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Archive for February, 2008

Malls in Beijing are escapes from the hustle and bustle of the city.  They are eerily empty.  The problem is pricing.  I was at the Oriental Plaza in BJ, and checked out a few international brands.  Across the board, the pricing is 20-30% above what you’d pay for the exact same item in Hong Kong or New York.  Which seems to make no sense given China is an emerging market.  More shockingly, these malls also have department stores selling “luxury” Chinese brands – and alas, they’re priced at Prada/Gucci level too.

A friend who works in luxury retail once told me that the brand’s strategy in China is to enhance the concept of “luxury”.  Since 99% of the people cannot afford the item anyways, the idea is to nurture the brand’s image of being luxurious, which equates to being outrageously expensive.  Stores in China certainly loses money – but they claim to make it up elsewhere.  Wealthy Chinese travels to HK, Europe, and the US and make big purchases.  Thus, stores in China are viewed as marketing expense, and a loss leader.  In the long run, they’d make it up elsewhere.

Josh Adams wrote an article in Asia Times titled Retail Strategy Rethink.  The thesis is that malls in China are not living up to its earnings potential and that at some point retailers will have to adjust and tailor to middle class consumers.  If we look at HK as a model for how a city develops, we might end up with a handful of super high end malls, and many residential community malls where supermarkets are the anchoring stores. 

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Happy New Year everyone…  It’s the year of the Rat. 

The Rat is supposedly the start of the twelve year Zodiac cycle.  If you’re born in the year of the Rat, here’s who you are, according to Wikipedia:

Being the first sign of the Chinese zodiacs, rats are leaders, pioneers and conquerors. They are charming, passionate, charismatic, practical and hardworking. Rat people are endowed with great leadership skills and are the most highly organized, meticulous, and systematic of the twelve signs. Intelligent and cunning at the same time, rats are highly ambitious and strong-willed people who are keen and unapologetic promoters of their own agendas, which often include money and power. They are energetic and versatile and can usually find their way around obstacles, and adapt to various environments easily. A rat’s natural charm and sharp demeanor make it an appealing friend for almost anyone, but rats are usually highly exclusive and selective when choosing friends and so often have only a few very close friends whom they trust.

Traditionally, Rats should avoid Horses, but they can usually find their best friends and love interests in Monkeys, Dragons, and Oxen.

Professions include espionage, psychiatry, psychology, writing, politics, law, engineering, accounting, detective work, acting, and pathology.

Hmm, espionage!! 
Sorry for the hiatus – will be back after the new years. 

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