Kim Novak, Chief Marketing Officer of Rubicon Project indicated that new modes of shopping

would revolutionise the way in which retailers targeted parents.

‘One of the important trends our survey identified for advertisers is that back-to-school shopping decisions are increasingly influenced online rather than on TV. Brands with a narrow focus on television advertising are missing a big opportunity to reach consumers online and on their mobile devices, where they are spending more of their time.’

Another key factor which the survey found influenced the parents’ product choices was discounts and savings, with 61% of parents citing discounts and promotions as the top factor in their decision on what products to buy. 74% also stated that they prefer to shop at chain stores because this makes them believe they will get a better deal.

Therefore, the research indicates that retailers need to find a balance between children focused advertising campaigns and targeted discounts to draw parents in. Also, firms will have to increase their online presence in order to maintain interest from increasingly internet savvy parents. As Novak highlighted in her statement: ‘The concept of ‘prime time’ is a thing of the past. Parents are now researching products and shopping from the moment they wake up until they power down and go to sleep at night’. The increase in time spent on the internet leaves firms with no option but to move online with their advertising and selling.

Overall these findings are positive for retailers, with end of holiday shopping set to boost their sales. The research offers new ideas for firms looking for innovative ways to lure parents away from their competitors in the run up to the return to class.

Technology is set to play a big part in the spending according to the study. The research found that 38% of parents intend to buy their children technology such as laptops, tablets and mobile phones for use in the classroom. The results also indicated that on average elementary and secondary school parents expect to spend nearly $400 on technology products, which is nearly double the $278 they expect to pay for their child’s clothing, highlighting where the parents place the most importance.

Tablet computers are one of the most common forms this technology takes, with 50% of K-8 children currently owning a tablet and 44% of parents stating they plan on buying their K-8 child one this year. Mobile phones also dominate spending with 44% of parents with college age children considering re-evaluating their mobile plan before the new term starts.

July 2015 • CorporateAmerica • 9

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News

Atlanta Hotel Gives Hyatt Hotels Growth Boost 150-room Hyatt House hotel celebrates opening in downtown Atlanta.

Hyatt Hotels Corporation and TPG Hospitality have announced the opening of the new Hyatt House hotel in downtown Atlanta, giving guests home-style comforts in a convenient location.

The General Manager of Hyatt House, Scot Gladstone, stated that the new hotel offered convenience and an impressive location.

‘Atlanta is a large and vibrant city, filled with restaurants, sports, parks, and other impressive art and entertainment attractions, and we are confident that Hyatt House Atlanta/Downtown will exceed guest expectations by providing them with a social and contemporary environment that will help them feel connected, welcome, and at home. Hyatt House Atlanta/Downtown is everything the name represents – a welcoming and warm environment that encourages guests to live like residents. We want each and every guest who comes through our doors to feel that they can let their real-life routines roll on, even when they’re on the road.’

The hotel is a new addition to Hyatt Hotels, a key brand owned by Hyatt Hotels Corporation. Hyatt Hotels operates at over 60 locations in the US including Boston and San Jose. The downtown Atlanta project was a joint venture with TPG Hospitality, which is among the top five largest U.S. hotel management firms with an operating portfolio of over 60 hotels, representing nearly twenty thousand guestrooms in twenty six states.

Paul Sacco, Chief Development Officer for TPG Hospitality, was eager to express that the new venture will allow them to grow their partnership with the hotel chain.

‘TPG Hospitality is pleased to expand our relationship with Hyatt with the opening of Hyatt House Atlanta/Downtown, which is located in the quickly emerging area of downtown Atlanta. Hyatt House Atlanta/Downtown fits the vein of lifestyle hotels that TPG Hospitality is now managing and developing throughout the United States, and TPG’s broad operational platform enables it to effectively manage properties at all points on the chain scale.’

The new hotel is in a prime location, minutes away from Centennial Olympic Park, Georgia Aquarium, World of Coca-Cola, and the Center for Civil and Human Rights.

This announcement follows the official opening of the Hyatt Regency Naha, Okinawa, and marks part of the firm’s global expansion plans. The development of both the grander Regency hotels and the more industrial House styles of hotels is key, allowing the firm, which began in 2012, a two-fold approach to market growth.

10 • CorporateAmerica • July 2015

Acquisition of Eagle Ford’s Assets Completed Enterprise Products Partners L.P has announced the closure of its purchase of the firm’s assets.

The deal sees affiliates of Pioneer Natural Resources Company and Reliance Holding USA Inc sell the member interests in EFS Midstream LLC. Enterprise Products Partners L.P is due to pay the purchase price, $2.15 billion, in two transactions. The effective date of the transaction is July 1st, 2015.

Michael A. Creel, chief executive officer of Enterprise’s general partner, stated that the firm was pleased with the acquisition which will help them with their future growth plans by drastically improving the firm’s liquidity.

‘We are pleased to close this acquisition. These assets ‘bolt on’ to our existing Eagle Ford crude oil, natural gas and NGL infrastructure network. We are looking forward to expanding our capabilities to provide Pioneer and Reliance as well as new customers with market flow assurance and market access. Supported by long-term, fixed-fee contracts and minimum volume commitments, this transaction will be immediately accretive to distributable cash flow per common unit and support future distribution growth.’

The transaction has afforded the Enterprise Products Partners, a leading US provider of midstream energy services with consolidated liquidity of approximately $4.3 billion. This is comprised of unrestricted cash on hand and available borrowing capacity under its $3.5 billion multi-year revolving credit facility and $1.5 billion 364-day credit facility.

The agreement states that the Pioneer and Reliance joint development will dedicate its Eagle Ford Shale acreage to Enterprise under a 20-year, fixed-fee gathering agreement that includes a minimum volume requirement for the first seven years. Pioneer and Reliance also dedicate their Eagle Ford Shale acreage under related 20-year fee-based agreements with Enterprise for natural gas processing, natural gas liquids transportation and fractionation, and for natural gas, processed condensate and crude oil transportation services.

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News

Sixth Private Equity Fund Closure for Private Advisors The alternative investment firm has announced the closure of its sixth dedicated small company private equity fund.

that the fund ‘will benefit from the Firm’s leading position and relationships in the small company private equity market’.

Virginia based firm Private Advisors LLC has announced that they have closed their sixth dedicated small company private equity fund, Private Advisors Small Company Private Equity Fund VI, LP on June 30th.

Chris Stringer, the Partner and Head of Private Equity at Private Advisors, was eager to praise their investors and outline the firm’s approach.

The fund closed on $350 million in total commitments, which exceeded its target of $250 million. Private Advisors and its employees, along with their parent organization New York Life, committed approximately $51 million, demonstrating alignment with investors and continued confidence in the strategy.

The fund is comprised of a diverse client base with over 50% of the capital committed from existing investors in prior funds. The investor base includes foundations, endowments, family offices, and pension funds. Private Equity believes

businesses, as opposed to other private equity strategies that are more dependent upon financial engineering or market timing.’

‘We appreciate the continued support of our existing investors and are excited to welcome several new investors and strategic relationships outside the U.S. Although the small company market has attracted many new institutional investors recently, we believe that it is Private Advisors’ long-standing, disciplined focus on this market segment that has allowed us to attract a number of new limited partners, including several non-U.S. pension funds. In general, investors are recognizing the relative attractiveness of the small company market and the ability of private equity managers to create value through business building, in other words growing and improving underlying

100 Montaditos Show Commitment to America with New Restaurant Spanish restaurant chain 100 Montaditos will open new branch in Florida despite filling for bankruptcy.

Financial restrictions have not hindered 100 Montaditos’s expansion plans, as the Spanish restaurant chain announced the opening of a new eatery in Florida.

The firm’s Managing Director, Ignacio Garcia Nieto, said the new restaurant was a sign that the company was still committed to staying in the US market.

The firm- which filed voluntary petitions for Chapter eleven reorganization in March 2015will open the new establishment in the North Miami-Dade County community on July 14th.

‘It is with great pride that we announce the opening of our newest U.S. location and demonstrate our commitment to the U.S. market, our customers, and existing franchisees. We are confident that we will emergence from bankruptcy later this year and look forward to continue developing the Montaditos brand in the U.S.’

100 Montaditos is a Spanish restaurant brand popular in the US because of their casual atmosphere and the popularity of their signature dish, Montaditos, which are crunchy, baked-to-order, tapas-sized rolls. The firm has created 100 variations of the dish and they can be filled with a variety of authentic tapa ingredients such as Serrano ham, chorizo and manchego cheese.

100M Holding, Inc., the parent company that operates the brand in the U.S., and 13 of its subsidiaries and affiliates filed for relief in March of this year under Chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Florida. The bankruptcy only involves the chain’s Florida stores.

The firm is attempting to resolve their financial situation by restructuring their management, with the new team being chosen and managed

by Garcia Nieto, who previously served as the Franchise Development Director for the brand in the U.S. and Latin America. Garcia will also be responsible for restructuring 100 Montaditos’s finances during the bankruptcy proceedings.

The firm’s Bankruptcy Counsel, Mariaelena Gayo-Guitian, was keen to emphasise that their firm is cooperating with the authorities and working towards a solution to the bankruptcy. ‘100M is working diligently with the appointed Official Creditors Committee to formulate a consensual reorganization plan, including simplifying its cost structure and grouping its restaurant locations to optimize logistics and related procedures.’

July 2015 • CorporateAmerica • 11

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Feature

Prime is the New

Black

Amazon have unveiled Prime Day, a new shopping event available only to members of Amazon Prime which the firm believes will eclipse Black Friday.

Black Friday, traditionally one of the biggest global shopping events of the year, has competition this year from Amazon, who have just launched their international retail event Prime Day. Amazon, the online retail giant, announced the event on 6th July. In their statement Amazon decried that although they had ‘helped make Black Friday even more of a global online shopping phenomenon’ they were now due to overtake the shopping event with their own which they claim will be ‘offering more deals than Black Friday’.

