Imagine the CEO has asked each of you—company executives—to comment on Sales Growth for the next 3 years. Lay out a specific, credible way for your company to grow revenue over the next few years. Use hard data from your company’s latest annual report for your base year (previous year). No speculation. No invented numbers.
Walk through your logic:
- How do you estimate total sales for the current year? If you have six months’ data, double it. If not, use the company’s average annual growth rate. Notice sales are falling? Adjust the growth rate down. Stay honest.
- Identify 3 to 5 strategies—or pick one bold strategy, break it into key activities. For each, connect the dots between your activity and the revenue upside. If you don’t want to name the strategy at this point, refer to “Strategy 1” and say that the name remains confidential.
- Make your estimates realistic. Sense-check them against the company’s typical growth. No wild promises—if you say revenue will double, explain why.
- Don’t break growth out by year. Quantify the gain by strategy. For example, if you’re projecting growth from 2024 to 2028, show how each activity moves the total, starting with 2024 as your baseline.
Your comment must be sharp and clear. Mention the base year, the numbers, the revenue you expect, and the strategy behind it. Show you know how companies really grow—and how to make that growth real.
There are 4 reasons why Sales declined. Reason 1 for Sales decline: Competition IBM is facing many strong competitors, such as
Amazon, Microsoft and Google. Reason 2 for Sales decline High investments and low returns in AI. In 2015, IBM spent more than $15 billion developing Watson. Compared to the large investment made, IBM has not had an impressive return since. IBM is seeking a competitive advantage with its AI technologies, especially in the Americas. Even if these technologies have seen an increase in sales in the Americas during the pandemic, revenue declined across IBM’s business segments. Cloud and Cognitive Software, IBM’s biggest unit, saw revenue decrease from 2019 to 2020. Reason 3 for Sales decline: Global Pandemic Revenue for IBM in Q2 2020 is down from the $19.2 billion figure recorded in the same quarter last year, as is net income, down from $2.5 billion to $1.4 billion, as the company continues its recovery from Covid-19. Even if AI and cloud computing saw a slight rise in revenues during the pandemic, this was not enough for IBM to end its 2020 on a positive note Reason 4 for Sales decline: Market Demand Shift IBM has faced struggles adjusting to changes in the marketplace in the Americas. Recently the company has focused on “strategic imperatives”: getting rid of low-margin businesses and investing in high-margin businesses; at the end of 2018, for example, IBM sold IBM WebSphere Commerce to HCL Technologies for 1.8 billion U.S. dollars. It is imperative to focus on the changing
demands of digital transformation in the Americas. The largest source of IBM’s revenue of 2020 now comes from its AI technology services and cloud platforms business segment, which specializes in helping organizations integrate their
traditional infrastructure into a multi-cloud environment, especially in the Americas.
To explain sales growth, I decided to choose Disney as the company selected. In their category (DPEP), I included five drivers 1. Merchandise licensing and retail, 2. Theme parks admissions, 3. Parks & experiences merchandise and beverages, 4. Resorts and Vacations, 5. Park Licensing and Others. Looking at the drivers and the comparison between 2020 and 2021, I saw an overall decrease in Net Sales for DPEP of -$0.4B/-2.9%. Comparing 2020 to 2021 for each driver, Merchandising increased by 0.5 Billion, whereas Theme Parks and Admissions decreased by 0.2B, Parks and Experiences decreased by 0.1B, and Resorts and Vacations decreased by 0.7B.
The analysis for Disney was surprising, as I thought Disney DPEP would have increased in 2021 as in 2020, they got hit by the pandemic. Looking at the results, 2020 was a better year for this category.
There are different factors why there was a decrease.
1- Parks attendance decreased in 2021 due that customers were scared of crowded spaces due to the spikes of COVID cases.
2- In 2021, Some resorts had to close down again due to the Covid situation; Shanghai hotel, Disney Fan resort,, and some were at a limited capacity.
3- Lower Hotels occupancy rate which decreased the net sales
Merchandising increased due to customer high demand for products and the addition of new products like Mickey and Minnie, Frozen 2, star wars, the mandolorian and Spiderman.
There seems to be a better future for Disney DPEP in 2022. Disney increased their overall prices of tickets, annual passes and in parks food and beverages since the initial of the calendar year 2022 and all parks at a full capacity. As the pandemic is fading and customers are willing to get into the parks plus the increase in price and opening of resorts, this should result in an overall increase of their net sales in this category.
The company I picked is Disney. As we all know, Disney has two main segments, one is Disney Media and Entertainment Distribution (DMED), and the other is Disney Parks, Experience, and Products (DPEP).
Under the DPEP segment, there are several branches:
1. Theme park admissions
2. Parks & Experience
3. Merchandise, food & beverage
4. Resorts and vacations
5. Merchandise licensing and retail
6. Park licensing and other
According to Disney’s 2021 annual report, the total revenue of the DPEP segment drop 3% from 2020 to 2021 and the main cause is Resorts and vacations. Due to the pandemic, Disney parks and resorts were all got influenced and the number of daily visitors was decreasing. However, Merchandise licensing and retail increased by 11%, which kind of helped to balance the loss.
Different from the DPEP segment, the growth of the DMED segment is significant. From 2020 to 2021, the total revenue of the DMED segment increased by 5%. Furthermore, Disney + has reached 95 million subscribers worldwide and the number keeps growing. Therefore, the revenue of the DEMD segment cancels out the DPEP segment, allowing Disney’s total revenues to slightly increased compared with 2020.
The company I pick is Nike, and the truth is that the sales did grow at the year of 2021 compared to previous years. Obviously after-pandemic effect is one of the major reasons for the sales growth of Nike at the last year, since retailing shop opened back, supply chain started to work efficiently and international shipment also came back to the same speed level as the time before Covid pandemic. However, to further analyze the sales growth of Nike, there are several other reasons that can be mentioned here to further explain the growth.
The first and the most important reason is the digital market growth of Nike. Even before the pandemic, Nike already started to encourage its customers to use the online shopping APP introduced by Nike but at that time the offline retailing shop was still the major force of Nike’s selling. Due to the effect of the Covid pandemic, Nike’s online shopping app got a chance to develop itself significantly because that was the perfect time for Nike to push the customers into its online shopping app and Nike did success in that.
The second reason is about the impact of product launches. Throughout that year, Nike continuously utilized the marketing strategy of Co-branding to introduce new products that can attract customers from both brands. The co-branding of Nike and the famous fashion brand OFF-WHITE is a perfect example for that which generate a considerable sales growth for Nike. Now Nike is still actively using the strategy, such as the Nike x Louis Vuitton co-branding which was just introduced recently.
In order to explain sales growth, I would pick L’Oréal. This company is organized into four complementary divisions, with each one developing a specific vision of beauty for its respective market: Professional Products Division, Consumer Products Division, L’Oréal Luxe, and the Active Cosmetics Division. According to L’Oréal’s 2021 annual report, this was a historic year with a strong increase in profits. The company had a +16.1% growth,
which is twice the beauty market growth.
* The sales growth compared to 2019 was recorded to be +11.3% like-for-like.
* There was a record operating profit of 6.16 billion euros and 19.1% of sales.
* In 2021, e-commerce grew by +25.7%, accounting for 28.9% of sales.
Successful product launches by division:
1. PROFESSIONAL PRODUCTS: growth: +24.8% like-for-like and +22.2% based on reported figures.
* Kérastase: Curl Manifesto
* Hair Colour: EQ by Redken and Dialight by L’Oréal Professionnel.
* L’Oréal Professionnel: Metal Detox and Redken – Acidic Bonding Concentrate line.
2. CONSUMER PRODUCTS: grew by +5.6% like-for-like and +4.5% reported, with +6.5% like-for-like growth in the fourth quarter.
* Sky High mascara by Maybelline
* Dream Lengths Wonder Water by Elsève
* Garnier’s Vitamin C Serum
* NYX Professional Makeup – Money Heist Collection
3. L’ORÉAL LUXE: growth at +20.9% like-for-like and +21.3% reported.
* Lancôme: Absolue and Helena Rubinstein
* Kiehl’s: Retinol Skin-Renewing Daily Micro-Dose Serum
* YSL: Libre
* Mugler: Alien Goddess
* Prada: Luna Rossa Ocean
4. ACTIVE COSMETICS: exceptional growth at +31.8% like-for-like and +30.3% reported.
* La Roche-Posay: Effaclar serum and Lipikar EczemaMED
* SkinCeuticals: Silymarin CF
L’Oréal’s exceptional growth was driven by generating high-rank innovations, as well as diligent cost control. This has enabled them to invest extensively in their brand, delivering record operating profit and an operating margin.
The company I am choosing to analyze is Ulta Beauty [ULTA]. Ulta has seen a rise in sales growth over the last year as reported in their annual report. The company pulled in $6.1B in net sales in 2021’s report and $8.6B for 2022’s. This can be attributed to a variety of reasons.
One main reason is the lifting of covid restrictions. 2021’s annual report showed a 17% decrease in sales given the fact that that year was spent mostly in quarantine. The 35+% increase into 2022 shows a return to regular life. Cosmetics and fragrances and bath contributed to these increases. “The net sales increase was primarily due to the favorable impact from stronger consumer confidence, government stimulus payments, and the easing of COVID-19 restrictions, and an increase of $15.1 million in other revenue. The total comparable sales increase of 37.9% in fiscal 2021, compared to a decrease of 17.9% in fiscal 2020, was driven by a 30.0% increase in transactions and a 6.0% increase in average ticket.”
Netflix is well known as a worldwide video streaming service. The company receives revenue from monthly subscription fees for streaming content, which offers various subscription plans for membership. The price varies by region and country, ranging from $2 to $27 per month.
The streaming revenue (sales) of Netflix is divided into regions including:
United States and Canada (UCAN)
Europe, Middle East, and Africa (EMEA)
Latin America (LATAM)
Asia-Pacific (APAC)
According to Netflix’s 2021 Annual Report, the revenue of Netflix has increased in all 4 regions. The highest revenue growth is 38% in APAC, followed by 25% in EMEA, and 13% in UCAN and LATAM. The total streaming revenue growth is 19%, which increase from $24 billion in 2020 to $29 billion in 2021.
The reasons for revenue growth are mainly due to the increases in the overall subscription price, increases in the number of subscribers.
1. Netflix shows an increase in average monthly revenue per paying membership in all regions: a 9% increase in UCAN, 8% increase in EMEA, 5% increase in APAC, and lastly 4% increase in LATAM.
This is due to the increase in price in most subscription plans in many countries. The higher average price is one of the reason that the revenue increases
2. Netflix shows an increase in average paying membership in all regions: 31% increase in APAC, 15% increase in EMEA, 9% increase in LATAM, and 4% increase in UCAN.
The reason for increases in this market growth is because Netflix has been offering low price plans in some countries in order to attract new customers as their international market penetration plan. It has worked very well, especially in India and Asia where Netflix has been gaining more market share.
The rising number of subscribers is also due to Netflix focusing more on new original movies content (new products) that is more customized to local people in each region.
Netflix has also included constant currency change in each region, which considered the foreign currency exchange rates to remain constant from each of the corresponding months of the previous year. This is to exclude the effect of foreign currency rate fluctuation on the monthly revenue.
Although the revenue has been growing, Netflix is facing a problem with saturating market of streaming services. It’s harder to gain more subscribers when there are more competitors. The revenue growth is lower than the previous years and investors aren’t happy about it. So, Netflix has been increasing the price to increase revenue and profit, while also trying to gain market shares in the region that still has low competition.
Company- L’Oreal
How would you explain the sales growth of your favorite company to others? Despite the unprecedented challenges caused by the global pandemic, L’Oreal was able to demonstrate remarkable growth surpassing pre pandemic figures and expectations.
Market Growth- In 2021 L’Oreal experienced exceptional market growth with sales growth up 16%. The company’s e-commerce channel grew by 25.7%.
Market Share Gains- There were market share gains in all zones, divisions, and categories (meaning all geographic zones showed gains despite the public health issues). All divisions of the business were up 6.5% in the fourth quarter.
Pricing- Despite being one of the company’s priciest sectors, L’Oreal Luxe became their largest division in 2021, specifically gathering attention in their fragrances, subsidiaries like YSL, Margiela, and Prada typically price their perfumes around $150USD.
Impact of Product Launches- Product launches have only helped L’Oreal in terms of growth. Due to their loyal consumers and brands desirability, they can profit and experience success with most new products their brands put out.
“2021 was a historic year for L’Oréal. Thanks to the expertise, passion and commitment of our 85,400 L’Oréalians around the world, the Group achieved record growth of +16.1%1, twice that of the worldwide beauty market. L’Oréal gained market share in all Zones, Divisions and categories. Over two years, the Group achieved growth of +11.3% like-for-like, spectacularly outperforming a market that had returned almost to 2019 levels.”
