The Macau Metro Monitor, March 16th, 2010


In his Policy Address, Macau CEO Fernando Chui Sai-on did not announce any cap on the numbers of tables, slot-machines or casinos. The government also reaffirmed its intention to raise the minimum age to 21 for entering in casinos, but gave no date for the introduction of the measure. As expected, Chui believed Macau should diversify its economy and support the growth of its MICE (Meeting, incentive, convention and exhibtion) business. He stressed regional cooperation among Guangdong, Hong Kong, and Taiwan. Chui reaffirmed the government’s target of creating more public housing by building 19,000 units and stressed the importance of the construction of public infrastructures like the new hospital in Cotai and the light railway system. Chui did not say anything about wage increases.


"Apart from those we have agreed in principle in the past, in construction and those already approved, we will regulate (approval of the building of new casinos) in the future," Chui said at a news conference on Tuesday. Chui also said the government planned to set up a regulatory body to monitor the growth of the gambling industry.



The Monetary Authority of Macau released data showing a 6.2% increase in new mortgages approved QoQ to MOP 6.6BN . The number of new commercial real estate loans (CRELs) approved dramatically increased by 88% from the previous quarter to MOP6.3BN. The delinquency ratio for RMLs (residential mortgage loans) fell 0.04% to 0.19%, while the delinquency ratio for CRELs dropped 0.10% since end-September 2009 to 0.23%.


The number of visitor arrivals in package tours increased 9.7% YoY to 458,920 in January 2010. Visitors from Mainland China (328,956) rose by 5.1% YoY. Meanwhile, the number of Macau residents traveling outbound in package tours dropped 4.5% year-on-year to 28,471, with mainland China being the most popular destination. At the end of January 2010, the total number of available guest rooms increased by 1,548 (+8.8%) YoY to 19,086 rooms. A total of 664,403 guests checked into hotels and guest-houses in January 2010, up by 26.6% YoY. The average occupancy rate of the hotels and guest-houses soared by 16.0% year YoY to 81.6%.


On the surface the S&P 500 looked like it had a good day, finishing mixed on Monday after spending the bulk of the day in negative territory.  The internals of the market were decidedly negative with volume down 11.6% day-over-day and the advance-decline line turning negative at -506, down 788 on the day.   


The news flow from global MACRO was a headwind yesterday, especially the news from China and Greece.  There were also some concerns surrounding comments from Moody's that both the US and UK have moved "substantially" closer to losing their AAA credit ratings, though note that CDS on US and UK government bonds were little changed.  As we have said many times, the ratings agencies are a lagging indicator. 


On the MACRO calendar in the US, industrial production rose a better-than-expected 0.1% in February, with a positive take away from the ability of production to increase last month despite the weather.  On the negative side, the only real disappointment seemed to be the NAHB Housing Market Index, which fell to 15 in March from 17 in February.


Yesterday, the SAFETY trade outperformed, while pockets of the market with outsized leverage to the RECOVERY trade underperformed today.  Notable decliners included Energy (XLE), Consumer Discretionary (XLY), Materials (XLB) and Industrials (XLI) was flat on the day. 


The bounce in the dollar was the big headwind too, with the move largely fueled by heightened tightening concerns surrounding China; the Dollar index was up 0.52%.  The Hedgeye Risk Management models have levels for the Dollar Index (DXY) at:  buy Trade (79.83) and sell Trade (80.79).


Yesterday, there was a lot of noise surrounding the regulatory uncertainty in the financial services and healthcare sectors.  Facilities names and Pharma posted modest gains today; managed care was a laggard with the HMO +0.2%, though the group did finish in positive territory.  There were several reports noting that Democrats currently lack the votes to pass the Senate's healthcare reform bill in the House.


Within Financials (XLF), the banking group was a slight outperformer yesterday with the BKX up 0.2%; however, investment banks along with money-center names were among the laggards yesterday.  The underperformance was attributed to the inclusion of the Volcker Rule in Senator Dodd's financial market reform bill released today.  


After lagging the broader market over the last few weeks, the consumer staples sector was the best performer yesterday.  In the Hedgeye sector models yesterday, outperformance over the immediate term put the XLP in an overbought position, so we shorted it.  Yesterday, WMT was one of the standouts on the back of an upgrade at Citi.  


