Article # 5 STRAND: Marketing Challenges, Approaches and Distribution

Ontario Premier Dalton McGuinty and Samsung CEO Chi Sung Ha shake hands in January on a $6.7 billion deal for the Korean company to supply renewable energy equipment to the province.

Mark Blinch/Reuters

Tim Armstrong

On Thu Sep 23 2010 

Is Ontario’s goal of becoming the leading source for green energy equipment and services in jeopardy?

In January, the government announced a $6.7 billion wind and solar power investment commitment by a South Korean consortium led by the giant Samsung Group. Samsung is committed to developing wind and solar farms in southern Ontario, as well as manufacturing renewable energy equipment of all kinds for the domestic and export markets. These combined activities are estimated by the government to result in 15,000 additional Ontario jobs.

What attracted Samsung, which is said to have been courted by a number of competing U.S. states? Partly the guaranteed energy rates under the Green Energy Act, significantly higher than those offered by competing jurisdictions. And partly by promised subsidies for the Samsung manufacturing plants, estimated at approximately $400 million. In addition, to the chagrin of local contenders, Samsung is given priority access to our energy grid for approximately 2,500 megawatts.

To further enhance Ontario employment, provision is also made for a stipulated percentage of the goods produced in Ontario facilities to have Ontario content.

Unless you are a local bidder bumped from your previous priority position for access to the energy grid, it all sounded great, for jobs, the environment and for global trade.

But two problems, both involving complex World Trade Organization trading rules — and neither raised at the time of the initial announcement — are cause for serious concern.

The first involves Japan, and its complaint that the local content and subsidies provisions of the Ontario/Samsung deal contravene various WTO prohibitions.

Are the Ontario provisions consistent with the WTO’s Trade Related Investment Measures (TRIMS) and its Agreement on Subsidies and Countervailing Measures? The former explicitly prohibits developed economies from imposing local content requirements on goods manufactured for export. Some argue that the Ontario legislation is justified since it involves “government procurement.” But Japan’s complaint extends beyond government procurement and involves the production by private companies of green energy equipment and supplies for export.

Alternatively, are the subsidies justifiable since they originate in subnational (provincial) rather than national (federal) legislation? If not, are there alternative defences?

The second issue concerns China and its increased efforts to expand its dominance in the global green energy supply sector. So far, China’s practices in the sector have not been formally challenged. Recently, however, the United Steelworkers filed a 5,000-page submission to the U.S. trade representative, requesting the U.S. government to file a formal WTO complaint. The particulars were outlined by the Steelworkers’ international president, our own Leo Gerard, in a scorching interview on CBC. Gerard claims that China, by contravening a series of its international trade obligations, is making it virtually impossible for any North American jurisdiction, including Ontario, to compete in the clean energy supply sector.

China, already producing about half of the world’s solar panels and wind turbines, has achieved and maintained its advantage by heavily subsidizing its manufacturers (many of which are state-owned), favouring those with superior export performance, as well as those using Chinese-made goods in the manufacturing process.

China has a unique natural advantage as well. It produces most of the world’s supply of rare earth materials required in the manufacture of wind turbines, solar panels and advanced batteries. And to maintain its competitive advantage, it has, according to Gerard, placed illegal export quotas on those minerals, as well as a Byzantine regimen of taxation and licensing requirements, all said to be contrary to its WTO obligations. Gerard also refers to China’s illegally managed and overvalued currency and its underpaid, exploited workforce, enabling the country to undercut virtually all global competitors in pricing its exported green energy equipment.

The Steelworkers’ complaints are echoed by several U.S. states, which, like Ontario, are attempting to establish green energy supply capabilities. Oregon, for example, says that despite its own controversial business energy tax credit, it cannot hope to compete in this key sector so long as China is permitted to “tilt the playing field” in the manner outlined in the Steelworkers’ complaint.

IF ALARM BELLS have been sounded at Queen’s Park or in Ottawa, I haven’t heard them. If key elements of the Samsung agreement are found to contravene our WTO obligations, what then? Is the agreement still operable? Does cancellation, amendment or delay in implementation result in forfeiture penalties?

In light of the Japanese complaint and China’s allegedly insuperable and so far unchallenged competitive advantages, these matters need to be fully and transparently addressed.

Tim Armstrong is a lawyer whose assignments in the Ontario government included deputy minister of industry and trade and agent general for the Asia-Pacific region.

