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We live in a digital world, and are reminded of this continuously. Yet we recognise that, to access most leaders of our top companies, traditional media remains vital. Board rooms still receive physical copies of the Wall Street Journal and the Financial Times, and many our leather trade journals remain in mostly physical form.
Quite a few of those same senior board members will now and then find themselves taking their grandchildren to communal play areas to let them enjoy the swings, roundabouts and slides. What will have hit them is that every young mum with her children is multi-tasking, and the task that seems to be dominant involves the one handed management of a smart phone. It creates an even stronger impression of the importance of the Internet than the hordes in coffee shops, airport lounges or on trains around the world all busy on devices individually configured for a mix of communication, information or entertainment.
It was only in 2007 that the iPhone was launched, but now mobile is leading the huge growth in the way we consume and buy products. Looking at all these young consumers it is clear that the trends we read of will only accelerate. A recent OECD report indicates that an X-generation 30 year old had 7% more disposable income than a thirty year boomer born in the fifties, while for 30 year old millennials the figure is as high as 40% or more. The young have money and are significant consumers.
Added to this, the young are driving consumption in the emerging markets as they are the ones to gain first from being pulled out of poverty ,and we can see that throughout the world it is the younger cohort that is rising in importance at retail much faster than was expected. Quite how this group buys products was discussed at the recent World Leather Congress by Ms Ding Xia, President of the Fashion Business of JD.com in China. She spoke of having 236 million registered customers buying US$136 billion worth of goods in 2016. These customers are educated, from middle class families and are brand loyal. They buy online expecting fast service and a good price. 92% of deliveries by JD.com in 2016 were on the same day or the next day.
There is a downside to the dependence on the Internet, which stretches beyond minimally understood algorithms only dedicated towards maximising engagement. In the first minute looking at web sites online the consumer has around sixty items collected about their browsing, and in three minutes that rises to three hundred. If using a mobile, this data being collated by specialist companies goes right down to precise GPS location and whether, for example, the customer is in a car and likely to want to stop for a coffee. This data is analysed in microseconds to allow targeting and retargeting of ads. For companies like JD.com who can link this information to the social media profiles of about a billion Chinese consumers the power of “big data” held by the top Internet Companies is immense. Fake news and unseen political manipulation is only the start. The enticement of advertising revenues and other income streams is just too great.
Few tanners understand the complexity
While few tanners understand the complexity of managing this sort of fulfilment, many do work well in the social media space and there is no doubt that the industry needs more. The positive promotion of leather on social media that comes from companies such as Bridge of Weir, GST AutoLeather and Stahl penetrates far beyond their immediate customers to a wide variety of stakeholders from employees through to interested customers.
When Tim Berners-Lee, father of the worldwide web, began his vision as an “open platform that allows anyone to share information, access opportunities and collaborate across geographical boundaries”. For tanners, openness and honesty counts in our battle for hearts and minds to slow the drift away from meat, dairy and leather towards inappropriate substitutes. The Internet is a failure so far if it had an objective to help humanity promote truth, as it is untruths and bad science which is being propagated to oppose leather.
Leather will only win by being transparent about what we do and explaining the science.
Dr Mike Redwood
November 22, 2017
Follow Dr Mike Redwood on twitter: @michaelredwood
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