Quote from https://www.globalcosmeticsnews.com/loreal-reports-historic-year-in-2021-with-sales-growth-driven-by-infinite-appetite-for-beauty/
Coca-Cola remains the world’s most valuable soft drink brand till date. I am comparing Coca Cola’s sales growth for the years 2011 and 2012. In 2012, Coca Cola made the most of its sales since the past 5 years. In 2011 the company saw a global volume growth and continued the momentum to 2012. In 2011 the total revenue was 46.54 US Billion Dollars followed by 48.02 US Billion Dollars in 2012. Here are a few drivers that led to the highest sales in these years –
1. Macroeconomic volatility – a major systematic factor was put in place by Coca Cola during these years in a large cross section of countries across the world. A few reasons that helped them manage this were the economic outputs, unemployment rates, and inflation in other countries that they gained an advantage from.
2. Bottling partners – Muhtar Kent, CEO of the Coca-Cola Company, faced a critical decision in 2011 after closing a $12 billion deal to buy its troubled North America bottling operations from its biggest bottler, Coca-Cola Enterprises. The decision was prompted by several changes in the U.S. market, including the bottler’s inability to make crucial investments, the growth of alternative, non-sparkling drinks, and the growing power of national accounts, such as Wal-Mart. Now that Coke owned most of its North American bottling network, Kent had to decide whether keeping the labor and capital-intensive side of the bottling business was in Coke’s long-term strategic interest. In December 2011, it purchased half of one of the biggest beverage companies in the United Arab Emirates, Aujan Industries. Three months later, it opened its 42nd bottling plant in China which showed tremendous growth results.
3. Expanding globally – Coca Cola started focusing on other regions when the US become a market that was producing organic revenue. North America, Japan and Germany with double-digit growth in key emerging markets, including India and China in the year 2011-12 by focusing on globally scaled marketing campaigns
4. Treating all products as their hero products – In these years, their major revenue was from sparkling water – Worldwide sparkling beverage volume grew 2 percent in the quarter, with international sparkling beverage volume up 3 percent. Still beverage volume worldwide grew 8 percent for the full year and 6 percent in the quarter, led by growth across The Coca-Cola Co.’s portfolio, including ready-to-drink teas, juices and juice drinks, energy drinks and water brands. International still beverage volume grew 10 percent for the full year and 7 percent in the quarter, and North America still beverage volume grew 4 percent for the full year and 3 percent in the quarter. Global brand Minute Maid Pulpy continues to expand globally, with 20 percent volume growth in 2011. Energy drinks volume grew 19 percent in the quarter with broad distribution of the company’s Burn energy brand, which now is available in nearly 80 countries. The company’s water volume grew 7 percent in the quarter as the company continues to focus on innovative and sustainable immediate consumption packaging such as the PlantBottle in North America, which is driving new customer listings, and the I LOHAS/Ecoflex lightweight crushable bottle for water brands in Asia and Latin America.
Coca-Cola Co.’s four-year productivity program was also in the works during these two years which was successfully completed with annualized savings of more than $500 million, exceeding its original target between $400 and $500 million. The company also launched a new “Productivity and Reinvestment” program with aimed incremental annualized savings of $550 to $650 million by the end of 2015 as a natural outgrowth of the company’s 2020 vision to design and implement the most effective and efficient business system.
Disney provides a variety of products and services under two main segments: Disney Media and Entertainment Distribution (DMED) and Disney Parks, Experiences and Products (DPEP).
While the DMED segment consists of movies and Disney’s streaming service (Disney+, Hulu, ESPN+), the DPEP segment covers theme park experiences, merchandise, resorts, and even the food and beverages offered within the parks.
Total revenues from 2020 compared to 2021 had dropped by 3% in the DPEP segment due to the pandemic. As for DMED, there was a 5% increase in revenue. It is obvious that the pandemic impacted the DPEP segment because less people were taking the chance to go to theme parks and staying at the resorts. Since there were less people in the parks, food and beverage sales also declined.
Meanwhile in DMED, an increase in total revenue consisted of subscription fees, advertising, and TV/SVOD distribution. The increase in advertising was from higher impressions on Hulu and pay-per-view fees on ESPN+ along with exclusive Disney+ releases, like Black Widow and Cruella, was a part of the increase in TV/SVOD distribution.
The increases in DMED covered the decrease in revenue in the DPEP segment and overall leaving a slight growth in revenue from Disney’s 2020 revenues.
The company I picked is 3M. 3M has four main business branches: health care, transportation & electronics, safety & industrial, and consumer.
1. Safety & Industrial will drop by 3% in 2022. In this business branch, the sales growth is primarily led by the closure and masking systems additional with abrasives, industrial adhesives, and types. Safety & Industrial has fallen by 1.3% according to the fourth quarter of 2021. The strong demand for COVID-related products has declined since the end of 2021. The COVID-related products will reduce their production, whereas the other products related to regular industrial production are increasing on the opposites; these are all a result of the lesser impact of COVID. Therefore, in the combination of growth and reduced demand, it is predicted that 2022 will still be a relatively declining sales by 3%.
2. Transportation & Electronics will drop by 5%. Affected by the war in Ukraine and soaring oil prices, transportation is facing a serious dilemma. As the essential factor of the transportation system, the soaring prices of oil limit the expansion. The sales growth will drop unless the energy price can be stable and affordable.
3. Health Care branch will drop by 4%. Oral care is the main industry production in this business branch, together with food safety and medical solution. The serious bad effect of inflation reduced the demand of consuming the oral care service. People are declining their consumption of the unnecessary.
4. Consumer branch will increase by 6%. The sales growth of the consumer branch has increased by 4.9% in the fourth quarter of 2021. After COVID, people back to the office and school, which brings back the demand for stationary. This is considered to be rigid demand and the sales in 2022 is promising.
The company I choose to talk about is Nike. Nike’s sales revenue was increased in year 2021 compared to its previous year. One of the major reasons for its growth is that after the pandemic, Nike started to re-open their retail stores and improved their supply-chain in order to meet the demand of their customers. Another reasons is Nike’s digital sales growth. While Nike’s in-store sales haven’t yet reached pre-pandemic levels, the retailer’s digital sales continue to grow. Globally, the retailer drove a 25% currency-neutral growth in its digital channel’s sales and digital is now 21% of Nike’s total revenue, up from 19% of total revenue the year prior. Indeed, Nike has been investing in digital shopping long before the pandemic, often as a first-mover in new technology. Nike invested in a sneaker launch app called SNKRS in 2015 and adopted curbside pickup and online-offline product-availability-integrated app in 2018. In addition, Nike’s loyalty membership is also playing a role in their sales growth, Nike reported 70% growth in repeat buying members. And Nike continue to manage their marketing strategy and digital growth.
How would you explain the sales growth of your favorite company to others? Try mentioning market growth, market share gains, pricing, and the impact of product launches
The company that I choose to work on is Coca-Cola who pulled off a 12.93% sales growth in 2021 compared to 2020. The biggest driver would be the increase market size in Latin America. As a matter of fact, Latin America accounts for 48% of Coca-Cola’s reported operating income. The major growth in Latin America was led by Mexico, Brazil and Argentina, driven by solid performance of Trademark Coca-Cola and the hydration category. Another contributor is recovery from the pandemic. Supply chains are going back to normal, people are more often going out, international shipping is increasing in size etc. These all leads to growth to the overall economy, thus to Coca-Cola as well.
Because of the inflation, price for Coca-Cola has gone up, especially in North America, which compensates the cost of production process.
There are stereotypes about Coca-Cola company that they are only doing business of cola, or soft drink in general. However, they actually have a very broad product line that can support their sales growths and contribute to the net income from different angles. For example, Nutrition, juice, dairy and plant-based beverages grew 12% last year which is double the rate of the soft drink category. Hydration, sports, coffee and tea also grew for 6%.
I’m using 3M’s as the company to explain Sales Growth. There are four business groups under 3M: Safety & Industrial, Transportation & Electronics, Health Care, and Consumer.
According to 3M’s 2021 Financial Report, the company has increased their sales by +9.9% year-on-year. Their 2021 Net Sales for 2021 were recorded at $35.4B, compared to 2020 Net Sales which came in at $32.2B. There were several factors that influenced the sales growth of 3M, I will be expanding on raw materials and organic growth.
Raw materials: As mentioned on their 2021 annual report, due to the “higher raw materials, logistics, and outsourced manufacturing costs” and other variables related to the global supply chain challenges of 2021, and “winter storm Uri in the U.S.” influenced the price increase of multiple products.
Organic growth: Some of the factors that directly impacted the organic sales growth of 3M were:
– $91M pre-tax “from a favorable Brazilian Supreme Court decision that concluded on the impact of state value-added tax when determining Brazil’s federal sales-based social tax-essentially lowering the social tax that 3M should have pain in prior periods.”
– “3M also experienced year-over-year increased costs as a result of the regular review of its respirator mask liabilities and certain follow-on accelerated depreciation following some of the restructuring in 2019 and 2020.”
As we have seen on other companies, COVID-19 also played a big role on 3M’s product launches, and pricing. “In 2021, COVID-related respirator sales negatively impacted year-on-year organic sales growth by approximately 0.2% as they grew at a slower rate than the rest of the Company.” However, 3M did see an increase in sale in personal safety, general cleaning, and other industries/products.
Resource:
3M 2021 Annual Report: https://s24.q4cdn.com/834031268/files/doc_financials/2021/ar/3M_2021_Annual_Report_Web-(3).pdf
Apple revenue increased dramatically between in the past decade, from $108 billion to $365 billion. In the past year alone, it has increased its revenues by 33%. Apple generated $365 billion revenue in 2021, 52% came from iPhone sales, and Apple Services was the second largest division, responsible for 18% of revenue. At the end of 2021, Sales of iPhones, Apple’s core product segment, were $71.63 billion (up 9%) in the year-end quarter, after the next generation iPhone 13 family began shipping last fall. That was an all-time high for the smartphone biz. In addition, Apple’s Services revenue for the period rose 24%, to $19.5 billion, also a record, the same growth rate as in the year-earlier period. The segment comprises the App Store, Apple Pay, Apple Music, Apple TV Plus, iCloud, AppleCare and other subscription businesses. In the quarter, Apple recorded all-time high revenue for areas including cloud, music, video, advertising and payment services. In the September 2021 quarter, supply-chain issues including chip shortages added $6 billion in costs, and the impact was expected to be even bigger in the year-end 2021 quarter. However, “Apple’s growth cycle is not reliant on pandemic cycles in the same way that say Netflix has been — benefitting but then finding it hard to keep up that growth,” said Tom Johnson, global chief digital officer at media agency Mindshare. “Apple’s cult following will always buy the latest version of its flagship device. Chip shortages were never going to hold back its growth long term.”
The company I picked is Nike which is a MNC that designs, manufactures and sells sportswear across the world. Sales growth have gradually recovered last year as covid-19 is under control now, and most countries have lifted quarantines that were previously in place. We see a trend of stores reopening and factory productions back on track to support its supply chain and consumer demands. Another reason for Nike’s market growth comes from its e-commerce empire that it put a lot of effort in building during the covid pandemic. In particular, Nike Direct has greatly contributed to the company’s market growth, which focuses on selling directly to its customers rather than through third-party retailers. For example, its SNKRS app allows Nike fans to buy Nike sneakers online and have exclusive first access to new and limited-edition sneakers. There are many advantages towards Nike’s DTC strategy, including changing consumer shopping habits (from offline to online), direct data collection (about consumer spending habits and preferences, allowing better direct to customer advertisement and bettering understanding of its customers), builds up loyal customer base (app provides inside access to new product launches), and also allowing Nike to control its own brand or product content. Besides that, Nike has also increased its impact of product launches through collaboration with well-known brands and celebrities. For example, its new partnership with Louis Vuitton this year, launching LV Air Force 1 which collected great media attention. Other collaborations ranges from sports celebrities to singers such as LeBron James, Serena Williams and Drake. Furthermore, Nike’s innovative products and technologies have allowed it to gain competitive advantage over its competitors over the years. Examples include Nike flyWire support system to maximize support and minimize weight, lunarlite foam cushioning for better energy return for runners, and its hands free sneakers for easy get in and get out.
Apple’s first fiscal quarter runs from October through the end of December and is the company’s biggest of the year, powered by increased holiday spending and a launch schedule that puts new products on the market in the fall.