ANALYSIS: Is Ontario’s goal of becoming the leading source for green energy equipment and services in jeopardy? Mark Blinch/Reuters, September 23, 2010, The Toronto Star

Ontario's goal to becoming the biggest source for green equipment is endangered when Japan accuses Ontario of violating WTO’s Trade Related Investment Measures (TRIMS) and its Agreement on Subsidies and Countervailing Measures. What that does is not allow developed economies to impose local content requirement on goods manufactured for export. But apparently, some say that in Ontario its justified since the equipment and such originates in a subnational rather then national legislation. Another issue brings China into the picture, and China already produces half the world's wind turbine energy and solar panels. It is the most naturally fit and has yet to be competed with. It is unclear whether the Samsung Agreement with Ontario will be operable, or even cancelled as of now.

Strands that relate:

 A strand that relates to this article is the "Marketing challenges, Approaches and distribution", because Ontario's first challenge is to get past the issue with the legislation before it can even prove itself to be the second most significant green equipment contributor. The second strand this relates to is the "Factors influencing success in international market" because it is important for Ontario to be "fit" or approved by the WTO before it receives the go ahead. So rules and government policy plays a factor in businesses like this.

Thoughts and Opinions:

This issue should be sorted out as soon as possible, and should be done so Ontario can be a green equipment contributor too. Since it follows the subnation legislation it shouldn't fall under the same category as nation legislation, making it a sort of loophole. Overall, Ontario should become a green contributor as it would bring more recognition to Canada like it has to China. If China can supply half of the world, Canada should at least be able to do a quarter of that. Samsung also favors Ontario over some of the states in the United States that are also suitable candidates.

Article # 4 STRAND: Working in International Markets

Canadian CEOs fall short in overseas experience, study finds

RICHARD BLACKWELL

From Tuesday's Globe and Mail

Published Tuesday, Oct. 05, 2010 6:00AM EDT

Last updated Tuesday, Oct. 05, 2010 7:37AM EDT

Canadian executives have far less international experience than corporate top brass in Australia, one of our key global rivals, leaving this country at a potential disadvantage in world markets.
According to a study to be released Tuesday by headhunters Russell Reynolds Associates, about 37 per cent of Canadian chief executive officers had at least one year of international work experience before they got the top job at their firms, compared with a dramatically higher 67 per cent of Australian CEOs.
Unless this gap is closed “our ability to compete on the world stage will become stagnant or perhaps even decline,” said Russell Reynolds’ Canadian country manager, Shawn Cooper. That could be a disaster at a time when economic power is spreading to new players around the globe, he said.
The study compared Australia and Canada because the two countries have similar-sized economies, a comparable mix of industries, and both recognize that international trade is crucial to their growth.
Indeed, when board members of large public companies in both countries were interviewed, similar proportions – more than 75 per cent – suggested that international experience was important. But the Australians are more successful in attracting executives who have worked outside the country, the study found.
One difference is that Australian companies find it easier to entice expatriate executives to return home. The geographic isolation of Australia means many executives working elsewhere want to come home eventually, while Canadian executives can easily live and work in the United States and remain close to home, the study said.
Another difference, the study suggested, is that Canadian companies think their executives can get what amounts to international exposure in North American markets without leaving the country, because of our proximity to the United States. Australian executives, by contrast, must actually leave that country to get international experience.
For Canada, the attitude that an executive can get global exposure while living at home is no longer good enough, said Jon Martin, a managing director in Russell Reynolds’ Toronto office. “Actually living and working in a market outside your own country is far and away the best way to gain that international orientation and competence.”
Boards of companies with international operations must make sure executives at various levels are encouraged to – or even required to – spend time overseas, Mr. Martin said. And they should also consider “importing” executives from other countries, he added.
Mr. Cooper said an executive’s international experience is important not just because it will help a company exploit new markets for its products. Many companies also want access to new financial and labour markets overseas, while foreign-based companies are coming to Canada to compete. In addition, domestic companies are increasing getting materials and components for their products from overseas. “Globalization hits on a number of fronts,” he said.
And if a company wants to do business in countries such as China or India, it will likely have to enter through a joint venture, Mr. Cooper said. “That is a whole different world for most corporate executives, and this is why you want people with [foreign] experience on the executive team.”
The Russell Reynolds study meshes with a recent report from the Institute for Competitiveness and Prosperity at the University of Toronto, which said Canadian firms need to boost ties in both advanced countries and emerging markets. Expanding trade with other countries increases competition and innovation, the report said.