One of the bigger tailwinds for the market seemed to be the continued pickup in M&A activity, with some high-profile deals yesterday in the apparel and E&P spaces.


Volatility improved 2.39% on Friday, while the VIX continues to be broken on TRADE, TREND and TAIL.  The Hedgeye Risk Management models have levels for the volatility Index (VIX) at:  buy Trade (17.15) and sell Trade (19.04). 


As we wake up today, equity futures are trading mixed to fair value ahead of today's FOMC rate decision and in the wake of yesterday's performance which saw markets eventually close flat having spent most of the day in the red. The focus of the FOMC meeting will be on any hints as to when the Fed might choose to lift rates.  As we look at today’s set up, the range for the S&P 500 is 22 points or 0.9% (1,139) downside and 1% (1,161) upside.


Today's MACRO highlights will be:

  • US Import Price Index
  • US Housing Starts (February) consensus 570K
  • US Building Permits (February) consensus 601K
  • ABC Consumer Confidence

In early trading, copper is trading higher as the dollar is trading lower.  The Hedgeye Risk Management Quant models have the following levels for COPPER – Buy Trade (3.24) and Sell Trade (3.45).


According to Bloomberg, gold rose for a second day in London as “investors sought a haven before the U.S. Federal Reserve’s interest rate decision and amid speculation about financial aid to Greece.” The Hedgeye Risk Management models have the following levels for GOLD – Buy Trade (1,094) and Sell Trade (1,122).


Also on Bloomberg today - “Saudi Arabia, the biggest and most influential member of the Organization of Petroleum Exporting Countries, said oil prices are in the right range and there’s no need to change production policy.”  Crude oil is trading slightly higher in early trading.  The Hedgeye Risk Management models have the following levels for OIL – Buy Trade (78.41) and Sell Trade (82.99).


Howard Penney

Managing Director














Blaze Of Perceived Glory

“I don’t know where I’m going

Only God knows where I’ve been”

-Jon Bon Jovi


While I doubt the 48-year-old rocker from debt laden New Jersey needs an introduction, it’s worth calling out that the aforementioned lyrics came from Bon Jovi’s #1 single back in 1990, shortly after 1987’s levered up Wall Street crash.


“Blaze of Glory” was also Jon Bon Jovi’s first solo album. Per our friends at Wikipedia, “the album mainly focuses on the theme of redemption and whether an individual's past wrongs will catch up with them.” How appropriate a metaphor for Debtor Nations as we tip-toe through the Ides of March 2010.


With short term stock market moves cheering them on around the world this morning, politicians from Greece to California will be headlining the Manic Media’s show again today. These are the wanna-be-rockers of their own political  futures. These are the high priests of all that beneficed this leverage crisis. These are the willfully blind saviors of reform.


Maybe the only thing worse than 545 people in US Congress deciding our children’s economic fate is piling 27 Finance Ministers from the European Union into rooms in Brussels to do the same. European stock markets are trading higher across the board this morning after Luxembourg’s Prime Minister Jean-Claude Juncker proclaimed Europe’s mystery of faith:


“We clarified the technical arrangements that would enable us to take coordinated action which could be swiftly put into place in the event it is necessary…”


Then like a phoenix rising from the ashes of a construction project in Qatar, the Central Bank Governor of the United Arab Emirates Sultan bin Nassar al-Suwaidi proclaimed this about Dubai World’s $26 Billion in debt and whether they’ll be needing a bailout:


““They haven’t discussed this issue with us and I don’t think it will be necessary…”




Each night I go to bed

I pray the Lord my soul to keep

No, I ain’t looking for forgiveness

But before I’m six feet deep”


Yeah! Hit it! “Take us now, but know the truth.”


With consensus clamoring to call China bubbles, the last of the global bubbles that remains is that in global politics and the Piling of debt, Upon Debt, Upon Debt. Knowingly or not, these politicians are going to take us down with a “Blaze of Glory”.


According to Dealogic, sovereign bond issuance in developing markets is currently amassed to $129 Billion in 2010 to-date. Never mind 2009 being the prior record in Global Debt Piled Upon Debt folks. This level of debt issuance is already running up +42%  year-over-year versus that.