In result, Apple revenue for the quarter ending June 30, 2022, was $82.959B, a 1.87% increase year-over-year. Apple revenue for the twelve months ending June 30, 2022 was $387.542B, a 11.63% increase year-over-year. Apple annual revenue for 2021 was $365.817B, a 33.26% increase from 2020.Apple’s revenue growth forecast is 7.4%. Apple’s revenue growth forecast is expected to average 5.5% over the next five fiscal years.
iPhone and Apple services are the two main support for apple revenue. Apple Watch and wireless headphone sales hit by slowing demand is the company’s wearables division.However, Morgan Stanley’s Woodring believe Wearables are the most discretionary product in Apple’s portfolio and therefore most prone to the pullback we are seeing in consumer electronics spending.
Apple’s hardware business was particularly grim. While iPhone sales increased 3% to $40.7 billion; Mac revenue dropped 10% to $7.4 billion; sales of wearables — including the Apple Watch, AirPods and HomePods — dropped around 8% to $8.1 billion, and iPad revenue barely declined to $7.2 billion, according to TechCrunch.Apple has managed to convince investors that the growth and profitability of its services business — which includes Apple Music, iCloud storage, App Store revenue, Apple Pay and warranties — matters more than its moribund top line.
Services “will make up for smart phone saturation and provide healthier profits,” noted CNBC. To be sure, Services are more profitable than hardware. After all, Apple’s gross margin from Services of 71.5% in the third quarter was significantly above Apple’s overall gross margin of 43.3%.
However, the growth of Services is falling short of Apple’s aspirations. While Services grew 16% in 2020 and 27% in fiscal 2021, they increased a mere 12% in the fiscal third quarter to $19.6 billion — $100 million below analysts’ expectations, according to Refinitiv.
That was not enough to boost its top line growth — since Services represented only 23.6% of Apple’s revenues for the quarter.
Apple is blaming the economy for slowing Services growth. Apple CEO Tim Cook said, the digital advertising division was “clearly impacted by the macroeconomic environment.”
I picked Pfizer to explain sales growth as this is the company I’ve been working on my assignments this semester. Pfizer is not my favorite company but I do like it. In 2021 performance, Pfizer’s sales growth increased from $41.7 billion to $81.3 billion, which is a 95% increased. It’s mostly from the operational increase of $38.4 billion and the impact of foreign exchange of $1.2 billion. There is strong growth in “Eliquis, Biosimilars, PC1, Vyndaqel/Vyndamax, the Hospital therapeutic area, Inlyta and Xtandi, partially offset by declines in the Prevnar family, Chantix/Champix, Enbrel and Sutent” according to Pfizer’s 2021 10-k report. Pfizer’s market share increased 60% – the total value of Pfizer’s stocks surged from $127 billion to $331 billion by the end of December 30, 2021. Parts of the pricing and reimbursement of Pfizer’s products depended on government regulation in 2021 as government had the most impact on drug pricing and Pfizer had to provide specific prices to the government agencies.
For Pfizer, revenues increased $39.6 billion, or 95%, to $81.3 billion in 2021 from $41.7 billion in 2020, reflecting an operational increase of $38.4 billion, or 92%, as well as a favorable impact of foreign exchange of $1.2 billion, or 3%. Excluding direct sales and alliance revenues of Comirnaty and sales of Paxlovid, revenues increased 6% operationally, reflecting strong growth in Eliquis, Biosimilars, PC1, Vyndaqel/Vyndamax, the Hospital therapeutic area, Inlyta and Xtandi, partially offset by declines in the Prevnar family, Chantix/Champix, Enbrel and Sutent.
To sum up, the sales grow from $41651 million in 2020 to $81288 million in 2021. The key drivers include operational (excl. impact of LOE and Operational impact of Comirnaty and Paxlovid Revenues) for $2947 million, impact of LOE for -$621 million, Operational impact of Comirnaty and Paxlovid Revenues for $36013 million and foreign exchange for $1208 million. And this definitely reflects the focus of Pfizer in 2021.
For L’Oréal , the sales growth in 2021 will be significant. the Group achieved record growth of +16.1%, twice that of the worldwide beauty market. L’Oréal gained market share in all Zones, Divisions and categories. Over two years, the Group achieved growth of +11.3% like-for-like, spectacularly outperforming a market that had returned almost to 2019 levels.In terms of Zones, North America made a strong comeback and joined North Asia as the primary growth contributor. In Europe, boosted by the Zone’s reorganisation, L’Oréal achieved significant market share gains and saw a return to 2019 levels. With an extremely volatile public health situation in SAPMENA-SSA and Latin America, L’Oréal demonstrated agility and delivered solid performance.
From my point of view, the main reason for the growth is that L’Oréal can adapt to the development of e-commerce faster and get rid of the impact of the epidemic faster. As a result, L’Oréal has achieved higher market share while achieving higher sales growth.
My company of choice is Lululemon because I like its sportswear. Lululemon is experiencing good sales growth in both 2021 and 2022. What’s remarkable about this growth is that Lululemon isn’t just thriving in a time of inflation; it’s growing while its closest competitor is having a tough year. Under Amour reported on its second-quarter earnings call that North America was flat for the quarter, “at $909 million compared to the prior year period, with international revenue declined 3%.”
1. For the 12 months that ended July 31, 2022, Lululemon Athletica Inc’s revenues were $7,061 million, an increase of 27.83% from the same period last year.
Lululemon Athletica Inc’s annual revenue for 2022 is $6,257 million, an increase of 42.14% from 2021.
2. Direct-to-consumer e-commerce revenue accounted for 42% of net income, a slight but positive increase from the 41% share in the second quarter of 2021.
Revenue expansion is occurring in North America and internationally, which are now growing at a compound annual growth rate of more than 25% over the past three years. Diluted earnings per share were $2.26, well ahead of the Street’s estimate of $1.87, while operating income reached $401.2 million.
3. The company is planning a conservative price increase starting in the second quarter of 2022 that will initially affect only about 10 percent of the general catalog. Chief Executive Officer Calvin McDonald said more price increases could come in the next few quarters.
4. The yoga-wear maker said it saw a modest impact from the blockade of stores and some suppliers in China, but the overall effects on first-quarter revenue were offset by strength in other regions.
Lululemon launched a women’s footwear product in March. Demand for the new products exceeded supply in the first quarter and “far exceeded” the company’s expectations.
The company I choose is Disney. In general, Disney sales have grown by 3% in 2021 compared to the year before. The factor leading to this growth is mainly growing DTC subscription revenue, while it has been partially offset by a decrease in the Disney Parks, Experiences and Products category due to the impact of COVID-19.
Disney’s business can be broadly divided into two categories, Disney Media and Entertainment Distribution(DMED) and Disney Parks, Experiences and Products(DPEP), revenues in DMED has increased 5% and the latter has decreased 3%. In DMED category, the Linear Networks and Direct-to-Consumer are the two driving factors for sales growth. The increase in affiliate fees and advertising sales, subscription fees and sub-licensing fees have contributed to the growth. Under the negative influence of the pandemic, the business in DPEP category still has not fully recovered to pre-pandemic level. The sale of admissions to theme parks, food and beverage, merchandise at theme parks and resorts, and charges for hotels etc. were all adversely impacted as a result of the closure/generally reduced operating capacity across the theme parks and resorts. While this decrease has also been partially offset since Disney has raised its average price for a certain amount.
The company I picked is L’Oreal. 2021 is a historic year for L’Oreal. They have 16.1% growth increases. And twice the beauty market growth. It is a very strong increase in profits.
The sales growth compared to 2019 increased by 11.3%.
The earnings per share is an increase of 20.9%.
L‘Oreal has four divisions, and L’Oréal Luxe became the Group’s largest Division, with remarkable success in fragrances, while the Consumer Products Division, the largest Division by volume, strengthened its position, with noteworthy performance in makeup. The fast-growing Professional Products Division continued its far-reaching transformation and became truly omnichannel. With a portfolio of brands that perfectly matches consumers’ health aspirations, Active Cosmetics also achieved spectacular growth, doubling in four years.
The reason why L’Oreal can achieve such large growth is due to the strict cost control and comprehensive e-commerce support of the L’Oreal Group. Due to the epidemic, offline shopping has decreased sharply, but the new comprehensive e-commerce and marketing support makes L’Oreal Group stand out from the major cosmetics groups.
L’Oréal continues to innovate, update products and acquire new brands to make the group stronger. Four different divisions showed their magical powers to seize different consumer markets, and the profits of the entire group rose steadily.
Despite rising prices, it has not stopped the enthusiasm of consumers. L’Oreal is committed to bringing the latest and best products to those who love beauty.
Sales Growth Analysis of Disney from 2019 to 2021
Overview: Disney’s total sales decreased around $2 billion from 2019 to 2021, to $65 billion in fiscal 2021. The main reason is the decreased of Parks & Experiences services fee and the Parks & Experiences and TV/SVOD distribution revenue. However, Disney content from licensing to being on the DTC streaming service. Therefore, it still have several growth in their digital media business.
– First, DTC subscription revenue increased $0.6 billion from 2019 to 2021. Content from licensing to third parties to being on the DTC streaming service.
– Second, Advertising revenue increased $0.3 billion from 2019 to 2021.
– Third, Merchandise licensing revenue increased $0.2 billion from 2019 to 2021.
The company I picked is Estee Lauder. The sales have grown 9% compared to the year before, driven by the increase from pricing of 7%, due to favorable impacts from changes in mix and strategic pricing actions; incremental net sales attributable to the increase in Estee Lauder ownership of DECIEM in the fiscal 2021 fourth quarter of 2%; and the increase from volume of 1%. Partially offsetting these increases was the unfavorable impact of foreign currency translation of 1%.
Estee Lauder has four main divisions: skincare, makeup, fragrance, and hair care.
Skincare occupied the biggest portion of total net sales, driven by incremental net sales attributable to the increase in our ownership of DECIEM in the fiscal 2021 fourth quarter of 4%.
Makeup net sales increased by 12% in fiscal 2022, led by higher net sales from MAC and Estée Lauder. The continued progression towards recovery in makeup, including increased usage occasions compared to the prior-year period, led to the increase in makeup net sales in The Americas and Europe, the Middle East & Africa.
Fragrance net sales increased by 30% in fiscal 2022, due to more store openings, and successful performances during holidays and key shopping moments.
Hair care net sales increased by 11% in fiscal 2022, primarily due to the continued progress toward salon and retail store recovery in North America. Net sales from Aveda increased, reflecting the continued success of existing product franchises, and new product launches.
To explain the sales growth, I chose Coca-Cola as the company of choice. For the full year 2021, the company reported revenue of $38.66 billion, up 17% year-over-year, beating market expectations of $38.08 billion; operating profit of $10.31 billion, up 15% year-over-year; earnings per share of $2.32, above market expectations of $2.29; and global unit case sales growth of Global unit case sales increased 8% year-over-year.
Market and market share growth: global unit case sales grew 9% year-over-year, and unit case sales in Asia Pacific grew 11% year-over-year, driven by strong growth in China, India, and the Philippines. Meanwhile, a strong increase in China last quarter, especially with the doubling of Coca-Cola Zero Sugar compared to the fourth quarter of 2019, and revenue enhancement management and e-commerce business also contributed to growth in China. Moreover, globally, Coca-Cola grew its value share of the non-alcoholic ready-to-drink (NARTD) beverage market in both the fourth quarter and for the full year 2021, with the share in both the in-home and out-of-home channels up.
Pricing: Due to inflation, the price of Coca-Cola has increased, which compensates for the cost of the production process.
Product Launch: With a long-term goal of becoming a “full-service beverage company,” Coca-Cola continued to strengthen the competitiveness of its classic brands while bringing fresh categories and beverage choices to consumers. For example, during the Chinese New Year of the Tiger, Coca-Cola launched its first limited edition of Chinese New Year cans in China. Incorporating Chinese elements such as traditional Chinese New Year paintings and cut-out art, as well as a series of creative marketing activities such as the Year of the Tiger animated movie and immersive interactive games. To strengthen Coca-Cola’s role as a symbol of joy and reunion, connect deeply with local consumers, enhance emotional resonance with local consumers, and further strengthen the brand’s market. The brand’s market competitiveness was further strengthened.
The company that I chose is Nike. From fiscal 2022 compared to fiscal 2021, Nike’s sales had been increasing by 5% ($42 to $44 Billions USD). There are many reasons that led to the growth of Nike. The first one is the growth of Nike Direct, which are both Nike-owned retail stores and digital platforms. Since the pandemic, consumers have shifted their ways of consumption toward online platforms because most companies have developed a system to make it more and more convenient to serve their customers and it help companies reduce the cost of physical stores and also manage inventory better in return. The second reason is the increase in the product price. Nike increased the price of footwear, which contributed to 66% of total revenue, by 5-10%, for example, one of the most popular models of Nike footwear, Air Force 1, increased the price from $90 to $100 in 2022. Another reason is that Nike has the biggest market share in the sportswear industry at 41%, followed by Adidas which has only 25%. That means competitors of Nike are not strong enough to slow down their sales growth. Nike has a strong consumer base to support and continue purchasing from the brand. The last reason is that there are many new products laugh during the fiscal year 2022 after the pandemic. Nike launched lots of new interesting products to attract their customers and potentially increase their sales. Nike partnered with Lil Nas X, a popular American rapper, to create exclusive sneakers called Satan Shoes which was successful among Nike fans and also his fans. Nike also launched other new sneakers called Go FlyEase, which can be put on and removed without using hands. The innovation of this sneakers gained a lots of attention from footwear consumers and helped strengthen the position of Nike that Nike is an innovative brand and always come up with shoes that not only good looking but also functioning, and finally support the growth of Nike as a whole.
