Horizons newsletter – Week 27 // 2017
Horizons is a bi-monthly Dasym Research initiative to show you how the Dasym themes have been in the news. We publish the Horizons on our website and as an email newsletter. If you wish to receive the email, please contact Investor Relations.
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Eating patterns in advanced economies are changing. Research shows that we prefer healthier snacks and that these outperform the sugary and unhealthy variants. Local, fresh and healthy snacks are in vogue. Over the years, our eating habits have also shifted away from the traditional three meals a day towards a more continuous consumption of smaller meals and snacks throughout the day at different places – a decentralized eating pattern. The increasing consumption of healthy snacks is, however, not necessarily reflected in a consistent trend of healthier eating. Although we try to reduce sugary snacks in our diet, the consumption of processed foodstuffs where sugar content is less visible, like breakfast cereals, is growing. Also, awareness of the importance of healthy food for good health is not reflected in the decrease of weight-related diseases, such as obesity. Food giants like PepsiCo and Danone now see an opportunity in healthy products. Even Nestlé recently entered the healthcare market. However, in order to truly become healthier, consumers need to make more fundamental lifestyle changes.
Historically, TV was more of an awareness-driving medium, capable of reaching huge audiences in a short time, while digital media played more on the ability to track consumers using a direct marketing approach. These approaches may seem separated, but as our CIO Peter van Rooyen argued at the Dutch Mediapark Annual Conference last week, they are moving closer. Both face challenges, including declining TV viewership and the call for more efficiency and transparency by advertisers. At the Cannes Lions advertising conferences in June, Unilever CMO Keith Weed stated that companies that improve their reporting standards “will get more of my ad dollars”. This indicates a growing demand for a model that brings TV’s awareness together with digital media’s targeting. Other events hinting in this direction, include the AT&T and Time Warner merger, the NFL streaming deal with Amazon, and Apple hiring two Sony executives to build its video business: AT&T, Amazon and Apple can already track and target consumers, but to generate awareness they’ll need audience-attracting content.
India steps up
Since the term was coined in 2001, the members of the BRIC countries have stood in China’s shadow. Throughout this period, India, Brazil and Russia had economies that were roughly equal in size, however all three put together remain smaller than the Chinese economy itself. Now it seems that India is stepping up. With expected GDP growth of 7.2% in 2017, it will outpace China (6.5%), making it currently the fastest growing major economy. India has a relatively closed economy, but Prime Minister Modi is touring the globe to increase economic ties. Furthermore, the country’s digital economy is booming. According to Mary Meekers’ internet report, broadband subscriptions are growing at 85% yoy and total wireless data consumed has increased ninefold since mid-2016. The government’s biometric identification system Aadhaar boosts digitalization and its demonetization scheme led to an uptake in digital payments. After 2001, China deepened its trade relations and unleashed its consumer market, which made it one of the central drivers of global growth. India now seems poised to do the same.