Greece has another $20 Billion Euros that they’ll need to raise by May. So this debt issuance party is just getting started. Just this morning, The Financial Times is reporting from the Brussels meetings that these 27 Euro dudes seem to be contemplating another $25B Euro credit facility out of thin air to make sure the volume at this Greek leverage party stays right jacked up.




All the while, the Chinese are selling Treasury debt to the masses of people who are punch drunk at this global debt rock concert. Just plow it into whoever’s 401k that will take it as the Chinese sell it right back down our Congressional wind pipe.

China selling? Oh, no – they’d never do that, would they? I’ve said this enough times to be as annoying as Chris Dodd telling you he has it figured out this time, but please, for the sake of sobriety – please watch what the Chinese do versus what they say.


China was a net seller of US Treasuries for the 3rd consecutive month in January, selling another $5.8B net and taking its balance of America’s debt holdings down to $889 Billion.


That’s another $889 Billion reasons to ignore the reality that you can just “take me now but know the truth.” If we anger The Client (China) enough, rates are going a lot higher than your “exceptional and extended” Congressman’s sense of self is telling you.


“Call me a young gun” if you will, but I am telling you that this “boy will be happy to die like a man” taking a stand on sovereign debt, as those addicted to leverage go down in their Blaze of Perceived Glory.


We’ll be hosting a conference call on Sovereign Debt on Friday. Please email if you’d like to listen in. My immediate term support and resistance lines for the SP500 are now 1139 and 1161, respectively.


Best of luck out there today,






USO – United States Oil — Despite a sharp correction in oil prices on 3/15/10, the price of WTIC oil remains in a bullish intermediate term position with TREND line support at $77.39/barrel. Buying on red.  


CAF – Morgan Stanley A Share — Now that all of the inflation data we have been calling for is on the tape, China's stock market looks like it wants to tell us the news is now baked into the expectations cake. Buying China low.


XLV – SPDR Healthcare — Healthcare was down again on 3/9/10 in the face of “Obamacare” inspired fear. While we fear we may be early here, it’s better than fearing fear itself.


UUP – PowerShares US Dollar Index Fund — We bought the USD Fund on 1/4/10 as an explicit way to represent our Q1 2010 Macro Theme that we have labeled Buck Breakout (we were bearish on the USD in ’09).

CYB - WisdomTree Dreyfus Chinese Yuan — The Yuan is a managed floating currency that trades inside a 0.5% band around the official PBOC mark versus a FX basket. Not quite pegged, not truly floating; the speculative interest in the Yuan/USD forward market has increased dramatically in recent years. We trade the ETN CYB to take exposure to this managed currency in a managed economy hoping to manage our risk as the stimulus led recovery in China dominates global trade.

TIP - iShares TIPS — The iShares etf, TIP, which is 90% invested in the inflation protected sector of the US Treasury Market currently offers a compelling yield. We believe that future inflation expectations are mispriced and that TIPS are a efficient way to own yield on an inflation protected basis.



XLP – SPDR Consumer StaplesConsumer Staples was the best performing sector on 3/15/10 in our S&P Sector Model and was immediate term overbought.


SPY – SPDR S&P500We moved to neutral (from bearish) on the S&P500 on the week of February 22. At 1139, for the immediate term TRADE, we’ll go back to bearish. This market is finally overbought. We shorted SPY on 3/5/10.


EWP – iShares SpainThe etf bounced on 3/3/10 in part from a strong day from Banco Santander, the fund’s largest holding in the Financials-heavy (43.8%) etf. We shorted Spain for a TRADE again on 3/5 as every sovereign debt risk has a time and price to be short of. We have a bearish bias on the country; massive unemployment, public and private debt leverage, and a failed housing market remain fundamental concerns.


IWM – iShares Russell 2000With the Russell 2000 finally overbought from an immediate term TRADE perspective on 3/1/10 and added to it on 3/2; we got the entry price that the risk manager makes a sale on strength.


GLD – SPDR Gold We re-shorted Gold on this dead cat bounce on 2/11/10. We remain bullish on a Buck Breakout and bearish on Gold for Q1 of 2010, as a result.


IEF – iShares 7-10 Year TreasuryOne of our Macro Themes for Q1 of 2010 is "Rate Run-up". Our bearish view on US Treasuries is implied.

