China Watch Blog

China Watch Blog reports that Qantas and the NSW Government have announced a new $30 million partnership to promote Sydney and regional NSW to the world.

NSW Premier Barry O’Farrell and Qantas Group Chief Executive Officer Alan Joyce signed the three-year agreement at Qantas’ facilities at Sydney Airport, marking the largest tourism and major events marketing partnership in the State’s history.

Qantas

Premier O’Farrell said the deal involved Qantas matching the NSW Government dollar for dollar to attract more international visitors particularly from the United States, United Kingdom, Continental Europe, China, South-East Asia, Japan and New Zealand.

“Nothing says Australia more than the unmistakeable red tail with the flying kangaroo and the home of Qantas is right here in Sydney,” O’Farrell said.

“This partnership with Qantas is the cornerstone of our strategy to increase tourism to NSW, providing a boost to our economy and helping to create more jobs.

“We will be aggressively targeting big spending leisure and business travellers from overseas which will be a boon for our hotels, restaurants and retail sector.

“This will build on our standing as the nation’s leader for international visitation and expenditure and the preferred destination for key emerging markets.

“We understand the importance of tourism to the State’s economy – that’s why we’re building a new convention and entertainment precinct at Darling Harbour and investing in partnerships like this with iconic brands like Qantas.”

Joyce said the time was right to elevate the partnership between Qantas and Destination NSW to a higher level.

“Qantas is Australia’s national airline, flying from Sydney to every continent on earth and to every corner of Australia,” Joyce said.

“Sydney is the gateway to Australia with more than 50 per cent of all international visitors to Australia arriving at Sydney Airport so it’s fitting this is the largest partnership we have ever entered into with a State Government.

“We have seen a fantastic and tangible response to work we have done with Destination NSW in the past and we think working more closely will result in more people visiting NSW and flying Qantas.”

The partnership – which sees both the NSW Government and Qantas invest $15 million each over the three years – will include international advertising and marketing campaigns, marketing activities around major events and joint public relations activities. There will be a strong focus on digital
platforms including online and social media.

China Watch Blog reports that airlines should charge obese passengers more, a Norwegian economist has suggested, arguing that “pay as you weigh” pricing would bring health, financial and environmental dividends.

Bharat Bhatta, an associate professor at Sogn og Fjordane University College, said that airlines should follow other transport sectors and charge by space and weight.

“To the degree that passengers lose weight and therefore reduce fares, the savings that result are net benefits to the passengers,” Bhatta wrote this week in the Journal of Revenue and Pricing Management.

“As a plane of a given make and model can accommodate more lightweight passengers, it may also reward airlines” and reduce the use of environmentally costly fuel.

Bhatta put together three models for what he called “pay as you weigh airline pricing.”

The first would charge passengers according to how much they and their baggage weighed. It would set a rate for kg per passenger so that someone weighing 59 kg (130 pounds) would pay half the fare of a 118 kg (260 pound) person.

A second model would use a fixed base rate, with an extra charge for heavier passengers to cover the extra costs. Under this option, every passenger would have a different fare.

Bhatta’s preferred option was the third, where the same fare would be charged if a passenger was of average weight. A discount or extra charge would be used if the passenger was above or below a certain limit.

That would lead to three kinds of fares – high, average and low, Bhatta said.

Airlines have grappled for years with how to deal with larger passengers as waistlines have steadily expanded. Such carriers as Air France and Southwest Airlines allow overweight passengers to buy extra seats and get a refund on them.

Asked about charging heavier passengers extra, Southwest spokesman Chris Mainz said: “We have our own policies in place and don’t anticipate changing those.”

United Air Lines requires passengers who cannot fit comfortably into a single seat to buy another one. A spokeswoman said the carrier would not discuss “future pricing.”

About two-thirds of US adults are obese or overweight.

In a 2010 online survey for the travel website Skyscanner, 76 percent of respondents said airlines should charge overweight passengers more if they needed an extra seat.

China Watch Blog reports Apple’s revenue may have missed expectations as sales of the iPhone reportedly disappointed. However, data from leading independent digital marketing agency, Greenlight, shows no slump in the number of online searches pertaining to iPhones, in the lead up to Christmas.

In fact, search volumes for the term ‘iPhone 5’ saw a dramatic 594% jump. However, the opposite was true for the term ‘Blackberry’. Just last week, its inventor, Research in Motion (RIM), showed off two new smartphones for its newly built BlackBerry 10 operating system.

