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Superbrands’ success fuelled by sex, religion and gossip

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By Alex Riley and Adam Boome, BBC Three

Before filming Secrets of the Superbrands, I'd never been to a porn shoot, and in my wildest imaginings I never thought the reason I'd end up at one would have anything to do with filming a documentary about the world's most powerful technology brands.

My mission was to find out how these brands – such as Apple, Microsoft and Google – have grown so explosively to become some of the world's biggest companies.

I toured three continents to visit their headquarters, talk to fans and find the inside story on why we hand over our money to them.

So there I was in a seedy nightclub in a Los Angeles suburb to meet Samantha Lewis, chief executive of adult entertainment studio Digital Playground, a company that for many years has been at the forefront of using new technology in the adult industry.

I was surprised to learn that they have been trailblazers for iPads, HD and 3D.

While the rather distracting business of photographing a naked woman was going on right behind me, Samantha told me that many technology brands used the adult industry to test new markets, albeit in absolute secrecy.

Why? Well, the sheer scale of the industry is such that you ignore it at your peril.

And it appears to have driven the take-up of several new technologies.

Sony, for instance, would not allow adult films to use its Betamax format in the 1980s and so the huge business in adult videos went to its rival VHS, hastening the end of the former.

Having lost out in the 80s, Sony wasn't taking any chances when it came to the battle between its Blu-ray format and Toshiba's HD-DVD.

This time around they're playing ball with the porn industry.

Blu-ray giveaway

But I discovered Blu-ray's success was not all down to moral compromise: there was another revelation during my trip to Los Angeles.

A company called iSuppli reduced my PlayStation 3 to a pile of screws, chips and diodes in order to work out the manufacturing costs, and I was astonished to find Sony had been losing money on every one it's sold.

This is partly because it has been giving away a free Blu-ray player in every one, making the PlayStation a games console and HD movie player in one box.

So, with 41 million PS3s sold to date, they've lost about £2bn, but captured a huge share of the market.

As they're making money on every Blu-ray disc sold, and HD-DVD has now died a death, it appears to have been a gamble worth taking.

All brands crave customer loyalty, but I wanted to know why and how a technology brand inspired religious fervour.

Devoted fans

The scenes I witnessed at the opening of the new Apple store in London's Covent Garden were more like an evangelical prayer meeting than a chance to buy a phone or a laptop.

The strangeness began a couple of hours before the doors opened to the public. Inside the store, glassy-eyed staff were whipped up into a frenzy of excitement, jumping up and down, clapping and shouting.

When the doors finally opened, they hysterically "high-fived" and cheered hundreds of delirious customers flooding in through the doors for hours on end.

And what did those customers – some who'd travelled from as far away as the US and China and slept on the pavement for the privilege – find when they finally got inside?

Well, all the same stuff as in the Apple store half a mile away on Regent Street. No special offers, no free gifts (a few t-shirts were handed out), no exclusive products. Now that's devotion.

I searched high and low for answers. The Bishop of Buckingham – who reads his Bible on an ipad – explained to me the similarities between Apple and a religion.

And when a team of neuroscientists with an MRI scanner took a look inside the brain of an Apple fanatic it seemed the bishop was on to something.

The results suggested that Apple was actually stimulating the same parts of the brain as religious imagery does in people of faith.

Basic needs

Witnessing the sheer scale of technology's takeover up close was breathtaking. Facebook didn't even exist seven years ago; now the brand is worth £32bn.

In India I visited Nokia's biggest phone factory, churning out handsets at a time when India alone is adding 20 million new mobile-phone subscribers every month.

How can this be possible? I asked people from the slums of Delhi to the streets of London and Chicago who they call most on their mobile phones and the answer was always the same: friends and family.

Like Apple, mobile phones and social networks offer an opportunity for us to express our basic human need to communicate.

And it's by tapping into our basic needs, like gossip, religion or sex that these brands are taking over our world at such lightning speed.

That's not to say that clever marketing and brilliant technical innovation aren't also crucial, but it seems that if you're not providing a service which is of potential interest to every one of the 6.9 billion human beings on the planet, the chances are you're never going to become a technology superbrand.

Secrets of the Superbrands is on BBC Three at 2100 BST on Tuesday, 17 May. Or watch online via iPlayer at the above link (UK only).

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Plan to unlock Kenyan export potential

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Capital FM Kenya

NAIROBI, Kenya, May 24 – A strategy that is meant to enable Kenya unlock the huge potential that exists in the export market has been launched.

Through the "Export Brands Kenya" the country hopes to raise the profile of its brands as well as encourage the development of other high quality products and services that can effectively compete in the global market.

