Happy 50th Anniversary for LEGO! Hearing or reading the name LEGO always brings up good memories and puts a smile on my face! During my childhood LEGO was my favourite toy! I could literally play all day with it! Yesterday was the official 50th anniversary of LEGO.
From a business perspective LEGO is a text-book example of a company that successfully transformed itself for the 21st century. Late 90s LEGO seemed to have had its best time. However it managed to blend in and fully adapt internet in its business model. Resulting in the fact that you now can first build your very own artwork online and have it delivered at your house in the famous interlocking bricks!
Furthermore, if you do a really good work in making your own LEGO artwork it can even be put in mass production by LEGO and put up in stores worldwide. LEGO gives you royalties of 5%, which in turn can make you a good living. Building and ordering LEGO bricks online now accounts for 10% of sales. So still loads of potential especially if you take in account the long tail. Building and ordering your very own LEGO artwork online is basically an unlimited supply of LEGO artwork variety.
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A symbolic visual for this week’s ups and downs at stock markets across the world.
On the bright side of all the market tumble news, I just found out that Western chocolatiers experimenting with new flavours aimed at targeting Asian markets in order to fuel growth in a saturated Western chocolate market. You can think of ginseng, red bean and green tea flavours! What’s more to come? As I just finished reading the book “The Long Tail by Chris Anderson” creating more product variety aimed at niche markets has a big future! A glimpse into the beginning of a world with unlimited variety of chocolate can be found here.
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What’s on the agenda for this week. Last week was dominated by macroeconomic news and off-course large financials recording their 2007 Q4 earnings. This will continue with over 100 S&P500 companies (amongst others Microsoft, Apple, General Motors, Ford, DuPont en Bank of America) recording their annual and/or 2007Q4 results but there is more in store this week and from another front namely international political economic news:
EU on Green: The European Commission unveils a comprehensive energy policy on Wednesday January 23rd in an effort to limit carbon emissions, increase energy security and shield economies from volatile fuel prices. It will include targets to reduce greenhouse gases, beefed up carbon trading and incentives for clean coal, biofuels, renewables and other sorts of greenery. Background articles here (The Economist) and here (IHT).
The World Economic Forum: Davos, will again welcome the World Economic Forum for its 38th annual meeting. It officially focuses on collaborative innovation, but the hottest topics behind the scenes will more likely focus around the credit crunch and the prospects for the world economy. On Thursday there will be the most prominent public meeting of the forum with ECB-president Jean-Claude Trichet, American minister of Finance Henry Paulson and leaders of leading American merchant banks. They will address the threat of any wider impact and implications of the credit crunch. Digital footage can be found here.
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Today, the world’s biggest bank delivers dreadful results. Citigroup recorded a net loss of $9.8 billion, driven by a whopping $18.1 billion in pre-tax write-downs and credit costs on exposure to subprime mortgages.
Worse, it is no longer just collateralised-debt obligations and other complex securitised products that are hurting the world’s largest bank (by assets if no longer by market value). Credit cards and other consumer-finance businesses are deteriorating fast as America’s economy flirts with recession.
Capital markets around the world ended the day all in red digits. What more can we expect the upcoming weeks when other leading financials record their 4Q and FY2007 results? How much more write downs can capital markets digest? How can we fix it?
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Curious about what consumer trends will emerge this year? Trendwatching.com made again a fair attempt in predicting them for you. The full report can be found here (PDF).
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The moment has finally come. Today Tata has unveiled the world’s cheapest motor car. Tata’s stripped-down motor car will cost you around US$2,500 (100,000 Rupees), and it’s aimed at the company’s home market of India. But its popularity need not stop there.
This is not only a breakthrough from a price point perspective. It basically puts a car into the reach of people that previously only could dream of owning a scooter or moped. Nevertheless there are still billions of people who cannot afford an investment of $2500,-. In essence this is a car aimed at the world’s middle class. There are hundreds of millions of people who will be able to afford the People’s Car - in China, in Vietnam, in Pakistan, in coastal Africa…. They’ll buy, as long as the quality is reasonable and the car doesn’t become a laughingstock, like the old Yugo.
Furthermore, in affect, the People’s car will also change the competitive dynamics of the entire auto landscape. Everyone except the luxury car makers might want to think about entering this uncontested market segment. If Tata can sell a good product for US$2,500, then it will be able to keep moving its consumers up the economic motor car ladder, to a US$5,000 car, and then a US$10,000 car. When you consider a growing market of hundreds of millions worldwide, a little brand loyalty could go a long way.
Updated @ Jan 11th.: Interested in the applied cost-cutting tricks please follow this link.
Source BBC News & IHT.
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Yesterday Wikia launched a new type of search engine: Wikia Search, with results that rely on users’ input and open-source software. Wikia, on the other hand, is a for-profit company cofounded in 2004 by Wales (co-fouder Wikipedia) and British Internet entrepreneur Angela Beeseley under the original name Wikicities.
What separates Wikia Search from many other Web-search tools, including Google’s, is that it will incorporate human input with methods based on computer programs. A potentially more important distinction is that Wikia will publish the code underlying the search engine. Opening the source code fits with the growing movement in the field of technology, including within Google, toward open software.
Still, Wales says it may take at least two years for the engine to reach the standard set by Google and competitors such as Yahoo! and Microsoft’s search tool. That may be too long for impatient Web surfers, says Danny Sullivan, editor-in-chief of the Search Engine Land Web site. “If it doesn’t come through the first time—that’s it,” he says. “People won’t go back again when there are so many other options.”
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The Financial Times has a great news backgrounder on climate change. I just finished browsing and skimming the entire section and I thought let’s share the wealth. *click here*
Next to this great backgrounder I fancy the FT column Global Village. It features columns linking local culture, business, and politics.
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Well, don’t say I didn’t warn you. Yesterday oil touches the $100 barrier and its front page news across the world. The primary question remains: Will it last? A long-term perspective demands that the world’s leading economies reduce their dependence on fossil fuels. However, the short-term imperative is still to find more of the stuff. Nevertheless, the main four influencers are: today’s demand, tomorrow’s demand, today’s supply and tomorrow’s supply.
It’s tough to make big changes in today’s demand; people would have to change their behaviour overnight to use less jet fuel gasoline, fuel oil, chemicals, plastics, etc. Tomorrow’s demand, on the other hand, is more malleable. E.g. creation of a new international agreement on climate change including both developed and developing nations, the new fuel standards in the United States, the shift to non-oil-based energy in Europe and Chinese efforts at conservation. In the meantime, however, the global economy is growing at about 4 percent per year - and demand for oil is likely to expand at least as quickly.
On the other side of the equation, today’s supply is already changing rapidly. Just this week, Iraq’s oil ministry predicted that its output this year would, at last, be higher than before the war. In addition, new oil supplies - even from high-cost sources - are coming online in big countries from Canada to Kazakhstan, and in small countries from Equatorial Guinea to East Timor. Supply tomorrow is a tougher nut to crack; so many geopolitical factors can affect it, to say nothing of the amount of oil actually left in the ground. But with peace, and with real changes in behaviour, oil need not see $100 again for a long time. Without them, we’ll keep checking off these landmarks: $110, $120, $130..
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