Black Friday is viewed as the beginning of the holiday shopping season and is held every year on the Friday after Thanksgiving. Originally an America phenomenon it has expanded globally over the years, with many stores in the UK and Europe offering similar discounts. The event offers customers numerous discounts on products from many retailers both online and in stores.

Amazon’s Prime Day will be held on July 15th, 2015, placing it in a different shopping period to Black Friday, with consumers likely to be more focused on buying summer holiday products than Christmas goods and presents, but Amazon remains confident that the new initive will be a success.

Amazon was also keen to publicise the fact that the event is only available to members of Amazon Prime, their subscription only online retail and streaming service. Greg Greeley, Vice President of Amazon Prime, emphasised this as well as the exclusivity of the event in his statement.

‘Prime Day is a one-day only event filled with more deals than Black Friday, exclusively for Prime members around the globe. Members tell us every day how much they love Prime and we will keep making it better. If you’re not already a Prime member, you’ll want to join so you don’t miss out on one of the biggest deals extravaganzas in the world.’

The event will only be available for Prime customers in the U.S., U.K., Spain, Japan, Italy, Germany, France, Canada and Austria with deals beginning at midnight on 15th July and continuing as often as every ten minutes. The event will include numerous categories such as electronics, toys, movies, clothing, patio, lawn and garden, sports and outdoor items and more. Customers can browse and pay for these items on portable devices such as mobile phones and tablets as well as laptop and desktop computers.

The shopping event, which has been created to coincide with the 20th anniversary of Amazon, will be heavily promoted, with the company launching 12 • CorporateAmerica • July 2015

a #PrimeLiving Photo Contest, which will allow customers to upload photos of products or events which make them happy, which is the concept of #PrimeLiving. Members must sign into Prime Photos between July 6 and July 15 to be eligible for the contest. The photos will be showcased on Amazon’s social channels in the days leading up to Prime Day and the winner from each country will have their photo become a screen saver on the Amazon Fire TV service. The winners will also each receive a $10,000 Amazon Gift Card.

Amazon has also found local artists in Prime Day eligible countries to create public art which will go on display in the run up to the event. The cities participating range from Toronto to Milan, Seattle to Berlin and the artists have been asked to create their interpretation of #PrimeLiving. The art is also being offered to customers as inspiration for the photo contest, to highlight what the concept of #PrimeLiving is.

The event marks a new era for online membership communities. Currently, such firms, such as Netflix or Spotify, only offer one specific service, such as TV or music streaming. Services such as Google Play offer consumers access to various online media such as apps and books, but they are free to create an account on.

Amazon Prime is a subscription only service which costs $99 a year and offers customers unlimited Free Two-Day Shipping on more than 20 million items across all categories, early access to select Lightning Deals all year long and unlimited Free Same-Day Delivery on more than a million items in 14 metro areas in addition to offering their full streaming service, with TV, music and films all available with the service. Prime also offers users unlimited photo storage in the Amazon Cloud Drive with Prime Photos and access to more than 800,000 books to borrow with the Kindle Owners’ Lending Library. In the run up to Prime Day customers will be able to sign up for a thirty day free trial of the service.

In addition to all of this, the service also offers the Prime Now mobile app to customers in Atlanta, Austin, Baltimore, Brooklyn, Dallas, Manhattan, Miami, and London, which provides them with one and two hour delivery on a selection of tens of thousands of products.

Customers can also have a free Amazon account, which will only allow them to purchase products from the online store and will not allow them to participate in Prime Day. Whilst the event is currently being billed as a one off, there is every possibility that if Prime Day is a success Amazon will extend it to make it an annual sale.

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Feature

Apple Music:

How Will It Affect the Streaming Industry?

As SoundHound announces partnership with the newly launched Apple Music, we analyse how the technology giant’s newest venture will impact the ever expanding streaming industry.

Apple’s new music streaming app, Apple music, is designed to offer customers a multi-platform music streaming service. The service, which launched on the 30th June, is being launched into a competitive and crowded online streaming market, which may either work to Apple’s advantage, or against it.

Users, who will initially receive a three month free trial on signing up to the service, will pay a $9.99 a month subscription fee after this has ended. This price is fairly standard in the industry, although Apple have been keen to stress that there will be the option of a $14.99 a month ‘family plan’ which will allow up to six users to use Apple Music simultaneously.

The service is deemed so revolutionary because of its multi-platform dimension, with users able to connect to a worldwide live radio station, a streaming service, a ‘For You’ section which creates personal playlists based on the user’s history and Apple Music Connect, a social media integration which will allow artists to post news and will let listeners respond directly via Facebook, Twitter or Email.

The announcement of a collaboration with SoundHound, the global sound recognition and music search company, highlights Apple’s determination to takeover in this highly competitive market. A survey by Edison Research, conducted at the beginning of this year and not taking into account the launch of Tidal, showed a competitive American market dominated by industry titans Pandora, which claimed an impressive 45% of the votes, iHeartRadio, iTunes Radio and Spotify.

SoundHound users will be able to stream the music of artists discovered through SoundHound’s features including their music identification, personalized History, Top Charts, or Music Maps using Apple Music. The song search provider will also broadcast Apple’s global radio streaming station Beats 1, with station’s presenting team being led by former Radio One show host Zane Lowe.

Beats 1 is already available iTunes Radio, an online radio station which in 2014 had an impressive 8% market share with over 20 million users according to Edison Research. The integration with Apple Music will allow the firm greater market penetration and to fully diversify into an industry separate from the technology which made the company a global household name.

Eddy Cue, Apple’s Senior Vice President of Internet Software and Services, has made it clear that the new service is designed to revolutionise the way users access their music. ‘We love music, and the new Apple Music service puts an incredible experience at every fan’s fingertips. All the ways people love enjoying music come together in one app — a revolutionary streaming service, live worldwide radio and an exciting way for fans to connect with artists.’

If Apple Music is an industry success, it could have an impact on the online streaming industry as a whole. Film and TV streaming has been expanding rapidly since the early 2000, as physical media such as videos and DVDs were replaced by online access. The online subscription only market is less densely populated than the music service, possibly because of the lack of a platform similar to radio stations which were easily able to diversify into online streaming services. TV channels have found it harder to Segway into the online streaming market, with the market dominated primarily by Netflix, Hulu Plus Access, Amazon Prime and SVOD Access.

A success in this area could lead Apple to diversify into this market, from which it currently remains absent. The firm currently offers iTunes, a service where customers can buy the rights to buy licensed TV shows and films on an individual, full ownership basis, but which does not provide the option for users to stream unlimited films and shows by paying a subscription, as is the industry standard in online streaming. The expansion of iTunes Radio into Apple Music could potentially pave the way for a further expansion of the services which iTunes provides for TV and film consumption.

A report by Jasper Lawler, a market analyst within CMC markets, highlights the danger Apple Music poses to its competitors, focusing primarily on Spotify.

Because of the integration with its own technology Apple Music already have an easy means of market entry. Lawler believes that other firms will have to join forces in order to stay ahead of Apple Music.

‘In order to compete with Apple and Google, the likes of Spotify and Rdio may have to join forces with Netflix. Else, other big players in tech may want to join the bandwagon, it’s not unheard of for Facebook to pay large valuations for startups with a growing user base and no profit. Yahoo! and Microsoft are possible acquirers with big cash piles who are trying to stay relevant in the mobile world.’

Apple Music will be available across almost the full spectrum of Apple devices, with iPhone, iPad, iPod touch and Mac users all catered for, although Apple has so far avoided any discussion as to whether the service will be available on the new Apple Watch. Even Siri, the firm’s pioneering voice control service will be integrated with Apple Music.

By integrating the new service with their own products, which according to IDC represent 18.3% of the smartphone market in 2015, second only to Samsung’s 24.6%, Apple are using their impressive influence in a separate market to promote the new service, but by allowing PC and Android users access to the service as well the firm exposes Apple Music to the full spectrum of customers within this market.

The lead up to Apple Music has not all been smooth, with the service having already had its share of misfortunes even before it launched. The high profile disagreement over paying musicians royalties, which involved influential American singer Taylor Swift and resulted in the company reversing their decision not to pay artists during the three month trial period for customers, which led to Swift ultimately deciding to join the service, but marring the period leading up to the launch as customers questioned the ethical practises of the company. Other popular artists such as the Beatles and Prince refusing to allow Apple the rights to their music and Fleetwood Mac have withheld their album ‘Future Games’ from the service, which reduces Apple Music’s appeal to an older audience. Currently the younger generation dominates the customer base for streaming services, and strong support from a new generation of customers would have offered Apple Music a big boost.

The launch was also disappointing to some new users who complained about long waiting times and possible difficulties uploading the app using their software. Overall however, only time will tell if Apple Music will revolutionise online music streaming or disappear into a list of other streaming services.

July 2015 • CorporateAmerica • 13

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Feature

Health is

Wealth

Health insurance market set for shake up as mergers and acquisitions are announced.

Rumours have been swirling for several weeks, but finally an announcement has been issued that Aetna is to acquire Humana Inc, creating one of the largest health insurance providers in the industry.

Centene’s Chairman, President and Chief Executive Officer Michael F. Neidorff, made it clear that the combination would allow Centene the opportunity for further market growth across new regions.

The announcement ends a month of turmoil for American healthcare industry, with stock prices fluctuating as a combination of new legislation and takeover bids conspired to put investors on high alert.

‘Over the past five years, Centene has achieved record performance and today’s announcement is a significant next step in our strategy to increase scale and drive geographic and product diversification. This transaction ensures that we extend our competitive position as one of the largest plans covering governmentsponsored programs in the country. Health Net’s presence in California and other key western states is complementary to our offerings, allowing us to bring additional innovative solutions to the healthcare market. With Health Net, we see opportunities to leverage our local approach more broadly to enhance our members’ access to higher quality healthcare services on a cost-effective basis and ensure measurable quality outcomes.’