The company I choose is Disney
Disney have two main segments:
– Disney Media and Entertainment Distribution (DMED)
– Disney Parks, Experience, and Products (DPEP).
Overall, Disney’s total revenue has slightly increased.
DPEP total sales have decreased 3% from 2020 to2021, and DMED revenues have increased around 5%.
Due to the COVID-19, the Disney Parks, Experiences and Products category get influenced and main reason is the tickets, resorts and vacations.
However, Disney + has reached approximately 95 million subscribers around the world and still growing.
Furthermore, the DTC subscription revenue increase around $0.6 billions.
Therefore, while the deceased of DPEP, the digital media business still have growth for the revenue.
I would explain sales growth on behalf of Disney Company, specifically analyzing the sale change between 2021 and 2019 of Disney Parks, Experiences, and Products (DPEP) segmentation. There are mainly four drivers under DPEP: 1. Theme park admissions 2. Parks & Experience, Merchandise, food & beverage 3. Resorts and vacations 4. Merchandise licensing and retail.
According to the 2021 and 2019 annual reports, the total revenue for DPEP has a 37% decline, from $26.2 billion down to $16.6 billion, decreasing by $9.6 billion. Drivers like Theme park admissions, Parks & Experience, Merchandise, food & beverage, and Resorts and vacations all have a significant decline, whereas Merchandise licensing and retail have increased slightly.
For theme park admissions, the main reason for the decline is park closure and generally reduced capacity in 2021. According to the annual report, Disneyland Resort, Disneyland Paris, and Hong Kong Disneyland Resort all opened less than 52 weeks. Disneyland Resort only operated for 22 weeks and Disneyland Paris for 19 weeks in 2021. Another factor is lower attendance caused by the travel policy during the pandemic. Guests need to reserve their tickets in advance and are required by law to use the “LeaveHomeSafe” app and fulfill the “Vaccine Pass” requirements upon entering the Park and specified premises. China also has flight limitations and quarantine requirements which lower the travel business.
For resorts and vacations, the lower occupied room nights and fewer passenger cruise days lead to the sale decline. The hotel occupancy rate in 2019 was 88% and became 37% in 2021 due to the pandemic. According to Disney Industry News, Disney Cruise Line has announced that it is suspending U.S. departures through June 2021, which includes all sailings on the Disney Dream, Disney Fantasy, and Disney Wonder.
For in-park experiences, merchandise, food and beverage, the decline was caused by lower volume. Although Disney parks are recovering from the pandemic, compared with 2019, the volume of passengers in 2021 still decreased a lot for all the parks. Competitors like Universal also surpassed Disney’s attendance.
Merchandise licensing and retail is the only driver has a sales growth in 2021. Merchandise licensing and retail revenue growth was due to an increase from merchandise licensing driven by higher revenues from merchandise based on Mickey and Minnie, Spider-Man, Star Wars, including The Mandalorian, and Disney Princesses, partially offset by a decrease in revenues from merchandise based on Frozen.
Other factors that cause the decline might be an economic downturn in the U.S. or globally. A decline in economic activity, such as a recession or economic downturn, in the U.S. and other regions of the world in which we do business, can adversely affect demand for any of our businesses.
I picked Disney fiscal 2019 compared to 2021. The total revenue decreased from 69.5 to 67.4 in Billions in the year 2021 (-2.1%). This revenue can divide into 4 major divers. The largest diver is Direct-to consumer which increased by 7% mainly from increasing the pricing rate at Hulu, Disney+, and ESPN+. The following factor is Media Network which increased from 24.8 to 28.1 billion (+3.3%) due to the increase in Cable advertising revenue. However, the studio entertainment factor decreased by 3.8%, and Disney parks, Experience and Product factor also declined from 26.2 to 16.6 billion. These impacted by Covid19 consequently close theme parks in many countries.
My company is Apple so I will explain the sales growth drivers for the same. Apple’s revenue grew by 7.79% from 2021 to 394.328 billion USD (United States Dollars) in 2022. This growth has been majorly by Mac sales growth of 14% compared to 2021 and Apple services that also grew 14% compared to 2021. While the major revenue contribution came from iPhone of 52% there was moderate growth of 7% in the same compared to 2021.
Mac sales growth was fueled due to demand by new customers thus acquiring more market share which led to revenue increase by 5 billion USD than 2021. However due to shortages in supply of chips the growth is expected to be lower in 2023. Apple services which include Apple Music, Apple TV+, Apple Arcade, iCloud+, Apple News+, and Apple Fitness+ was able to deliver innovative apps and entertainment that garnered a lot of fame leading to higher subscription base of 900 million subscribers up by 155 million subscribers then 2021. The revenue also increased by 10 billion USD.
Apple witnessed a decline in sales for iPad by 8% compared to 2021 with revenue of 29 billion USD. This is mainly because no new launches were introduced for iPad and iPad pro except software updates and the supply issues faced due to the chip shortage. This hints that Apple plans to roll out major changes for iPad 2023. Overall, a growth in customer base for both Macs and Apple service combined with a consistent growth in iPhone and Wearables sector has acted as a sales driver for Apple in 2022.
I would explain the sales changes of Disney company of 2021 vs. 2019. Disney’s revenue was 67,418 million, decreased by 3.09% compared to revenue from 2019. For Disney Media and Entertainment Distribution segmentation, the sales has increased a lot over the years. The shifting consumer preference in consuming video content, contributed to the revenue growth generated by Direct to consumer streaming service. Disney+ is gaining market share compared to Netflix’s decreased market share. However, compared to 2019, the revenue of Disney Park, Experience and Products declined dramatically, mostly due to the impact of Covid-19. Most of the parks and resorts has been closed, suspended or operated at a limited capacity in 2021. The factors like health concern, travel restriction and unstable economic conditions combined, resulted fewer attendance of customers, which accounts for a major source of revenue in 2019.
For the foreign exchange assignment, I would first recommend my company hold the events in Europe & Middle East or Asia if we would love to host the event out of North America. Because the personnel in both areas is 30%, compared to 10% in Oceania & Pacific. So, in order to reduce the price of transportation and airfare, I would rule out hosting events in this area first. Then we narrowed it down to Europe, Japan, and Turkey.
First, the euro had a sharp rise against the dollar in the near 2019-2020, but continued to decrease after the epidemic. Therefore, Europe can be our candidate, but the price and living standard in Europe is another factor we have to consider.
The second place is Japan, which can also be disregarded because the exchange rate of the yen against the dollar has continued to rise in the past three years, especially in the past year, from 113 to 146. Moreover, the living standard of Japanese prices is also very high.
The third place is Turkey, Turkey can be said to be a very good choice. The lira has continued to fall against the dollar in the last three years, although the magnitude is not large, but the downward trend has not changed, and the lira has maintained a steady decline against the dollar due to the appreciation of the dollar. Moreover, the prices and living standards in Turkey are relatively low.
CocaCola revenue for the twelve months ending September 30, 2022 was $42.343B, a 12.01% increase year-over-year. CocaCola annual revenue for 2021 was $38.655B, a 17.09% increase from 2020. CocaCola annual revenue for 2020 was $33.014B, a 11.41% decline from 2019.
The reasons why increased is due to increased price. Coca-Cola increased prices on its products to account for rising inflation. The prices charged for Coca-Cola’s beverages in away-from-home venues are higher than those that grocery stores charge for beverages that are (presumably) for at-home consumption. Indeed, management highlighted that nearly all of the Q4 revenue growth was the result of higher prices and the channels where the beverages were sold. Consumers are once again going out more often.
The company I chose was Nike.
Nike reports its operations based on internal geographic organization. The Company’s reportable operating segments for the NIKE Brand (include results for the NIKE and Jordan brands) are: North America; Europe, Middle East & Africa (EMEA); Greater China; and Asia Pacific & Latin America (APLA).
Global Brand Divisions revenues include NIKE Brand licensing and other miscellaneous revenues that are not part of a geographic operating segment.
For fiscal 2022, the company reported revenue of 46,792 USD millions for NIKE Brand and Converse. Its sales experienced a 5.17% increase compared to fiscal 2021. (Data from WSJ Markets) Nike’s revenues were driven by higher revenues in EMEA, North America and APLA, partially offset by lower revenues in Greater China. Higher revenues in EMEA and North America each contributed approximately 3 percentage points to NIKE, Inc. Revenues, and APLA contributed approximately 2 percentage points, while lower revenues in Greater China reduced revenues by approximately 2 percentage points. (Data from NIKE 2022 Annual Report)
The main reasons for growth include:
General resurgence of sporting events：As sport continues to return, the entire sportswear industry has seen growth opportunities, with companies of different sizes experiencing growth.
Improved physical retail traffic: With the lifting of the epidemic restrictions, stores open again and traffic in retail outlets has increased, bringing with it improved sales opportunities.
D2C transformation: Nike has industry leading D2C marketing and NIKE Brand Digital business fuels growth. And in 2020 it just launched its newest phase of CDO – Consumer Direct Acceleration, which greatly helped to boost Nike Direct, the business that cuts down operation expenses and lifts average selling price. NIKE Direct revenues represented approximately 42% of total NIKE Brand revenues for fiscal 2022 compared to 39% for fiscal 2021. This strong digital sales growth could be noticed in all segments except Greater China.
Product innovation: Continued to increase depth and breadth of NIKE’s global portfolio.
In Greater China, revenue decline is much more complex. Greater China revenues for fiscal 2022 decreased 13%, reflecting impacts from supply chain constraints, government restrictions due to COVID-19 as well as marketplace dynamics. Impacts include higher inventory obsolescence reserves and elevated freight and logistics costs.
For Apple, the company experienced a positive sales growth by 8% from 365,817 million USD in 2021 to 394,328 million USD in 2022. Higher net sales from iPhone, Services and Mac are the main contributing drivers to the sales growth. The iPhone sales grew by 7% with the robust consumer demand on the premium iPhone models. iPhone provides Apple with the biggest revenue contribution of 52% or 205,489 million USD. The company has decided to increase the prices of its iPhone models to maintain profitability and combat rising manufacturing chip costs. With the in-house chip, Apple’s Mac was able to raise demand and gain more market share, which contributed to revenue growth of 14% from 35,190 million USD in 2021 to 40,177 million USD in 2022. Equalling Mac’s revenue growth is the sales of Apple services such as Apple Music, Apple TV+, Apple Arcade, iCloud+, Apple News+, and Apple Fitness+, which experience a 14% revenue growth from 68,425 million USD in 2021 to 78,129 million USD in 2022. This was resulted from Apple’s ability to produce creative and popular content that wins awards and recognition. Currently Apple has a total of 900 million paid subscribers, a 154 million increase from 2021. However, Apple’s Wearables is growing at a slower pace of 14%, while the iPad experience a decline in sales of 8%. This could be the result of saturation in the education market as many schools and families are well-stocked from providing devices for remote learning during lockdown.
Nike INC.
2022 Fiscal Year revenue was reported to be $46 Billion and has seen a 5% increase from last year’s revenue of $44.8 Billion.
There have been many factors for this increase. For one, fewer covid restrictions worldwide have brought back in-person sports and retail shopping. There was also a lot of development in the online platform during the pandemic that contributed to their online sales. There’s also a higher percentage of full-price sales on a whole equivalent basis, a higher margin in the Nike Direct business, and positive changes in net foreign exchange rates, which contributed to the increase in gross margin. Nike also had different collaborations with brands and public figures (celebrities). As well as launching their metaverse store. In North America, revenues increased by 7%, footwear sales rose by 5%, driven by Nike Direct’s expansion and largely offsetting a dip in the wholesale sector. While footwear revenue grew by about 9%-point, greater ASP (average selling price) per pair offset a 4% decline in unit sales. Revenues from apparel rose 9%, mostly due to growth in the Men’s category. A higher ASP per unit contributed almost 11% points to the gain in apparel revenue while unit sales of clothes fell by 2%. Europe, the Middle East & Africa has seen an increase of 12%, Asia Pacific & Latin America has seen an increase of 16%, meanwhile, Great China has seen a decrease by 13%. A reason due for this decrease in China is because of the Covid-19 related government restrictions which resulted in reduced physical retail traffic.
