SME Featured East Asia

SME business confidence in Hong Kong returns strong in Q3 amid easing pandemic restrictions

Hong Kong – With the pandemic situation in Hong Kong now gradually easing up to open to the local and global economy, small and medium enterprises (SMEs) in Hong Kong are also slowly opening up, with business confidence rates seeing a steadfast growth among the local SME sector during the third quarter, new data from the Hong Kong Productivity Council (HKPC) shows.

According to their latest index alongside Standard Chartered Hong Kong, the SME Overall Index has risen for three consecutive quarters, this time by 4.4 to 46.6, hitting a three-year high since Q3 of 2018.

All five component sub-indices stipulated in the index also rose in Q3, among which the ‘Global Economy’ sub-index recorded the most significant surge again, from 43.6 to 52.8 which made an impressive leap from the low of 7.9 in the same period last year. Together with the ‘Recruitment Sentiment’ sub-index which rose to 50.9, these are the first two sub-indices to surpass the 50 neutral mark in the past two years. Eightof the 11 surveyed industries have recorded two-year highs in their industry indices. 

The sub-indices of ‘Information and Communications’, ‘Real Estate’, and ‘Social and Personal Services’ are the best performing industries, with their respective indices all over 50.

On investment sentiment in the coming quarter, most SMEs are planning to spend more on ‘Information Technology’ and ‘Product & Marketing Promotion’. While 24% of SMEs plan to increase investment in ‘Information Technology’, 20% of local SMEs would like to boost investment in ‘Product & Marketing Promotion’ – both are one-year highs. Meanwhile, 63% of SMEs surveyed expected an upcoming increase of ‘Raw Material Cost’, which is 5% higher than the previous quarter.

For Edmond Lai, chief digital officer at HKPC, the results of the index reflects the stableness of the pandemic situation in Hong Kong during the survey period, and that the SME sector is bound to its ‘steady U-shape rebound with the outlooks of ‘Global Economy’ and ‘Recruitment Sentiment’ being positive’.

He also noted that the survey showed that SMEs are ‘flexing their muscles’ to pick up their business as fast as possible by increasing investment and expanding staff size.

Meanwhile, Kelvin Lau, senior economist for Greater China for global research at Standard Chartered Bank Hong Kong, commented that the latest SME Index readings confirm that Hong Kong’s business conditions have not only further improved over the past quarter, but that such positive momentum is also likely to carry over to the start of second half 2021, boding well for more economic recovery ahead. 

He also added that the are seeing confirmation as well of such recovery being broad-based, with all five component sub-indices and eight of the eleven industry sub-indices posting quarter-over-quarter increases. All this, however, is still not enough to push the overall SME Index back above the 50 neutral mark for now, meaning that SMEs are generally still operating below normal levels.

“Looking at the breakdown, the improvement in ‘Global Economy’ sub-index remains the biggest driver of positive sentiment this time, while ‘Recruitment Sentiment’ sub-index also returned above 50 for the first time in two years, boding well for Hong Kong’s unemployment rate to extend its recent nascent downtrend. That said, improving global prospects have not translated into much better confidence among manufacturers, exporters and financial services providers this time; rather, we see prior underperformers such as retailers playing further catchup – probably supported by the continued unwinding of social distancing measures since the first quarter,” Lau explained.

He added, “Our latest survey results also reflect still-high cost pressures, especially those for raw materials; that has in turn pushed prices higher for finished goods and services, confirming that some pass-through of higher costs onto buyers is indeed happening.”

In addition, the survey also explored SME perspectives and planning in response to the economic recovery in 2021. Around 7% of SMEs surveyed said their business fared better than before the pandemic, while 31% of them claimed to be close to returning to the pre-pandemic levels. The business performances of ‘Information and Communications’, ‘Real Estate’ and ‘Financing and Insurance’ industries are the most satisfactory amid the pandemic, with ‘Accommodation and Food Services’ being the most affected – 81% SMEs surveyed reported a setback in business. The most popular actions taken proactively by SMEs to achieve business rebound are ‘Product/Service Improvement’, ‘Market Promotion’, ‘Online Expansion’, ‘Productivity Enhancement’ and ‘Use of Digital Technology’.

