deborah weinswig's digital health presentation for nacds aug. 24, 2015

1

THE COLLISION OF DIGITAL HEALTH, THE CONSUMER, AND WEARABLES

Deborah Weinswig Executive Director – Head Global Retail & Technology

Fung Business Intelligence Centre

August 24, 2015

2

DEBORAH

WEINSWIG

• Executive Director and Head of Global Retail & Technology

for the Fung Business Intelligence Centre

• Award-winning global retail analyst and a specialist in retail

innovation and technology

• 12 Years at Citi Research where she served as Head of the

Global Staples & Consumer Discretionary Team

• #1 ranking analyst by Institutional Investor for ten years

• Mentor to Silicon Valley accelerators including Alchemist

Accelerator and Plug & Play

• Certified Public Accountant, with a Masters of Business

Administration degree from the University of Chicago

4

ABOUT FUNG

BUSINESS

INTELLIGENCE

CENTRE (FBIC)

• Established in 2000 and headquartered in

Hong Kong

• FBIC (formerly known as the Li & Fung

Research Centre) has served as the

knowledge bank and think tank for the Fung

Group

• New York–based Global Retail & Technology

research team follows broader retail and

technology trends

6

TODAY’S

TOPICS

1. Digital Health

2. Medication Adherence

3. Specialty Pharmacy—Biosimilars

4. Docs-in-a-box and Telemedicine

5. Silver Generation Spending Trends

6. Technical Beauty

7. Wearable Tech

8. Cool Startups

9. Impact of Chinese Tourists

10. Mobile Commerce

7

1. DIGITAL HEALTH

8

INDUSTRY DRIVERS • Clinical applications

• Compliance requirements

• Future enabling technologies for cloud computing,

Big Data, mobile computing and social media

Source: IDC, EMC Digital Universe Healthcare Brief

153

2,314

2013 2020E

Healthcare Data (Exabytes)

48% CAGR

Healthcare data is

expected to grow at a

48% CAGR through 2020

9

HEALTHCARE BIG

DATA ARCHITECTURE

Future Design

Storage, Processing

and Application

Services

• Ingest—Capture data from a range of sources

• Store—Store everything in a standardized environment

• Analyze—Use Big Data analytics to discover predictive

patterns—clinical/business opportunities

• Surface—Share across the enterprise—clinicians,

executives and patients

• Act—Project future opportunities: accountable care

organization (ACO), patient engagements, growth and

population health preparedness

Source: EMC

10

MACHINE

LEARNING AND

ARTIFICIAL

INTELLIGENCE

• Machine learning its finding its way through

startups into applications like marketing, security,

and operations

• Deep learning includes computer vision, speech

recognition, natural language processing, and

bioinformatics

• Companies today are using neural networks to

identify objects for use in driverless cars

11

HEALTHCARE

PROVIDER

SPENDING IN

FUTURECARE TECH

INCREASING IN

2015

How do you expect your 2015 IT spending to change

for each of the following areas?

Source: FutureCare: Cloud, Big Data, Mobile and Social Optimize the EMR,”

12

2. MEDICATION ADHERENCE

13

MEDICATION

ADHERENCE

“Drugs don’t work in patients who don’t take

them.”

–C. Everett Koop, MD (former U.S. Surgeon General)

• 20%–30% of prescriptions are never filled

• Only 1 in 2 patients take their prescribed

medications correctly and on time

• Nearly 3 out of 4 Americans admit that they do

not always take their medication as directed

• Medication Adherence:

– Timing

– Dosage

– Frequency

The problem:

Only 1 in 2 patients take their prescribed

medications correctly and on time

14

MEDICATION

ADHERENCE

Apps can tell patients when to take their

medicine and how much to take

Pillboxie RxmindMe Txt4health

15

MEDICATION

ADHERENCE Smart Wireless Pill Bottles

• Currently being used by patients in

pharmaceutical and research engagements

• Collect and send all adherence data in real time

• Automatically analyzes this information and

populates data on secure dashboard

• If doses are missed, patients can receive

customizable alerts and interventions—using

automated phone calls, text messages, and other

means

Second-Generation Pill Bottle

Wireless pill bottles can monitor time, usage and

collect other data

16

MEDICATION

ADHERENCE Propeller

• For Asthma and COPD (chronic obstructive

pulmonary disease)

