29 July 2006

The economics of tampons in Shanghai

I made my first trip to Carrefour today and much to my dismay, it has been confirmed: OB has a monopoly on the tampons market in China.

There is a whole Carrefour aisle (and you know how big Carrefour aisles are) of about 20 brands of pads, but just one teeny weeny brand of tampons - OB.

(Gentlemen reading this who think this is TMI and feel queasy should probably stop here. But for those macho enough to follow, here's some background - OB is the applicator-less tampon which you either love or hate it. Like probably 80% of tampon users, I happen to hate it.)

The unfortunate Carrefour discovery was quickly followed by a quick SOS to good old Ms T who promises to mail some Tampax right over tomorrow. I should have googled for a list of things to bring earlier. Someone on the Shanghaiexpat forum listed:

Comfort food. For when you are down sometimes.
Tampax. A whole suitcase of tampax.

Righto. That is exactly what I am going to stock on the next time I fly out of Shanghai.

Now that all the follow-up actions have been done, the economist in me got thinking: what exactly happened in the tampons market in Shanghai? Surely this is a case of market failure. A quick google on the internet revealed that Playtex used to be available in Watsons here last year, but I went to probably the most upmarket one in Jing'An last week and there was still nothing except OB :( Which means that Playtex must have pulled out of the market.

Okay, so you say - what's so difficult to figure out about that? Lack of market demand in China, only room for one player, natural monopoly for OB.

But the interesting thing about OB is that it is not exploiting its monopoly position at all. According to my Carrefour market research today, a box of OB costs just slightly more than US$1 here, and even comes with freebies, whereas it cost about US$4-5 in US and Singapore. In fact, it was so cheap that I just had to buy one - I figured an inferior substitute is better than no substitute.

I am thinking that OB is stuck in a difficult place where it cannot exercise its monopoly powers - seasoned tampon users don't want to use it because it is not a like product to other tampons, while pad users are even more worse to win over - you have to make them switch to tampons, then to OB at that. In short, OB's market segment is way too niche.

So maybe that is why OB has to resort to using a price strategy to win customers over... It got me to buy a box of OB after a long time - so perhaps the strategy did work somewhat. But in the initial conversion of the Chinese market, there could be merits in having some competitors so that you can share the cost of advertising and education.

So please, OB competitors, please come to the Shanghai market. 3 million young women for your conversion and many ready-to-buy foreigners!





恒龙广场的南京路很高档 - Gucci, LV, Ferragamo 什么都有,就象新加坡的Paragon一样- 但因为高档,乞丐也相对的多,令人心酸。


上海有一点我是觉得很可爱的 - 这儿的商业广场到了傍晚,都会有很多老人穿着朴素的睡衣来散步。

打着领带的专业人士与朴素的老人共用一个空间 - 这要算是民主还是共产?

25 July 2006

Of flying spit and splinters: Shanghai episode one

Day 4 in Shanghai.

For those who haven't heard, I have just moved to Shanghai a few days ago to work for the next two years. That is also why I have been leaving this blog patch of mine in dilapidation for the past few weeks. (Sorry folks - there was just a gazillion and one thing to move and do before leaving.)

It is now Day 4 in Shanghai and I still like it - despite the crowd, the traffic, the flying spit and splinters. (You've gotta love a multi-tasking cyclist - cycling past me and spitting at the same time. The flying splinter story is less exciting - just some carpenter trying to axe some wood and whooola, a visible chunk of splinter comes flying out onto the walkway in front of me. Anyone considering sending me a helmet for my birthday?)

Shanghai reminds me of Tokyo, which is probably why I take to it very well. Not as civilized and clean as Tokyo, but the old-world-meet-new-world charm is equally alluring. Colonial amidst Chinoise amidst Ikea - that is more than enough to redeem Shanghai from any flying spit and splinters. Did I mention that I really like the sound of Shanghainese too? I wonder where I can learn it.

People-wise, drivers and waitresses have been friendly, and friends have been selflessly helpful. Ms C, a local Shanghainese, has been fully involved in my apartment hunt to ensure I am not fleeced while Mr C came to my rescue yesterday after hearing my bank draft sob story. (Never bring a bank draft to China - it takes 1 WHOLE MONTH to clear.)

My only real lament is the internet here. Now, the access is wonderful - I have free LAN in my hotel room, and the content is excellent - see this amazing 3D map of Shanghai. But, and that is a big but, blogspot, wikipedia and goodness knows what else are banned. It's funny how you take the concept of free internet as an entitlement until one day you realize that it is a privilege elsewhere.

So for those of you whose blogs I read, please email me if you wanna share your joy with me. I can still post, receive your comments, but can't view my own talljoanne.blogspot.com, so pardon me if photo layout etc look haywire. For the next two years, I will be a blind blogger groping in the dark...

