Inflight Magazine of Brussels Airlines

Business trends

Boyd Farrow rounds up what’s happening in the business world across Europe

On your bike

Fiat’s eco message to 500 owners

One might imagine that car makers would be getting nervy, what with more and more cities introducing bikes schemes. Fiat, however, doesn’t seem bothered; in fact, the company has begun to offer owners of its Fiat 500 an electric bike while their car is in the repair shop. The service is now available in several Spanish cities, including Barcelona, Valencia, Seville and Madrid, through a partnership with one of the world’s biggest bicycle makers, Trek. There’s no charge for borrowing the electric bikes, which have a 70km range and recharge during braking as well as through plug-in power.

The motivation for the move, Fiat says, is to demonstrate its commitment to sustainable mobility; the company also offers an eco:Drive service to help consumers use their cars more efficiently. If the electric-bike loan programme proves popular in Spain, the company intends to extend it to other European countries. Of course, if electric bike makers have any sense, they’ll already have been trying to cut similar deals with other car companies…

Every object tells a story

RFID tagging system allows items donated to charity to speak for themselves

A clever new collaborative project between Oxfam and TOTeM (Tales of Things and Electronic Memory) will enable people to attach personal stories to items that they give to charity.

Launched at the recent FutureEverything digital arts festival in Manchester, Remember Me uses RFID tags. People donating items at an Oxfam store in Manchester were asked to recount a story about the object into a microphone, including when they acquired it and any personal memories associated with it. The audio clips were linked to an RFID tag and QR code, and items tagged with a story were added to the shop’s stock as part of the in-store exhibition. Customers could then use their own smart phone or a bespoke RFID reader to listen to the stories through speakers in the shop.

Beyond the Oxfam project, TOTeM’s free iPhone app gives purchasers anytime access to attached stories, and can also be used to scan, comment and add locations to any objects. Consumers can tag their own items at the TOTeM website, linking any object to a snippet of video, audio or text describing its history via printable QR code tags.

TOTeM, which is a collaboration of several universities, including Salford, close to Manchester, says the concept steers people away from thinking of value as purely financial, encouraging them to realise the sentimental value of objects and (maybe) think twice before throwing things away. Presumably, savvy retailers are now mulling over how to adopt the idea to appeal to authenticity-seeking consumers.

Retail therapy

European Commission puts the spotlight on sales of goods across the region

The European Commission is placing retailers in member states under scrutiny as it reviews areas ranging from the cost of products to online strategies. Among the matters attracting the organisation’s attention are price differences between countries, energy consumption, relationships with suppliers and even traffic flow to and from stores.

In one specific example, the Commission found there was a 28.4% difference in the bill for food and non-alcoholic drinks between the Netherlands and Belgium. More broadly, it stated it was perturbed by “a lack of growth in e-commerce” and a “lack of information and transparency on pricing.” While multinational giants like Tesco and more niche players such as Abercrombie & Fitch have embraced the opportunities afforded by the web, this hasn’t been the case across the region. In the UK, online retail should account for 10% of category sales by 2012, according to projections from payment services provider PayPal. However, the Commission suggested that this channel currently holds a market share of 2% or more in just four of the nations under its remit. Such inconsistencies are hampering the development of a single European market for goods and services, especially given that shoppers are often unwilling or unable to buy goods across borders. The Commission is currently receiving responses from retailers, and expects to publish its report later in the year.

Russia at the movies

New opportunities for Hollywood, both online and in cinemas

With film distributors often refusing to hand over money and the sale of counterfeit DVDs widespread, Hollywood studios have long been thwarted in their attempts to make money out of Russia. Now, however, there appear to be growing opportunities. The studio 20th Century Fox is in talks with MTS, Russia’s biggest mobile operator, about distributing content via both the web and mobile phones. Sony is in similar negotiations about the possibility of streaming film and TV shows through MTS’s online and mobile portal, Omlet.ru, and MTS has agreed deals with Disney and NBC Universal. At present, Omlet.ru offers 750 film titles, 90 TV series, 400 programme episodes and 10,000 music videos. Broadband penetration is estimated to stand at 25% in Russia, but is expected to rise dramatically in the near future. Russia’s cinema-going habit is also on the rise producing some of the highest per screen box office averages in the world. Imax Corp and the Moscow-based Russian exhibition chain Cinema Park have just signed a deal to install up to 14 Imax cinemas in the country over the next few months, bringing the total number to 27 by 2012 and making the region Imax’s third largest market – behind the US and China.

Eight-legged freak

World Cup octopus ‘signs’ lucrative advertising deals

The biggest personality thrown up by this summer’s World Cup was unquestionably Paul the psychic octopus – but, like many star players, the oracle is now having to adjust to life after football. And he seems to be flourishing. Paul has already appeared in a print advert for German supermarket chain Rewe, in which he chooses a tasty mussel from inside a Rewe-branded box. His England-based agent Chris Davis told Spiegel that the famous cephalopod has turned into a “million-plus brand” and has now received more than 160 endorsement offers, including a book deal. Neither Rewe nor Davis would disclose the amount Paul earned from the ad, with the agent only saying that it was “substantial” sum and will go to a turtle sanctuary in Greece. Other plans include a soft toy contract and a campaign in which he will swim alongside David Beckham to promote England’s bid for the 2018 World Cup.