• Sensor is a small device that attaches to the top of

the inhaler

• Tracks medication use, with a record of the time

and place inhaler use

• Wirelessly syncs with smartphone via

Bluetooth

• Mobile app enables view of data plus personalized

feedback/suggestions

The propeller can monitor inhaler usage

17

MEDICATION

ADHERENCE

Klaptic

• An ambient medication alert system that is

designed to maintain the health and

independence of the target audience

• Used haptic feedback modules (vibrations)

and other indicators to alert a user of when

to take a medical drug and which one to take

• Modules can be fitted onto reading glasses

or existing pieces of clothing

Klaptic is a clever eyeglass-mounted

wearable for monitoring the use of medication

18

MEDICATION

ADHERENCE

miWatch

• Smartwatch app for

– Reminding about appointments

– Rx-refill requests

– Lab/test results

• Reminders for:

– Medication adherence

– Appointments with doctors

– Alerts and notifications from a patient portals

Smartwatches can also provide reminders for taking

medication and deliver necessary information

19

MEDICATION

ADHERENCE

Proteus Discover system

• Pill—Sensor-enabled pills send a signal to the

patch and measure what medication has been

taken

• Patch—Records time a sensor pill has been taken

as well as rest and activity

• App—The Discover App tracks medications,

steps, activity, rest, heart rate, blood pressure,

and weight

• Portal—Allows health-care professionals to drill

down into an individual patient’s data

The Proteus Discover system us a patch that monitors medication use that can

collect other data

20

3. SPECIALTY PHARMACY

21

EXPANDING

OPPORTUNITIES IN

A FAST-GROWING

MARKET

Source: NHE, Artemetrx, CVS Health Note: Includes infused oncology

$86

$118

$153

2014E 2016E 2018E

Addressable Specialty Market ($ Bil.)

Medical Pharmacy

16% CAGR

22

PREPARING FOR

TOMORROW

• Enterprise vision to create a “Connected” Health Experience

• First-in-class tools to help patients seamlessly manage retail, mail, and specialty prescriptions

• Enhanced front store personalization tools drive value for customers

Integrated Digital

Offerings

23

SPECIALTY IS

GROWING IN

ABSOLUTE

DOLLARS AND

PERCENT OF TOTAL

SPEND

Source: NHE, CVS/caremark

24

THREE KEY

DRIVERS OF

UTILIZATION

Source: CVS/caremark

25

DRUG PRICES

DRIVEN BY

ANNUAL PRICE

INFLATION AND

HIGHER

LAUNCH PRICES

Source: CVS/caremark Note: Annual drug costs based on average wholesale price (AWP) accessed summer 2013.

26

COST

MANAGEMENT

OPPORTUNITIES

IN SPECIALTY

PHARMACY:

BIOSIMILARS

Source: CVS/caremark

27

RETAIL INFUSION

AS THE NEXT

INNOVATION

Source: Press Ganey

28

4. DOCS-IN-A-BOX AND TELEMEDICINE

29

URGENT CARE

CLINICS

Overview

• Pressure from lawmakers, employers and insurers on

hospitals to treat patients in less costly outpatient care

settings

• Number of insured expected to grow by 30 million over

next decade

• Open evenings and weekends

• Physician on staff

• Most operated by nonprofit health systems, such as

Aurora Health Care or Intermountain Healthcare

• Insurers such as Humana and WellPoint are also

purchasing chains of clinics

• Private equity firms $2 billion in health and medical

services in 2012

Source: CNBC

The number of urgent care clinics is growing due

to government policies and economic necessities

30

Key Statistics

• Approximately 9,000 urgent care centers in the US

– Growing 8–10% annually

– 40% expect to expand or add another site

– 94% have at least one full-time physician on staff

• 75% located in suburban areas, 15% in urban areas, 10%

in rural areas

• About 50% are freestanding. About 50% in shopping

centers

• 85% of clinics are open 7 days a week

• 95% close after 7 p.m.

