August 1998


  • World News Today... daily headlines and abstracts
  • Reaching Consumers in Asia Through Direct TV Advertising
  • Airfare Pricing Strategy Under Review by Major US Airlines
  • Proctor & Gamble Launches New Facility in Northern China
  • DuPont Invests in Packaging Industry in Europe
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  • ASIA -- Because nearly one-third of products sold by the US are purchased by Asian consumers, there is a direct connection between the economies of the USA and Asian markets. With Asia's recent economic turmoil and more than a billion consumers in the region, it is no wonder that US companies and many from other countries continue to eye Asia as a market of opportunity. But the drawbacks become evident when we dissect the market and remind companies that Asia is made up of many countries, customs and cultures and separate business practices.

    It always comes back to marketing lesson #1. Know your customer. Know your market.

    For many companies with an eye on Asia, China appears to be a ripe, and developing market. It is true that Asia (including China/Hong Kong, Japan, N/S Korea, Malaysia, Philippines and Singapore) has a population of over 1 billion people, which translates to approximately 350 million TV households. And China has a population of over 1 billion people, alone, with more than a quarter of a billion TV households (281,000,000). But the money spent by businesses to advertise on TV is disproportionately low in China -- only US$1.7 billion per year, compared with Japan, which spends more than US$16 billion/year to reach 43 million of its TV households.

    For direct TV marketers, the differences become even more pronounced. For example, Chinese consumers rarely have credit cards to make immediate purchases, and the penetration of telephones makes direct-selling nearly impossible, relying much more heavily on retail outlets. Clearly the impact of TV, specifically direct TV advertising is stronger in Japan than in China.


      [PANGAEA specializes in consumer marketing insights and integrates the full spectrum of business intelligence into thoughtful market launch strategies for its clients.]

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    There are other obstacles, in a general sense, to doing business in Asia and selling products to the mass market through TV advertising. For example, in China, airtime is not booked based on a specific campaign, but rather it is purchased to fill available slots. And beware in Japan where TV stations have favored clients. In Indonesia, it is against the law to broadcast an infomercial with foreign footage. In Korea, it is altogether against the law to broadcast infomercials on any stations other than cable and terrestrial broadcast channels dedicated to home shopping.

    While the next largest market in this Asian group is N/S Korea, with a combined population of 68.2 million, there are only 13.5 million television sets and spending is only around US$2 billion per year -- certainly more than that spent in China on 1.2 billion people. But in Korea, the product approval process can be so extensive that without a local partner, it would be imminently difficult to get a foreign product on the air.

    Partnering with a well-established company in Asia will be critical to a successful TV advertising product launch -- and to selecting the specific markets for entry. Besides the media regulations, not all products do well in all countries. Working with consultants that have direct ties to established local businesses -- advertising agencies, marketing research companies, media firms, attorneys, etc. will directly impact your chances for success in Asia.

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    USA -- In a market that showed steady and significant price increases from 1995 through 1997 (3%, 9% and then 16% increases, respectively), it seems that US business airfares have finally begun to stabilize during the last 8 months. This stability is attributed mostly to corporate customers negotiating for lower fares and reducing corporate travel. While travel is being cut back at even the top 100 travel spending companies in the US (including 3M, Chrysler, DuPont, Ford, GM, Mobil, Proctor & Gamble, Oracle and RJR Nabisco), some of the interesting changes in travel are the drastic measures companies are taking to reduce travel fares, including buying nonrefundable tickets. As such, airlines are re-thinking their pricing strategy, but need to do so without alienating their leisure travelers who comprise the majority of their passengers and who offer the greatest growth potential for airline business.