The ruling by the Supreme Court to uphold the Affordable Care Act, which insured the safety of healthcare subsidiaries for approximately 6.4 million Americans, and was among the factors which spurred an upward surge in the prices of shares in numerous healthcare businesses such as HCA Holdings and Community Health Systems.

However, the biggest factor in the healthcare market’s uncertainty over the last few months has been the rumours that Aetna were lining up to acquire Humana, one of their biggest rivals in the health insurance market.

The deal, which is worth $37 Billion, was finally announced on 3rd July and will create an immense insurance firm. The deal was announced jointly by the two companies, who stated that they ‘have entered into a definitive agreement under which Aetna will acquire all outstanding shares of Humana for a combination of cash and stock valued at $37 billion or approximately $230 per Humana share based on the closing price of Aetna common shares on July 2, 2015’.

Aetna and Humana, the third and fourth largest health insurance firms by revenue respectively, still require federal approval for the deal. The deal will create one of the largest healthcare insurers in the US. The joint statement issued by the firms gave an indication of the scale of the new combined business.

‘The complementary combination brings together Humana’s growing Medicare Advantage business with Aetna’s diversified portfolio and commercial capabilities to create a company serving the most seniors in the Medicare Advantage program and the second-largest managed care company in the United States. The combined entity will help drive better value and higher-quality health care by reducing administrative costs, leveraging best-in-breed practices from the two companies — including Humana’s chronic-care capabilities that measurably improve health outcomes for larger populations — and enabling the company to better compete with more cost effective products.’

A further development for the healthcare industry came when Centene announced that they will acquire all of the shares of another health insurance company, Health Net, in a cash and stock transaction valued at approximately $6.8 billion which will include the acquisition of approximately $500 million of debt.

The terms of the deal state that Health Net shareholders would receive 0.622 shares of Centene common stock and $28.25 in cash for each share of Health Net common stock, with Centene shareholders would own approximately 71% of the combined entity, with Health Net shareholders owning approximately 29%, based on the closing prices of both companies from the 1st July.

14 • CorporateAmerica • July 2015

In a further shake up to the market, CVS Health Corporation, the health retailers, have announced that they will acquire Target Corporation’s pharmacy and clinic businesses for approximately $1.9 billion. The announcement, made on 15th June, outlined an invasive takeover strategy with a clear and impressive expansion plan.

‘Through this agreement, CVS Health will acquire Target’s more than 1,660 pharmacies across 47 states and operate them through a store-within-a-store format, branded as CVS/pharmacy. In addition, a CVS/pharmacy will be included in all new Target stores that offer pharmacy services. Target’s nearly 80 clinic locations will be rebranded as MinuteClinic, and CVS Health will open up to 20 new clinics in Target stores within three years of the close of the transaction. The new clinics will be part of CVS/minuteclinic’s plan to operate 1,500 clinics by 2017. In addition, CVS Health and Target plan to develop five to 10 small, flexible format stores over a two-year period following the deal close, which will each be branded as TargetExpress and include a CVS/pharmacy.

This strategic relationship brings together two leading retailers with complementary strengths, brands and cultures to enhance the health care experience for Target guests while expanding CVS Health’s retail presence in new markets, such as Seattle, Denver, Portland and Salt Lake City. The transaction enables CVS Health to reach more patients, adding a new retail channel for its offerings, and expanding convenient options for consumers.

Given CVS Health’s proven success in growing its business, the relationship is expected to benefit Target’s long-term traffic and sales growth. It also enables Target to strengthen its focus on wellness as a signature category. Moving forward, enhanced efforts by Target will center on continuing to deliver products and experiences to help guests eat well, be active and find natural and clean label products.’

Christopher Weaver of the Wall Street Journal recently compared the recent spate of mergers in the healthcare industry to Game of Thrones. The scope of the deals and the constant rumours which have circled in recent months certainly have a touch of the Lord Peter Baelishes about them. Only time will tell if the impact of these deals will be as brutal as the quest for the iron throne but for now the healthcare market is certainly in a state of flux.

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Feature

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Feature

Smartphone Market Shake-up Research by Strategy Analytics indicates that current market forecasts will put India ahead of the US in selling smartphones by 2017.

The US has always been a huge consumer of technology, with an estimated 182.6 million people in America using smartphones. Currently the second largest market for the devices in the world, they are due to be eclipsed by India in 2017, a new study predicts.

The research by Strategy Analytics also forecasts that with regards to the three main countries selling phones, America, China and India, market size will have directly correlated with population size by 2017. China will remain the top of the market, with India set to takeover in second place from the US by 2017.

Smartphone consumption is on the increase worldwide, with the three main countries being the backbone of this. Neil Mawston, Executive Director at Strategy Analytics highlighted this in his statement on the results of the study.

‘We forecast global smartphone sales will grow from 1.5 billion units in 2015 to a record 1.7 billion in 2017. China, India and United States are the big three countries driving smartphone growth worldwide today and in the future.’

The results show that India will buy 118 million smartphones this year, with that rising to 149 million in 2016. In 2017 India will buy 174 million handsets, which will be just ahead of America who are forecast to purchase 169 million. However, these figures still pale in comparison to those from China, who in 2017 are estimated to buy 505 million handsets, well over double the amount expected to be bought by India that year.

America’s own reduction in growth will also have an effect on the market. Whilst India’s smartphone market will increase by a staggering 43% this year, America’s will only increase by 11%, dropping to just 2% in 2016 before reaching 1% in 2017. India’s market growth will slow after 2015, with 26% predicted for 2016 and 17% in 2017, but this still represents a larger percentage of growth than either the US or China, whose growth will only be 3% in 2017. However, this still outstrips the US, which will see the largest fall in growth across the three years.

This stagnation in growth in the US could be caused by contracts for buying the devices which force customers to keep the same handset for a set period of time.

Phone providers typically offer discounts to customers who wait to upgrade their phones, which could also be a factor in the reduction of growth in this market.

Also, the saturation the American smartphone market means that with so many devices available, customers may choose to stick with what they know and wait for the upgrade on their own handset, rather than purchase a completely new device, which will reduce the number of handsets they purchase, as upgrades are typically less frequent than the new products entering the market.

Meanwhile, India has seen a rise in local companies producing mobile phones, such as Micromax, which produces phones within India, enabling them to provide lower cost phones than their foreign counterparts. Such growth has been vital in spurring on India’s expansion in the smartphone market, as Linda Sui, a Director at Strategy Analytics bought to light in her statement.

‘We forecast 458 million smartphones will be sold in China in 2015, rising steadily to 505 million in 2017. China has been the engine of global smartphone growth in recent years, but China is now maturing and slowing. India is fast becoming the next major growth wave. We forecast 118 million smartphones will be sold in India in 2015, increasing strongly to 174 million in 2017. India’s growth is being driven by low smartphone penetration, expanding retail availability of devices, wealthier middle-class consumers, and aggressive promotions from local smartphone brands like Micromax.’

Studies also forecast a rapid increase in wealth in India, which will help the smartphone market as the devices come to symbolise affluence and money. Also, as wealth increases across India a new swath of customers will be entering the market, a growth strategy not open to the US market.

The implication that China’s market is maturing highlights the potential for further growth in India over the coming years. As yet there is no information on whether India could eventually take over from China in the smartphone market but these forecasts indicate that they are a contender to do so. China’s predicted growth in the market over the next three years is less than half of India’s, although it is higher than that of the US. This has vast implications for the smartphone market, with manufacturers needing to tailor their products to this rapidly expanding market and possibly adjust production and customer care locations to reflect the market shifts.

Woody Oh, Director at Strategy Analytics made it clear that India had to become a main focus for major players in the smartphone market over the coming years. ‘India will sell 174 million units and overtake the maturing US market to become the world’s second largest smartphone country by volume in 2017. No serious global hardware or software player can afford to ignore the huge Indian smartphone market today.’

There has already been a surge in relocation in India recently, encouraged

by India’s Prime Minister Narendra Modi’s speech in which he encouraged manufactures to ‘Make in India’. Samsung has been eager to move into India in recent years, and the ‘Make in India’ speech has set up a dialogue on the advantages of moving production into India throughout the industry. Moving production into India reduces costs of importing the products and disturbing them, which is an attractive concession for smartphone companies who will see an increase in orders from India over the coming years.

India’s growth in this sector is a combination of their own rise and America’s fall, as the US becomes disenchanted with constant consumption of pricey handsets and start saving by sticking with what they have.

July 2015 • CorporateAmerica • 17

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Feature

You Shoes, You Lose European footwear market gains momentum, with rapid growth helping boost sales in popular US firms.

American footwear brands are seeing a rise in international sales as the European footwear market expands thanks to rising purchasing power for young customers, a new report has stated.

The research, conducted by Transparency Market Research, indicates that the market was estimated as being worth $42, 941.3 million in 2014, and will expand at a CAGR of 1.5% during the forecast period which between 2015 to 2021. The study predicts that the market will be worth $47, 625.8 million by 2021.

The study segmented the European footwear market into the U.K., France, Italy, Germany, Spain, the Netherlands, and Rest of Europe. The U.K., out of all the countries in Europe, held the biggest market share in 2014, tallying 15.2%. This was followed by Germany with 13.6%. Italy is likely to experience the highest growth in the footwear segment in the forecasting horizon. The study predicts that this hierarchy will remain, with the UK predicted to have the largest market share in 2021, followed again by Germany.

Footwear was also separated into sections of the market, allowing the research to analyse the smaller sections of the market.