ANALYSIS: Canadian CEOs fall short in overseas experience, Richard Blackwell, October 5, 2010, The Globe and Mail


 This Article compares Canada's Executives to other countries (specifically Australia) and finds that Canadian CEOs actually lack travelling experience. Atleast 37% of Canadian CEOs have atleast a year of international work experience, which is half as much as the number of Australian CEOs. The reason why Canada and Australia are compared in this study is because they're economies are similar in size, mixed industries, and they both rely a lot on international trade. The study also believes that Canadian executives don't feel the need to go international because of our close proximity to the United States. They can build their foreign businesses and live close to home at the same time. In Australia however, going international is the only option since its so far away. Expanding foreign markets in other places such as China and India is being examined, expanding trade with other countries leads to increase in competition and innovation.


The Strands it relates to:


 It relates a lot to "Working in International Markets" because opening a business in a foreign company is good, since you're making your business popular, getting money, and hopefully winning over other businesses or companies with similar products. Its also a part of working in a business, since you can't always be successful by staying in one place. This article also relates to "Factors influencing success in international markets" because again opening a foreign business is good for your company if its successful. 


Thoughts and Opinions:


Just because Canada is closer to the United States does not mean that we have to rely on them for all of our international work. I believe the best way to exploit new foreign businesses in other countries is for executives to actually go overseas. It's like University or College in a way, more CEO's should travel. If foreign trading plays such a big part in our lifestyle we should at least set up shop and compete elsewhere.

Article # 3 STRAND: Factors influencing success and Challenges, Approaches, Distribution

ENERGY

Plunging natural gas prices chill sector

MARTIN MITTELSTAEDT

From Wednesday's Globe and Mail

Published Wednesday, Oct. 06, 2010 6:30AM EDT

Last updated Wednesday, Oct. 06, 2010 6:37AM EDT

Gold, silver and a host of other commodity prices are in liftoff mode. But one important material isn’t joining in the party: natural gas(NG-FT3.870.133.45%).

The fuel’s price has been falling recently, and by many accounts, is likely to continue going that way, possibly for a long time.

While the front-month natural gas futures contract edged up Tuesday to $3.77 (U.S.) per million British thermal units, a rise of 1 per cent, it had fallen nearly 6 per cent over the previous three sessions. Earlier this year, it was flirting with $6.

If the downward trend continues, and many market players think it will, the lower prices will be a major drag on the earnings of North American energy producers with a heavy exposure to natural gas, although they’ll be a boon to homeowners during the upcoming winter’s heating season in the form of lower utility bills.

Prices are following the path of least resistance lower because of poor demand-supply fundamentals, according to market experts.

“It looks like there is still more supply growth to come, both from the U.S. and now potentially from Canada,” said Martin King, vice-president of institutional research at FirstEnergy Capital Corp. in Calgary. “A lot of the demand growth seems to have stalled out.”

Given the trends, prices are heading a lot lower, in his view. He said he “would not be surprised to see something” in the low $3 area.

The plunge in gas prices has caught some of the savviest energy market players off-side in their trades and pronouncements. Many of these investors had been touting gas as a money-winning contrarian play, with the commodity so unloved it was bound to rally. Natural gas in the past has had incredible upside sprints, and in late 2006 traded at near $16, making this year’s levels seem cheap by comparison.

But the call to go long has either been wrong, or early, depending on the point of view.

The Toronto Stock Exchange-listed TBP Energy Fund (TBP.UN-T7.46----%) managed by the legendary U.S. energy financier of the same name, was loaded up with natural gas stocks, such as Devon Energy(DVN-N66.300.921.41%) Chesapeake (CHK-N22.590.271.21%) andEncana (ECA-T30.560.140.46%) along with a major futures position in the commodity, according to its most recent statement, for the period ended June 30.

The fund, sold to the public earlier this year at $10 a unit, has recently been trading around $7.50, for a loss of about 25 per cent from the initial offering, although the rally in oil prices has lifted the security from its August low of $6.75.

The fund manager could not be reached for comment.