The Macro Mixer: A Notable Divergence

In the first two weeks of March the S&P 500 has rose +4%.  Given this, many are waking up today to feeling that all recent short ideas are really bad and all recent long ideas are really great. 


Last week the dollar was down 0.74% and stocks were up 0.99%.  That makes some sense, but none of the sectors most leveraged to the REFLATION trade outperformed the S&P 500.  What may not make sense was that commodities were down last week.  The CRB index was down 1.1%, gold was down 2.9% and copper was down 1.1%.  So the scenario of stocks up, dollar down, and commodities down presented an interesting divergence.


The question we asked ourselves during our morning meeting was, “Are commodities, and gold in particular, anticipating an interest rate hike?” 


In the face of bond yields going up, commodities –gold and copper especially - went down.   As we have expounded upon at length, we believe the fed’s departure from the language of “extended and exceptional” will push yields up.  As the cost of capital goes higher, it is implied that the prices of the most speculative commodities come under pressure. 


Coming into this week, our Hedgeye models are running bullish with 9 of 9 sectors positive on TRADE and 8 of 9 sectors positive on TREND.  On Friday, the sector study was bearish with 5 of 9 sectors declining on the day.  The one sector that is not positive on intermediate term TREND is Utilities (XLU).  We see issues with XLU; gold and commodities going down are a signal the interest rates are going up.  XLU is a surrogate for yield chasers. 


With commodities under pressure and the dollar in a bullish formation - positive on TRADE, TREND and TAIL - it’s not surprising that Materials (XLB) and Energy (XLE) underperformed last week and year-to-date.  


The best performing sectors are the ones most levered to the inventory build in the US economy, the consumer propensity to spend, and the “Piggy Banker Spread”: Consumer Discretionary (XLY), Financials (XLF) and Industrials (XLI). 


We pick our spots carefully, but right now the only sector we are long is Healthcare (XLV).  In the Hedgeye Healthcare First Look Tom Tobin commented that “These are strange days for Health Reform.  This week should spell the end of the process and everyone is expressing confidence that they will be vindicated.  Not everyone can be telling the truth, however.  The Intrade quote started spiking on Friday.  Somebody knows something.” 


With the XLV up on a down day, we are happy to be long! You don’t have to be bullish on the market to be bullish on certain sectors or stocks.


Howard Penney

Managing Director


The Macro Mixer: A Notable Divergence - xlv


Domestic Pigs (Continued)...

One of the great advantages of being in my seat now versus the one I sat in while I was on the buy-side is that I have the opportunity to position myself at the hub of an exclusive research network – our own.


Many buy-side analysts and portfolio managers often share their research findings/anecdotes with our team real-time. Given that we don’t have a prop desk or run our own fund on the other side of client trades, I tend to get better information than I used to get.


Here’s a great note from one of Boston’s star senior buy-side analysts about how state finance really works.

Thanks again for all of your research contributions. We appreciate every one of them.




Unedited –




I have been looking at a house in Boston suburb, but realized that close to 1 acre of the 1.3 acres is on wetlands or restricted land.  So I went to town hall and had a # of eye opening discussions.   


First I went to Conservation and learned that the assessed value was already using a 5% discount b/c of the restrictions on the land, so I wouldn’t be able to get a tax break.    Then I went to the people that do assessments, and confirmed the assessed value of the house is $1.15 mm, while the asking price for the house is $850k.  (only 1 house in this town has ever sold for more than $1 mm).   This house has been on the market for 4-weeks with no bids.  I asked how soon I could get the assessed value lowered for tax purposes if I paid 25% less than assessed value.  I learned an interesting thing.  She said “the sale prices is not necessarily a good indicator of fair value”.  I said “really, what is a better indicator of fair value?”   She wasn’t sure, but said sometime people are forced to sell.  I asked if there were ever times when sale prices were higher than fair b/c of a price bubble caused by low interest rates.  She looked cross eyed.  I knew I’d gone too far. 


I conceded her argument and asked when could we evaluate the assessed value.  Evidently the assessed value is calculated once per  year and is based on comparable home sales 2 years ago.  The tax payments are made monthly, so the payments in for the Sept and Dec qtr are based on theoretical value – which they calculate by increasing the previous run rate 2%.  I asked – so basically you assume home values go up ever year.  She said “yes, but we don’t want to pass the whole increase through right away, so that’s why we only apply a 2% increase.”  I then said – “so you assume home values go up more than 2% every year”…. She agreed.