Furthermore, the survey found that SMEs are placing high hopes on ‘Global Economic Recovery’, ‘Re-opening of Cross-Boundary Travel with the Mainland’ and ‘Relaxation of Social Distancing Measures; to fully grasp the opportunities from market recovery. Yet they also saw the constraints of a severe worldwide epidemic situation and geopolitical tensions, with 37.3% of SMEs surveyed indicating their intentions to raise prices to cope with inflation and offset cost pressure.

Marketing Featured East Asia

7-Eleven HK to donate 1,000 7-SELECT chicken legs as store marks 40-year journey

Hong Kong – The global convenience store chain, 7- Eleven, has pledged to donate 1,000 7-SELECT chicken legs for 40 consecutive weeks to be distributed to Hong Kongers in need, marking its important 40th year in the industry.

The new initiative, which is done in partnership with Food Angel a local NGO, is part of 7-Eleven’s effort to be in the daily lives of Hongkongers. The donations will be delivered to recipients via Food Angel’s Community Centre, Community Food Assistance Service, and Automated Food Dispenser Service – an innovative initiative that allows for the flexible collection of chilled meals.

In addition, Food Angel will distribute the donations across its 180 charity partners. It is expected to help over 10,000 recipients including the elderly, low-income families, and people recovering from mental health problems, as well as cage home residents, and disabled people.

According to 7-Eleven, during the height of the pandemic last year, they have initiated several activities to help those most impacted by the outbreak. They have donated and delivered 70,000 food items to local neighborhoods and launched the ‘Charity Meal Voucher Program’, which raised over 550,000 vouchers to provide hot meals to disadvantaged people and low-income families. 

“Although the pandemic situation in Hong Kong is starting to stabilize this year, we remain committed to showing care and support to the most vulnerable in society,” said 7-Eleven.

Technology Featured Southeast Asia

All-in-one social messaging platform for businesses, SleekFlow, expands to MY, SG

Kuala Lumpur, Malaysia – SleekFlow, the Hong Kong start-up that provides an omnichannel social commerce platform to companies, has announced that it will now be expanding its business to SEA markets Malaysia and Singapore. This follows its recent funding that has raised a 7-figure MYR in a Pre-A round investment from Gobi Partners China (Gobi), the investment manager of Alibaba Entrepreneurs Fund (AEF).

SleekFlow helps companies manage communication channels such as WhatsApp, Facebook Messenger, WeChat, as well as Line and Live Chat, among others, through an all-in-one social messaging platform. It helps streamline sales, customer support, and marketing workflows while integrating with over 2000 tools, including e-commerce platforms and payment gateways, to automate the whole customer journey with ease.

According to Henson Tsai, the founder, and CEO of SleekFlow, there are about 8-10 unicorns in Hong Kong but very few selling SaaS products. Tsai said that SleekFlow aims to be a world-renowned Hong Kong SaaS brand which is why it has decided to first expand to Southeast Asia first and “then to the world.”

“SleekFlow is missioned to realize the full potential of social messaging for business all over the world,” said Tsai.

He adds, “First, I would like to express my gratitude towards the Gobi for believing in SleekFlow. Aiming to scale the height in the Southeast Asia Market, we will set up new teams in Malaysia and Singapore, where people rely heavily on WhatsApp.”

According to the platform, it has, within a year helped users across over 20 countries, with annual recurring revenue of 7-digit USD.

Marketing Featured East Asia

Global digital OOH marketplace VIOOH expands to HK via JCDecaux Cityscape tie-up

Hong Kong – London-headquartered global digital out-of-home (OOH) marketplace, VIOOH, has partnered with outdoor advertising company JCDecaux, to expand to urban Hong Kong via JCDecaux Cityscape its street furniture and bus shelter programmatic advertising inventory. 

JCDecaux Cityscape in Hong Kong has been operating Bus Shelter Advertising since 1993 and Tramcar Advertising for more than 10 years. With its Audience Intelligence Solution on the media assets, JCDecaux Cityscape is able to reach and interact with a broad group of mobile audiences every day.

Following the partnership, VIOOH would now be covering a quarter of the digital OOH market in Hong Kong across street furniture, trading across both guaranteed and non-guaranteed deals via JCDecaux. 

The affiliated data partners include Audience Management System for Street Furniture developed by JCDecaux, and OOH Planning and Measurement from audience and location intelligence company AdSquare, while integrated DSP partners include ad-tech firms Hivestack and The Trade Desk, as well as media agency Verizon Media.