Source: Companies

There are about 9,000 urgent care clinics in the US,

and the number is growing by 8% to 10% a year

URGENT CARE

CLINICS

31

URGENT CARE

CLINICS

Source: physiciansimmediatecare.com

Broad Range of Services

Urgent care clinics perform a wide variety of functions,

including diagnosing illnesses, taking X-rays,

performing lab tests, and giving immunizations

32

URGENT

CARE

CLINICS

Source: Companies

970

400

81

CVS/caremark Walgreens Walmart

Number of Clinics

Many drug stores and, increasingly, retailers

offer urgent care clinics

33

TELEMEDICINE • Why Use Telemedicine?

• Shortage of physicians

• Distribution of expertise

• It works well

• Cost effective

• Patients like it

Source: HEALTHePRACTICES, Lewin Group

Telemedicine is necessary

due to the shortage of

physicians and provides

efficient care

34

TELEMEDICINE

Source: HEALTHePRACTICES, Lewin Group

Physician Shortage

Telemedicine is necessary

due to the shortage of

physicians and provides

efficient care

35

TELEMEDICINE

Source: HEALTHePRACTICES

Solutions Available Today

Today, telemedicine can provide radiology, neurology,

psychiatry, dermatology, ophthalmology, and

cardiology

36

TELEMEDICINE 10 Million Patients Served by Telemedicine

• Outsourced specialists

• Teleradiology

• Internet clinical consults

• Cardiac monitoring

• Remote monitoring

• Civilian network consults


Today, 10 million patients have been served by various telemedicine

functions

37

SERVICES

AVAILABLE

TODAY

• Online services

• Consumer health apps

• Urgent care

• Patient generated health data (PGHD)

• Wearables

• Scannables (sensors)


Many telemedicine functions can be

performed online or through wearables or

scannables

38

SERVICES

AVAILABLE

SOON


There are many connected healthcare

devices available today or under development

39

TELEMEDICINE

• Teladoc, founded in 2002, is the first and largest

telehealth provider in the US

• The service provides consults via phone or online

24/7/365

• Doctors are U.S. board-certified family practitioners,

PCPs, pediatricians and internists

• Health providers use electronic health records to

diagnose, treat, and write prescriptions

• Patients control their electronic health records and can

take their records with them

• Members report that Teladoc physicians resolved their

medical issues 92% of the time

Teladoc provides consults with board-certified

doctors via phone or online 24/7/365

40

ADVANCED

TECHNOLOGIES


Advanced uses of telemedicine include robotics,

remote surgery, and live monitoring via cellphone

41

ADVANCED

TECHNOLOGIES


Other advanced application include 3D modeling of organs

and tumors

42

5. SILVER GENERATION SPENDING TRENDS

43

SUMMARY • The “silver” generation represents over-50

Americans, who have high incomes and

different spending patterns than millennials

• This demographic category is expected to

expand markedly through 2060

• The silvers also have net worths well above

average

• Silvers tend to spend more on healthcare,

food at home, household furnishings, pet

supplies and personal care …

• … and less on transportation, education and

clothing than millennials

The silver generation is a growing demographic group

with high net worths, incomes, and different

purchasing preferences than the upcoming millennials

44

MEDICARE

POPULATION

GROWING

AND UTILIZING

THREE TIMES AS

MANY SCRIPTS AS

PATIENTS UNDER 65

Source: CVS Health; Medicare Trustees Report, 2014; Avalere Medicaid Model, Barclays, McKinsey MPACT 6.2, CBO Public Exchange Estimates, Oliver Wyman, 2014.