According to Greenlight’s ‘Brown Goods Sector Report – Issue 14’, in November 2012, a total of 12 million searches were made on Google UK for Audio & Accessories, Cameras & Camcorders, PCs, Laptops and Tablets, Phones & Accessories and TVs & DVD Players, up 5 million on August 2012 levels.

Phones & Accessories-related search terms proved most popular. They accounted for 53% of all Brown Goods-related queries compared to 32% in August, when searches pertaining to PC’s, Laptops and Tablets dominated (48%).

‘iPhone 5’ search volumes see a six-fold rise

According to Greenlight, the term ‘iPhone 5’ was queried more than 4 million times, accounting for 34% of all Brown Goods-related searches in November, up from August’s 673,000.

In the case of ‘Blackberry’ however, the opposite was true. Greenlight’s data shows search volumes for the term totalled 246,000 compared to 301,000 in August.

Apple knocks Amazon UK off top spot to become the most visible site for Brown Goods

Greenlight also assessed which brands, retailers and review sites were the most visible in both Natural Search* and Paid Media** results and therefore had the greatest share of consideration when UK consumers searched on Google UK for Brown Goods in November.

Greenlight’s Integrated Search league table shows that Apple, which in August lay in fifth place, snatched Amazon UK’s lead to become the most visible website overall. In November, it achieved a dominant share of visibility across both the Natural Search and Paid Media listings – 60% and 72%, respectively.

Whilst Amazon UK was relegated to fourth place, it was one of just three sites that managed to hold on to a spot in Greenlight’s top ten, from August.

China Watch Blog has learnt received an article entitled, “THE ASCENT OF ONLINE TRAVEL AGENTS (OTAs) And why Google will likely be planning your next vacation” which sounds interesting and even highly probable.

The article says: “If you are like most people in the developed world, you have had at least one infuriating experience when booking a hotel room or an airline ticket. From technology (the site crashes just after you have entered all your details but before you pressed “confirm”), to pricing (the buyer’s remorse you feel when you continue browsing after purchasing only to find the hotel you have booked cheaper elsewhere), to transparency (“low-cost” providers not actually being low-price, when all additional fees and taxes are accounted for), transactions can cause frustration.

The travel and hospitality industries have been impacted by the internet more than most, and customers’ experiences signify the corresponding rate of flux.

Online travel agents (OTAs) such as Expedia and Priceline have claimed huge market share gains from traditional players in a short period of time. They have grown into giants, with multiple brands and business lines, catering to all segments of the market.

On the other hand, “brand.com” sites, where hotel chains and airlines sell direct to customers, have had mixed success. Low cost airlines such as Ryanair that cater to a price-sensitive segment, sell exclusively directly, and the internet has helped boost sales and reduce costs.

Flag-carriers, such as British Airways and Lufthansa, also sell directly online, but their target customers often see value in making comparisons over a variety of suppliers, and use an OTA to do so.

OTAs are attractive as they also facilitate the bundling of complementary services, such as hotel rooms, car hire, travel insurance etc. While suppliers have also added these ancillary services to their portfolios, they offer deals with “preferred suppliers” rather than the broader assortment found at OTAs.

Aggregating the aggregators

July of this year saw the IPO of Kayak, a company founded by ex-executives from a variety of OTAs. Currently valued in excess of $1 billion, Kayak aggregates the aggregators. Its novel approach simply presents all offers from all suppliers, whether brand.com or OTAs, to the customer. Kayak makes money from the suppliers or OTAs for providing the referrals or click-through, and in addition has a revenue stream from advertising on its site. Interestingly, Kayak plays no part in the actual transaction as it merely refers customers to vendors.

This Kayak model has been imitated by other start-ups, such as Trivago, but perhaps the biggest disruption on the horizon will come from Google. Google recently acquired ITA, a company that provides information solutions to the industry.

And, travel and hospitality related searches on Google have been impacted. For example, typing “4-star hotel in Chicago” into Google will produce the usual thousands of results, but top of the list are links to hotels that, when clicked, derive referral income for Google. Google is, in essence, acting like Kayak, a referrer of customers but removed from the actual transaction.

Of course, Google has for long delicately balanced the need to provide unbiased and relevant search results to the user with the economic imperative of favoring sites that pay money to be higher up that list.

As one looks to the future, this industry is likely to continue evolving rapidly. For the same reason most of us prefer going to a supermarket instead of myriad specialist stores, aggregation and bundling are here to stay.

Whether substitutes or complements, there is value in having all alternative offers under the one roof, or more accurately, on the same site. Data, or more precisely an understanding of customers via data analysis, will become even more critical. This is true for suppliers, for OTAs and for aggregators such as Kayak alike.