‘Europe footwear market is expected to undergo several changes such as new variations and style and eco fashion in different footwear categories. Consumers mainly prefer non-athletic footwear due to changes in fashion and rise in number of working women. Moreover, new footwear styles including ethical footwear and recycled footwear is mainly driving the market. In addition, growing fashion consciousness among consumers towards footwear products and increasing purchasing power of youth population are expected to boost the demand for footwear in the major countries of Europe including France, UK, Italy, Spain Germany and Netherlands among others in the forecast period.’

Gender was also examined in the study, which broke this down into men’s, women’s and children’s. The study found that the men’s shoe market is comparatively larger than that of women and children’s footwear, but there is high growth in the women’s market as more women entered the working environment.

The study has also opened up opportunities for serious growth among American brands in Europe, as the footwear market expands and economic recovery following the recessions in some countries drives high spending on clothing.

As economies recover and more people get back into work the market for hardwearing work shoes will increase, as well as that for shoes deliberately marketed as leisure wear as previously unemployed customers find themselves needing distinction between their work and recreational footwear.

18 • CorporateAmerica • July 2015

Factors for these changes were diverse, according to the research.

‘Changes in footwear market in Europe are expected due to several factors.

Among these, the emergence of newer styles, the arrival of eco-friendly footwear products in the market, recycled footwear, product innovation, and comfort enhancement are prominent market drivers for footwear. Fashion-consciousness and growing disposable incomes are anticipated to expand the footwear market in countries such as the U.K., Italy, France, Spain, Germany, and the Netherlands during the forecast period.

Online sales, lifestyle changes, increase in shopping centers, and technological advances are among the main reasons for the burgeoning footwear market. The growth of ecommerce has made a wide range of footwear available to customers in the comfort of their homes, which has increased brand exposure, providing a boost to the Europe footwear market.’

These diverse changes in the footwear market in Europe will allow a diverse range of different footwear brands to move into the region, with the market in need of various types and styles of shoe.

The study also analysed the market leaders, citing these as Adidas AG, Nike Inc, Bata Limited, Deichmann SE, and Puma SE. The American brands listed here are mainly sportswear brands, indicating that American trainers are popular in Europe and allowing companies to start their market penetration there before expanding into other styles of shoe once more established in Europe.

The results will impact on US firms seeking to break into the European footwear market. Large footwear companies have already begun to see the potential, with SKECHERS footwear recently announcing their expansion into Europe through the launch of their Central Eastern Europe subsidiary.

Michael Greenberg, the President of SKECHERS was keen to highlight how growth in these markets could have a big impact on the business.

‘For nearly two decades, we’ve successfully marketed our product to consumers in Central Eastern Europe through several distributors, but in the last few years we have seen a growing demand and increased potential for SKECHERS in the region. With the strength of our diverse product worldwide, we believe the time is right to further grow our brand – and that transitioning to a wholly-owned subsidiary will allow us to leverage our capital, product, logistics and business model to achieve this growth.’

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Feature

At Their

Leisure

Americans, Canadians and the British lead the poll into which country is most satisfied with amount of leisure time, which could have wider implications for worker satisfaction.

Leisure time is a luxury most people don’t enjoy as often as they like, but a recent study has shown that Americans are the happiest with the proportion of time allotted to them for leisure activities.

Internationally, the results were disappointing, with only 16% of people surveyed stating that they were completely satisfied with the amount of leisure time they had. Although the concept varies by culture, the results of this study, conducted online by GfK, illustrate that leisure time could become a new focus for businesses looking to increase worker satisfaction.

America, a country with no statutory requirement to provide their workers with holiday, still managed to come top of the study for satisfaction, with 69% of participants saying they were completely or fairly satisfied. This was followed a close joint second by the UK and Canada which both had 67% completely or fairly satisfied. The joint third were Germany and Belgium which had 66%.

There were also several countries where participants were less than satisfied with the proportion of leisure time they had, which were led by Russia, where 31% of participants were not at all satisfied, alongside Japan with 30% dissatisfaction and Brazil, which had 28% of participants which were dissatisfied. This is suggestive considering Russia offers their workers 28 days paid holiday per year, as well as numerous bank holiday days. These results suggest that holiday days are not the issue, but that leisure time is defined by workers as more the time that have during their working week.

This could have a significant effect on businesses, who could consider offering more breaks, flexible start and end times or abolishing working weekends for their employees in order to improve their job satisfaction. Whilst the research did not ask any further questions to its participants in terms of how their unhappiness at the amount of leisure time they had affected their job satisfaction or decision to browse for another job, the implication is clear that employees who were unhappy in such a key area of their lives would be more likely to eventually become dissatisfied by their careers.

The study, which sent an online questionnaire to participants aged fifteen or older in twenty two different countries in the summer of 2014, also included retirees, who were among the most satisfied with the amount of leisure time, with 31% being completely satisfied. Therefore, since participants with the most leisure time were the most satisfied, businesses should take this to mean that an increase in leisure time has a positive effect on happiness. Also, as already noted, the amount of holiday which participants are afforded does not necessarily correlate with satisfaction on the topic of leisure time, highlighting that the participants separate holiday from leisure time.

The countries with the most satisfaction are all from more affluent countries, although Japan’s inclusion in the list of countries with the least satisfaction 20 • CorporateAmerica • July 2015

suggests that wealth is not a key factor in leisure time satisfaction. However, access to a variety of time saving products and enjoyable activities may have an impact on these results, therefore employers could also explore the possibilities of supplying workers with perks such as gym or leisure club memberships or discounts on leisure products.

The study will also have implications for the leisure industry, because consumers who are less happy with the amount of leisure time they have will be more susceptible to advertising of products aimed at customers with limited time, or products which help them save time with tasks which are still enjoyable, such as time saving cooking products.

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Feature

New Dimension in 3D Printing Amazon finds retail opportunity for new technology with 3D printing store.

Amazon, the global online retailer, has announced a new application for 3D printing technology with the expansion of their online 3D printing store.

3D printing, the revolutionary new technology which allows users to create a physical product from a three dimensional model, has so far been the domain of experimenting technology firms and the construction industry. However, as Amazon announces a new wave of expansion for their online retail store, which opened last year, the market for the technology is expanding, albeit at a slower rate than previously envisioned.

The announcement states that the new service will allow customers to personalize characters from their favourite characters from numerous popular video games, by selecting a character and then using the personalization widget to create unique poses, use armor configurations or apply various different weapons and accessories to their character. Then they use the 3D product preview function to see a 360 degree view of their masterpiece from any angle, after which the customer goes through an approval and checkout process before the product is 3D printed on-demand and shipped directly to the customer. Most of the designs are created by Sandboxr, a 3D printing firm which specializes in gaming and video game character creation.

The three main personalisation packages are Smite, which allows customers over ‘30,000 ways to create customized characters’; Primal Carnage, which gives the option for ‘more than 12,500 customized set framed poses and character options’ and Infinity Blade, which offers users ‘over 12 million combinations to personalize the characters with unique poses, armor configurations, weapons and accessories’.

The cost of this service depends on the level of personalization, with the price starting at just $29.99, with larger customized characters rising in price to $49.99 up to $89.99. These prices make the figures more accessible to casual customers wishing to purchase a limited number of the products for recreational use.

Steve Johnson, Director for the Amazon Marketplace, made it clear that although the product range in the online store was still in the early stages of growth, this new range marked a key expansion for the 3D printing range.

‘There is a lot of passion and excitement in the culture of gaming, as well as 3D printing, and by combining these two worlds and allowing customers to design and personalize their favorite video game characters we can bring enthusiasts even closer to the games they love. 3D Printed Products on Amazon is still in its early days, and we are eager to offer customers the freedom to be designers and create one-of-a-kind items.’

Amazon’s online store is one of the largest online destinations for customers to purchase customizable 3D printed products, and this new range of products marks a key growth strategy as the firm attempts to make the technology more accessible to a retail market. The store also has a service aimed at business, allowing brands to offer print on-demand product designs.

Currently the store sells customizable 3D printed jewellery, as well as other products such as printed home decorations and electronics accessories, but currently the product range is limited. Despite this Amazon is keen to promote the number of products on offer, stating that since its launch the number of products has grown by over 150%.

‘The 3D Printed Products store gives customers access to thousands of fun and unique items, many that can be customized by material, style and color variations, and personalized with text. The 3D Printed Products store is one of the largest online destinations to discover customizable 3D printed products and features convenient search tools, interactive 3D preview functionality and the product personalization widget.’

By appealing to customers with an interest in gaming and introducing a new, more interactive means of creating the 3D products Amazon broadens their reach in the industry and making the products more attractive to customers, with the personalization allowing the technology to be used to its full potential as opposed to simply being a new means of manufacturing products.

Customers can also purchase 3D printing technology for themselves from stores such as iMakr, but with prices in the thousands for the machines they are currently not accessible to casual users. Printing machines are also being gradually introduced into the manufacturing industry but as yet customers wanting a service allowing them customizable products which can be printed for them have a limited choice.

Amazon’s service is appealing to customers because it allows the advantages of 3D printing, namely the ease of creating complex products, allowing for personalization without the customer having to print the products themselves.

The new range will introduce a new group of customers to the technology, as well as heralding a big expansion for the store. However, as the technology slowly becomes more accessible Amazon may have to diversify further to compete in the growing market.

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Feature

The Financial Frontier

The Federal Aviation Administration has granted permission for the 10th commercial spaceport to be built in the US. Is this money well spent or cash tossed into the air?

Space is the final frontier, but have the US gone too far, as the economy remains precarious and spending cuts dominate the budgets?

Ellington Airport is set to become a launch site for Reusable Launch Vehicles following Federal Aviation Admiration approval. The Houston Airport System announced that they had been granted a Launch Site License on 30th June, which will allow them to become a key centre for various aerospace operations, such as the launching of micro satellites, astronaut training, zero gravity experimentation, spacecraft manufacturing as well as a host of other potential activities.