We believe the natural gas market will be amply supplied through 2011 but we expect natural gas prices to move toward $5.50 by year-end 2011.— RBC Dominion Securities

Another prominent forecaster calling for higher prices was Henry Groppe, the octogenarian patriarch of highly regarded Texas petroleum consulting firm Groppe Long & Littell.

In April, he said prices, then fluctuating between $4 and $5 per million BTUs, would rally to more than $8 by last month. The call was based on a view that the current surge in output from shale gas deposits, the big reason supplies are increasing, wasn’t sustainable. Mr. Groppe could not be reached for comment.

RBC Dominion Securities last month lowered its price projections for natural gas to $4.50 this year from $5, to $5 next year from $5.75 and its long-term level to $6 from $6.50.

“We believe the natural gas market will be amply supplied through 2011 but we expect natural gas prices to move toward $5.50 by year-end 2011” because of improving global economic growth, the bank said in its Global Energy Research publication.

Encana

The bank has downgraded gas-focused Encana to “sector perform” and reduced its target price to $35 from $37.

While the company is “one of the best-managed independents with superior execution capability” the bank said Encana’s strategy to double its production volume per share over the next five years in the midst of high supply conditions is likely to weigh upon natural gas prices for years.

Among senior firms it favours are companies with more of an oil focus, including Canadian Natural Resources Ltd., Talisman Energy Inc., Husky Energy Inc. and Suncor Energy Inc.

Not all gas producers are unloved. Canaccord Genuity has four top buys among Canadian firms with market caps over $250-million (Canadian) that its analysts believe can return more than 25 per cent.

It estimates that Calgary-based explorer Fairborne Energy(FEL-T4.280.010.23%) could rise 80 per cent; Progress Energy(PRQ-T11.410.201.78%) a mid-size producer focused on exploration, development and production in northwest Alberta and northeast British Columbia could rise 49 per cent; Daylight Energy (DAY-T10.07-0.03-0.30%) a mid-tier producer in Western Canada has an upside of 48 per cent, and NuVista Energy (NVA-T10.20-0.02-0.20%) has a potential return of 31 per cent. All of the companies have sizable exploration activities.

The weakness in natural gas pricing, while difficult for producers, has a silver lining for anyone using the fuel. Enbridge cut Ontario gas prices earlier this month by 15 per cent. The annual saving on a typical residential bill will be about $60, according to an estimate by the company.

ANALYSIS: Plunging Natural Gas prices chill sector, Martin Mittelstaedt, October 6, 2010, The Globe and Mail.

 Prices of Natural gas are getting lower and lower due to poor demand and supply fundamentals, and many people think they will only get worse. The lower the prices get, the lower the energy workers are making, but homeowner's won't be too depressed. Many people invested in Natural Gas because of its incredible rises upwards in the past, but they think it may be too late or too early. The RBC Dominion Securities say that natural gas prices will be ample throughout 2011, but will falter in the end because of improving economic growth. The natural gas company Encana is also proving to almost weigh down on the prices because of its strategy to double its production volume per share over the next five years. The good news is, natural gas prices now are beneficial to anyone using the fuel.

Strands it relates to:

 This article relates a lot to "Factors influencing success in international markets" because supply and demand fundamentals are practically the basics of all businesses. If theres not enough demand for them, the prices will drop and its harder on the energy workers that get the natural gas. It also relates to "Challenges, Approaches, and Distribution" because not enough demand and too much supply is quite the challenge for the people that work to get natural gas but not those who will demand it. Also, even if it's not as common; if new energy workers were to begin working in a natural gas plant of some sort they wouldn't start of with good wages.

Thoughts and Opinions:

Natural Gas is something that most people at young ages pay less attention to. If the natural prices continue getting lower, eventually the company Encana will run out of resources to make the gas. This in turn will make other countries lose gas, and their businesses will be bankrupt. Maybe if we bought more fuel, it'll be in a high enough demand to get the prices higher again.                                                                                                        

Article # 2 STRAND: Business, Trade and the economy and Factors influencing success in international markets

China to host UN climate talks.