The Brand Liaison Director at Export Brands Kenya Herman Shadeya said that through the Public-Private Partnership (PPP) initiative, they hope to encourage more Foreign Direct Investments to Kenya and the wider Eastern Africa region.

"Export Brands will therefore create a platform for expanding Kenya's export potential and increasing the number of players through operations that not only impact on the quality and volumes of products and services being made available in the markets beyond our borders but also builds value for Kenya's offerings," Mr Shadeya said.

A booklet detailing Kenya's indigenous export firms will also be published in an attempt to increase the visibility of the export brands and spur their demand.

However, only companies with a turnover of $1 million (Sh84 million) per annum and those that are members of specified apex bodies will be eligible to have their products profiled in the book.

Last year, the market contributed Sh409.7 billion in foreign exchange although this was derived from the traditional exports such as tea, coffee, apparels and horticulture, which means that Kenya is not able to capitalise on its premium products.

For instance, about 98 percent of locally produced coffee is exported in raw form for processing where it is blended with coffee from other destinations. This is however not always acknowledged when such brands are marketed which means that Kenya loses out.

What this calls for is the need to diversify the market through, for example, laying greater emphasis on value addition to the country's products as well as the promotion of manufactured goods as a shift from the over reliance on primary exports.

When this happens, Kenya should strive to conquer the greater East African market which has a population of over 130 million and thus a substantial consumer base. Doing so would also present the much needed job opportunities for the millions of unemployed youth in the country.

Before this is attained however, the government would have to create an enabling environment through the formulation of friendly policies that can promote the development of the exports industries.

Export Promotion Council (EPC) Chairman Njeru Ndwiga emphasised the importance of urgently addressing the cross-cutting obstacles that hinder the country from taking full advantage of the huge export market opportunities.

Proper branding of the exports coupled with efforts to increase their visibility would do the trick, he reckoned.

As the body mandated with the development and promotion of export trade, Mr Ndwiga disclosed that they were also carrying out various initiatives to prop up informal sector players to enable them contribute towards the sector.

Through the Export Promotion Villages, EPC intends to assist 'jua kali' traders such as those in the arts and crafts field, to market their wares in the international market.

Treasury management is key to sustainable financing

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Companies interested in achieving maximum interest earnings on cash balances venture into treasury management.

This was the message by Themba Rikhotso, CFC Stanbic’s country head for Transactional Products and Services to the country’s top CEO’s assembled during this year’s Superbrands CEO Club meeting held on 10th March. Treasury management is a key part of any company or individual’s interested in increasing their yields from their own cash resources through a variety of financial structures and tools.

It entails management of an enterprise's holdings and entails activities such as trading in bonds, currencies, financial derivatives and also encompasses the associated financial risk management.

Mr. Rikhotso highlighted the main objectives of treasury management and broke down the complicated formulae involved in the service. He first split the treasury management into liquidity management and yield management.

For liquidity management, the main aims were for establishment and maintenance of an access to short term financing options.

Another objective was the access to medium and long term support for capital assets and the final objective was coordination of financial solutions. The main objective of yield management is to optimise cash resources.

“The other aspect of treasury management is risk management,” said Mr. Rikhotso. In this sector, liquidity, interests’ rate, exchange rate and market risk are the ones that are carefully evaluated to give optimal performance of the investments. All banks have departments devoted to treasury management, as do larger corporations. For non-banking entities, Treasury Management and

Cash Management are sometimes used interchangeably. The treasury operations come under the control of chief finance officer of the concern or the vice-president / director of finance.

Bank treasuries may have the several departments. These include fixed income or money market desk that is devoted to buying and selling interest bearing securities. Another aspect is foreign exchange or "FX" desk that buys and sells currencies.

A capital markets or equities desk that deals in shares listed on the stock market.

In addition the treasury function may also have a Proprietary Trading desk that conducts trading activities for the bank's own account and capital, an asset liability management or ALM desk that manages the risk of interest rate mismatch and liquidity; and a Transfer Pricing or Pooling function that prices liquidity for business lines (the liability and asset sales teams) within the bank.

“In notional pooling, several balances are put together to determine net position of the participating accounts,” explained MR. Rikhotso. The treasure introduces several treasury participating accounts and uses the accounts to keep the net position close to zero. They then invest in higher yield account. Afterwards they have an option of paying the interest back to participating account based on contribution or paying interest into nominated interest accounts. Mr. Rikhotso also gave a detailed overview of cash management complete with formulae and functional derivatives.