    (Source: YOUR LINK HERE)

    TIANJIN, China -- Proctor & Gamble (P&G), the largest consumer goods company in the world began production in northern China early this month in the municipality of Tianjin. This facility will manufacture shampoos and sanitary napkins as well as products specifically designed for the Chinese market. P&G first started operations in China a decade ago in Guangzhou and has since established 11 joint ventures dispersed throughout China.
    (Source: YOUR LINK HERE)

    WILMINGTON, Del., USA -- DuPont's new facility, LeTrait, France, represents an important move for DuPont. This is DuPont's first polyethylene based shrink film line outside the USA. The DuPont LeTrait site is now the first European Clysar(R) manufacturing line for polyethylene films. ClysarR was the first polyolefin shrink film introduced into Europe in the late 1970's.

    This move capitalizes on DuPont's commitment to meeting the needs of the 21st century, "as global demand increases the need for more packaging shrink wrap.... The LeTrait plant positions us well to deliver what our customers need, when they want it," according to VP and General Manager of DuPont's Packaging and Industrial Plymers business unit. ClysarR shrink film is sold worldwide through distributors and is used for packaging food, toys and printed materials, among other things.
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    LAST MINUTE TRAVEL BARGAINS -- Special Discounted Fares

    American Airlines' Net SAAver and Net SAAver International offers last minute travel bargains for travelers departing from the USA. You can schedule a last minute meeting or a weekend getaway to selected destinations throughout the USA, Europe, the Caribbean, Central America or South America each week and benefit from these discounted rates.

    Through this program, you can fly at discounted rates, as long as you can plan to travel on short notice. These low round-trip fares are good for travel only on the dates specified. They expire on Fridays. Check back each Wednesday for the week's destinations!

    From Boston, MA (BOS) to:

  • US$298 -- London Gatwick, England (LGW)
  • US$298 -- London Heathrow, England (LHR)
  • US$298 -- Paris, France (ORY)
  • US$159 [Business Class] -- Bermuda (BDA)

    From Chicago O'Hare, IL (ORD) to:

  • US$129 -- Hartford/Springfield, CT (BDL)
  • US$129/CAD$187 -- Montreal, Quebec, Canada (YUL)
  • US$129 -- Raleigh/Durham, NC (RDU)
  • US$169 -- San Diego, CA (SAN)
  • US$99/CAD$144 -- Toronto, Ontario, Canada (YYZ)

    From Dallas/Ft. Worth, TX (DFW) to:

  • US$139 -- Charlotte, NC (CLT)
  • US$139 -- Jacksonville, FL (JAX)
  • US$169 -- Oakland, CA (OAK)
  • US$69 -- San Antonio, TX (SAT)
  • US$169 -- San Jose, CA (SJC)

    From Los Angeles, CA (LAX) to:

  • US$69 -- Palm Springs, CA (PSP)

    From Miami (MIA) to:

  • US$139 -- Cleveland, OH (CLE)
  • US$169 -- Denver, CO (DEN)
  • US$169/CAD$245 -- Montreal, Quebec, Canada (YUL)

    From New York Kennedy, NY (JFK) to:

  • US$69 -- Albany, NY (ALB)

    [Restrictions apply. Check with American Airlines or our travel service group for details and confirmation. Not responsible for typographical errors.]

    To take advantage of the North American and USA fares, you must depart on Friday after 7pm or anytime on Saturday, August 28 - 29, 1998; return anytime the following Monday or Tuesday, August 31 - September 1.

    International flight departures leave on Thursday or Friday, August 20 - 21, 1998. Thursday departures return anytime the following Monday and Friday departures return anytime the following Monday/Tuesday.

    To take advantage of these last minute bargains, or any travel needs, Call 1-800-715-4440 and ask for a Net SAAver Domestic or International Fare. Be sure to give the agent this PIN#: 27035 to book your flight. Or send e-mail to, include your name and telephone number, please.

    You can also read the latest news about Travel & Tourism.

  • .....check back for more news this month!

    For more information about any of these topics in any foreign market, or if you would like an in-depth market study, contact PANGAEA, International Consultants. With an extensive network of marketing consultants, attorneys, ad agencies, research companies, logistics experts and more around the world, PANGAEA is uniquely qualified to offer hands-on, local marketing and management consulting services.

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    Updated 8/31/98