Total sales for Disney from 2019 to 2021 decreased by approximately $2 billion from 2019 to 2021 .
This factor is primarily due to the impact of COVID-19, a decrease in Disney parks, experiences and product categories.
Growth in DTC subscription revenue, and thus some growth in their digital media business remained.
A general reduction in the ability to close/operate theme parks and resorts under the negative impact of the pandemic, preventing their revenues from reaching pre-epidemic levels Theme park related merchandise also needed to offset the decline in total production by increasing prices.
The company I chose is Coca-Cola. In 2021, Coca-Cola’s net sales were 38.66$ billion. Compared to 2020, which is 33$ billion, the company gained a sales growth of 17%.
Pricing: Global inflation has led to rising prices of raw materials for the production of Coke, so Coca-Cola has carried out price management and increases. For example, using different packaging to give consumers different price choices.
Units: In terms of sales volume, global single box sales increased by 6% year-on-year, higher than in the same period in 2019, mainly driven by developing and emerging markets. The single-case sales in the Asia-Pacific market increased by 3% year-on-year, mainly driven by the Chinese and Indian markets; Coca-Cola and flavored soft drinks led the sales growth in the Asia-Pacific market.
Environmental: The growth was driven by the ongoing, asynchronous recovery in many markets and the company’s ability to better adapt to successive waves of the pandemic.
Market share: For the quarter and the entire year, the company gained value share in total nonalcoholic ready-to-drink (NARTD) beverages, which included share gains in both at-home and away-from-home channels. The company’s value share in total NARTD beverages, and in both at-home and away-from-home channels, remains ahead of 2019.
The impact of product launches: Coca-Cola re-launched a drink in China in September-Lemon-Dou, a Japanese-style lemon sparkling alcoholic drink. Flavored alcoholic beverages occupy a certain proportion of the beer industry. Coca-Cola has won a particular share in flavored alcoholic drinks, becoming an important business and contributing to revenue growth. The Coca-Cola Company and China Mengniu’s joint venture, Keniuliao Dairy Products Co., Ltd., announced the launch of the “Fairlife” brand to enter the Chinese low-temperature milk market, bringing new low-temperature milk products to Chinese consumers and promoting the upgrading of dairy consumption in China. . This is the Coca-Cola Company’s strategy of engaging in the full range of beverage products and varieties.
For over 60 years, since its foundation on the 15th of April 1955, McDonald’s has grown to be the world’s most popular and recognized fast food restaurant. In 2020, McDonald, like other businesses, was shaken by the shocks and aftershocks of covid-19 but confronted its way up to survival through several sales growth drivers. The historical survival Model for McDonald’s is devotion to their high-level capital investment in new business locations introduction of new products such as fried chicken designs and business models. McDonald’s net earnings in 2022 have shown a steady rise from sales in that part of the year. From a recent study on McDonald’s total earnings in its second quarter performance, revenue per market share was $2.55, whereas its total revenue was $ 5.72 billion, even though not as much as expected. The war between Russia and Ukraine resulted in a slight drop in net sales by approximately 3% but experienced a global same-store sales increase of roughly 9%. Solid and productive international relationships stimulated this growth in the current year’s second quarter. McDonald’s total earnings, a recent study on its second quarter performance, shows that its earnings per market share were $ 2.55 while its revenue was $ 5.72 billion. These values on market share earnings and total revenues in 2022 represent a decline in sales growth from a reported 3% decline in global sales due to the closure of McDonald’s fast-food restaurants in the Ukrainian and Russian markets. The decline is also due to a 46% decline in earnings per share to $1.60 due to a $1.2 billion charge from the closure of Russian and Ukrainian outlets. According to the company’s claims, McDonald’s sales growth increased by 3.7% in 2022’s second quarter as inflation dominated its local and external (international) performance. They also affirmed that same-store sales increased by approximately 9.7% globally due to its global sales performances and relationships. The company also claimed that within its six most significant markets, its digital sales accounted for approximately a third of McDonald’s sales. As a giant in the fast-food restaurant industry, McDonald’s sales growth has outperformed many of its competitors due to its reliable marketing and implementation of a competitive digital sales program. The company also said its sales increased partly because of a strategic price increase for its menus to maintain profit margins.
We can potentially improve the value of the budget, allowing for more activities and facilities for the executives, if we could reduce the cost by holding the conference in a place with a favorable exchange rate.
We must take into account how other currencies have declined in value relative to the dollar over the past three years in order to choose suitable sites for holding the event.
Over the past three years, the currencies of the following nations have depreciated significantly against the US dollar:
1. Turkey: Over the past three years, the value of the Turkish Lira (TRY) has declined by almost 70% in relation to the US dollar (USD).
2. Argentina: Over the past three years, the Argentine Peso (ARS) has lost nearly 65% of its value against the US dollar.
3. Brazil: Over the past three years, the Brazilian Real (BRL) has lost more than 30% of its value relative to the US dollar.
4. South Africa: Over the past three years, the South African Rand (ZAR) has lost more than 25% of its value relative to the US dollar.
5. Mexico: Over the past three years, the Mexican Peso (MXN) has lost nearly 20% of its value against the US dollar.
With this knowledge, we might think about holding the event in one of the nations mentioned above. The most desirable possibilities are Argentina and Turkey because of their considerable depreciation. Both Buenos Aires, Argentina, and Istanbul, Turkey, are large cities with first-rate facilities that might host the event.
We may take advantage of the good exchange rate and lower the cost of the event by holding it in Istanbul or Buenos Aires. The local sights and cultural experiences would also greatly enhance the event and give the executives a memorable experience.
Finally, holding the event in Istanbul, Turkey, or Buenos Aires, Argentina, could help us save a significant amount of money while giving the executives a fun and unforgettable experience.
Based on the information provided, it may be possible to save money by holding the conference in a location other than New York due to currency devaluation in certain regions.
By comparing the exchange rate of each currency against the U.S. dollar over the past three years and calculating the percentage change in value. We can focus on the regions that have seen the greatest currency depreciation against the U.S. dollar, as this indicates the greatest potential for cost savings.
At current exchange rates, the euro has depreciated about 17 percent against the dollar over the past three years. Similarly, the Japanese yen has depreciated by about 21%, the Turkish lira by about 70% and the Argentine peso by about 65%.
By comparison, we can see that Turkey is the most suitable place to host a conference. This is followed by Argentina. However, we should also consider the potential impact on our company’s reputation and brand image. Hosting a conference in a location that is not normally associated with our industry or values may send the wrong message to our stakeholders. In making our decision, we should carefully consider the potential reputational impact.
Currently, I believe that either Egypt, Lebanon, or Pakistan is the best place to hold the convention. This is because as of February 2023, they have the highest recentdepreciation rates compared to the USD. The Egyptian Pound had depreciated by 24.86% over the past 3 months, and 93.77% over the past 6 months. The Lebanese Pound depreciated by 58.94% over the last 3 months, and 150.00% over the last 6 months. The Pakistani Rupee depreciated by 20.02% over the last 3 months, and 52.05% over the last 6 months. The Russian Ruble also has a similar deprication rate over the last 3 months to both the Egyptian Pound and Pakistani Rupee, at 20.64%, however there are multiple reasons why this is not an option. Firstly, the political climate would not allow it, as many countries have now boycotted Russia. Additionally, over the last 6 months, it actually appreciated by -5.16%, showing that the depreciation is not a long-term trend.
As per the given scenario, the company is planning to organize a three-day event for 100 executives with a budget of 1 million dollars, which means $10,000 per executive. To save on the cost, the executives suggested taking advantage of the currency’s depreciation in certain countries and hold the meeting there instead of New York.
Upon analyzing the depreciation of various currencies compared to the dollar for the last three years, Japan emerges as a promising location to hold the event. The Japanese yen has experienced significant depreciation against the dollar, with a 14% decrease in value in the past three years. This depreciation can be leveraged to save on costs, as the company can get more value for its money when converting dollars to yen.
Moreover, Japan has a well-developed transportation system, making it easy for executives from different parts of the world to travel to the country. Japan is also a hub for business and technology, making it an ideal location for an executive event.
Additionally, Japan offers a unique cultural experience for the executives. They can explore traditional Japanese cuisine, visit historical landmarks, and immerse themselves in the Japanese culture during their stay. This cultural experience can also help to foster stronger relationships between the executives, which could be beneficial for future business interactions.
In conclusion, hosting the event in Japan could be a cost-effective and culturally enriching option for the company. The depreciation of the yen against the dollar and Japan’s well-developed transportation and technology infrastructure make it an attractive location for the event. Furthermore, the cultural experience that Japan offers can also enhance the relationship between the executives and provide a unique backdrop for the event.
I would recommend that company meetings be held in Asian countries, such as China or Japan. China’s and Japan’s currencies decline by 6% and 13%, respectively, against the U.S. dollar in 2023. Therefore, this can reduce the budgeted expenses to a great extent. Also, transportation costs and consumption levels in China are low compared to Asia as a whole, so costs for living and accommodation can be minimized.
I think organizations could be hosting the convention in Argentina, Hungary, Japan and Turkey to save the cost rather than in New York. According to the data about depreciation of different countries’ currencies compared to the dollar for the last three years. I found that Argentina, Hungary, Japan and Turkey’s currencies have big changes in recent three years. For example, in 2019 Argentina’s yearly average exchange rate is $48.192, but in 2022 is $130.792. In 2019 Japan’s yearly average exchange rate is $109.008, but in 2022 is $131.454. Also, Turkey’s yearly average exchange rate is $5.685 in 2019, but it became to $16.572 in 2022. In 2019, Hungary’s yearly average exchange rate is 290.707; in 2022 is 372.775. We can discover that there is a very big gap between three years in aspect of yearly average exchange rate. However, running a conference or staging a fancy event costs money in many aspects including traveling expenses, hotels, meals, and entertainment. And if company hold this event in New York, the company’s expenses must be huge. By comparing depreciation of different countries’ currencies which I mentioned before, those countries have high rates of yearly average exchange. Therefore, I recommend that company could save on the cost by hosting the convention in Argentina, Hungary, Japan or Turkey.
I recommend starting an event in Turkey. Because more than half of the company’s employees are located in Europe, North America and the Middle East, it is convenient to get there, and participants may be more receptive to Turkey. Secondly, the U.S. dollar has risen by about 200% against the Turkish currency in the past three years. Other currencies have been on an upward trend recently and exchanging them may result in losses.
When considering where to host the event, Japan is an attractive option due to its well-developed infrastructure, the depreciation of the yen against the dollar, and the cultural experience it offers. However, there are other countries with significant currency depreciation that should also be taken into consideration. Over the past three years, the currencies of Turkey, Argentina, Brazil, South Africa, and Mexico have all depreciated significantly against the US dollar, making them viable options for the event. Buenos Aires, Argentina, and Istanbul, Turkey, in particular, offer excellent facilities and could be used to host the event. By taking advantage of these favorable exchange rates, the company could save on costs while still providing a memorable experience for the executives. Japan may be the ideal location, but the company should also consider the other countries with significant currency depreciation to maximize their savings.
Organizing an annual event for 100 executives with a budget of $1 million for three days is a significant task. We need to consider several factors when deciding to hold the meeting in New York or to take the advantage of currency depreciation in Europe, Japan, Turkey, Argentina, or other countries. I think our company should first analyze and compare cost.
1. Cost in New York:
Accommodation, meals, and entertainment for 100 executives: $1,000,000
Travel expenses to New York for 30% of executives: $300,000
Total Cost in New York: $1,300,000
2. Cost in alternative locations:
We need to estimate factors, for example, Exchange rates, Accommodation costs, Meals and entertainment costs, Local transportation expenses, Venue rental fees, Safety and infrastructure. And we also need to check if the depreciation in the local currency provides substantial cost savings.
3. Evaluate the Benefits:
We also need to consider the benefits of hosting the event in each location, such as networking opportunities.
I suggest holding the meeting in Asia, such as China, because the exchange rate between the US dollar and the Chinese yuan has been relatively good and has not fluctuated much in the past year, while the exchange rates in the other three regions have fluctuated greatly. In addition, Asia is moderately close to where candidates from other regions are located, so the time it takes for everyone to fly here won’t be too different.
Based on the analysis of currency depreciation and cost savings, I recommend Argentina as a potential replacement for New York as the convention location.The Argentine Peso has experienced significant depreciation against the US Dollar over the last three years. This depreciation can lead to cost savings when organizing your convention.The exchange rate of Argentine Peso to US Dollar was 0.0167 on January 3,2020. But recently, their exchange rate is 0.0029 on October 29,2023. It means the currencies of Argentina was delined approximately 83% in recent three years. Argentina now provides a more affordable environment for holding events.