49

69

2013 2019E

Growth in Medicare Lives (Million Lives)

45

WHO IS THE

“SILVER”

GENERATION? Generation Age Income After Taxes

Gen Z / Millennials <25 $26,559

Gen Y 25–34 53,178

Gen X 35–44 69,152

Younger Boomers 45–54 68,048

Older Boomers 55–64 63,312

Golden Generation 65–74 48,742

Average $56,353

Americans in the age range of 45 to 54 have above-average

after-tax incomes

46

US

DEMOGRAPHICS

2010–2015 321

335 347 359 370 380 389 398 407 417

0

50

100

150

200

250

300

350

400

450

20

15

20

20

20

25

20

30

20

35

20

40

20

45

20

50

20

55

20

60

Projected US Population, 2015–2060

Under 18 years 18 to 24 years 25 to 44 years

45 to 64 years 65 years and over

Source: US Census Bureau

The over-45 population is

projected to increase

markedly during

2015-2060

47

ABOVE-AVERAGE

DISPOSABLE

INCOME

Source: US Bureau of Labor and FBIC Global Retail & Technology

Members of the “silver”

generation (55-74) have

above-average disposable

income

US Average Disposable Income

48

WHAT THE “SILVER”

GENERATION

WON’T SPEND

ON…

Members of the “silver” generation spent below-

average levels on transportation, education

and clothing

$8,860

$9,183

$9,004

Silvers Millennials

Transportation

All Consumers

$874 $1,019 $1,138

Silvers Millennials

Education

All Consumers

$1,423 $1,832

$1,604

Silvers Millennials

Clothing All Consumers

Source: US Bureau of Labor and FBIC Global Retail & Technology

49

6. TECHNICAL BEAUTY

50

ELEVATE BEAUTY:

BUILD ON OUR

STRONG

FOUNDATION

Source: CVS Health

Enhance the Beauty Shopping Experience

Bring our Health Expertise to Beauty

51

FACIAL MAPPING • Virtual Makeovers and Try-Ons

• ModiFace is a Toronto-based company with a

background in building 2-D and 3-D facial

simulations

• L’Oréal Makeup Genius

52

Try-it-on • TryItOn lets customers virtually try on makeup products

while in the store via an app for iOS and Android

smartphones

• The user uploads a photo, scans a barcode for the

product, and can view an image of the makeup on her face

• Brands supported include L’Oréal, Maybelline and Revlon

• The app analyzes the user’s skin pigments to determine

which makeup suits the user’s skin tone

• Users can also share images with friends to solicit their

opinions

TryItOn uses augmented reality to enable users to try on

makeup suitable for their skin tone and also solicit their

friends’ opinions

53

MAGIC MIRRORS • Attracting customers with visual suggestions

and options

• Expediting the fitting-room process

• Theft protection

• Data collection

54

MAGIC DISPLAYS

FOR SHOPPER

ENGAGEMENT

• Immersive, interactive experiences

• Affordable price is making large panels and

custom displays more affordable

• 3D motion detection has moved into the

consumer sphere

55

COLOR

MATCHING GOES

HIGH-TECH

• Sephora + Pantone = Color IQ

• IMAN Cosmetics determines one’s “color

signature” after taking a headshot

• The apps offer a wide range of product and

look recommendations

56

SMARTPHONES

DOUBLES AS

PERSONAL BEAUTY

CONSULTANTS

• Smartphone apps are capable of:

– Conducting skin analysis

– Making product recommendations

– Performing virtual cosmetic testing

• Allure + SkinBetter = App that applies

dermatologist-grade scanning technology to

identify skin issues

• The apps offer a wide range of product and

look recommendations

57

SOCIAL SELLING

BEATS ONLINE ADS

FOR BEAUTY

PRODUCTS

• 50% of beauty shoppers rely on beauty videos on

YouTube when making a purchase (source:

Google)

• With YouTube’s help, beauty content creators

provide beauty products to website owners in

exchange for links to their website

• The site generated 40% of traffic from YouTube

links and conversion rates increased to 15%

Michelle Phan’s E-tailers

58

GENETIC TESTING

FOR CUSTOMZIED

TREATMENTS

• Technology has enabled consumers to obtain

tailored anti-aging products based on DNA

analysis

• Information transparency demands

hypercustomization from beauty brands –

products that are adjustable to the daily

changing needs of an individual’s skin and hair

Geneu skincare lab in London offers

skin profiles based on a DNA sample

from a simple mouth swab

59

BIOTECH INVADES

BEAUTY

• The line between medical research and

beauty is blurring

• For products and therapies, particularly for

anti-aging remedies:

– Biotech materials

– Genetic profiling

– Stem-cell-based

60

WEARABLE TECH IN

NAIL ART AND

MAKEUP

• Early areas of research include

– Nail decoration

– Tattoos and conductive makeup

– Combining beauty and technology to empower the

disabled

61

3D PRINTING OF

COSMETICS

• Desktop printer with a sub-$200 price tag that

can print makeup such as lipstick, lip gloss,

eye shadow, blush, nail polish and brow

powder

62

ON-DEMAND

BEAUTY SERVICES

• The app Beautified allows users to search

for nearby salons and book last-minute

appointments using geolocation-based

technology

63

7. WEARABLE TECH

64

THE INTERNET OF

THINGS

Cisco forecast: 50 billion

devices by 2020

Source: Cisco

• Cisco has forecasted that there will be 50

billion devices connected to the Internet by

2020

• There are already more connected devices

than people

65

WEARABLES

MARKETS

The wearables market is estimated at about 60.6

million units and $6.6 billion this year

Source: ABI Research, HIS, MarketsandMarkets, FBIC Global Retail & Technology

35.7 46.5

60.6 79.0

103.0

134.3

$2.8

$5.1

$6.6

$8.8

$12.0

$16.8

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18

0

20

40

60

80

100

120

140

160

2013 2014 2015E 2016E 2017E 2018E

Market V

alue

($ B

illion

)

Un

its

(Mill

ion

)

Size and Value of Wearables Market

Units Dollars

66

SMARTWATCH

MARKET

The global smartwatch

industry is estimated at

$2.5 billion in 2015—

about 5% the size of the

watch industry

Source: Generator Research

0

50

100

150

200

250

2013 2014 2015 2016 2017 2018

Worldwide Smartwatch Market (Mil. Units)