Houston City Council members gave their support to the project two years ago, but the FAA has only recently announced that the plans will go ahead. The project will involve developing around 400 acres of land situated at the airport and will support Reusable Launch Vehicles which launch horizontally in a similar way to commercial aircraft, as opposed to vertically like most rockets.

The Houston Aviation Director Mario C. Diaz was keen to emphasise that the new launch site would provide a boost for the area.

‘Houston has been at the forefront of aviation history and innovation for decades. Not only does this opportunity reinforce an already long-established connection with the aerospace industry, it offers Houston an opportunity to strengthen its reputation as a forward-looking city and leader in creating hightech, next-generation type jobs.’

The Mayor of Houston, Annise Parker, was also a keen exponent of this idea and the notion that the facility will enhance the reputation of the area.

‘Houston will play a lead role in commercial space operations in the 21st century.

We believe a licensed Spaceport in Houston will not only serve as an economic generator for the city but also enhance Houston’s well-deserved reputation as a leader and key player in the aerospace industry.’

The creation of the space centre at Ellington is currently unbudgeted, but with the increased uncertainty in Europe and with political focus anchored to improving the American economy, is the cost of such facilities justified?

In a budget announced in 2010 Obama stated that the next year’s budget would contain reduced money for NASA, the American government’s agency devoted primarily to the civilian space program. This led NASA to announce the retiring of their final manned space shuttle in 2011.

However, a study in 2014 by the Organization for Economic Cooperation and Development showed that in 2013 America’s $39.332 billion space program cost more than that of every other country’s combined spending on space travel.

The second largest spend that year on space exploration was China, who spent $10.774 billion on their program, third being Russia with $8.691 billion.

In that same year, Obama’s government raised taxes to American citizens in order to reduce the country’s immense deficit. In addition to this, a federal

budget breakdown for that year showing that the government spent $28.1 billion on general government costs that year, significantly less than the outlay for the space program. Their protection budget for that year only just outstripped that of the space program, at $62.8 billion.

The space programs doubtless earns money for the country, with tourism often strongly attached to space facilities. The Kennedy Space Centre in Florida boasts a visitor complex which offers tours of the centre and space related experiences such as the chance to meet real astronauts and simulations of the space experience.

In addition to tourism, businesses and industries in the surrounding area also benefit from the space program which requires large quantities of materials, employees and machinery to operate. Arturo Machuca, the General Manager at Ellington Airport indicated that the new spaceport being created there would have similar positive implications for Houston.

‘Now that we are officially the 10th commercial spaceport in the U.S. we are ready to work with our aerospace industry partners to take advantage of the unique location, infrastructure and human resources that the fourth largest city in the U.S. has to offer.’

Status is also a key factor in the space programs, with America keen to remain at the forefront of international space travel and research. A recent study by Monmouth University found that 56% of Americans felt that the money and effort spent on the 1960s moon landings was enriched society with ‘longlasting benefits’.

However, the same study also showed that 51% of people believed increased spending on space exploration would be beneficial, whilst 43% thought it would not make a sound investment. Although the majority is in favour of increased spending on space exploration it is a very slim majority. Therefore, further economic issues could tip the balance on this decision.

Recently the space program in America took a blow in the form of the failure of SpaceX, a NASA project which involved sending a rocket to take supplies to the International Space Station, which exploded moments after leaving the ground.

Numerous high profile people, including Senator Bill Nelson and former astronaut Buzz Aldrin have insisted that this failure indicates that more space exploration is needed. Many commentators have echoed this by speculating that NASA’s reliance on outsourcing the launches, a key budget reducing tactic by the government agency, was part of the reason for the failure of the SpaceX rocket.

Despite this, it is clear that many Americans are questioning the impact that the billions of dollars spent on space exploration is having on them, particularly following this recent failure. With spending cuts top of the government’s agenda, it may only be a matter of time before they set their sights on the space program.

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Feature

A New Reign in Spain?

The Greek crisis has left the dollar strong against the euro, so is now the best time to consider expansion into Spain?

The combination of a strong dollar and a high proportion of English speakers has left many companies eager to expand into Spain. With the country’s government keen to use the recent Greek crisis to advertise their own skilled navigation out of the Eurozone quagmire, is a move to into the Spanish market a wise idea?

It has recently been announced that Andersen Global tax firm has taken this step by purchasing Global Abogados, a tax and law firm with offices in Barcelona and Madrid.

Mark Vorsatz, the CEO of Andersen Tax, explained the decision to move into Spain because despite the current turmoil in other parts of Europe, the firm feels it is a key element of their global expansion program.

‘Establishing a presence in Spain furthers our European growth strategy. Global Abogados is a true fit for our culture and our dedication to providing best-inclass client service. This addition reinforces our commitment to ensuring our clients receive the highest quality tax and legal advice throughout the world.’

Antonio de Weest Prat Jorba, the Office Managing Partner for Global Abogados, was keen to emphasise that the acquisition would be beneficial to both parties and would that he felt Andersen Global were committed to adapting to the Spanish firm’s needs.

‘With an already robust association in Europe, Andersen Global allows us to better serve the growing international needs of our clients. We are looking forward to working with a firm that shares the values we treasured at Arthur Andersen and maintains the same level of commitment to providing quality client service.’

The acquisition is certainly a sound one in terms of growth, with Global Abogados providing the firm with two locations in Spain, which brings Andersen Global’s international reach up to 41 international locations providing customers with access to over 1,100 professionals worldwide.

However, with trepidation about the future of Europe mounting in the ongoing Greek crisis, is now a good time to be moving into a major European nation like Spain?

There are several main points in favour of an expansion into Spain. Recently, despite the ongoing fracas in Greece, Spain’s government has raised the country’s growth forecast to 3.3% for this year. The International Monetary Fund have also raised their estimate of Spain’s economic growth to 3.1% for this year, which is well ahead of many other European countries. With such economic expansion businesses could expect to be able to achieve rapid market growth themselves as well as stable suppliers and a more limited risk of a fiscal meltdown like the one currently being experienced in Greece.

Spain’s Prime Minister, Mariano Rajoy has also recently announced a six month income tax reduction scheme designed to rejuvenate the country’s economy, 24 • CorporateAmerica • July 2015

which would make Spain a good idea for expanding retail businesses into, with consumers set to have more disposable income than before.

Many studies also indicate that Spanish tourism is continually on the rise, with tourist spending accounting for a vast amount of Spanish revenue. A recent study by Centtrip, a leading pre-paid MasterCard firm, showing that British tourists alone spend around £6.14 billion whilst holidaying in Spain each year, the most amount spent in any country in the world.

An expansion into Spain need not be hindered by any language barrier, with Spain experiencing a large growth in the number of English speakers, according to recent research by Education First, who stated in their 2014 English Proficiency Index that Spain has been actively improving its English skills in order to make itself more attractive to international investors and businesses.

‘The Spanish government has defined English as one of seven basic skills, alongside Spanish and math. Starting in 1995, some regions in Spain began turning public primary schools into bilingual schools, in which students spend 30% of their day in English. Madrid intends for half of all public schools to be bilingual by 2015.’

Before going out and buying offices in downtown Madrid, it should be noted that there are negative implications of a move into Spain. The country only left their recession in late 2013 and the recent Eurozone crisis could potentially have a negative effect on them, with Greece currently plunged into turmoil and neither Germany or their main creditor, the European Central Bank offering the country support.

Considering this response from their creditors it is possible that even with a steadily growing economy Spain may not be entirely safe from economic destruction. According to statistics published by Trading Economics, Spain’s government debt is at 1046191569.00 thousand Euros. The International Monetary Fund and the European Central Bank are Spain’s principal creditors and, crucially, are also Greece’s main creditors, meaning this reaction happen in Spain in the future.

In addition to this, the current Spanish elections have thrown up some surprising issues which could potentially paralyse any business looking to expand into Spain. The key issue is the Podemos Democratic Party, who are gradually encroaching on the power of Spain’s current leaders, The People’s Party, and whose assentation to power could herald new laws which would cause business serious problems. The party would like to remove all spending cuts, as well as focuses on worker’s rights which could potentially detract from the economic recovery by increasing the country’s debt.

Overall Spain is an attractive opportunity for businesses seeking expansion into Europe, but with the recent Greek economic problems, businesses will have to decide if the risks of economic meltdown and political uncertainty outweigh the potential benefits.

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Feature Feature

Streaming Ahead---

Traditional TV watching habits are disappearing as viewers find greater convenience online, a new study shows. Television moves online with 28% of television watching is now done through streaming.

The research, entitled ‘TV Share of Clock’ and conducted by GfK MRI, was conducts among respondents to the firm’s ‘Survey of the American Consumer®’ and the results were previewed at this year’s ARF Audience Measurement conference. The study was part of the firm’s ‘Future of TV’ report series, with the firm planning to reuse many of the questions from ‘TV Share of the Clock’ in the rest of the studies in order to create a trend-able database with links to the company’s profile data on US consumers.

28% of TV viewing is now done online, according to the study. The study showed that using subscription or free online platforms on a computer or mobile device accounting for 16% of the time viewer’s spent watching TV content, whilst online streaming through a traditional TV set made up another 9% and 3% comes from other methods for accessing content, such as portable game consoles.

The study identifies 41% of TV viewers as being ‘Digital Enthusiasts, who subscribe to at least three digital TV services online, in addition to maintaining a traditional pay TV subscription such as cable or Sky. Other means of combining streaming and TV consumption were also identified in the study. Customers who accessed online TV content and streaming service through their TV were named ‘TV 2.0’.

Some consumers were also keen to watch TV through mobile devices such as phones and tablets, and were named as ‘On-the-Go Getters’ by the report. They are an important group of consumers, with 8% of all TV consumption being done on mobile devices.

Being mobile is clearly a big consideration for TV watchers with the study showing that 30% of participants stated that they had watched a program on a smartphone in the past thirty days, and 29% told the study that they have used a tablet to watch TV content during the same period.