I went to tax collectors department and got the tax payments the house has made in the last 2 yrs.  I said, “If I buy this house for 25% less than the assessed value, don’t you think I’ll be paying lower taxes in a few years?”   She said, “no, probably not, because if the value were to actually fall, they’d just have to increase the tax rate because the town’s budget is dependent on those tax dollars.”


I couldn’t believe it.  I know I wasn’t dealing with the most educated people – but the assumption is still prices go up every year.  What is going to happen in 2 years when we are using comps that show falling market values?   Many states are already insolvent and it is only going to get worse, or they jack up tax rates and those overlevered families get squeezed out.  Am I missing something??? I know the market can rise and fall 80% a number of times in the next few years, but with this secular challenge…. How do we not keep moving lower?



R3: Revisions Revisited


March 15, 2010


The earnings season is now pretty much over and the better than expected results were met with a sizeable move to the upside for the retail sector. So after a major “sell the news” day that came with better than expected same store sales in early February, we’ve seen the opposite reaction just one month later. So what gives?





The earnings season is now pretty much over and the better than expected results were met with a sizeable move to the upside for the retail sector. So after a major “sell the news” day that came with better than expected same store sales in early February, we’ve seen the opposite reaction just one month later. So what gives? Now good news is actually good news for a change. Perhaps it’s the group’s high short interest or the reality that there is still a quarter or two of easy compares. Earnings appear to be heading higher, at least for the first half of the year. Whatever the reason is, after a brief pause, the earnings revision factor appears to be on the upswing.


However, reality is also setting in and the consensus earnings growth rate for the next twelve months is now just 19% (down from 27% when we last ran the numbers on February 8th. and now being measured off of a much higher base which includes 4Q09). Everyone knows comparisons are tough on many fronts in the back half, but it now appears this reality is finally being incorporated into guidance and expectations. Commensurate with the drop in expected growth is a slight reduction in the group’s forward multiple, which now hovers around a 19x P/E- a full point lower than our last reading. While it may be a subtle change, especially against a strong tape for retail, it’s becoming more clear that sustaining peak growth and peak margins is becoming a more difficult task.


R3: Revisions Revisited - NTM and Consensus Chart short term


R3: Revisions Revisited - 90 Day chart short term


R3: Revisions Revisited - Valuation Table


Eric Levine





  • Good news. Target’s collaboration with Liberty of London appears to be a huge success, even before the national rollout begins today. The company’s pop-up store in Bryant Park, NYC was so successful it ended up closing almost a full day early after selling out. The buzz online is also widespread, with bloggers and fashionistas declaring this the best designer collaboration the company has done in years. 
  • In an effort to drive customer traffic and meet the demands of consumers seeking value, Ann Taylor has taken dramatic cuts to its initial retail pricing. Across the board, average initial retails are down 15% year over year. Pants and sweaters are two categories that received the biggest pricing adjustments, while suiting and accessories remain unchanged. 
  • Hibbett’s noted that it had 96 real estate deals agreed upon by landlords in 2009, but only 42 stores actually came to fruition. The remaining stores that did not move forward were the result of developers and landlords that were unable to secure loans or get their projects built. Despite the difficulties in getting new stores opened, Hibbett’s remains committed to accelerating store opening growth beyond the 3-4% current run-rate when the environment allows. 




Hanesbrands Focuses on Innerwear Growth Initiatives - After declines in annual profits and sales, Hanesbrands Inc. wants to leverage its brand muscle in the innerwear sector. The apparel giant has set a goal of growing through international expansion in countries such as China, India, Brazil and Japan, acquiring a midsized company with annual volume of $200 million and tapping several retail partnerships, including a multiyear contract with Wal-Mart Stores Inc. to be the sole supplier of plus-size women’s apparel and select innerwear through the Just My Size brand. The deal is projected to generate sales of $50 million to $75 million this year. Hanesbrands, which spun off from Sara Lee Corp. in September 2006, is seeking to generate annual net sales growth of 2 to 4 percent and yearly earnings per share gains of between 10 and 20 percent over the next several years. In fiscal 2009, the Winston-Salem, N.C.-based company reported profits of $51.3 million, or 54 cents a share, compared with $127 million, or $1.34 a share, in the previous year. Revenue fell 8.4 percent to $3.89 billion. The company in January reported a fourth-quarter loss of $1.1 million. In an industry that’s been transformed by consolidation for almost two decades, Hanesbrands retains a powerful portfolio that includes Hanes, Champion, Playtex, Bali, Wonderbra and L’eggs. The innerwear unit, which consists of intimate apparel, men’s underwear and socks, generated wholesale sales $1.83 billion in 2009.  <>