VIOOH China’s CEO Ben Lin shared that VIOOH is pleased to offer advertisers the opportunity to benefit from more digital inventory at premium locations in Hong Kong.

“Our ambition is to change the conversation about out of home and to help accelerate transformation in outdoor advertising and we hope advertisers and media owners alike will maximize this new opportunity to thrive,” said Lin.

Meanwhile, Yoann El Jaouhari, the managing director of JCDecaux Cityscape, said that with this launch, their clients can enjoy unmatched flexibility, data-driven media planning, optimization, and retargeting capabilities, and data-triggered digital content across multiple prime districts in Hong Kong Island, namely Admiralty, Causeway Bay, and Central, as well as Wan Chai. 

“Our advanced ecosystem of data and digital solutions will help us accompany the brands to leverage the power of digital programmatic OOH, smartly optimize their advertising strategy, and keep improving the return on their ad spend in Hong Kong with JCDecaux,” said El Jaouhari.

According to VIOOH’s recent State of the Nation report, about 84% of Hong Kong advertisers claim they have bought, planned, or placed OOH programmatically in the last 12 months, above social media. Almost 94% expect to increase their investment in programmatic OOH in the next 18 months, indicating that programmatic OOH, considered to offer benefits for both brand-led and performance-led campaigns, is well utilized in the market.

In Hong Kong, programmatic investment in OOH in the last 12 months is the media channel that ranks highest, with 80% on social media, 80% on digital video, and 70% on digital audio following closely behind. About 76% of all Hong Kong media executives either agree or strongly agree that programmatic OOH is a clear part of their programmatic and digital strategy, with a greater number 82% agreeing programmatic OOH provides excellent value for money.

VIOOH said that more digital OOH inventory is due to be announced later this year.

Marketing Featured East Asia

Song Joong-Ki the face to launch new range of credit cards by Standard Chartered, Mastercard, Cathay

Hong Kong – The pandemic has prompted countries around the world to introduce travel restrictions and containment measures. However, these implementations cannot stop eager travelers to resume planning their travel preparations. 

A new range of credit cards by Standard Chartered, Cathay, and Mastercard has been launched to enable travelers to earn more prestigious privileges and enjoy a higher level of banking and travel experiences offered by the new credit card series.

A multi-platform campaign has been developed by TBWA\Hong Kong in support of the new card series – ‘Standard Chartered Cathay Mastercard Credit Cards’.

The theme of the campaign centers around ‘Get Ready for New Heights’, the over one-minute ad features famous South Korean actor Song Joong-Ki, and renowned Hong Kong lyricist Wyman Wong. It captures the actor explaining the card series’ many offers and privileges through various ads, encouraging the lyricist to plan his future banking and travel experiences.

The three new cards in the series are ‘Standard Chartered Cathay Mastercard Credit Card’, ‘Standard Chartered Cathay Mastercard Credit Card – Priority Banking’, and ‘Standard Chartered Cathay Mastercard Credit Card – Priority Private’, which recognize different banking segments. The card series replaces the existing ‘Standard Chartered Asia Miles Mastercard Credit Card’.

Cardholders can still earn Asia Miles directly by using banking services only from Standard Chartered, while Priority Banking and Priority Private cardholders can also enjoy complimentary Cathay Pacific Business Class Lounge access, priority check-in and boarding services, or limited Marco Polo Club Silver or Gold membership during the promotional period.

“With the pandemic delaying travel plans and creating a growing sense of wanderlust, the campaign invites people to get a head-start on their travel preparations with an elevated card experience to earn miles faster and more easily than ever,” said Terence Ling, the head of strategy at TBWA\Hong Kong.

Meanwhile, TBWA\Hong Kong’s Managing Director Jan Cho commented that they wanted to tap into the booming popularity of K-dramas, and use the allure of Korea as a travel destination.

“However, due to pandemic travel restrictions, overseas filming was no longer possible, and forced us to quickly adapt to a new way of working. I’m very proud of our team, and the production team in Korea, for working remotely and cohesively to bring this campaign to life,” said Cho.

Developed together with media support by Carat Hong Kong and iProspect Hong Kong, the campaign includes TVC, out-of-home, and print, as well as online, and social media.