Amazon will host a global conference for executives. The conference is three days long as well as has an overall budget of one million dollars. Some employees within the company have proposed that because of currency devaluation in other regions, the conference should be held somewhere other than the United States, which would save the company’s budget. We listed three regions to compare with New York based on the largest cities on each continent: Istanbul, Tokyo, and Sydney.
The Japanese Yan has lost 23.92% of its value over the last five years compared to the US Dollar, the Turkish Lira has lost 80.71% of its value, and the Australian Dollar has lost 12.04% of its value. Istanbul seems to be the most favorable at the moment. In terms of accommodation, the average hotel price in Tokyo is 71.5 USD per day, Sydney is 169 USD per day and Istanbul is 50 USD per night. Compared to New York (206 per night), Istanbul is the most economical. Istanbul also has lower food and entertainment options than other regions and is very localized, which is believed to attract executives’ interest.
Of course, Tokyo, Japan, a place with a very different culture than the West, is also a very good choice, and the price of accommodation (for a single person) is not too different from Istanbul. One of the advantages of choosing Japan is that it has a very developed economy. For a company like Amazon, which focuses on technology and consumer experience, hosting a conference in Japan is not only a way for executives to experience a different culture, but also a great learning experience. Another option could also be China, Hangzhou – one of the most developed areas for e-commerce in China. So I would suggest that Amazon should consider a number of factors to decide where to hold its global conference. New York is a more expensive option that can be disregarded.
I think we should take advantage of recent currency depreciations in planning this annual event, to maximize our budget efficiency. The Turkish lira has depreciated around 60% against the dollar in the past two years. This trend means that USD can buy more TRY than before, potentially leading to cost savings in Turkey for expenses paid in the local currency. Turkey generally has a lower cost of living and lower prices for services compared to New York. This factor, combined with the depreciation of the TRY, could result in substantial cost savings in terms of accommodation, meals, and local transportation. Even though the travel cost for executives from North America will be higher, but this can be offset by the currency depreciation in Turkish Lira. Also, the travel cost for executives from Europe & Middle East will be lower because Turkey is a closer spot than New York.
Prepare a recommendation showing how we could save on the cost by hosting the convention in a location other than New York. Focus on the depreciation of other currencies compared to the dollar for the last three years.
I chose holding the convention in Seoul, South Korea. I believe Seoul is the best option because it is the most city-like location in comparison to the other parts of East Asia, which I think makes up the fact that other places in East Asia would be cheaper. 1 USD is 1357.34 South Korean Won and looking at the past 5 years, the currency compared to the dollar is very consistent which means we can buy all the hotels and plane tickets in advance without worrying that the USD would get stronger/weaker. In addition, it was found that the average Seoul (major city in South Korea) hotel was 45 USD a night which is cheap especially comparing to 175 USD in New York (almost 4 times the amount!).
The average meal at an inexpensive restaurant in South Korea was $6.66 USD and a meal for two at a mid-range restaurant (3 courses) was 39.98 USD. This is substantially cheaper than NYC’s price in food! In NYC, the price of an inexpensive meal was 25.50 USD while a meal for a mid-range restaurant was 120 USD. The difference is large (almost 3 to 4 times).
For transportation compared to NYC, Seoul is around half the price for everything (a one way ticket was .98 USD while in NYC it was 2.90 USD)!
Finally, for entertainment, in New York, a cinema ticket was 19.50 while in Seoul, the price was 10.35 USD. Overall, Seoul is around 3-4 times cheaper in every single aspect!
Finally the main reason I chose South Korea is because a good amount of the representatives are from Asia (30%) so it justifies having the location to be there.
New York is an great city with lots to do but Seoul has just as many amenities! Seoul has numerous theaters, spas, amusement parks and even a K-POP center that teaches dance lessons! These are the reasons why I believe Seoul is a great city to choose to hold the convention. I feel that although other cities in other parts of Asia may be cheaper (Hanoi in Vietnam), Seoul has the most to do and has the most similar city feel to New York while being decently affordable.
Sources
https://www.google.com/finance/quote/KRW-USD?sa=X&ved=2ahUKEwivlLq96aGCAxXFE1kFHYEQAFUQmY0JegQIChAr
https://www.budgetyourtrip.com/hotels/south-korea/seoul-1835848
https://www.budgetyourtrip.com/hotels/united-states-of-america/new-york-city-5128581#:~:text=The%20price%20of%20accommodation%20can,New%20York%20City%20is%20%24524.
https://www.numbeo.com/cost-of-living/in/New-York
https://www.numbeo.com/cost-of-living/country_result.jsp?country=South+Korea&displayCurrency=USD
https://english.visitseoul.net/entertainment
Compared to 2021, Apple’s net revenue increased by 8%.
Driver1: Sales growth by product
1.iPhone: Net iPhone sales increased by 7% due to the company’s release of new iPhone models in 2022.
2. Mac: Mac net sales increased by 14% due to increased laptop demand.
3.iPad: Compared with 2021, iPad net sales declined by 8% in 2022 because the iPad Pro is still in its 2-3 use period and people will not buy new iPads so quickly.
4. Wearables, Home, and Accessories: Net sales of them increased by 7% due to increased demand for Apple Watch and Air Pods.
5. Serve: Services net sales increased by 14% due to higher income in advertising, cloud services, and the App Store.
Driver2: Sales growth by region
1. Americas: Americas net sales increased by 11% during 2022 due to higher demand for iPhone, Services, and Mac.
2. Europe: Europe’s net sales increased by 7% due to higher demand for iPhones and Services. The weakness in foreign currencies relative to the U.S. dollar had a net unfavorable year-over-year impact on Europe’s net sales during 2022.
3. Greater China: Greater China’s net sales increased by 9% due primarily to higher net sales of iPhones and Services. The strength of the renminbi relative to the U.S. dollar had a favorable year-over-year impact on Greater China’s net sales during 2022.
4. Japan: Japan’s net sales decreased by 9% during 2022 compared to 2021 due to the weakness of the yen relative to the U.S. dollar.
5. Rest of Asia Pacific Rest of Asia Pacific: Net sales increased by 11% during 2022 compared to 2021 due primarily to higher net sales of iPhone, Mac, and Services. The weakness in foreign currencies relative to the U.S. dollar had an unfavorable year-over-year impact on the Rest of Asia Pacific net sales during 2022.
Apple’s net revenue increased by 8% compared from 2021.
Driver1: Region growth
1. Greater China: Greater China’s net sales increased by 9% due to the currency change and other factors like new products.
2. Americas: Americas net sales increased by 11% during 2022 .
3. Europe: Europe’s net sales increased by 7% due to the weakness in foreign currencies relative to the U.S. dollar had a net unfavorable year-over-year impact on Europe’s net sales during 2022.
4. Japan: Japan’s net sales decreased by 9% during 2022 compared to 2021 due to the weakness of the yen relative to the U.S. dollar.
Driver2: Product growth
1.iPhone: Net iPhone sales increased by 7% due to the company’s release of new iPhone models in 2022.
2. Mac: Mac net sales increased by 14% due to increased laptop demand.
3.iPad: Compared with 2021, iPad net sales declined by 8% in 2022 because the iPad Pro is still in its 2-3 use period and people will not buy new iPads so quickly.
5. Services: Services net sales increased by 14% due to higher income in advertising, cloud services, and the App Store.
The company I chose is Disney. Disney’s two main segments are Disney Parks, Experiences, and Products (DPEP) and Disney Media and Entertainment Distribution (DMED). From 2020 to 2022, Disney’s total revenue will range from $65.3 billion to $82.7 billion, an increase of almost 20 million (22.7%).
Here are some of the main drivers:
First of all, with the end of the covid 19 epidemic and the advent of the holidays, more people choose to go out, and the number of people visiting Disneyland has increased significantly. During this period, Disney’s ticket prices have increased, but the number of people entering the park is still very high.
Secondly, as the number of tourists increases, so does the sales of goods and food. The impact of DPEP has turned from negative to beneficial.
Third, Disney media has been on an upward trend in recent years, even during the pandemic. Because of the adoption of streaming media, especially Disney+, which has 146.7 million subscribers worldwide, is still a growing trend. The increase in Disney+’s market share is very beneficial to Disney.
Fourth, DMED’s growth has not been affected by the end of the epidemic because Disney has continued to export good movies to ensure the stability of customers.
Disney’s DPEP and DMED will show an increasing trend year by year in 2022. The Disney Company has also determined that Disney streaming media will have a price increase in 2023, which will give Disney more revenue and increase overall sales.
In 2022, Spotify experienced significant sales growth, ending the year with a robust subscriber base of 205 million users. The company’s annual revenue reached an impressive 11.7 billion euros, reflecting a notable 21% increase from the previous year. This substantial growth underscores Spotify’s strong position in the competitive digital music streaming industry. Despite the challenges and changes in the landscape, Spotify managed to adapt and thrive, emphasizing the company’s ability to navigate evolving market dynamics while maintaining substantial sales growth.
Comparing the currency fluctuations of the Euro, Japanese Yen, Turkish Lira, and Argentine Peso, the recommendation is to hold the convention in Argentina as the US dollar holds the highest value due to the recent drastic depreciation of the Argentine Peso. The USD to ARS conversion has grown by 680% over the past 2 years and over 2000% in the past 5 years. The ARS significantly depreciated in mid-December 2023 and has continued to depreciate further into 2024. The current going rate as of March 2, 2024, is 1 USD = 843 ARS.
The budget of USD$10,000 (AR$8,432,770) per executive will be more than enough and should have plenty of room for company savings. As an example, a 4 days, 3 nights stay (breakfast included) at a 5-star hotel in Buenos Aires costs roughly around AR$500,000 or only USD$592. This 5-star hotel rate simply does not exist in New York.
1. First, we need to determine the region and specific city for the conference. Since only ten percent of the executives are from New York, we will only consider hosting the conference in North America, Europe and the Middle East, and Asia. Moreover, we have selected New York, Istanbul, and Tokyo as our preferred cities because these cities are not only major urban centers but also very suitable for tourism.
2. Next, we will estimate the costs based on the depreciation of local currencies in different regions over the past five years: the Japanese Yen has depreciated by 25.24% against the US dollar, while the Turkish Lira (TRY) has depreciated by 71.93% against the US dollar over the same period. However, we still cannot determine which location is more suitable for holding the conference at this point.
3. Finally, we need to look at how much the cost of living in these cities translates into US dollars:
– Travel Costs: New York $500, Istanbul $400, Tokyo $700
– Hotel Costs: New York $300, Istanbul $100, Tokyo $200
– Dining Costs: New York $150, Istanbul $50, Tokyo $100
– Entertainment Costs: New York $100, Istanbul $50, Tokyo $150
– Total Costs for Three Days: New York $2,150, Istanbul $1,000, Tokyo $2,050
Overall, Istanbul appears to be the most suitable place to hold the company conference, not only because of its largest currency depreciation but also because the US dollar’s purchasing power has increased there, allowing for more products and services to be bought than before.
Apple’s sales growth in the past 2 years can be broken down to (1) product category performance, particularly pivoting into Services and (2) regional sales dynamics.
One of Apple’s most prominent growth has been its diversified performance across its product categories. While traditional hardware lines like the iPhone, Mac, and iPad have long been Apple’s revenue backbone, a notable shift towards Services has emerged. In 2023, Services, which include offerings like Apple Music, iCloud, and Apple TV+, marked a significant growth area with a 9% increase in net sales, translating to $7.1 billion more than the previous year. This shift signifies Apple’s strategic pivot towards building recurring revenue streams, to help mitigate the drop in demand for hardware products, particularly the Mac and iPad as well as volatility in the sales cycles.
Additionally, Apple’s global footprint means regional dynamics, including economic conditions, currency fluctuations, and consumer preferences influence its sales. The past two years have seen varying performances across different geographies. In the Americas, a 4% decrease in net sales was reported, mainly due to lower iPhone and Mac sales. Europe and Greater China similarly experienced decreases in net sales by 1% and 2%, respectively, with currency weaknesses playing a significant role in these regions. Japan saw a larger decrease in net sales of 7%, while the Rest of Asia Pacific experienced a small increase of 1%, highlighting the diverse impacts of regional market dynamics and currency fluctuations on Apple’s sales.
OPTION 1
Meta’s Global Executive Meeting
After taking a closer look at moving our global executive meeting from New York to Japan, it seems like a smart move with a lot of financial upside. The Japanese Yen has dropped by about 20% against the US dollar over the past three years, which gives us a great opportunity to cut costs by taking advantage of the better exchange rate.