Phillips-Van Heusen Said to Be Close to Hilfiger Deal - Phillips-Van Heusen Corp. may reach an agreement to buy apparel maker Tommy Hilfiger from Apax Partners LLP for about 2.2 billion euros ($3 billion), according to a person briefed on the discussions. A cash-and-stock deal may be announced as soon as today, the person said. The talks were reported yesterday by the New York Times. Apax, the London-based private-equity firm, bought Tommy Hilfiger in 2006 for about $1.6 billion. A purchase would add Tommy Hilfiger, which introduced its first menswear collection in 1985, to Phillips-Van Heusen clothing lines that include Calvin Klein and Izod. Phillips-Van Heusen is seeking brands that can grow globally and boost profitability, Chairman and Chief Executive Officer Emanuel Chirico said last week at a Bank of America Merrill Lynch investor conference. He declined to identify potential targets. “What is key to us is a strong brand that has enormous growth potential in North America and around the world,” Chirico said at the March 11 conference. “Any acquisition we do would be accretive to margins in the first full year.” <>


VF Corp. to Open Panama Sourcing Office - VF Corp. will establish a supply chain office to manage purchasing in the Latin America region in Panama City, Panama by October, The Business Journal of the Triad Area reported. The news indicates a growing committment to manufacturing and sourcing operations in the Western Hemisphere at a time when many apparel makers are looking for closer-to-home sourcing alternatives to Asia and particularly mainland China. VF's Outdoor Coaltion already sources much of its fleece from Central America. VF Corp. told The Business Journal it will also be relocating an office currently in Plantation, Fla. VF Corp. expects to eliminate up to 20 positions at its Greensboro, NC headquarters as part of the changes with some of those employees being offered the opportunity to relocate to Panama. <>


Cartier Launching E-Commerce in U.S. - Cartier is launching e-commerce in the U.S. today, a key initiative in the fine jewelry and watch industry, which until recently has been wary of the virtual marketplace. Emmanuel Perrin, Cartier North America president and chief executive officer, said the demand for online selling is too great to ignore. Branded fine jewelry and watches are fairly new to the buying on the Internet, partly because a lot of the merchandise sold online in the U.S. involves counterfeit, diverted or gray goods offered at lower prices. However, advanced technology — Tag Heuer, for example, has created a special hologram to denote an authorized e-tailer — has enabled more brands to get in on the act. In recent years, De Beers, Bulgari, Harry Winston and Boucheron began selling jewelry and watches on their Web sites. Cartier launched e-commerce in Japan in 2008. Last year, Cartier tested a “call-to-purchase” service on, which was a step on the road to an e-commerce presence. Perrin predicted will be one of the firm’s top five producing stores in the U.S. by 2012. The Web site offers styles from the firm’s multiple categories including jewelry and timepieces. High jewelry, corrective eyewear and engagement rings are not being sold online. The Web site offers accessories and fragrances with retail prices starting at $80 for a business card holder and ranging to as much as $16,000 for a piece of jewelry or a watch. The broad assortment of Cartier’s iconic Love, Trinity, Santos and Tank collections also will be sold.  <>


