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We update you on the most essential news from Asia in tech, media, and business—the things you need to know that you probably haven’t heard in Western media.
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Latest NASDAQ Delisting Notice for Luckin Coffee ☕️
Luckin Coffee was previously heralded as one of China’s biggest business successes over the last year, a serious competitor to Starbucks and one of the fastest growing companies in the country. This was all before a $310 Million financial reporting fraud was revealed in April, leading to a series of investigations and still ongoing controversy.
This week, Luckin disclosed that it has received a second notice from the NASDAQ asking the company to delist from the exchange. Their first delisting notice came on May 19 for “public interest concerns” and “fabricated” records. This second one is because Luckin has failed to file their annual report for the fiscal period ending December 31, 2019. The current share price of Luckin is hovering around $2.70, a significantly lower price than their high of $50 a share in mid-January.
Luckin had their IPO on the NASDAQ in May 2019, with a lot of fanfare characterising the company as the next Starbucks of China. Luckin was such a high profile company with a large percentage of their investors coming from the West, specifically the US. So the impact of Luckin’s fraud and impending decline can be traced all the way to the recent US legislation introduced to delist Chinese companies and a broader sense of mistrust between the investment communities of the two countries.
Challenge for India’s Wedding Industry 💒
In India, weddings are a big business—a $50 Billion industry. With a population of 1.3 billion people (and half under the age of 30), the industry was expecting double digit growth going into this year. Unfortunately, the Coronavirus has created new challenges to prevent this growth from happening.
This Vogue Business article outlines some of the ways businesses are adapting, including virtual appointments, increased e-commerce, and augmented reality. Many people have also had to postpone or completely rethink their approach to getting married. Personally, I’ve had several friends get married over Zoom the last few months, which cuts into what people would have spent for a traditional wedding. A large part of a wedding’s cost is spent on luxury goods, which could mean anything from the actual bridal wear to jewellery.
What’s happening in India’s wedding industry is something many countries are experiencing, but India’s size means it’s more susceptible to this corona-induced downturn. The US is the world’s largest wedding market valued at $70 Billion, with India coming in second at $50 Billion and growing more quickly. 29% of global jewellery spending also currently comes from India. The challenges of this wedding industry will have ripple effects across the broader Indian economy.
Gucci and Other Fashion Brands Need Work On Their Chinese Socials 👜
The idea of a brand rushing into social media or “digital” is a playbook I’m very familiar with. When I worked at Facebook, social media was too often seen as a blunt marketing instrument rather than a nuanced tool. It’s not easy. This article from Jing Daily outlines Gucci’s struggle to find success on short video app Douyin, the Chinese version of TikTok owned by parent company Bytedance.
Gucci launched on Douyin on April 29 earlier this year, in an attempt to better connect with younger Chinese audiences like Millennials and Gen-Z. Since then, the account has received lots of negative feedback from fans, primarily criticising the aesthetic and quality of Gucci’s videos. For Gucci and many similar brands, China is often their most important market, as the country accounts for two-thirds of growth in the global luxury market. So being successful on Chinese social media is not a luxury, but a necessity.
Update #13 - Luckin Coffee, Indian Weddings, and Gucci