More upbeat news about Shanghai soon - my new apartment for one!

05 July 2006

The cabbie blood in me

I think it is the cabbie blood that I inherited from my father - I was really cheered by this story on Japanese cab drivers from the Terrie newsletter I received. Must be the image of them leaping out in the rain to open my taxi door! Of course, you may say that you pay a bomb for the taxi fare, but in this world, you can pay a bomb for many things and still get mediocre service...

Riding in one of Tokyo's ubiquitous cabs the other night, we had an interesting reminder of just how different Japan can be. This particular cab was participating in a product giveaway to salarymen returning home late at night. The product was a new energy health food bar from Otsuka Pharmaceutical. In handing over the bar, the cabbie apologized and said in Japanese, "Here have one of these -- it doesn't taste too good..." ??!!

Now, if you've been in Japan for a while, you'll know that this could either mean, "I'm being forced by the firm to give you this, but my advice is don't eat it," or "This is pretty good, but I'm being polite and am talking the product down. Now you just have to try it to find out for yourself, right?"

Receiving the bar, we did indeed try it out after alighting, and found that it actually wasn't too bad.

Munching away, we started thinking about Japanese taxi culture, especially here in Tokyo. Despite the low wages, long hours, difficult city lay-outs, and drunken, sometimes sex-crazed passengers, Japan's taxi drivers are the salt of the nation, and 99% of them are unfailingly polite. Indeed, one cab company, we forget which, even has its drivers leap across the passenger seat, race you for the door, and open it from the outside for you. This sudden series of movements by the cabbie can be a bit of a surprise when it first happens to you -- and even more so when it is pouring with rain. But it certainly does make you remember the extreme politeness of drivers from that particular firm.

There are apparently about 380,000 taxi drivers in Japan, most of whom seem to be servicing Shibuya-Roppongi and the other 5 major centers on the Yamanote line, after 23:00. They belong to 8,048 different companies, about 100 of which operate in Tokyo -- so competition is alive and well. Actually, the competition really took off after the government removed both price and licence-limiting controls in 2002, thus causing a surge of newcomers into the market.

There are cab companies of all types, including those with pet taxis, for taking your poodle or chihuahua to the vet -- or out on a date. One such company is Taikoh Taxi, which is located in Aichi, and charges JPY2,500 for the first 10km then JPY200/km after that. Although the initial cost is high, riding with your pet for any distance beyond 10km is actually about 2/3 cheaper than a regular cab. In addition to transporting pets, Taikoh also provides pet-sitting, pet-trimming, and pet-feeding services. www.taikoh-taxi.co.jp. Not yet in Tokyo, unfortunately.

Among the other types of services are bridal taxis, which have special cars with high roofs and wide doors to accomodate the bride in her full traditional wedding gown. If you've ever seen a bride with her oval headpiece, the tsuno-kakushi, you'll know what a pain it must be to get into a regular cab. See http://tinyurl.com/gc4ct for an image of the headgear. Other services include non-smoking cabs and welfare cabs -- i.e., those fitted out for disabled people.

Probably the best thing about Japanese cabbies is their integrity. Despite drivers traditionally saying, "please don't leave anything behind," we have personally forgotten bags, notebook PCs, company files, and books, realizing only later that we'd done so. In EVERY case, we've been able to call the cab company and the driver has either directly come back or has passed the package on to another driver to hand-deliver to our address. In other instances, and this happens regularly, if a cab driver picks the wrong route and as a result we get stuck in a traffic jam, he will refund some of the fare from his own pocket, all the while apologizing for not having known any better.

But this is not to say that every cab driver strives for excellence. With the economic setbacks of the 1990's and the traditional winter migration of workers from the frozen north, there is an increasing number of drivers who simply don't know where they are going -- or they are drunk. The Nikkei recently reported a new cell phone accessory by Tanita, which is an alcohol detector that attaches to any of DoCoMo's 3G FOMA handsets. Apparently the cab companies plan to make their drivers breathe into the thing at random intervals, and since the FOMA handsets have a camera, the dispatcher can see the person actually doing the breathing.

Although off-season country drivers who don't know Tokyo present no major challenge to those of us who have lived here for any period of time, it is disconcerting for foreign businesspeople who are new to the city. One way to cope with a lost (or drunk) cabbie this is to be forearmed. We suggest newcomers consider a rental phone from Go Mobile. For a very reasonable JPY150/minute, Go Mobile's Concierge service provides you with a help desk that will translate cabbie directions and complaints -- to/from English and Japanese. http://www.gomobile.co.jp/index_e.html.