The meeting drew 52 top CEOs who used the occasion to mingle, network and learn new management tools from the various presenters.

Toyota’s MD calls for lean leadership

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“Companies that adopt the lean system and ‘visual management’ aim to generate more profit through greater efficiency, better prices and better quality.”, says Toyota East Africa Limited Managing Director Hylton Bannon.

This was during his presentation on Lean Management the Toyota was during this year’s Superbrands CEO Club meeting held in early March. The strategy has been Toyota Motor Corporation’s recipe for success in a century of its existence. He said that the history of the strategy is based on rich tradition going back to the time of the founder of the company Kiichiro Toyoda.

The younger Toyoda was inspired by his father, Sakichi who himself founded the Toyoda Automatic Looms Works Limited, a company that made automated looms for the Japan’s textile industry. Mr. Bannon said that the main five principles as inherited from the fathers of the company have over the years pushed the giant auto maker and dealer to continue conquering new frontiers year after year. “We always abide by his mantra of lean management and lean leadership,” he said during the meeting that attracted over 50 CEOs from the country.

The five principles have pushed the company’s fortunes even in times of adversity include the employees’ call to be faithful to their duties which translates to the overall good for the company. The need to be creative and studious, a feat that has seen it stay ahead of competition. The company has weathered many storms latest being the recall saga of their Toyota Prius model.

The management is based on the need to always be practical this has been vital in eliminating any frivolity that may crop up in chores. They have also built a homelike atmosphere that ensures that their working condition is warm and friendly. The final principle is the respect for people and gratefulness at all times.

“These are the principles that we inherited from our founder father and it is the one that has propped up the company all these years,” he said. In the presentation, Mr Bannon busted the myths that have surrounded the lean leadership mantra. “Many people think that lean leadership is a recipe of success but in Toyota we believe that success comes with consistent thinking and right frame of mind,” he said.

The other myth tackled was that this strategy was a project or a programme while at Toyota the inventor of the strategy, think that it is management philosophy. He also said that there has been misconception that there are set of tools to implement this strategy while the reality is that this comes naturally with focus on customer satisfaction. As a manufacturing company, analysts have termed the strategy works because of their niche while the Toyodas believed in teamwork and a culture of improvement that transcends all sectors final myth was that this was a short term project but to Toyota is an unending search for perfection.

Toyota East Africa Limited was this year’s CEO club meeting sponsor and Mr. Bannon delivered this inspirational speech in his keynote address to the CEOS at a Nairobi Hotel. The lean management presentation for East African business leaders comes at a time when major companies such as Barclays, KCB, Safaricom, Airtel are undergoing restructuring and adapting a leaner more efficient team.

Hanningtone Gaya

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Hanningtone-Gaya

Hanningtone Gaya, MANAGING DIRECTOR – Media 7 Group kenya Limited.

Anil Ishani

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Anil-Ishani

Anil Ishani, Advocate and Fellow – Chartered Institute of Arbitrators

Chris Harrison

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Chris Harrison, CHAIRMAN – Young & Rubicam Brands Africa & Indian Ocean

Lenny Nganga

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Lenny Nganga, DIRECTOR – Saracen Media Ltd

Alfred Amulyoto

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Alfred Amulyoto, MANAGING DIRECTOR – Nuturn Bates

Gil Kemami

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Gil Kemami, MANAGING DIRECTOR – Ogilvy Advertising

Maggie Kigozi

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Professor Maggie Kigozi, EXECUTIVE DIRECTOR – Uganda Investment Authority

Esther Mwihaki

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Esther Mwihaki, MANAGING DIRECTOR – Lowe Scanad

Kirabo Lukwabo

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Kirabo Lukwabo, MANAGING DIRECTOR – QG Saatchi and Saatchi

Esther Mkwizu

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Esther Mkwizu, CHAIRPERSON – Tanzania Private Sector Foundation (TPSF)

Maxmillian Kitula

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Maxmillian Kitula, MEDIA EXECUTIVE – Roots Marketing Communication

Francis Mugisha

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Francis Mugisha (FCMA), MANAGING DIRECTOR – Management Consult Associates

Hermenegilde Nndikumasabo

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Hermenegilde Nndikumasabo, PRESIDENT – Burundi Chamber of Commerce, Industry, Agriculture & Handicrafts, CCIB

Sameer Merali

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Sameer Merali, DIRECTOR – Sameer Investments Ltd

Tom Sitati

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Tom Sitati, Executive Director East Africa – Interbrand Sampson

George Lutta

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George Lutta, REGIONAL DIRECTOR – Media Investment Management – Scangroup