Apple Other

67

STATE OF THE

WEARABLES

MARKET

• Technology still in its infancy

• Size, battery life, limited features, and lack of

performance are hindering innovation

• Engineering needs to connect with product

design

• Fashion and electronics supply chains need

to come together for products to be

successful

• Gadgets needs to become beautiful garments,

jewelry, watches and accessories

• No need to compromise aesthetics for

functionality

The wearables market is

still in its infancy, and

much remains to be done

to connect aesthetics

with tech

Source: Kloog

68

SMARTWATCHES Functions

• GPS tracking

• Analog/digital faces

• Heart rate monitoring

• Activity tracking

• Sleep quality tracking

• Fall detection

Smartwatches perform much of the functionality

of fitness bands

Source: Kloog

69

SMART FOOTWEAR Functions

• GPS tracking

• Alerts

• Stride detection

• Balance detection

• Pace detection

Smart footwear offers many functions developed

specifically for runners

Source: Kloog

70

BIOMETRIC

CLOTHING

Functions

• Pulse Rate

• Heart Rate

• EKG Functions

• Skin Temperature

• Muscle Contraction

• Respiration Sensors in biometric

clothing can collect many

types of physiological

data

Source: Kloog

• UV sensors

• Activity tracking

• Fall detection

• Hydration level

• Electrolyte level

• Glucose level

71

FIRST RESPONDERS

AND UNIFORMS

Functions

• GPS Tracking

• Wi-Fi

• BTLE

• Camera

• Gas Sensors

First responders have specific needs for sensors and

connectivity in order to monitor their environment and

communicate with the base

Source: Kloog

• Independent Zone

• Flexible

• Waterproof

• Wearable Screens

• Heat Sensors

72

SMART GLASSES Functions

• Voice Command

• Search

• Biometrics

• BTLE

• Screen

Beyond the Google Glass, smartglasses have many applications in industry

and medicine

Source: Kloog

73

POSTURE

MANAGEMENT

Functions

• Correction

• Compression

• Tapings

• Harnesses

• Embedded sensors

Wearables can be used to correct our posture and

to help reduce back pain

Source: Kloog

74

ENERGY

HARVESTING

Functions

• Bags

• Apparel

• Outerwear

• Gloves

• Sports Equipment

Wearables can collect energy from our physical movement,

avoiding the need for external power sources such as

batteries

Source: Kloog

• Bicycles

• Skateboards

• Fans

• Household Goods

• Recharging Solutions

75

GLUCOSE

MONITORING Guardian Real-Time Continuous Glucose Monitoring

(CGM) system

• Offers protection day and night

• Provides continuous glucose readings and

customizable alerts with notification of oncoming

highs and lows

• Enables real-time corrections for better glucose

control

The Guardian is a

combination of a patch

and an external device for

glucose monitoring

76

NANOTECH

• Nanoenabled products are a $1 trillion+

market

• What’s special about nano

– Size-dependent properties

– High surface-to-volume ratio

• Types: buckyballs, nanotubes, graphene,

nanoparticles and quantum dots

• Key products: personal care, clothing,

cosmetics, sporting goods, filtration and

sunscreens

• VCs are actively investing in

nanotechstartups, driving further innovation

Nanotech is the next

small thing enabling new

products and wearables

Source: Kloog

77

8. COOL STARTUPS

78

INDOOR

MAPPING

TECHNOLOGY • In-store shopping companion that provides

content that matters to the customer

• Customer can double-tap to save or swipe to

dismiss

• Double-tap proximity cards to save them

• As customer moves through the store, new

relevant cards pop up augmenting the

shopping experience

inMarket provides contextual content for

shoppers on their smartphones

79

INDOOR

MAPPING

TECHNOLOGY • aisle411, Walgreens and Google’s Project Tango

Have Teamed Up to Change In-Store Shopping

Experience

• Project Tango can determine a shopper’s location

inside the store within centimeters

• Allows shoppers to search and map products inside

stores using tablets and 3D augmented reality

• Shoppers can be rewarded with loyalty points as

they navigate the store

• The platform overlays

– Navigation

– Rewards

– Personalized special offers

Location-based technology is being combined with

augmented reality to offer an enhanced in-store

experience

80

HEART

MONITORING Home Diagnosis

• The BioStamp is a temporary tattoo that can

take several measurements, including

– UV exposure

– Temperature

– Perspiration and biochemistry

– Blood pressure

MC10 is developing wearable technology for consumer, digital

health, medical devices, and industrial & defense

applications

81

BABY

MONITORING

There are many commercially available products for

monitoring a baby’s breathing and activity

82

UV

MONITORING

SunFriend

• Provides alerts based on exposure and skin

sensitivity

• Tracks UVA+UVB levels

• Computes UV index (UVI)

The SunFriend monitors UV levels and alerts the wearer when he or she

has had enough sun based on the skin type

83

BLOOD

GLUCOSE

Glooko Type 1 & 2 Diabetes Monitoring Software

• Challenge—Tracking, recording and monitoring blood

glucose readings can be time-consuming and difficult

• Opportunity—Create a mobile app that minimizes the

possibility of human error from manual tracking.

• Solution—iOS app syncs with 19 meters to

automatically record readings. Users can email reports

to their physician. Other features include automatic

logging, food database integration, email integration,

Facebook integration, and note-taking.

84

9. IMPACT OF CHINESE TOURISTS ON RETAIL

85

SUMMARY • We estimate Chinese overseas spending will

nearly double to $422 billion by 2020

• Chinese travelers primarily stay within Asia,

however smaller numbers visit the US and UK

• Average spending was $1,678 in our survey,

however the greatest frequency was in approx.

$400–1200

• The most commonly purchased products were

apparel and accessories and beauty products

• More middle-income Chinese citizens will travel,

and travelers will travel more independently,

which has certain implications for retailers

86

Social Media

Savvy

• Wechat has 549 million active users, covers 200 countries

• WeChat mobile payment users reached 400 million

80% of Chinese high net-worth people use Wechat

87

A $422 BILLION

MARKET BY 2020

• Total outbound passenger journeys will double

between 2014 and 2020, to approximately 234 million

• Total overseas spending by Chinese tourists is

expected to jump 23% in 2015 to $229 billion

• By 2020, we estimate, total overseas spend will

reach $422 billion—a projected 13% CAGR

$229

$422

2015 2020

Chinese Overseas Spending ($ Bil.)