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Aljazeera.net (Oct 4, 2010)(615 words) 

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10/3/2010 5:44:47 AM
China is set to host its first UN climate conference but hopes are dim that the event will see the major breakthroughs that environmentalists are hoping to achieve.
Some 3,000 delegates will converge in the northern port city of Tianjin on Monday for the latest round of protracted negotiations aimed at securing a post-2012 treaty on tackling global warming.
China, the world's biggest emitter of greenhouse gases and blamed by many developing nations for derailing last year's Copenhagen talks, hopes to use the event to showcase its green credentials.
The Tianjin talks are aimed at building momentum and finding areas of agreement ahead of the annual summit of the 194-member UN Framework Convention on Climate Change (UNFCCC) in Cancun, Mexico, starting on November 29.
The final objective is a treaty aimed at curbing the greenhouse gases that scientists say cause global warming, which in turn could have catastrophic consequences on the world's climate system.
"Tianjin... is where governments will need to cut down the number of options they have on the table, identify what is achievable... and muster political compromises that will deliver what needs to be done in Cancun," Christiana Figueres, the UN climate chief, said.
Incremental progress
But even the most optimistic forecasts for the six days of talks foresee only incremental progress amid the continuing fallout from last year's failure in Copenhagen by world leaders to forge a legally binding, comprehensive deal.
"Our expectations are not very high, in the sense that we have not witnessed a willingness from governments to really move the negotiations forward," Wendel Trio, the climate policy director for Greenpeace International, told the AFP news agency.
Many are hoping the treaty will not face any hiccups and be sealed in South Africa a year later, in time to replace the Kyoto Protocol that expires at the end of 2012.
Analysts say China is doing so partly to demonstrate its commitment to the UN process and clean energy.
"We think this is a significant step showing that China wants to be an active participant and contributor to the negotiations," Barbara Finamore, the programme director of Natural Resources Defence Council China, said.
"It's probably trying to show it is... taking the lead in negotiations and [does not want to be] seen as obstructionist."
Sticking point
Nevertheless, China is expected to remain firm in Tianjin and beyond on many of the key disputes with the US and other developed nations that have led to the current gridlock.
One of the highly-sensitive issues is how much money developing countries will receive to help them deal with climate change.
In Copenhagen, developed nations pledged to give poor countries $30bn in initial funding from 2010 and 2012, rising to a total of $100bn annually by 2020.
Wen Jiabao, the Chinese premier, on a two-day visit to Greece said on Saturday both countries were exploring ways to save energy and cut greenhouse gases in commercial shipping.
"To modernise Piraeus, we have to make efforts to cut greenhouse gas emissions," he said in a statement during a visit to the premises of the Chinese shipping giant Cosco at the Greek port of Piraeus, near Athens.
Wen said he signed two agreements on economic co-operation in commercial shipping with George Papandreou, the Greek prime minister, to set up a "research centre devoted to the reduction of greenhouse gas emissions in the merchant navy".
"The merchant marine is an important sector of co-operation between the two countries because 60 per cent of crude oil is imported in China on Greek boats and 50 per cent of Chinese merchandise is transported on Greek boats," he added.
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Source Citation

"China to host UN climate talks." Aljazeera.net 4 Oct. 2010. Custom Newspapers. Web. 6 Oct. 2010.

ANALYSIS: China to host UN climate talks

Newswire, October 4, 2010, Provided by Syndigate.info an Albawaba.com company

To Contribute to the UN's plans to prevent global warming, China has stepped up to host the meeting where matters of the greenhouse gases contributing to global warming are going to be discussed. The meeting will take place in Tianjin, and the UN says that China has already shown to be a good contributor to the cause, despite being one of the biggest emitters of greenhouse gases. The new agreement will replace the Kyoto Protocol in South Africa before 2012 if agreed to, and the UN already had its doubts since many governments didn't side with the idea completely. It is also planned that Cophagen would give developing countries an initial $30 billion, and rising to a total of $100 billion by 2020. Tianjin will be the center of which everything will be set as concrete. China's shipping giant Cosco also signed an agreement to decrease greenhouse gas emissions with the Greek Prime Minister George Papandreou, since China and Greek ship to each other more so then other countries.

Strands it relates to:

This Article relates to "Business, Trade and the Economy" because adjustments need to be made to China's methods of exporting goods to countries like Greece which may also affect its economy. Other ways this strand relates is that money will be given to developing countries in order to help them get accustomed to the climate change process. It also relates to "Factors influencing success in global markets" because the weather is an important factor when it comes to shipping and transporting goods. The weather changing too drastically will affect things like transportation, and scientists believe global warning can bring catastrophic events. Lastly, it largely relates to the Global Environment for business because if greenhouse gases aren't decreased, global warming will happen. If it does happen, business can decline greatly in places that rely on the weather to work, like China.