Marketing Featured East Asia

Uber Eats’ ‘Tonight, I’ll Be Eating’ campaign lands in Hong Kong

Hong Kong – Uber Eats’ famous campaign, ‘Tonight, I’ll Be Eating’, has just been debuted to the Hong Kong audience. This follows the latest installment that was recently released in Australia by Special Group, the brains behind the campaign, which features famous talent judge and critic Simon Cowell and Australia’s iconic household entertainment group, The Wiggles. 

The highly-awarded TIBE campaign first graced TV screens and social media platforms in 2017, which then was highly focused on the Australian audience featuring stars hailing from Australia. A big part of the campaign’s traction among viewers is its use of sarcasm and humor, basing the narrative on the featured famous star’s well-known quirk and characteristic. Some of the widely-known personalities that have already appeared on the campaign were British singer Boy George, actress Naomi Watts, and professional rugby league footballer Beau Ryan. Some of the most recent are comedian Leslie Jones and hockey legends Patrick Roy and Mario Tremblay. 

Still showcasing that trademark charm and humor, the debut in Hong Kong will be taking a different turn, where the campaign has been developed to spread the advocacy of loving and supporting local businesses. It has been named ‘Make Local Famous’ and was developed by Special Group Australia in partnership with creative group Uth Hong Kong. 

The ad features the country’s most loveable and dynamic duo, singers Joyce Cheng and Alfred Hui. Set in a lavish and stylish home, Joyce and Alfred are donning denim jackets covered in the logos of many local favorites. In the commercial, Joyce playfully irons patches of logos from some of their favorite local shops they will be ordering from. Towards the end of the scene, the duo is seen promoting many local restaurants and their food with an entire wall of televisions sitting behind them, while Alfred is seen in a classic Mary Poppins moment pulling out dishes after dishes of food out of an Uber Eats paper bag. 

Aside from the focus on local businesses, the Hong Kong installment is also flipping the traditional celebrity endorsement model on its head by picking the said duo. The ‘Make Local Famous’ campaign will see Joyce and Alfred advocate for the thousands of small and medium restaurants on Uber Eats. The campaign will also be providing a wide number of restaurant partners with ready-to-use content for them to repurpose on their owned channels.

Elisa Janiec, general manager of Uber Eats Hong Kong, said that the campaign genuinely speaks to their culture where food is a huge part of their cultural distinctiveness, with the “collision of West and East, old and new, hawker street stalls and Michelin-starred restaurants.” 

“It’s lively, creative, social, and deeply ingrained into the fabric of the city. There’s no better way to pay homage to this than to hero local restaurants and their food. Hong Kong is built around great food, and this campaign is all about celebrating that,” said Janiec. 

Ally Doube, APAC head of brand strategy & social at Uber Eats, commented, “Across APAC, we are passionate about unlocking local consumer insights to bring to life in all of our marketing, whether through brand campaigns or social ads. We are blessed with having the ‘Tonight, I’ll Be Eating’ platform at our hands, one of the most award-winning campaigns, as our creative hook. The team in Hong Kong has done an amazing job pairing it with the strongest local insight to bring to life a magical and compelling campaign.”

A mock-up of the campaign’s marketing asset on an HK tram shared by the agencies

Meanwhile, Max McKeon, Special Group Australia’s creative director, added, “Introducing the ‘Tonight, I’ll Be Eating’ brand platform in Hong Kong is in itself incredibly exciting, but to do so with Uber Eats offering up one of their biggest brand assets – celebrity – to all the local restaurants in the region makes this an especially unique way to celebrate Hong Kong culture.”

Aside from Hong Kong, the TIBE campaign has also been launched in Asian markets Japan and Taiwan. In September last year, Uber Eats and Special Group saw one of its biggest celebrity partnerships when it featured Sci-Fi icons, Star Wars’ Mark Hamill, and Star Trek’s Patrick Stewart for the campaign’s debut in the US and Canada. The ad took audiences by storm due to the spot igniting each of the franchises’ fans’ cultural debate of which is the better franchise. 

The integrated campaign in Hong Kong will air across TV, social, OOH, digital, and through restaurant partners. 

Marketing Featured East Asia

The Hoffman Agency to handle Microsoft HK’s PR duties

Hong Kong – Integrated communications agency The Hoffman Agency has been recently appointed by the Hong Kong arm of tech giant Microsoft to handle its public relations business, effective 1 July. Said appointment comes in line with the company’s 30th anniversary and the upcoming launch of Azure Availability Zones in Hong Kong.