That may be a little fanciful, however: after all, in water, Paul would simply be out of Beckham’s league. A more realistic goal for the famous octopus might be to try not to be eaten. After all, fans of every team other than Spain have reasoned that revenge is a dish best served warm, with maybe a drizzle of olive oil and some garlic. Ominously, even Rewe boasts of the tastiness of octopus on its website, drawing attention to their arms, “which come deep-frozen and pre-fried.”

Into Africa

Nestlé to invest in opportunities throughout the continent

After years as a buyer of African cocoa beans, Nestlé plans to heighten its presence on the continent as it seeks to tap into growing levels of demand in the region. The Swiss food group, headquartered at Vevey on Lake Geneva, will stump up more than €100m in Equatorial Africa over the next three years, strengthening its operations in Kenya, Congo, Mozambique and Angola.

“We have been here for many years and we are deepening and accelerating our investment in the continent… There are good opportunities here,” chief executive Paul Bulcke told Western media. “We will be more than doubling our workforce, creating 750 new jobs. If more companies make similar investments, we will empower consumers to spend more, boosting demand for goods.”

Nestlé’s African sales reached €2.2bn in 2009 – only 3% of its global revenues – but the company believes the financial recovery in this market will be faster than in much of Europe. Nescafé coffee, Maggi seasoning, baby food Cerelac and Nido milk powder are among brands already well established in East Africa. The conglomerate posted a 6.7% rise in its turnover in Asia, Oceania and Africa last year, outpacing the expansion of 6.5% recorded in the Americas and the improvement of 0.3% generated in Europe.

What’s in a name?

Gucci’s great-granddaughter has her business plans blocked

Families, huh? The Florence-headquartered Gucci Group has just won an injunction against Elisabetta Gucci, thwarting her plans to develop a global chain of hotels under her name.

Elisabetta wanted to open an 87-suite hotel in Dubai – where else? – by the end of the year, as the first of 40 hotels she planned for the Middle East, Russia, the Far East and South America over the next 15 years. However, the Florence court deemed that the use of Elisabetta Gucci’s name “has caused customer confusion and has been harmful to Gucci’s business” and that the ruling “will hopefully act as a significant deterrent for those who intend to unlawfully license or commercially exploit the Gucci trademarks.”

Like all the members of the Gucci family, the businesswoman and great- granddaughter of Gucci founder Guccio Gucci is forbidden to commercially use the Gucci name, which is owned by the Gucci Group. In an earlier statement, the luxury goods company told Women’s Wear Daily: “Gucci wants to make clear that it has no relationship with Elisabetta Gucci Hotels and that it is not involved in any project with Elisabetta Gucci Hotels.”

Interestingly, it’s been a good month for Gucci all round: the company’s French parent, PPR, just reported first-half profits up a staggering 87% due to growing demand for clothing and accessories in Asia. Profits advanced to €407m, from €217.9m a year earlier, PPR said in a statement. Net income more than doubled, to €402.8m, beating the €327.5m average estimate of analysts surveyed by Bloomberg.

Crisis of conscience

Financial uncertainty leads to increase of charity donations

The economic crisis has caused a rise in private charity in Denmark. DanChurchAid, for example, has reported that donations are up a third from before the beginning of the crisis in late 2007. Secretary-general Henrik Stubkjær announced that regular donors gave 31% more in the first half of 2010 than in the same period the year before. According to Stubkjær, this is because a crisis prompts people to realise that things aren’t always plain sailing and to think of those who are less fortunate. The rise has also been noticed at Denmark’s tax authority, which reports that charitable amounts for which people sought a tax deduction in the period 2008-2009 rose by €6m/DKK 45m, to €79m/DKK 592m.

Unicef has also seen a rise in donations, reporting that its 2009 rise eclipsed that of the post-tsunami period in 2005. Secretary-general Steen M Andersen says the significant rise surprised the company, as it entered 2009 with a certain degree of uncertainty.

A question of ethics

Russian government’s ‘corruption crackdown’ met with scepticism

In a huge crackdown against corruption in Russia, the Kremlin is implementing a wide-ranging ethics code – complete with fashion tips. From October, no government official will be allowed to take paid side jobs, except in research, education and “creative activities”. They won’t be allowed to accept gifts, nor use their position to pressure anyone for personal gain, and they must report all attempts to offer bribes or engage in other forms of corruption. The thing that Russian officials are objecting to most, however, is not the aspersions cast on their integrity but rather the guidelines on their appearance. The official memo says clothes should be “a common business style that is distinguished by its formal, moderate, traditional and orderly attributes” – but strangely it doesn’t mention the images of Prime Minister Vladimir Putin riding a horse through mountain scenery last summer.

Some Russians, who view corruption as a way of life, are sceptical about this latest clampdown. Pavel Kabanov, head of the National Anti-Corruption Committee, stated to The Moscow Times recently that the measures are useless because, “bureaucracy will not control itself.”

The only ways to curb corruption, he said, are public control, independent media and political competition, all of which are virtually absent. He added: “Our society is childish: it doesn’t understand that it’s the citizens who hold power, and the bureaucrats are simply supposed to serve them.”

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