Thoughts and Opinions

Personally, I agree with UN's decision with making a new "back-up" agreement to decrease greenhouse gases with China. This is partly because according to the article, China is one of the biggest emitters of the gases in the first place. If China keeps taking steps at decreasing the amount of pollution they release with shipping and such, it'll really help keep global warming from happening. Also if China does it, other countries might follow, and efforts will not be in vain. It just seems like a better world to do business in if the condition of it stays healthy.

Article # 1 (Revised) STRAND: Factors influencing Success in International Markets and Business, Trade and the Economy

A worldly ad approach

MARINA STRAUSS

From Friday's Globe and Mail (includes clarification)

Published Thursday, Sep. 23, 2010 7:26PM EDT

Last updated Tuesday, Sep. 28, 2010 4:01PM EDT

It was a well-intentioned stab at marketing to ethnic customers. To mark the Muslim holy month of Ramadan, Loblaw Cos. Ltd.(L-T41.200.110.27%) commissioned television spots for its No Frills supermarket chain on multicultural television, touting specialties such as halal chicken and ground beef.

But something was off. The voice-over in the No Frills commercial was in Punjabi. But the Bollywood movie during which it aired was in Hindi.

“It’s the equivalent of running an English ad on French television,” says Gavin Barrett, creative director of multicultural marketing firm Rao, Barrett and Welsh, who noticed the gaffe when it appeared on OMNI Television.

Welcome to the latest minefield for marketers – one that they must get right. By 2031, one in three Canadians will belong to a visible minority group, and one in four will be foreign-born, according toStatistics Canada. Retailers have been slow to cash in on the massive change in Canadian demographics. Now, they are racing to serve the burgeoning market of new Canadians, stocking everything from kecap manis and okra in their grocery aisles to darker shades of makeup foundations at their cosmetic counters. But they are still struggling with how to advertise and promote their new products. They suffer from language slip-ups or bland, predictable ads that simply trumpet savings to budget-conscious multicultural consumers, without trying to grab their attention with flair and humour.

“A lot of clients prefer the safer option,” says David Innis, partner in Fat Free Communications, which specializes in marketing to Canadians of South Asian descent. “They indulge in, basically, tokenism… They’re scared about offending and saying the wrong thing.”

Loblaw spokesman Bob Chant says the company was unaware of the inappropriate language use in the recent No Frills commercial, and had planned for a Hindi version of it to run with the Hindi movie.

Despite the hiccups, some retailers – including Loblaw – have raised the stakes with cheeky or unusual marketing to lure multicultural shoppers. Home Depot has taken the initiative of running workshops for Asian consumers in their own languages, helping them learn about do-it-yourself chores which, in their homelands, they didn’t need to do because they could hire cheap labour.

For merchants, the need to respond to changed demographic shifts is an urgent one. “Every retailer needs to address this issue quickly,” Perry Caicco, retail analyst at CIBC, said in a report last week. Over the next decade, about 70 per cent of the growth in Canadian consumer spending will come from visible minorities, especially those from Asia, he says. Retailers also face the challenge of competing with savvy ethnic stores here. “Ethnic grocers may now be as big and powerful as Wal-Mart,” he says, referring to the discount titan.

Retailers have begun to acknowledge the need to chase multicultural customers. About a year ago, Loblaw acquired T&T, a top Asian supermarket chain based in Vancouver, and is now borrowing from the T&T playbook for its mainstream store shelves. Loblaw recently started to carry Japanese-style mochi rice balls, Stassen pure jasmine green tea and Silver Swan soy sauce, a Filipino favourite. “It is for me a huge opportunity,” Loblaw president Allan Leighton told a retail conference this week. “We have to be the No. 1 player in ethnic. Everything we’re doing is very much focused on this particular opportunity.”

At Shoppers Drug Mart Corp. (SC-T39.15-0.22-0.56%), “we have not been successful in driving our ethnic mix,” Jurgen Schreiber, chief executive officer of the country’s largest drug-store chain, says. This year that’s beginning to change as Shoppers moves to central purchasing of multicultural inventory for about 10 per cent of its stores in distinct ethnic neighbourhoods. Products include basmati rice and eyelash enhancers (popular among Asians at Vancouver stores), although marketing to new Canadians is limited to in-store signs, spokeswoman Tammy Smitham says.