Currently, the estimated cost per executive in New York is around $10,000. However, by moving the meeting to Japan, we could reduce the cost to approximately $7,500 per person, saving us 25%. In total, we’d save around $250,000. The majority of the savings would come from lower hotel and meal costs. Tokyo hotels are about 30% cheaper than New York, and meals are about 40% less expensive. Furthermore, transportation and venue rentals in Japan are approximately 25% cheaper
While flights from North America to Japan might be a bit pricier, this would be offset by cheaper flights for execs coming from Asia and the Middle East, where flying to Japan costs less than flying to New York. Plus, with Meta’s growing presence in Asia, Japan is strategically located and closer to key markets.
Aside from saving money, Japan provides a diverse range of cultural and logistical benefits that will make the event more enjoyable overall. The country’s excellent technological infrastructure and unique cultural experiences would greatly enhance the meeting.
With all of this in mind, I recommend that we consider Japan for Meta’s global executive meeting. The cost savings, combined with the additional strategic benefits, make it an excellent decision for us.
Given the depreciation of several currencies against the U.S. dollar, hosting the convention outside of New York would allow us to reduce costs significantly. After evaluating several markets, Tokyo seems like the most strategic choice.
1. Japan: The yen has depreciated by 30% over the last 3 years. Tokyo’s hotels, meals, and entertainment are 25-40% cheaper than in New York. This would bring the per-person cost down from $10,000 to $7,500, saving $250,000 overall.
2. Turkey: With the lira down 60%, Istanbul offers even greater savings, with costs dropping to $5,500 per person, saving $450,000 overall. However, travel logistics could complicate attendance.
3. Argentina: The Argentine peso has rapidly depreciated, offering opportunities for savings. However, longer travel times for executives from APAC and North America make it less convenient.
Final Recommendation: Tokyo is the best option, balancing savings, accessibility, and aligning with Lululemon’s growing presence in Asia. The total estimated cost would now be $750,000, allowing us to use the saved $250,000 for other initiatives.
For the Meta annual executive event, I’d suggest that it be held in either Turkey. In general, a depreciated currency relative to the USD makes the costs become more affordable for companies that are U.S dollar based. Based on date from XE, the Turkish Lyra has depreciated in comparison to the USD by over 83% over the past 5 years. Similarly, the Argentine Peso has depreciated in comparison to the USD by over 64%. Japan and Euro had significant depreciation in relation to the USD in comparison to the USD, but no where near Argentina and Turkey.
In terms of flights and transportation, Turkey is an extremely large travel hub, meaning there will be convenient flights for all members of the executive coming from various corners of the world making flights per person (round trip) between $1000-$1400. Once the executives arrive in Turkey, the depreciation rate is to their advantage as the executives can leverage a strong USD to provide entertainment, housing and meals to the guests. By choosing a location with a favorable currency rate, Meta could reinvest savings into enhancing the executive experience or even trimming the event budget while maintaining high standards. Therefore, my suggestion would be to host this retreat in the location with the highest depreciation rate, Turkey.
To identify the best cost-saving opportunities, analyzed the currency depreciation against the USD over the last three years for the following region/ countries.
Europe (Euro) The Europe has depreciated approximately 10-15% against the USD, which bring the estimate cost for 100 executive to $850,000 – $900,000
Japan (Yen) The Yen has depreciated around 15-20% against the USD, which bring the estimate cost for 100 executive to $800,000 – $850,000
Turkey (Lira) The Lira has depreciated around 40-50% against the USD, which bring the estimate cost for 100 executive to $500,000 – $600,000
Argentina (Peso) The Peso has depreciated by approximately 60-70% against the dollar, which bring the estimate cost for 100 executive to $300,000- $400,000
Based on the analysis, Argentina is the most cost-effective option for hosting the executive event, by taking advantage of the depreciation of currencies, it offering potential savings of up to $700,000 compared to hosting in New York. This would not only improve the budgetary efficiency of the event but also allow for a more valuable and richer experience for the executive compare to hosting in New York.
1. Europe (France or Italy): Aligns with LVMH’s luxury branding. With the euro depreciating, costs could reduce by 10-12%. Holding the event in a European fashion capital could also reinforce brand prestige.
2. Japan: A top luxury market, important for LVMH. Hosting here provides a 15% cost benefit and aligns with market presence goals.
3. Turkey or Argentina: While these options offer the highest savings, they might not align with LVMH’s luxury image. Turkey still holds solid connection to high-end tourism.
For LVMH’s annual executive event, hosting in Paris offers significant financial advantages with the 10% depreciation of the euro against the US dollar. With major event costs (accommodation, meals, and entertainment) charged in euros, the budget benefits from favorable exchange rates, resulting to an estimated 10% overall savings. This decrease could reduce $100,000 from the initial $1,000,000 budget if the event were held in New York. By choosing Paris, LVMH decreases its exposure to foreign exchange concerns since payments are aligned with the company’s euro-denominated activities, resulting in more predictable expenditures.
Paris not only offers financial efficiency but also lowers travel costs for European and Middle Eastern executives, who accounts for 60% of attendees, thus lowering overall expenses. LVMH’s strong presence and history in the city may bring additional discounts on venues and services, increasing cost-effectiveness. This strategy ensures that the event remains aligned with the brand’s luxury image while maintaining cost-effective through currency optimization and localized spending advantages.
OPTION 2
Meta’s sales growth between 2022-2023
Based on the official press release of Meta addressing the full year 2023 financial highlight
(https://investor.fb.com/investor-news/press-release-details/2024/Meta-Reports-Fourth-Quarter-and-Full-Year-2023-Results-Initiates-Quarterly-Dividend/default.aspx)
Between 2022 to 2023 the revenue increased from $113.6 billion to $131.9 billion, this $18.3 billion sales growth can be divided into three main drivers.
1. Advertising: Being the most profitable and primary revenue stream of Meta, Advertising contribute $18.3 billion sales growth, which took up 100% of the total sales growth. This solid growth rate is driven by higher ad demand and improved ad products.
2. Other revenue: Other revenue increased marginally, from $808 million in 2022 to $1.058 billion in 2023. This segment represents a smaller portion of Meta’s total revenue, contributing only a slight growth of 0.3 billion.
3. Reality lab: Reality Labs, responsible for Meta’s investments in VR/AR and metaverse technologies, saw a slight decline in revenue from $2.159 billion in 2022 to $1.896 billion in 2023. The decline reflects challenges in the metaverse segment or shifts in strategic focus, though the overall impact on Meta’s total revenue remains limited given the segment’s smaller contribution.
Lululemon’s overall growth of 18.5% between 2022 and 2023 is due to several drivers. The major ones, in my opinion, are:
Product innovation: Lululemon has consistently launched new and innovative products, including an accessory line. For example, the “Wundermost” line for women, the golf and tennis lines for both genders, and the “Steady State” and “Soft Jersey” lines for men, as well as new versions of the Blissfeel and Chargefeel sneakers.
Opening of new stores: This is also a major factor that drove a significant increase in sales. We opened stores in a variety of formats, including different sizes of company-operated stores, outlets, pop-ups, and stores operated by third parties under supply and license agreements in the Middle East and Israel. In 2023, we opened 28 new stores in Mainland China, bringing the total to 127 stores in the country. The expansion of our operations helps build our brand awareness, resulting in growth in net revenue.
Development of a multichannel strategy: We are investing not only in opening more physical stores but also in our e-commerce and digital channels to reach customers in different markets. We have secured a strong online presence in our e-commerce channel, serving our guests via our country-specific websites, our mobile app, and through third-party regional marketplaces such as Zalando, Lazada, and SSG.
Investment in marketing and advertising: We are increasing brand awareness through new campaigns and global brand activations. For example, the Dupe Swap event in Los Angeles was very successful in bringing many new customers to our brand. We believe investing in brand awareness is crucial to driving our international expansion and growth.
Community engagement: We invest in community-building through events such as World Mental Health Awareness Day, held by Lululemon in six cities in China, which gathered more than 9,000 people. Community is one of our core values, and we believe it is also very powerful in helping to increase brand awareness, strengthen brand loyalty, and acquire new customers, thereby increasing our market share.
The decline in Estée Lauder’s sales from 2022 to 2023 is attributed to several factors. The slow recovery of the travel retail market in the Asia Pacific region, particularly in Mainland China and South Korea, significantly impacted performance. Additionally, pandemic-related restrictions and rising COVID-19 cases in Mainland China negatively affected sales in the first half of fiscal 2023. Other regions were also impacted by unfavorable foreign currency translations, especially the strong U.S. dollar. Furthermore, a shift in product mix, with a decrease in high-margin skincare sales, led to a lower overall gross margin。
According to Tesla’s 2022-2023 annual report, there are four main growth drivers that impacted its revenues. Automotive Sales Volume, Automotive Regulatory Credits, Services and Other Revenue and Energy Generation and Storage. Firstly, the increase in automotive sales revenue was primarily driven by higher deliveries of the Model 3 and Model Y vehicles, specifically due to the global production ramp-up of the Model Y. However, This volume increase was partially offset by reductions in the average selling price and adverse effects from currency fluctuations. Secondly, Revenue from regulatory credits increased slightly by $14 million in 2023 compared to 2022. Tesla sells these credits to other manufacturers to help them meet emissions standards. This revenue source is connected directly to Tesla’s production and regulatory compliance requirements. In addition, revenue from services and other increased significantly, influenced by the growing fleet size, which led to more sales of used vehicles, maintenance services, parts, and paid Supercharging. This growth reflects increased volume and usage among Tesla’s customer base. Lastly, Revenue from Tesla’s energy generation and storage segment rose by $2.13 billion, primarily due to increased deployments of its large-scale Megapack energy storage solutions.
For Nvidia, foreign exchange and strong demand in key segments contributed notably to its sales growth. In 2023, Nvidia experienced robust revenue growth driven by significant demand for its Data Center products, with an increased focus on AI and machine learning applications across enterprise and cloud services. However, foreign exchange fluctuations, particularly a stronger U.S. dollar, presented headwinds that slightly impacted overall sales in international markets.
Despite these challenges, Nvidia’s ability to cater to the expanding AI market allowed it to offset foreign exchange pressures, leading to continued revenue growth. The Gaming and Automotive segments also saw steady demand, with innovations like the GeForce RTX 40 Series and partnerships in autonomous vehicle technology supporting Nvidia’s position as a leader in cutting-edge tech solutions across global markets.
Holding the executive convention outside New York could significantly reduce costs, especially considering recent currency fluctuations. Tesla’s global operations highlight the advantages of strategic location choices to optimize manufacturing and distribution costs; similarly, leveraging favorable exchange rates can create significant cost benefits for this event.
Lisbon, Portugal is the recommended location for the executive convention. The substantial cost savings compared to New York ($250,000) would justify the costs involved in moving the event, particularly if the exchange rate differential remains favorable.
Reasons for Choosing Lisbon:
Significant Currency Depreciation: The Euro has experienced periods of depreciation against the dollar over the last three years, making travel and expenses in the Eurozone potentially cheaper than in the US.
Lower Cost of Living: Portugal, in general, offers a lower cost of living compared to New York, translating into potentially lower costs for hotels, meals, and entertainment.
Attractive Destination: Lisbon is a vibrant and attractive city, offering a rich cultural experience and various tourist attractions to engage executives during their free time.
Accessibility: Lisbon has an international airport with good connectivity to various global cities, ensuring convenient travel for the executives.
Potential for Negotiation: By choosing a location outside of a major global hub, there is potentially more negotiating power in terms of hotel and other event-related costs.
Integrated Energy Solutions: Tesla aims to provide integrated energy solutions, combining vehicle charging with home solar power and battery storage. This integrated approach can be appealing to environmentally conscious customers, potentially boosting sales in both sectors. This synergistic effect could enhance sales growth.
Increased Accessibility to Financing: Favorable automotive credit regulations that make financing easier and more affordable for consumers could increase Tesla’s sales, particularly for buyers who rely on loans to purchase vehicles. This could lead to increased sales volume.
Positive Spillover Effects: A thriving automotive market can create a more positive perception of the industry as a whole. This positive perception could benefit Tesla, increasing consumer interest and willingness to consider electric vehicles, thus increasing overall sale growth.
To save money on the annual executive event, we can choose a location where the local currency has lost value against the U.S. dollar. This makes things like hotels, food, and event spaces cheaper for us. In the past three years, the Turkish lira, Argentine peso, and Japanese yen have lost a lot of value. This means we can get more money in these countries than in New York. The best options for saving money are Istanbul, Turkey, and Buenos Aires, Argentina. These cities have much lower costs for hotels, food, and event venues. The U.S. dollar is much stronger there, so we can spend less but still have a great event. Tokyo, Japan, also has a weaker currency, but it is still an expensive city so that we would save less. By moving the event to Istanbul or Buenos Aires, we can cut costs while still providing a high-quality experience for the executives.
