Will online sales brighten a bleak holiday season?
Time 11/11/2008
by Kristina Dell
As retailers brace for penny-pinching shoppers this holiday season, they're hoping their websites can deliver some good news. At the very least, the Internet should outdo the sidewalk in delivering sales growth: holiday forecasts predict zero to 2.2% overall sales gains for November and December, according to respective estimates by Bain & Company and the National Retail Federation (NRF), the world's largest retail trade association.
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Weaker gift card demand to hit post-holiday sales
Reuters 11/11/2008
by Nicole Maestri
The once-hot holiday gift card may be losing some of its luster, dealing a setback to struggling U.S. retailers who count on the cards to drive consumers into stores for a post-Christmas shopping spree. As shoppers have witnessed a slew of retail bankruptcies this year, they are showing some reluctance toward buying the cards as gifts for friends and family. "We do see a decline in the demand for gift cards," said Darrell Rigby, head of Bain & Company's global retail practice. Consumers "may be able to give a gift with higher perceived value by getting actual merchandise than by just giving a gift card," he said.
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Tapping into shoppers' psyches; Battered retailers turning to sentimental sales pitches
The Washington Post 11/11/2008
by Ylan Q. Mui
The economic downturn is rattling US shoppers as their wallets shrink and credit dries up. Retailers, who just reported their worst October in decades, fear disaster. The battle for customers -- and survival -- is on, and stores have little margin for error. With Wal-Mart dominating the race to rock-bottom prices, those who can't compete must get creative. Darrell Rigby, a partner at Bain & Company, said many shoppers are on tight budgets this year and may not be swayed by their psyches. "Economic downturns have a way of turning consumer purchasing hierarchies upside down," he said. "Self-actualization and esteem-building don't seem nearly as important as taking care of basic needs."
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Private equity reassesses India after investment losses
Financial Times 11/10/2008
by Sundeeo Tucker and Joe Leahy
Firms have struggled to deploy capital in India in recent years because of the unwillingness of familyrun companies to sell control, and limits on leverage. The situation led to a huge increase in private investments in public equity, or so-called "Pipe" deals, as private equity firms sought exposure to companies that were among the world's fastest growing. Sri Rajan, head of the private equity practice of Bain & Company in India, said: "Given the current investment climate, the existing Pipe model has lost favour among private equity funds operating in India. Understandably, firms are now looking to invest in ways that offer them downside protection."
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Survival of the fittest
Business Times Singapore 11/10/2008
Many top executives from companies in various industries speak about their survival strategies amidst this period of economic turmoil. Charles Ormiston, a director at Bain & Company Singapore, says "downturns are a terrible thing, but they do represent an opportunity to gain market share and potentially leapfrog to leadership positions." Bain has been engaged by several firms to scan their sectors for potential targets and to help initiate the due diligence process on possible candidates.
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