Amid the challenges, a few retailers are working at piquing consumers’ interests in different ways. Loblaw last year used a clever play on words in an ad to promote Indian foods eaten during the Vaisakhi harvest festival. “Vaisakhi is coming,” the ad asserts. “So is every Tom, Daljit and Hari.”

South Asians connect emotionally with the message because they gather in large numbers to feast during Vaisakhi celebrations, says Mr. Innis, whose firm produced the ad for Loblaw. “The solution is really simple: advertisers should apply the same criteria to multicultural advertising as they do to mainstream work.”

Wal-Mart Canada turned to real people to try to reach out to new Canadians in television ads a few years ago. The spots showed South Asian and Chinese families talking about settling into their new life in this country. One man explained how he felt to see snow for the first time – like stars falling from heaven – and shopping for coats, gloves and toques at the discounter. “They let him speak his mind,” says Ramesh Nilakantan, a former executive with ad agency Publicis, which did Wal-Mart’s advertising. “It wasn’t scripted. When you’re a new Canadian, you’re not familiar with what to buy.” And you don’t necessarily want to spend a pile of money.

Others are trying to go beyond advertising to entice the ethnic consumer. Home Depot (HD-N31.74----%) this year has drawn overflow crowds when it held workshops at its stores in Cantonese (in Richmond, B.C.) and in Hindi and Punjabi (in Brampton, Ont.) Store staff advised on how to paint a room for $99 and other simple do-it-yourself tasks.

“You’re moving them from a do-it-for-me culture to a do-it-yourself culture,” says Mr. Nilakantan, who was on the team that helped develop Home Depot’s multicultural workshop strategy. “You’re talking to a person who can’t even put a nail in the wall… Drywall, for instance, doesn’t exist in India. All the walls are cement.”

Still, the challenges for marketers remain immense. In India alone, for example, there are 21 languages, 2,000 dialects and seven religions, Mr. Nilakantan says. Some people are vegetarians, others don’t eat pork and still others don’t eat beef. Is it any surprise that Loblaw was caught with the wrong language in its No Frills ad?

Yet getting it right can generate a big payoff. New Canadians can be extremely loyal to brands. “When they come here as new Canadians, they’re extremely vulnerable,” he says. “Anybody who reaches out to them at that stage is somebody whom they will value. That’s the opportunity for marketers to reach out to them in the early days. In almost all cases , they will stay with you for life.”

ANALYSIS: A worldly ad approach

Marina Strauss, September 23, 2010, The Globe and Mail

This article is about the common misconceptions that occur when business owners of one part of the world try to promote other business owners from another part of the world. Ramadan had come around, and the grocery shop NoFrills made a commercial to endorse halal meats. The problem with this that the voice-over that was added in was in a Punjabi accent, and when it aired in a Bollywood film again it was in Hindi. Although this is hardly a rare occurance, mistakes happen when the North American culture tries to broaden its horizons and reach out to the other ethnic groups that live in the community, like muslims. Despite this, other business like Loblaws use creative tactics to attract other ethnic groups, like the "Tom, Daljit and Hari" line shown in the article. Some stores like Shoppers Drugmart find it difficult to appear to other cultures because they didn't think of purchasing goods from over seas before. They do now, thus succeeding in attracting many asian customers with products like eyelash enhancers, which are popular in Vancouver markets as well.

What strand does this Article relate to?

This Article relates to the "Factors influencing success in International Markets" and "Business, Trade, and the economy". It relates to the third strand because importing goods from other countries plays a big part in international success. The more you buy from other countries, the better your relationship with them becomes. Also, the more foreign goods you have, the more ethnic groups you'll lure. It relates to the first strand too because the article is about business over all- getting the foreign goods and appealing to a variety of cultures. It also increases relationship with other countries and allows local businesses to grow.

Thoughts and Opinions

I found this article a little amusing, because I've seen many ads on television commit the same act of misconception of speaking a certain culture's language. There was a shampoo ad with an Indian woman promoting it, and they awkwardly voiced over her real voice with an Australian woman's. I found it very weird and unnecessary, why do commercial producers do that? Not only would the commercial be more effective if the Indian woman was speaking with a Hindi or Punjabi accent, but it wouldn't look stupid either. Voice-overs are risky!