Having visibility across all of the customer’s purchase behavior – all flights, all hotel stays etc. – will facilitate a better understanding, an ability to make recommendations and better serve the unique needs of each customer. This is why aggregation and bundling matter. And, it is what may put Google in the driving seat for the future as it has the potential to assemble the most complete dataset of transactions, the competence to analyse it and push relevant offerings to customers.

John Walsh is Professor of Marketing at IMD and Director of the Building on Talent program, which is for high-potential managers early in their careers looking to take on greater responsibility.

China Watch Blog has learnt that beginning on August 30, Guangdong government has launched a 4-month on-line sales campaign to promote made-in-Guangdong products.

The government, for the promotion, has opened an official website www.ghwsx.gov.cn, wishing to push forward e-commerce.

Hundreds of companies will take part in this campaign, mainly providing high-tech electronics, smart home appliances and brands with a long-standing history, said Vice director of Guangdong’s Economic and Information Commission Qi Zhenli.

China Watch Blog has learnt that Google has announced a trial which will enable people using the search engine to see search queries feature results from their Gmail account.

The search giant also said it is extending Google Knowledge Graph to every English speaking country. According to Adam Bunn, Director of search engine optimisation (SEO) at leading independent digital marketing agency, Greenlight, the former, if rolled out permanently, would have some drawbacks for marketers data-wise and, whilst it could be viewed as an opportunity from an email marketing perspective, that would be highly dependent on message retention. The Knowledge Graph meanwhile will benefit retailers, brands and digital marketers.

Gmail in search results will make site visit data tricky to track – Marketers will need to seek out marketing technology solutions that will help plug the data void

“In terms of the impact of Gmail integration on search as we know it, there will start to be cases where Google searches will surface relevant emails the searcher has forgotten about that end up winning the click at the expense of advertisers and sites that rank in the ordinary search results,” says Bunn.

“For example, if a friend of mine has sent me an email recommending a particular restaurant to try, and that email appears on the right hand side of the search results the next time I type “restaurants in London”, then it seems likely I’ll at least consider re-reading that recommendation rather than clicking on one of the normal search results.”

According to Bunn, this will also encourage people who currently go digging around in their Gmail accounts for information, to perform a Google search instead, as in the “my flights” example that is being discussed currently.

“Over time, this should increase the share of Google users who stay logged in when searching; this will make personalised search a bigger deal, and swell the number of visits to sites that can’t be tracked to the keyword level due to logged in users appearing as “not provided” or similar in Google analytics.”

However, this can be plugged by utilising marketing technology solutions, such as Hydra’s One Platform, which can transform real-time unstructured ‘big data’ into actionable intelligence; uncovering opportunities to achieve optimal performance.

With ‘personalisation’ in search growing, it is key for marketers and brands to focus on how well they engage with customers

According to Bunn, whilst Gmail in Google search results may be perceived as an opportunity for email marketing, it would be heavily dependent on people retaining the message.

“It’s pretty obvious that email marketing can jump on this as an opportunity. But how likely is it that your email will stay in someone’s inbox to appear later in their search results if they don’t know and like your brand, something that needs to be created and supported offline and online with digital PR, social media engagement, natural and paid search presence? Equally as unlikely that someone will have recommended your restaurant, I’d bet.”

Either way, with personalisation of one sort or another growing on all fronts, the reaction of marketers should be – how well am I engaging with my customers and potential customers across all channels?

The expansion and roll out of the Knowledge Graph bodes well for marketers

In Bunn’s view, the expansion and roll out of the Knowledge Graph is also important.

Boiled down, the “Knowledge Graph” is a glorified version of “related searches”, except Google has a smarter way of interpreting what is related to your original query such that the related results are broader and more intelligent. Furthermore, says Bunn, they are (or will be) displayed even more prominently than they have been to date in the new carousel format.

“What matters about this development is that the things Google puts in the carousels are links to further search results; this move is actually reasonably good for marketers, since before the introduction of the carousel, the related results were below a mini wikipedia-esque listing (see below). Now it seems likely they will be somewhat more prominent. This is useful because it, in theory, broadens the search patterns of users giving marketers who focus on targeting a broad array of related keywords more opportunities to gain traffic from Google.

China Watch Blog wishes to report that there will be a 1-day “Brandwashed” Symposium co-organized by HBC and HKIM. It will take place at the Grand Ballroom of Hyatt Regency Hong Kong on 30th August 2012, and at the Marina Bay Sands in Singapore on 10th September. Martin Lindstrom, a Brand Guru of 6 best-selling books on branding, including “Brand Sense” and “Buyology”. His latest book: “Brandwashed” hit all bestseller lists in 2011.

