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Jacob Cooke on Apple, Adidas & Barbie in China

Published on: August 14, 2023

In this week’s episode of The Negotiation’s After Hours, WPIC co-founder and CEO Jacob Cooke speaks to Todd Embley about Apple’s performance in China and the reception of the Barbie movie.

Check out the discussion above. You can also read the edited transcript below.

Todd Embley:
Hey everyone, I’m Todd Embley and welcome to another edition of The Negotiation After Hours, our new video series, where we speak to WPIC Marketing + Technologies, co-founder and CEO, Jacob Cooke, recapping and diving into the latest top consumer tech business stories from China and other APAC markets.

Jacob joins us from the WPIC Vancouver head offices today.

Jacob, welcome.

Jacob Cooke:
Thanks, Todd.

Todd Embley:
Okay, two headliners to chat with you about today.

The first is that two big global consumer companies reported earnings last week, both showing strong results in China.

Let’s dive into those first.

Jacob Cooke:
Well, the first company is obviously Apple.

Apple had actually what’s being called a very disappointing quarter globally with revenue dipping by 1%. Now, the June quarter is always weak for Apple because consumers are holding up the new summer or the September releases for the iPhones, et cetera. But there’s also a difficult, maybe global macro environment for them.

However, China stood out as a silver lining for the tech giant. This trend of China being a high-performing market has been evident for so many global companies in 2023. Diving deeper into the numbers, Apple sales in the greater China region, which includes the mainland, Hong Kong, Taiwan, and Macau, surged by 8% year over year. 15.8 billion. That’s not just an increase, it’s now a record high for the tuned quarter in the market.

Given that China boasts the world’s most extensive internet user base for the largest smartphone market, its continuing position is one of Apple’s top-performing regions, and be surprising anybody.

WPIC’s message to brands has always been that China offers really unparalleled potential for driving recent performance which is a testament to that insight.

We’ve talked about so many other companies too. This and yet there’s still a lot of negative coverage about the economy, but we just continue to see the actual data points and the earnings announcements again and again and again that, you know, the potential here is still massive.

The second take is that Chinese consumers obviously have a very strong appetite for foreign brands. An intriguing highlight from the earnings report was Tim Cook’s observation that are increasingly trading in from their Android devices.

This trend is particularly noteworthy in China, considering China’s plethora of homegrown smartphone brands that use Android and Apple’s position as an iconic American company. Remember, Tim Cook was received as a celebrity in China when he visited in the spring.

So foreign brands that use data and understand Chinese consumer preferences have strong products and strong brand identity. They can win in this market.

Todd Embley:
What about the second company?

Jacob Cooke:
Well, the second company is Adidas, and I was surprised this didn’t get more media coverage because Adidas has had highly publicized struggles in China in the last two years.

But last week the sports giant reported Q2 earnings and China revenue was up 16% compared to flat global revenue again.

Todd Embley:
Okay, so the next interesting story I want to talk to you about is the popularity of the Barbie movie and how it’s done in China.

Have you seen the movie?

Jacob Cooke:
I have not seen them every time.

Todd Embley:
I have not seen the movie either, but let’s dive into more of the data and the e-commerce and all the things that are interesting to people like you and me.

Tell us about what’s going on with the movie in China.

Jacob Cooke:
Yeah, well, it’s been a hit.

Just like in Western markets, it sparked an entire fashion trend called Barbiecore with bright pink clothing becoming super popular.

First some of the data about this.

The movie itself is holding over 25 million at the box office so far, which is better than any recent American movie in the last couple of years. Since the movie came out, Barbie-related searches on Tmall are up even by 1,000%. And it’s been the number one trending topic on Weibo — the social media is getting tens of millions of inquiries.

You know, for Barbie-inspired fashion posts on Xiaohongshu (Red) as well, searches for pink clothes are way up. Like it’s massive.

What’s fascinating about all this, too, as well, is that, unlike the West, the Barbie doll was never really a thing here. Alibaba is reporting Barbie doll sales being up. So this really kind of came out of nowhere. But the culture has really gone from zero to hero pretty quickly. We haven’t seen anything like this in quite a while. How long it lasts, we don’t know.

But there’s a lot of great reporting on this too. I think Jing Daily’s had this right, you know, I’ve read just a bunch of stuff on how they’ve covered the culture.

It’s been really, really good there — great reporting. But this is totally different. Remember they were trying to sell dolls in 2009 in Shanghai and that flagship Barbie store closed in 2011. It just wasn’t that popular.

So the second more revamped approach has just been a huge, huge hit.

Todd Embley:
Yeah. Okay. So we definitely want to get more into that.

For those of you, and it’s a shameless plug here: you got to go listen to the last couple of episodes of The Negotiation. We talked to Crystal Tai from Jing Daily. We talked to Yaling Jiang from Following the Yuan about what exactly happened.

If we cover the Barbie house, the 30 million dollar investment by Mattel into Shanghai, we talk about even children’s toys and where are they in the market right now and how they grow up. A lot of very deep discussions along those lines around the Barbie movie.

But for today, thanks very much, Jake. That’s been very fascinating. Thanks very much for joining us and for everybody listening and watching. We’ll see you next time.

Jacob Cooke:
Thanks a lot Todd, bye.

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