Through the agency appointment, The Hoffman Agency will work to strengthen Microsoft Hong Kong’s position as a leading technology partner for Hong Kong businesses with a focus on cloud computing, hybrid workplace and cybersecurity. In short, this will bring a fresh perspective to strengthen Microsoft Hong Kong’s communications efforts.

In addition, the agency will be responsible for developing external communications programs, aimed at showcasing how Microsoft Hong Kong is using its technologies to empower individuals, businesses and organizations across different sectors, and its partner network, to emerge stronger in the post-COVID world. 

According to Kevin On, general manager for Hong Kong at The Hoffman Agency, both companies share the same vision of empowering companies to solve business problems. He added that the agency will take a fresh, innovative approach to communications and support Microsoft Hong Kong to achieve more as they celebrate 30 years in the city

“Microsoft plays a key role in helping businesses transform globally and locally, and we are excited to be a part of this. There are unique and powerful stories behind every technological advancement, and our mission is to bring these to the fore and convey Microsoft’s empowered Hong Kong narrative in a compelling way,” On stated.

The Hoffman Agency has also been recently appointed by Shutterstock earlier this year to handle the company’s communication accord from March to December 2021.

Marketing Featured East Asia

Cathay Pacific unveils new travel lifestyle brand ‘Cathay’

Hong Kong – In its ongoing stance to improve their engagement with customers, airline Cathay Pacific has recently announced its newest premium travel lifestyle brand called simply ‘Cathay’ that merges “positive things” on travel and lifestyle. 

Over the coming months, ‘Cathay’ will be rolling out a range of new offers in spending, dining, shopping, hotels, and wellness – enabling it to engage with their customers not only when they fly with them, but “everyday.” 

‘Cathay’ brings together Cathay Pacific and its existing loyalty programs Marco Polo Club and Asia Miles all in one place, simplifying the way customers can interact with them, including how to earn status and use miles.

Through the new brand, ‘Cathay’ is also set to make its proposition more appealing. By integrating its offerings and forging better partnerships, it promises to bring a wider range of products and services to the benefit of customers.

As part of the initial launch is a new Cathay co-branded credit card – which will be rolled out in Hong Kong soon. These will all culminate in an upcoming refreshed customer relationship program in the first half of 2022. 

Augustus Tang, chief executive officer at Cathay Pacific, notes that the center of the ‘Cathay’ brand is a so-called ‘celebration of all the best things we love – and have missed – about travel’.

“We are very proud to have been connecting our customers with people, places and experiences around the world through the joy of travel. Our ability to enter the travel lifestyle space and the success of this strategy is built upon the enduring strength, trust and respect that Cathay Pacific has established over 75 years of accomplishments, and the hard work and dedication of our people around the world,” Tang stated.

He added, “‘Cathay’ reinforces our commitment to engage with our customers in their everyday lives with world-class service. By adding more value and simplicity, we are helping to move them forward in life as per our ‘Move Beyond’ purpose.”

‘Cathay’ will be only available in Hong Kong at the moment, as Cathay Pacific will work out in the near future to expand the travel lifestyle brand to other markets in the near future.

Marketing Featured East Asia

HK’s SaSa to close about 20 stores, eyes stronger O2O business

Hong Kong – Hong Kong-based beauty and personal care chain SaSa has announced in its latest financial results for the year 2020/2021 that it is expecting to close 15 to 20 stores throughout the year. 

SaSa is only one of the many businesses that have shut down operations as a strategic move over pandemic-induced economic downturn. According to the company, the markets of the Hong Kong and Macau SARs dealt a severe blow to the group’s sales performance with the pandemic bringing tourism to a standstill. 

Since the beginning of February 2020, the cumulative number of Mainland Chinese visitors in the Hong Kong SAR up to now has plunged to almost zero year on year, and due to social distancing initiatives imposed by the Hong Kong SAR government, local consumer sentiment has also been dampened. 

SaSa’s brick-and-mortar stores are established in Hong Kong SAR, Macau SAR, and Malaysia. 