Of the groups of TV watchers found by the study, the ‘Digital Enthusiasts’ were most likely to use TV network apps, with 44% stating that they currently use network apps that do not require a cable subscription, and 35% saying that they use network apps which do require a cable subscription. Consumers identified by the study as ‘Digital Enthusiasts’ spent an average of $10.80 per month on network apps. This information provides businesses with clear links between website viewing and app usage.

The findings show the movement of TV online, but also showed that viewers still enjoyed some aspects of traditional TV viewing, according to Christie Kawada, Executive Vice President of Product Management and Innovation at GfK MRI.

added demand for one another; viewers are checking out more – and different -- content, and ultimately watching more. Even digitally savvy viewers still value time-honored TV experiences, like social viewing and second-screen experiences, thus keeping linear viewing strong in today’s digital world.’

The study did also examine traditional modes of TV viewing and highlighted that consumers are keen to cling onto them, with ‘Watch a show live when it is first broadcast’ placed as the top out of a list of participant’s favorite ways to watch TV. The study also showed that watching shows ‘live when broadcast’ accounts for 39% of all time spent using TV content.

Michael Drankwalter, Executive Vice President of Syndicated Media Sales for GfK MRI was keen to highlight the potential for industry advancement that these results offer.

‘With its direct links to the GfK MRI consumer database, TV Share of Clock connects expanded insight into this new digital world to action. For any viewer segment, content publishers can get a deep sense of their buying styles, advertising attitudes, personal values, leisure time activities, and much more.

And best yet, all insights coming from these emerging TV viewing groups can also be profiled at the network and show levels to make all the data relevant to everyone’s business.’

This new information will have a vast impact on the advertising and media industries, with strategies for slowly moving online required to keep up to date with these new developments. Marketing departments will have to find new ways to integrate their TV advertising with online content, whilst media firms can look into expansion into mobile and online streaming services and more frequent live broadcasts.

Content developers can also establish clear links to websites or apps within their shows to push customers towards using these services. Live content could include features such as online competitions or extra content available exclusively online or on apps which would drive viewers watching on their televisions to look at the show’s online content as well.

By establishing clear links between mobile sites, apps and online websites media firms could also extend the audience to these sites as the research shows that customers use a variety of devices and formats when accessing online TV content.

‘Our study reveals important new populations of TV viewers, emphasizing how TV has taken on a whole new meaning, with different approaches to combining streaming and traditional platforms and viewing. We live in a new type of video ecosystem, where online video and live TV co-exist amongst traditional cable offerings, apps, and digital streaming of live TV. These platforms are creating July 2015 • CorporateAmerica • 25

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Feature

Is Sport the Future of Sustainable Foods?

New report confirms leading sports stadiums serving top teams are promoting sustainable foods through practise.

Sustainable foods have been a hot topic for a number of years, but translating this into high sales and reaching new customers has been problematic.

According to a new report by the Green Sports Alliance in conjunction with the Natural Resources Defense Council has pinpointed 20 sporting venues across North America that are serving healthier food choices to sports persons and adopting more sustainable food practices behind the scenes.

collectively serve hundreds of millions of people each year, offers an influential platform that can educate consumers and the marketplace about healthier food and stronger food systems. There is a growing trend towards more efficient and environmentally intelligent practices across the supply chain of game day food.

The powerful examples in this report provide successful models that all food providers should emulate.’

‘Champions of Game Day Food’ highlights a broad set of more sustainable activities across sports venue food practices which include planning menus with seasonal and local fare; sourcing third-party certified sustainable food and drinks; using energy and water efficient kitchen equipment; and reducing wastage by donating unsold food and composting spoiled foods. The report also highlights the addition of more local, organic, antibiotic-free, vegetarian and vegan options on stadium menus, as well as more recyclable and compostable utensils and packaging. There is even evidence that some stadiums have moved towards being more self-sufficient, with some having their own on-site gardens to grow some of their own food in and several stadiums composting their own food waste.

As evidenced by the recent popularity of the $29 a week food stamp challenge, which was popularised by celebrities such as Gwyneth Paltrow and involved participants attempting to live off the standard amount of money provided to people on food stamps for a week, there has been an increased awareness recently of food poverty within the US. The rise in sustainable food practises in sports stadiums could potentially pave the way for new practises in households and in other large businesses, which in turn could have a massive impact on the way in which US consumers purchase food.

The Strategic Food Advisor for the Natural Defense Council and report coauthor Gabriel Krenza highlighted the potential these findings had on the wider sustainable food market. ‘Prioritizing sustainability in sports stadiums and arenas can have ripple effects well beyond the venue gates. By modeling smart food practices, these iconic sports teams are showing real leadership that is influencing their millions of fans as well as the important food providers that supply their concession stands.’

Krenza’s comments on concession stands, which sell products to fans to consume while they watch the sporting event, highlights how these sustainable food choices can impact not just the sports people eating the food behind the scenes, but also customers using the stadium. This is a key example of how sustainable food practises are becoming more mainstream, with customers now being offered more choice at games and sporting events beyond hot dogs and nachos.

This was echoed by the co-founder and President of the Green Sports Alliance, Dr. Allen Hershkowitz. ‘We are seeing the start of a significant cultural and marketplace shift towards environmentally intelligent food at sports venues.

Greener food service programs have helped venues improve operational efficiency, feed those in need, and better cater to varied dietary preferences. The game day fan experience is changing for the better as a result.’

There have already been significant changes to the food market in America.

The market has recently seen a boost in the sustainable and alternative food market, with stores such as Wholefoods rapidly gaining in market share as well as an increase in popularity of specialist diets such as veganism, vegetarianism.

Flexitarians, consumers who choose to limit the amount of meat and dairy products they eat, are also increasing. The expansion in these markets has led to increasing demand for products such as meat and dairy replacements, vitamin supplements and kitchen products.

There has even been change to legislation with the U.S. Food and Drug Administration recently legislating against partially hydrogenated oils which are the primary dietary source of artificial trans fat in processed foods. Processed foods, often the least sustainable foodstuffs because of high levels of artificial chemicals and the low cost fillers added to them, have become an important topic with regards to food sustainability, and this ban will herald a big change in the market. This ban is only one small example of vast changes US food industry in recent years, with many retailers also opting to remove harmful chemicals from their products themselves as consumer awareness grows.

All of these changes illustrate a new awareness in America of the food we are consuming, and highlights the alterations which are coming to the American food market. The improvement in food at sports stadiums is simply the beginning: America is experiencing a food revolution.

The comments of Alice Henly, Director of Programs at the Green Sports Alliance and Resource Specialist at the NRDC were more focused on promoting the message that a move towards more sustainable foods would help to fight food poverty and promote more sustainable food practises in the wider community outside of sport. ‘Changing the menus at sports venues, which

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Super Insurance Deal to be Investigated The merger between Willis Group and Towers Watson was blighted by allegations of corruption as they are subjected to investigation by Kendall Law Group.

The proposed merger between Willis Group and Towers Watson, two giants in the world of American insurance, was hit by corruption allegations and investigations just hours after it was announced.

The new firm would be a titan in the industry, with the firm’s announcing that ‘The combination of Willis and Towers Watson brings together two highly complementary businesses to create an integrated global advisory, broking, and solutions provider to serve a broad range of clients in existing and new business lines.’

The merger will create a super insurance company with the implied equity value of the transaction is being around $18 billion. The announcement intimated that the combined company will have around 39,000 employees in over 120 countries and will have an estimated pro forma revenue of approximately $8.2 billion. In their announcement, the Willis Group made it clear that the merger would benefit both customers and investors alike.

‘Combination offers clients a broader range of advice, analytics, specialty capabilities and solutions covering benefits; brokerage and advisory; talent and rewards; exchange solutions; and risk and capital management across all segments and geographies. Creates integrated global platform to drive long-term growth and market share gain in traditional and new businesses.

Merger delivers significant potential to enhance long-term shareholder value through incremental revenue growth, expected cost synergies of $100-125 million, and greater corporate efficiencies.’

The new super firm created by the merger would be called Willis Towers Watson, and a definitive merger agreement has already been signed, under the terms of which the companies will combine in an all-stock merger. Both insurance companies have confirmed that the decision was unanimously approved by their respective boards of directors.

John Haley, the Chairman and Chief Executive Officer of Towers Watson was keen to emphasis the benefits this merger would have for their investors and clients.

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‘This is a tremendous combination of two highly compatible companies with complementary strategic priorities, product and service offerings, and geographies that we expect to deliver significant value for both sets of shareholders. We see numerous opportunities to enhance our growth profile by offering integrated solutions that leverage Willis’ global distribution network and superb risk advisory and re/insurance broking capabilities to deliver a more robust set of analytics and product solutions across a broader client base, including accelerating penetration of our Exchange Solutions platform into the fast growing middle-market.

at lower than their sale price on Monday, which the firms had stated was what the figures were based on.

We also expect to realize substantial efficiencies by bringing our two organizations together, and have a well-defined integration roadmap to capitalize on identified savings, ensure the strongest combination of talent and practices, and realize the full benefits of the merger for all of our stakeholders.

Gardy & Notis, LLP, a New York based national securities firm is also looking into the transaction, again citing the reduced value of shares in the merger announcement as their main focus. Morgan & Morgan gave a similar announcement of an investigation, giving no further details than that they were investigating the firm and its board of directors ‘for potential breaches of fiduciary duties in connection with the sale of the Company to Willis Group Holdings PLC for approximately $18 billion’. Numerous other law firms have also announced similar investigations, which could prompt The U.S. Securities and Exchange Commission’s Office to announce their own, official investigation. It could also lead the shareholders to launch a legal bid against Towers Watson to try to recoup some of the money they will potentially lose if these allegations are accurate and the merger is still allowed to go ahead.

Importantly, our organizations share a client-first mentality and a focus on providing services and solutions that consistently exceed clients’ expectations.