13% CAGR

Source: FBIC Global Retail & Technology

We estimate Chinese

overseas spending will

nearly double to $422

billion by 2020

88

UNDERSTANDING

THE OVERSEAS

SHOPPER

• FBIC Global Retail & Technology and China Luxury

Advisors survey of 1,019 Chinese Internes users

aged 18+

• Two-thirds of Chinese Internet users traveled

overseas during May 2014-May 2015 period

12.9%

10.3% 9.5%

7.3%

5.7%

3.2% 2.1% 2.0%

HongKong

Thailand SouthKorea

Japan Taiwan US Macau UK

Chinese Tourists’ Top Destinations

The top five destinations for Chinese tourists were

in Asia. The percentage of trips to the US and UK

was much lower


89

HOW MUCH DO

OVERSEAS

SHOPPERS SPEND?

• Average spending was $1,678

• Most popular spending bands were $407–

$815 and $815–$1,222

• 3% spent more than $6,516

13%

20%

17%

13% 13%

8%

6%

3%

8%

Amount Spent on Retail Purchases

Average spending was $1,678 and the most

common spending was in the range of $407 to

$1,222


90

WHAT DO

OVERSEAS

SHOPPERS BUY?

• Most popular overseas shopping categories:

clothing, footwear and accessories,

fragrances and beauty products, electronics

and other food or beverage

56% 52%

32% 31%

23% 20% 19% 18% 16%

10%

Apparel Beauty Electronics Other food Healthitems

Watches Tobacco Jewelry Alcohol Otherproducts

Categories of Products Purchased

The most commonly purchased products were

apparel and accessories and beauty products


91

HOW MUCH DO

OVERSEAS SPEND

BY COUNTRY?

• Chinese visitors to the US spend the most on retail purchases; at $2,555, they spend 52% more than the $1,678 global average, Followed by Europe and Japan

$1,678

$2,555 $2,548

$2,270

$1,922 $1,696

$1,290 $1,256

GlobalAverage

US Europe Japan S. Korea Taiwan Thailand HongKong

Estimated Per Capita Spending by Destination

Chinese visitors to the US spend the most on retail

purchases; at $2,555, they spend 52% more

than the $1,678 global average, Followed by

Europe and Japan


92

10. MOBILE COMMERCE

93

CHINA:

THE WORLD’S

LARGEST ONLINE

MARKET

China’s online population has grown rapidly to 641 million,

including 127 million rural users iResearch estimates the total mobile transaction value will

exceed ¥3.2 trillion at the end of 2017, up from ¥274 billion in 2013

China Mobile Commerce Growth (US$ Bil)

$2 $11 $44

$132

$258

$401

$512

2011 2012 2013 2014 E 2015 E 2016 E 2017E

Source: iResearch

94

APPS ARE

DOMINATING

SMARTPHONES

16%

84%

58%

42%

Total Internet BuzzFeed

Share of Time Spent on Mobile

MobileWeb

App

Source: comScore, March 2014

Apps are much easier to

navigate than mobile

apps and are therefore

more popular with users

95

INCREDIBLE

RETAIL

DIGITAL

OPPORTUNITY

93% Sales will be Offline

70% Sales will be digitally

influenced

Source: Google Analytics

In the future, 93% of sales will be offline and 70%

will be digitally influenced, according to

Google

94

THANK YOU!

Deborah Weinswig, CPA ExecuHve Director— Head of Global Retail & Technology Fung Business Intelligence Centre New York: 917.655.6790 Hong Kong: +852 6119 1779 [email protected]

Filippo BaEaini [email protected]

Sunny Chan, CFA [email protected]

Marie Driscoll, CFA [email protected]

John Harmon, CFA [email protected]

Aragorn Ho [email protected]

John Mercer [email protected]

Shoshana Pollack [email protected]

Kiril Popov [email protected]

Jing Wang [email protected]

Steven Winnick [email protected]