Martin’s presentation is highly engaging, informative, interactive and enjoyable. Most importantly, they are very practical and hands-on, arming delegates with tools and practical advice to impact their business strategies, daily marketing and brand implementations in a positive way. He understood the wisdom of the net before most of us, now he’s sharing his best wisdom with you….

Martin reveals:
• Shocking findings on how consumers will soon become better marketeers than the professional ones, and to be prepared for the next big thing – social branding
• How the consumer’s ability to influence others is fast becoming a sizable trend that will soon affect your brand
• What a 3-month long guerrilla marketing experiment will tell us about the most powerful hidden persuader of them all. And more..
There is a short video clip of Martin’s presentation in our website, you may take a look at http://www.hbc.hk/event2012a/intro.html

Martin will provide one on one critique of delegates’ work if you want to bring your commercials or print advertisement, he can do it during the symposium.

China Watch Blog has learnt that a Queensland father has offered 50 cases of beer to anyone who will employ his son as an apprentice, ABC News wire reported. For more, go to this link.

http://www.abc.net.au/bestof/?WT.svl=bestOfScroller#s3533954

China Watch Blog has learnt that Shelly Palmer put out this alert that satirical newspaper The Onion recently described Facebook as a project of the Central Intelligence Agency (CIA).

“After years of secretly monitoring the public, we were astounded,” a fictional agency deputy director told Congress. He was happy that Facebook users voluntarily post “alphabetized lists of all their friends” and “even status updates about what they were doing moment to moment”. It is, he concluded, “truly a dream come true for the CIA”.

The scenario is not that far from the truth. Facebook has close to a billion users, many of whom post daily updates on their thoughts and feelings. The same thing happens on Twitter. Foursquare users share information about their location. Commentators on news sites express opinions and outrage. And, as a New Scientist review of procurement requests shows, the US government is keen to take advantage of what amounts to a society of self-surveillance.

In a way, they are behind the curve – marketing firms already monitor social networks to gauge public reaction to product launches. And online chatter can be analysed to forecast election results, for example. US federal agencies want to harness these techniques in an attempt to gauge overseas opinion about America, or even get hints on how to head off terrorist activity.

With these aims in mind, officials at the Department of State issued a procurement notice on 1 June asking software developers to submit bids for a contract to supply tools that provide “deep analysis of topics, conversations, networks, and influencers of the global social web”.

These tools will analyse conversations taking place in at least seven foreign languages, including Chinese and Arabic.

Once the bids are in, the software systems will undergo a six-month trial in which they will examine online reaction to a specific event, such as a talk given by a US ambassador.

The military is even further along with such plans. In 2007, the US air force awarded defence giant Lockheed Martin a $27 million contract to develop the Web Information Spread Data Operations Module, or WISDOM, which analyses posts made to news forums, blogs and social media.

Military analysts are already using it to monitor Central and South America and the Pacific region. Lockheed Martin is now upgrading WISDOM with a $9 million contract from the navy, which wants to “understand the latest regional trends and sentiment and predict threats from groups and individuals”.

Other departments have similar plans – the FBI is talking to software vendors, and the Department of Homeland Security already has a monitoring system up and running.

How might such monitoring affect our online behaviour?

Imagine reading an article about US government policies and then wanting to post an angry comment. Would you pause if you knew the government would collect and store your comment and username? “This prevents people from speaking their minds,” says Ginger McCall of the Electronic Privacy Information Center in Washington DC.

“It quells dissent.” One would hope government officials had such concerns in mind. It is difficult to say, however, because repeated attempts by New Scientist to obtain comments from the Department of State were met with silence.

One would hope government officials had such concerns in mind. It is difficult to say, however, because repeated attempts by New Scientist to obtain comments from the Department of State were met with silence.

China Watch Blog received this from one of our readers, who claims this is a true account of what was heard on a recent flight from Shenzhen to Qingtao by China Southern Airlines:

China Southern aircraft

“Good afternoon, Ladies and the German. This is your cheap purser Wang Lui speaking. On behalf of China Sudden Airlines, I would like to welcome you on board our Bowling 737 from Shenzhen to Qingtao. Members of my crew speak Chinese and other languages that you do not know. It is a great pressure serving you to-die. Should you need any resistance during the fright, peace do pest the call button. I and my gals are available to make you feel comfortable. Meanwhile, the airkwaft is going to fry. Peace sit upright and keep you belt tightly fastened until dinner is served at five dirty p.m. Hope you would enjoy your fright with us. Funk u ..”