As we bring these two companies together, we are confident associates across both organizations will enjoy increased development opportunities as part of a stronger and more global growth company’ However, on the same day, Kendall Law Group announced that they would be investigating ‘whether Towers Watson and its Board breached their fiduciary duties by failing to fulfill its fiduciary duties, failing to maximize the value of the Company, failing to disclose all material benefits and costs, and failing to obtain the best possible consideration for the Towers Watson shareholders.’

The discrepancy steams from the valuation of Tower Watson’s shares, which were valued at the time of the announcement of the merger as around $125 a share based on the transaction details but according to the Kendall Law firm’s assessment of the situation ‘Monday’s closing price for Towers Watson was $137.98 a share, while Willis share price is up over 7%’. None of the announcements by either of the insurance companies mentioned specifically the individual share prices for either firm, but these can be calculated using the other financial information provided, which indicates that the shares are valued

The Kendall Law Firm, led by former federal judge Joe Kendall, are not the only firm due to investigate the merger. Former United States Securities and Exchange Commission attorney Willie Briscoe and the securities litigation firm of Powers Taylor LLP have also announced their intentions to investigate Towers Watson and its board of directors because they believe that the valuation share price ‘is significantly lower than the 52-week high and at least one analyst’s estimated value of $157.00 per share’.

If these allegations are accurate then shareholders in Towers Watson will be receiving shares and a special cash dividend which is worth approximately $12 less than the shares were worth on Monday, when the deal was announced. Shareholders in Willis Group, a firm with considerably lower share value than Towers Watson, would receive 50.1% of the combined company whilst Towers Watson shareholders would receive 49.9% of the combined company on a fully diluted basis.

Therefore, Willis Group shareholders can be considered to receive greater value for their shares from the deal than those who have invested in Towers Watson. It would imply that the board of directors at Towers Watson deliberately allowed their firm’s shares to be undervalued.

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Trump Associates Flee

Following Presidential Candidacy Speech

As Donald Trump announces his presidential candidacy, we examine whether his political ambitions will affect his business empire.

Donald Trump, the business magnate who in recent years has become better known as a television personality/ figure of fun, has officially announced his candidacy for the 2016 presidential elections.

Trump’s website issued a brief statement on his candidacy on June 16th: ‘Donald J. Trump announced his candidacy for President of the United States of America.

Mr. Trump was joined by his immediate family and stood before thousands of supporters to declare his candidacy for the 2016 GOP Presidential nomination.’

It continued to outline the Trump campaign’s main regions of focus: ‘Mr. Trump has teams based in the early primary states of Iowa, New Hampshire and South Carolina. He will be visiting each of these states beginning with Iowa today, followed by New Hampshire on June 17th, and South Carolina on June 19th.The Donald J. Trump for President Campaign will be headquartered in New York City.’

Trump, who previously expressed an interest to run for president in 2012 but then declined to run, is the owner of the Trump Organisation, which incorporates an impressive portfolio of real estate, media publications, hotels and golf courses.

However the Trump Organisation, and its founder, are losing friends fast following Trump’s Presidential Announcement Speech, delivered on June 16th.

The speech prophesied that immigration was the biggest threat to America, and cited numerous examples of countries who were using America as a ‘dumping ground for everybody else’s problems’. Trump also made it clear that both immigration and America’s foreign economic policy were to blame for the country’s problems.

‘Our country is in serious trouble. We don’t have victories anymore. We used to have victories, but we don’t have them. When was the last time anybody saw us beating, let’s say, China in a trade deal? They kill us. I beat China all the time. All the time.

When did we beat Japan at anything? They send their cars over by the millions, and what do we do? When was the last time you saw a Chevrolet in Tokyo? It doesn’t exist, folks. They beat us all the time.

When do we beat Mexico at the border? They’re laughing at us, at our stupidity.

And now they are beating us economically. They are not our friend, believe me.

But they’re killing us economically.’

Trump continued on to include the Middle East in his speech: ‘It’s coming from more than Mexico. It’s coming from all over South and Latin America, and it’s coming probably— probably— from the Middle East. But we don’t know.

Because we have no protection and we have no competence, we don’t know what’s happening. And it’s got to stop and it’s got to stop fast. Islamic terrorism is eating up large portions of the Middle East. They’ve become rich.’

He continued to express his feelings that the US was failing in its duties to its citizens through its immigration policy.

‘It’s true, and these are the best and the finest. When Mexico sends its people, they’re not sending their best. They’re not sending you. They’re not sending you. They’re sending people that have lots of problems, and they’re bringing those problems with us. They’re bringing drugs. They’re bringing crime. They’re rapists. And some, I assume, are good people.’

Businesses affiliated with The Trump Organisation have gradually been distancing themselves from the organisation following the speech. NBC, the National Broadcasting Company of America, severed all ties with Trump in a statement made on June 29th.

‘At NBC, respect and dignity for all people are cornerstones of our values. Due to the recent derogatory statements by Donald Trump regarding immigrants, NBCUniversal is ending its business relationship with Mr. Trump. To that end, the annual Miss USA and Miss Universe Pageants, which are part of a joint venture between NBC and Trump, will no longer air on NBC. In addition, as Mr. Trump has already indicated, he will not be participating in “The Apprentice” on NBC. “Celebrity Apprentice” is licensed from Mark Burnett’s United Artists Media Group and that relationship will continue.’

NASCAR, which is owned by the same parent company as NBC, has also announced that they will not be associating with Trump further following the speech. The car racing firm confirmed to USA Today that they will not be hosting their Xfinity and Camping World Truck series post season award banquets at the Trump National Doral Miami resort following the comments.

Other firms that have cut ties with Trump following the speech include the New York department store Macy’s and Univision, a Spanish-language television network.

Trump has been vocal on social media sites, such as Twitter and Instagram, following the speech and the business fallout it instigated, making statements which indicate that it was his decision to cut ties with the firms and not theirs after they stated that they would no longer be doing business with him.

The impact from these business loses will be catastrophic. Trump has lost millions of dollars in contracts through these businesses severing ties with him, and the negative publicity could have a wider reaching effect as his suppliers, customers and contacts could potentially jettison the Trump Organisation to reduce the risk of the negative attention affecting their firms.

A large proportion of the Trump Organisation is devoted to media and publishing, and without support from other businesses and customers this section of the company could easily collapse.

All of these firms have made it clear that it was Trump’s views they object to, and therefore his candidacy for president can be seen as less of an issue, but as the debate heat up and Trump is invited to express views on a wider variety of subject there is every possibility of his losing more business allies.

A full transcript of Donald Trump’s inaugural speech is available here.

July 2015 • CorporateAmerica • 31

www.corporateamerica-news.com

Feature

Tea Time

New product launches highlight diversification in US drinks market.

Summer is traditionally the time of year when new iced drinks are launched, but tea is defiantly the flavour of this year as firm’s launch new iced tea products in an attempt to diversify as America embraces a wider range of tea products.

Peet’s Coffee, which acquired Mighty Leaf Tea last year in an attempt to expand in 2014. In his statement Dave Burwick, the President and CEO of Peet’s Coffee and Tea focused Mighty Leaf’s diverse range of products and how this could improve Peet’s business and growth plans.

‘We’re excited to add Mighty Leaf Tea to the Peet’s family as we’re both Bay Area companies with core values built on the highest standards of quality and deep commitment to craft - it’s a natural, complementary fit. Mighty Leaf is a fantastic premium brand, known for its artisan teas and signature hand-designed mesh tea pouch; their addition to our existing tea business enables us to further strengthen and accelerate our growth in this market.’

This summer the firm has announced a new range of Mighty Leaf Iced Teas & Iced Tea Infusions, with a menu which includes black tea, herbal tea and green tea infusions in the form of iced drinks infused with various fruits such as pomegranate and blueberry.

Tyler Ricks, Chief Marketing Officer of Peet’s Coffee and board member of Mighty Leaf Tea, highlighted growing diversification in the US tea market as a key reason behind the launch of the new range.

‘Tea is the second most popular beverage in the world behind water, and Americans drank nearly four billion gallons of tea last year alone. Mighty Leaf and Peet’s teas are built on the highest standards of craft and quality. We’re uniting these exceptional teas under the Mighty Leaf brand to give tea lovers a focused, premium tea experience in our stores with more innovative, artisanal blends and handcrafted tea beverages.’

Larger firms are also jumping on the flavoured tea bandwagon, with Starbuck, the international coffee shop chain recently launching a limited edition product called Teavana® Shaken Iced Mango Black Tea Lemonade, which is described by the company as ‘a delicious blend of premium black tea, juicy mango, sweet passion fruit, and a splash of lemonade’, adding that ‘Starbucks baristas will shake the beverage a minimum of 10 times in order to release the drink’s vibrant flavors’. The new product will also be available as a loose leaf tea for customers to recreate the beverage at home, and the notions of sophistication and summer enjoyment were key factors in the drink’s development, as Starbuck’s Senior Product Developer for beverages Megan Droz was keen to emphasise.

‘We always start with the experience first, not the flavor. That gives us a much stronger connection to the beverage we create because the flavor is rooted in a feeling, in something special that has occurred.’

The move into tea flavored drinks, with the emphasis being placed on summer sophistication and an enjoyable drinking experience proves that the company are trying to expand their product range, which currently includes a number of Frappuccino® products, cream and coffee drinks, as smoothies.

These new product releases follow research from the Tea Association of the U.S.A., Inc. which indicates that the US tea market is expanding at a rapid rate.

The report, entitled ‘The State of the U.S. Tea Industry, 2014 Year in Review’, stated that ‘2014 continued to be a year of growth for the US tea industry, building on a trend that started more than two decades ago. The total wholesale 32 • CorporateAmerica • July 2015

value of tea sold in the USA grew from less than two billion dollars in 1990 to more than 10 billion dollars today.’