Nike Brand Awareness Pushing 99% for Athletic Footwear Buyers - Even before the most recent Olympic Winter Games gave it yet more lift in the market place, the Nike brand was recognized by nearly 99% of all respondents to a recent survey conducted by The SportsOneSource Group as a component of its annual Brand Strength Report. Brand awareness was 98.8% among the consolidated respondent pool aged 13 years old and up that had purchased athletic footwear or apparel over the past year.  Somewhat surprisingly, the awareness level for female respondents was slightly higher than the male group, topping out at 99.1% awareness.  Adidas was second in brand awareness at 95.2% and Reebok/RBK brand awareness stood at 93.2%.  Converse (87.6%) and Puma (86.1%) rounded out the top 5. The brand awareness responses in the survey, which was conducted in late 2009, are a key component in the firm’s annual Brand Strength Report and the formulation of the Brand Strength Index.  The Brand Strength Index was formulated in early 2009 by The SportsOneSource Group in an effort to more effectively measure the overall consumer perception of a specific brand.  Each brand measured was tested across four main criteria, with those criteria each individually weighted to reflect their importance in the overall indexing formula.  <>


Even without sites customized for foreign markets, global sales are rising - Few U.S. retailers offer web experiences tailored to consumers in foreign countries, but many nonetheless are reaping online sales from abroad. 14.5% of the 75.2% of merchants selling internationally, which includes Canada, report that in 2009 more than 25% of their total web sales came from customers outside the United States, according to Internet Retailer’s new international e-commerce survey of 247 web-only retailers, chain retailers, catalogers and consumer brand manufacturers. 4.8% report 21% to 25% of sales came from outside the borders of the country, 7.0% report 16% to 20%, and 5.9% report 11% to 15%, the survey finds. 9.1% say 8% to 10% of 2009 sales were derived from international shoppers, 12.4% report 5% to 7%, 18.3% say 2% to 4%, and 28.0% report less than 2%. Of the 24.8% not selling internationally, 60.3% are assessing the viability of selling to consumers outside of the United States; and, of those merchants, 70.3% plan to start selling internationally within a year. According to the survey, however, only 18.6% of U.S. merchants offer a currency converter, 15.4% show the fully landed cost of delivering an item to the consumer’s door in local currency, 15.4% offer product content in a local language, 15.0% feature customer service content in a local language, and 14.2% offer telephone support in a local language. <>


E-retailers make gains in multiple customer service channels, study finds - Online retailers posted gains in just about every area of customer service—from e-mail to self-service to contact center—according to a test by eGain Communications Corp., a provider of customer service software. Analysts conduct the test annually by “mystery shopping” the web self-service and contact center customer service at 175 companies spread across eight industries—financial services, retail, communications, consumer goods manufacturing, insurance, health care and pharmaceuticals—in the U.S. and Canada. Online retail’s overall service score was 2.3, up from 1.8 a year earlier. The average score across all industries was 1.8. eGain considers scores less than 1.0 poor; less than 2.0 below average; less than 3.0 above average; and 3.0 or better exceptional. “Retail sector performance was a bright spot in this year’s ‘mystery shopping’ customer service research,” says Anand Subramaniam, eGain vice president of marketing. “However, channel silos still remain across knowledge, policy and process.” Following are online retail’s customer service scores in each evaluated category, along with the previous year’s score:

  • E-mail: 3.0, up from 2.5
  • Self-service: 2.4, up from 1.9
  • Choice: 2.3, up from 2.0
  • Cross-channel: 1.9, up from 0.9
  • Cross-agent: 1.9, down from 2.0
  • Telephone: 2.7, n/a



Americans Say Jobs Top Problem Now, Deficit in Future - Unemployment now stands alone as the top issue in Gallup's latest update on the most important problem facing the country. Thirty-one percent of Americans mention jobs or unemployment, significantly more than say the economy in general (24%), healthcare (20%), or dissatisfaction with government (10%).

R3: Revisions Revisited - G1
This month, unemployment overtook general mentions of the economy, as the percentage naming unemployment held steady at 31% while the mentions of the economy dipped from 31% to 24%. Unemployment, the economy, and healthcare have been the top three cited problems each month since last May.

R3: Revisions Revisited - G2
The economy had ranked No. 1 in Gallup's monthly most important problem measure since February 2008, when it overtook the Iraq war. The war in Iraq had been the top issue (or tied for the top) each month since April 2004. Thus, unemployment's position at the top of the list marks the first time in six years that something other than Iraq or the economy in general has led Americans' list of national concerns. More broadly, the economy's struggles are apparent, as 66% of Americans mention some economic issue as the nation's most important problem. At least half of Americans have done so each month since March 2008. <

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