Inside a SaSa store

Overall, the group’s retail sales in the markets of the Hong Kong and Macau SARs dropped by 58.1% year on year, while its same-store sales decreased by 54.4% during the financial year. Meanwhile, in Malaysia, turnover decreased by 34.9% in the financial year. 

Due to the movement control orders in Malaysia, the group’s stores were temporarily closed for nearly 100 days in total. As of 31 March 2021, the total number of SaSa’s retail stores in Hong Kong and Macau SARs was reduced from the peak of 118 two years ago to 100. Among closed stores in Hong Kong SAR, 80% were located in tourist districts. 

With this, the company has expressed plans to leverage its online sales and deliver an enhanced customer experience by combining online with offline. 

SaSa’s current website

Compared to offline sales, the beauty retail chain’s online business had been looking up, rising by 45.4% to HK$501.3m accounting for 16.5% of the total turnover from the group’s continuing operations, up from 6% in the previous financial year. 

The company shared that the group’s long-term vision is to grow businesses beyond brick-and-mortar operations. By growing the share of sales from online platforms, it trusts that it can help reduce its reliance on physical stores. 

“Through persistently adjusting and rationalizing the store network, the group could improve its overall cost structure and lower the breakeven point for the traditional retail business, thus reinforcing its competitiveness and profitability in the long term,” the group said.

The group will work to further realize the complementary effects of combining the advantages of online business and physical stores to improve both customer experience and the group’s profitability. 

It plans to execute the integration of online and offline operations. The group said that it will be improving inventory and logistic arrangements to provide a seamless O2O customer experience. For SaSa, the O2O business offers a more favorable gross margin and basket size owing to the element of personal service when compared to pure online sales channels. All these mean a more attractive profit margin for the O2O business, an area that the group wishes to develop to its fullest potential.

Dr Simon Kwok, SBS, JP, the chairman and CEO of the Group, said that online business has become the new focus of the retail industry, and that they are dedicated to expediting development in the new retail landscape by investing more resources in their online business, unceasingly strengthening the brand and adjusting their product portfolio. 

“The Group will also proactively propel businesses beyond our core markets in Hong Kong and Macau SARs and promote the online business, thus diversifying and expanding our revenue portfolio and customer base and creating value for our stakeholders in the long term.”

Marketing Featured East Asia

AS Watson Group leads top Hong Kong retailers in 2020

Hong Kong – The consequences of the pandemic are unprecedented and felt around the world, wreaking havoc across the retail industry. Euromonitor International, the global independent strategic market research provider firm, has revealed its list of the top companies within the retailing industry in the APAC region for 2020, and in Hong Kong, more than half of the leading companies in 2019 are still the ones that ruled 2020.

The majority of the 10 companies on the list maintained their sales growth and rankings in 2020. International health and beauty retailer AS Watson Group has retained its standing, coming out to reign the rankings as the top retailer. This was followed by Dairy Farm International Holdings, the pan-Asian retailer that operates across food, health and beauty, and home furnishings, and restaurants, with Japan-based distribution business firm Seven & I Holdings Co landing in the third spot.

Meanwhile, jewelry company Chow Tai Fook Jewellery Group also maintained its sales as well, coming out in the fourth spot, while property developer Sun Hung Kai Properties caps the top five. One of the firms that have also retained growth for the year is convenience store firm Alimentation Couche-Tard ending in the eighth spot.

Two out of the top 10 firms have registered improvement in sales, namely, retail and financial services company AEON Group and multimedia business firm Hong Kong Television Network, landing in the sixth and seventh spots respectively.

On the other hand, jewelry retailer firm Luk Fook Holdings and retail chain company Broadway Photo Supply have dropped sales in 2020.

AS Watson Group, which registered $9.8b in sales in 2020 came out as the 34th leading retailer in the Asia region. For the region, Alibaba Group Holding took the crown with $367b in total sales for the year.

According to Euromonitor, the pandemic has had a significant negative effect on consumer confidence, leading many to rein in their spending, which impacted many retailers adversely enough to exit the market. However, the pandemic has been a boon for grocery retailers and e-commerce and will continue to enjoy strong growth in retail current value sales, as consumers become more interested in home cooking and following a healthier diet.

In 2021, the research firm believes that brick-and-mortar sales will begin to rebound, while retailers that depend on tourism will be the slowest to recover, including stores selling jewelry, watches, and apparel, as well as footwear, and luggage.