The report citied diversification in products from merely tea into confectionary, juice and health drinks as a key reason behind this market growth, as well as an increase in tea shops which has led consumers to become more discerning as they expose them to finer, more speciality and flavored teas.

Other considerations, such as customers seeking healthier products and the wealth of convenient, ready to drink products available to consumers in a wider variety of retail outlets have also had influences on the market’s rapid expansion.

‘Additionally, ready-to-drink tea products have increased the availability of this health positioned beverage in non-traditional outlets. Most warehouse clubs, mass merchandisers, gas marts, drug stores, and convenience stores now carry tea products, while large distribution increases in the vending and foodservice sectors have further bolstered tea’s prevalence.’

The report’s data shows that the tea industry in the US has grown considerably, with the total tea sales in 1990 being $1.84 billion, rising to $9.79 billion in 2000 and hitting $ 10.84 billion in 2014. The speciality and ready to drink segments of the markets grew the most considerably from 1990.

The US tea market shows no signs of slowing down and the launch of these new products proves that there is no limit to the tea products America will embrace.

www.corporateamerica-news.com

Feature

July 2015 • CorporateAmerica • 33

www.corporateamerica-news.com

Feature

34 • CorporateAmerica • July 2015

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Feature

America Losing its

Apparel

The retail company has announced its strategic turnaround plan, which involves a $30million cost reducing strategy.

American Apparel, once the darling of the high street fashion world, is set to close stores and trim down its workforce following an announcement on July 6th that the firm will be implementing its strategic turnaround plan to help boost their ailing finances.

In addition to closing underperforming stores and slimming down its workforce, the retail company has also announced that there will be a rejuvenation of the firm’s leadership team. This follows the announcement on 10th June that the firm’s top level management was being shaken up with the arrival of Brian McHale as the firm’s Senior Vice President and Chief Information Officer. The firm has also announced the hiring of Christine Olcu as General Manager of Global Retail and Brad Gebhard as President of Wholesale to help implement its global retail and wholesale turnaround strategies. Under the plans the post of President of U.S. Retail will continue to be held by Nicole Gabbay.

Paula Schneider, recently appointed Chief Executive Officer of American Apparel highlighted that these new appointments were necessary to improving the business and putting them back on track financially.

‘We are looking forward to working with Christine and Brad to leverage their expertise, which will be invaluable in delivering compelling products to our customers. We are proud of our heritage as the largest apparel manufacturer in North America, and the initiatives announced today are designed to enable us to return to profitability so that we can continue to serve our loyal customers and provide fair wages to our dedicated employees for years to come.’

Another measure is the redesigning of the firm’s fall merchandise line. For the first time in its history American Apparel will offer customers a fall line which focuses on advanced basics and key items for both men and women. The firm’s CEO was keen to state that the firm would be increasing their focus on this season to improve sales.

‘Historically, the fall season has not been a major focus for the Company. We are beginning the process of re-merchandising the product assortment in our retail stores to increase productivity by SKU. The new styles are designed to increase revenue as we continue to evolve our product offering during this important selling season.’

Overall Schneider was optimistic about turning the company around despite the precariousness of their situation.

‘We are committed to turning this company around. Today’s announcements are necessary steps to help American Apparel adapt to headwinds in the retail industry, preserve jobs for the overwhelming majority of our 10,000 employees, and return the business to long-term profitability. Our primary focus is on improving the processes and product mix that have led to steep losses over the past five years. Our customers, employees, and local communities around the

world believe that American Apparel is an iconic brand that deserves to succeed.

My job is to make that a reality.’

However, these measures may not be enough to save the fashion brand. The statement announcing the cuts was more dismayed in its assessment of their financial position than their CEO. ‘Even if American Apparel increases revenue and cuts costs, there can be no guarantee that the Company will have sufficient financing commitments to meet funding requirements for the next twelve months without raising additional capital, and there can be no guarantee that it will be able to raise such additional capital.’

American Apparel’s decline has links to their problems with their former CEO and the founder of the business Dov Charney. In May the firm announced that they would be taking legal action against Charney ‘for violations of his Standstill Agreement with the Company’. The firm announced that they were terminating Charney ‘for cause in accordance with the terms of his employment agreement’.

Charney is retaliating against the firm with his own lawsuits, which the company’s statement highlighted as particular problems for the failing firm.

‘In addition, management is defending the Company against approximately 20 lawsuits and administrative actions initiated by Company founder Dov Charney and his associates. The Company believes these cases are meritless and intends to vigorously defend such actions and, where possible, pursue remedies against Mr. Charney for his actions.’

The company has also reported poor first quarter financial results this year, with a loss per share in the first quarter of 2015 of $0.15. Although American Apparel’s operating expenses had reduced by $8.6 million, or 11%, compared to the same period in 2014, the firm’s business inventories were also down by $25 million, or 17%, compared to the same period in the previous year.

Net sales had also decreased by 9% year on year, with gross profit down 34% to $47.5 million from $72 million for the same period in 2014. The company attributed this to various flaws in the firm’s own business strategies, as well as to external issues.

‘The decrease was related to discounts related to management’s strategic initiative to reduce inventory levels by accelerating the sale of slow-moving inventory, the foreign exchange impact of the strengthening US dollar and lower retail sales. Gross profit, excluding significant charges, decreased to 42.0% of net sales in the first quarter of 2015 from 52.5% in the first quarter of 2014.’

The future looks bleakest for the employees set to lose their jobs as part of the cost cutting tactics. But, as the company were keen to point out, without these cost cutting plans, there may not be an American Apparel in future.

July 2015 • CorporateAmerica • 35

www.corporateamerica-news.com

Dunk Feature

Slim

Oreo to diversify with unveiling of new thin cookie.

The snacks, traditionally aimed at the young and the glutinous, are being revamped to appeal to a more adult audience with the launch of new Oreo Thins.

The Thins are being marketed at adults looking for a quick sweet fix, making a departure from the firm’s usual marketing strategy, which has seen the firm release other products such as Double Stuff Oreos, which contain twice as much cream filling as standard cookies, as well as Triple Double Stuff Oreos which are filled with chocolate flavoured cream.

Oreo cookies, the original of which is two small, thick coco flavoured cookies sandwiching a layer of cream filling, has also been diversified into such varied products as an Oreo Pie Crust, mint and berry flavoured Oreos and Oreo ice cream cones.

In addition, the brand’s website boasts an impressive recipe section which has highlights such as ‘Oreo Cookie Balls’, ‘Oreo Milk Shakes’ and ‘Chocolate Carmel Crème Pie’, all designed to appeal to a young audience which places less emphasis on health and more on an intense chocolate consuming experience.

The website itself, a bright blue and white affair covered in drawings of Oreos, does not exactly reflect the new adult image that the brand is attempting to cultivate by with the new launch.

Patty Gonzalez, Senior Brand Manager for OREO at Mondelez International, made it clear that Oreo was moving in a new direction with the design and targeting a different customer base.

‘At OREO, we know that some of our fans have grown up and that their tastes have grown up too. With this in mind, we’re excited to introduce OREO Thins as a new take on the classic cookie. The crisp and delicate texture of OREO Thins was specially designed for fans who love the taste of OREO but are looking for a more sophisticated cookie.’

The company, which has taken its cue from the slim design of modern technology, were keen to emphasise the new cookie’s slim credentials, with a view to appealing to calorie conscious consumers. Four Oreo Thins will constitute a serving size, with this providing one hundred and forty calories, considerably less than the standard Oreo, which has a serving size of three cookies providing one hundred and sixty calories.

The new cookie will also be physically smaller, with Oreo Thins measuring around 7.5mm thick, considerably slimmer than traditional Oreos.

The new Oreo will be available in Original, Golden and Mint flavours, and is being billed as a permanent addition to the Oreo brand, with customers able to purchase the snacks from thousands of popular food retailers from July 13th at an SRP of $4.59. Original Oreo cookies are also available in all of these flavours.

The brand’s statement makes it clear that the new product is designed to be more comparable to a British biscuit than an American cookie. ‘With a crisp and delicate taste, OREO Thins pair great with an afternoon latte or cup of tea for a more adult treat.’

36 • CorporateAmerica • July 2015

This is a marked departure from traditional advertising slogans for the cookies, which are famous for their ‘twist, lick and dunk ritual’ which the brand describes as ‘the signature way to enjoy this iconic cookie for many different cultures around the world.’ The brand also boasts that ‘OREO has a Facebook community of more than 40 million OREO lovers around the globe, representing 200+ countries and dozens of different languages.’

Mondelez International, the global snacking company which owns the popular cookie brand in addition to Cadbury, Trident gum and Tang powdered beverages, has announced that in conjunction with the launch of Oreo Thins they will be rolling out an intense 360-degree marketing campaign, beginning on July 7th, which will include: ‘A “Thinvitation” to fans on OREO social channels starting July 7 where they can obtain a one-time-only code they can enter at OREOThinvitation.com for a chance to receive a free taste while supplies last.

A new, epic TV launch spot by The Martin Agency. Debuting July 20, it features visual cues to help emphasize the thin, crisp and delicate nature of OREO Thins.’

The marketing campaign will also involve Oreo’s social media networks, with one series of adverts showcasing ‘A series of new etiquette rules around how to “properly” enjoy the OREO Thins’ and ‘A playfully cinematic video that illustrates how the more sophisticated OREO Thins gives the “forgotten” pinky finger a new reason to be.’

The radical departure from their usual section of the snack market highlights a change in the US food market, as customers embrace healthier options and look for sophistication as opposed to value for money in their snacks.

This new marketing initiative will entice sceptical US customers to try the new product, which is a radical departure for the brand and may lead it to diversification and success in a new section of the snack market, or back to the drawing board.

www.corporateamerica-news.com

August 2015 / Planner

August 2015 / Planner Colorado Day

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