McDonald’s global sales over the past 5 years have been following a positive trajectory. Looking forward over the next 3 years, sales projections are positive, building on the firm’s $130 billion annual global sales in 2023. With the fast food industry’s CAGR of 4.6% and McDonald’s strategic investments in restaurant expansion, menu innovation, and operational efficiency, sales are not only expected to rise based on the firm’s price increases, but incremental sales are to be achieved as well. McDonald’s plans to open 10,000 new restaurants globally by 2027, with 2% of annual sales growth attributed to these new locations. Moreover, McDonald’s product portfolio expansion in emerging growth categories such as the new concept of CosMc’s beverage brand, they are likely to further generate incremental sales. Based on these factors and industry trends, McDonald’s could see its global annual sales grow to approximately $145–$150 billion by 2026.
Given the rising costs of hosting international conventions, relocating the annual executive event from New York to a location where the local currency has depreciated against the U.S. dollar presents a significant cost-saving opportunity. Over the past three years, countries such as Japan, Turkey, and Argentina have experienced substantial currency depreciation relative to the dollar. Hosting the event in one of these countries could allow the company to stretch its $1 million budget considerably further without compromising on quality.
For example, the Japanese yen has depreciated by approximately 30%, making Tokyo a compelling option. Japan offers world-class infrastructure, safety, and ease of travel, particularly for executives from Asia and Oceania. Similarly, Turkey has seen a depreciation of over 60% in its currency, which could result in more than 50% savings on local expenses in a city like Istanbul, though some consideration should be given to economic and political stability. Argentina’s peso has depreciated even more dramatically, offering potential for deep cost savings in cities like Buenos Aires. However, high inflation and logistical complexity may offset some of those benefits.
Additionally, relocating the event to a location that is geographically central to the distribution of executives—30% from North America, 30% from Europe & the Middle East, 30% from Asia, and 10% from Oceania—could help balance travel costs. Hosting in a European or Middle Eastern city where the euro or local currencies have weakened could also yield modest savings while remaining logistically sound.
Overall, by strategically choosing a host country with a favorable exchange rate, the company could maintain the quality of the experience while significantly reducing costs per executive, potentially freeing budget for enhanced programming or future initiatives.
Source for Currency Depreciation & Exchange Rates:
Internal Revenue Service. Yearly Average Currency Exchange Rates. U.S. Department of the Treasury, https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates. Accessed 31 Mar. 2025.
Relocating the annual executive event from NY to another country where the local currency has significantly depreciated against the U.S. dollar will be an excellent cost-saving opportunity – provided that there is no compromise on the quality as well. Over the past three years, countries like Turkey, Argentina, Japan, and ever certain parts of Europe have undergone substantial currency devaluation – allowing the company to stretch its million dollar budget further.
Relocating the annual executive event from New York to a country where the local currency has significantly depreciated against the U.S. dollar presents an excellent cost-saving opportunity without compromising on quality. Over the last three years, countries like Turkey, Argentina, Japan, and parts of Europe have seen notable currency devaluation, allowing the company to stretch its $1 million budget much further.
Let’s break down the numbers for each country mentioned:
1. Turkey: In comparison to 2024, the dollar has almost doubled in purchasing power in 2025, with the Turkish Lira being approximately 31.7 TRY as of March 2025. If the event costs $10,000 per executive in New York, hosting in Turkey could bring it down to around $4,700–$5,000 per executive—a potential saving of up to $500,000 overall.
2. Argentina: From 2022 to 2025, the country has experienced more than 600% in devaluation (Argentine peso depreciated from 115 ARS/USD in 2022 to over 850 ARS/USD in 2025). However, hyperinflation and logistical issues may make Argentina a bit more of a complex choice. Still, potential savings could exceed $600,000 if planned carefully.
3. Japan: Since 2022 to March of 2025, the Japanese Yen has depreciated by 41% (15 JPY/USD in 2022 to 162.64 JPY/USD in March 2025). Tokyo offers high-quality infrastructure and safety, and savings of around 30–35% on local expenses could be expected, translating to a $300,000–$350,000 reduction in total spend.
4. The euro has weakened from ~0.88 EUR/USD in 2022 to 0.92 EUR/USD today. While savings aren’t as dramatic, hosting the event in cities like Lisbon or Athens—where costs are already lower than Western European hubs—could still reduce total expenses by 15–20%.
By shifting the event to a country with a significantly depreciated currency—such as Turkey, Japan, or parts of Eastern Europe—the company could reduce total costs by 40–60%, amounting to $400,000 to $600,000 in potential savings. These savings could be reinvested into executive development programs, enhanced hospitality, or future strategic initiatives. Many of these countries offer high-quality venues, international-standard infrastructure, and a lower cost of living, all of which allow for a premium experience at a significantly reduced cost. Taking all factors into account—including currency advantage, safety, infrastructure, and accessibility—the most balanced and strategic option would be to host the event in Turkey. With the Turkish lira having depreciated by over 100% in the past three years, and Istanbul offering world-class hotels, conference venues, and convenient flight routes from both Europe and Asia, it presents the strongest value-for-money proposition without compromising quality. Moreover, choosing a location closer to the geographic centre of attendees—30% from Europe & the Middle East, 30% from Asia, and 10% from Oceania—further reduces travel costs and logistical strain. This forward-looking approach not only maximises the current budget but also aligns with global cost-efficiency trends, demonstrating smart financial stewardship and adaptability.
Links: https://www.oanda.com/currency-converter/en/?from=EUR&to=USD&amount=1
https://fiscal.treasury.gov/reports-statements/treasury-reporting-rates-exchange/
Hosting the company’s annual executive meeting in a location with a depreciated currency compared to the US dollar can significantly reduce costs. Over the past three years, currencies like the Argentine peso (depreciated by 350%), Turkish lira (66%), Japanese yen (33%), and euro (20%) have weakened against the dollar. Based on these trends, Argentina offers the biggest cost savings, potentially reducing the $1 million budget by $400,000 due to favorable exchange rates. If Argentina is not viable, Europe (primarily Spain or Portugal) could serve as a secondary option, offering moderate savings while maintaining stability and quality. Turkey and Japan are less favorable due to higher costs despite their currency depreciation. By strategically choosing a location like Argentina or Europe, the company can optimize expenses while delivering a successful event.
When a company plans a three-day conference for 100 executives each year, we of course want to get as much value out of the budget as possible while maintaining the quality of the event. This year’s overall budget was $1 million, which averaged out to roughly $10,000 per executive, covering all aspects of transportation, lodging, meals and entertainment. While New York is always a popular place to hold conferences and has a great infrastructure, given the overall cost, it’s actually worth looking at whether there are more cost-effective alternative options.
The U.S. dollar has continued to strengthen over the past few years, and relatively speaking, many countries have seen their currencies depreciate. For example, the euro has gone from 1 euro to $0.951 in 2022 to $0.924 in 2024; the Japanese yen has fallen from 131.45 to 151.35; the Turkish lira has depreciated from 16.57 to 32.86; and the Argentinean peso has fallen from 130.79 all the way down to 915.16. These changes suggest that it would be more cost-effective to spend money with the dollar in these countries. In other words, you can get more and better resources for the same budget by choosing these places to host the conference.
In countries like Japan or Turkey, the price of a night in an upscale hotel may be 30% or more cheaper than in New York. And because of the advantage of the exchange rate, we have more leverage when bargaining with suppliers. The cost of conference venues, catering and transportation may also be lower. European countries like Portugal and Greece, which are relatively economical but have good hospitality, are also worth considering.
Of course, the choice of location can not only look at the exchange rate. We also have to consider the local inflation rate, economic stability, ease of travel for executives, visa policies, and overall service experience. Like Argentina, although the exchange rate looks particularly good value, it has high inflation, which may affect the actual cost. Japan, on the other hand, although its currency has also depreciated quite a bit, the quality of service and infrastructure are more assured, making it a safer choice.
references:
https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates
https://data.worldbank.org/indicator/PA.NUS.FCRF
Option 2 Explaining Sales growth
Apple’s recent sales growth highlights both challenges and opportunities. In fiscal 2024, Apple achieved total revenue of $391 billion, a slight increase from previous years. The company’s growth was mainly driven by its services division, which grew 12.87% year-on-year to $96.17 billion, showing the growing importance of subscription services such as iCloud and Apple Music. Meanwhile, iPhone sales remained relatively flat at $201.18 billion, up just 0.3% year-on-year as the smartphone market reached saturation in key regions. Mac revenue also grew slightly by 2.14%, while wearables and accessories fell by 7.13%, suggesting that consumer demand for these products may face resistance.
Regional performance provides further insight into Apple’s growth drivers. The Americas remained the largest contributor, generating $167 billion (43% of total revenue), up 3.84% year-on-year in the fourth quarter of 2024. Europe emerged as a key growth region, with strong demand driving sales up 7% year-on-year to $101.3 billion, despite competition from Chinese brands such as Oppo. However, revenue in Greater China fell 8% year-on-year to $67 billion, reflecting economic challenges and increased competition in the region. Japan and the rest of Asia-Pacific contributed smaller shares but remained stable. These regional trends highlight Apple’s reliance on its diversified global presence while underscoring the need to address challenges in specific markets.
Sources:
https://backlinko.com/apple-statistics
https://www.apple.com/newsroom/pdfs/fy2023-q4/FY23_Q4_Consolidated_Financial_Statements.pdf
Reviewing three years of currency depreciation data shows that the U.S. dollar gained strength in several countries which could help lower the event costs.
1. Argentina
The Argentine peso experienced major depreciation moving from about 70.635 ARS/USD in 2020 to 915.161 ARS/USD in 2024, and Argentina’s favorable exchange rate provides cost advantages yet faces economic instability with high inflation and shifting policies. According to recent reports domestic prices have risen which results in some goods becoming more costly even though the peso has depreciated.
2. Turkey
August 2024 saw the Turkish lira reach an all-time low with an exchange rate of 36.32 TRY/USD, while Turkey has experienced economic difficulties due to its high inflation rates and the closure of numerous businesses.
3. Japan
The Japanese yen has fallen from approximately 106.725 JPY/USD in 2020 to 151.353 JPY/USD in 2024, and Japan provides a stable economic backdrop along with superior infrastructure which makes it an ideal destination for international events.
4. Eurozone Countries
From 0.877 EUR/USD in 2020 the euro has fallen to 0.924 EUR/USD in 2024, and Europe offers multiple destinations equipped with advanced facilities that can host executive meetings effectively.
Recommendation:
Japan stands out as the top choice when evaluating currency depreciation and economic stability together. Event costs will likely decrease as the U.S. dollar gains more purchasing power from the yen’s substantial depreciation. The strong infrastructure and political stability in Japan enhance its appropriateness as a destination for hosting events.
Action Steps:
Cost Analysis: Perform a thorough expense comparison between Japan and New York by examining travel costs, accommodation expenses, and event service fees.
Logistical Planning: Work with Japanese event planners to examine venue availability and transportation logistics among other considerations.
Decision Making: Examine the possible financial benefits alongside practical considerations to determine whether relocating the event is advisable.
The company can benefit from lower costs through advantageous exchange rates and deliver an outstanding event experience by selecting Japan as the event location.
Sources:
https://www.irs.gov/individuals/international-taxpayers/yearly-average-currency-exchange-rates
https://www.reuters.com/world/americas/stung-by-high-prices-argentines-seek-cheaper-nikes-big-macs-abroad-2025-01-06/
https://tradingeconomics.com/turkey/currency
https://www.reuters.com/markets/turkish-firms-face-wave-closures-amid-economic-reckoning-2024-09-09/
OPTION 1:
We can save money on our annual McDonald’s executive event by holding it in another country instead of New York. Looking at the average exchange rates of the countries mentioned above over the past five years (1):
EUR – Has appreciated 0.2%
JPY – Has depreciated 27.55%
TRY – Has depreciated 82.27%
ARS – Has depreciated 87.9%
(All are relative to USD)
Though the Argentine peso (ARS) has depreciated the most against the U.S. dollar, I recommend holding our executive event in Turkey because it offers the best combination of affordability and convenience. Here’s why:
For one, because our leadership team is split across 30% in North America, 30% in Europe & the Middle East, 30% in Asia, and 10% in Oceania & the Pacific, Turkey is easier to reach than Argentina for many of our executives, thanks to shorter travel times and stronger airline networks.
Additionally, Turkey’s overall cost of living is slightly lower than Argentina’s, which helps us stretch our $1 million budget even further. Using a cost-of-living index(2) where New York City is 100%, Istanbul is around 40.07% and Buenos Aires is about 42.64%. This means everyday expenses such as lodging, dining, and transportation tend to be a bit cheaper in Istanbul, giving us an extra financial advantage for hosting our event.
On top of the cost savings, Istanbul in particular has top-notch facilities and infrastructure for large-scale events, along with a rich cultural heritage that promises a memorable stay. It’s also worth noting that Turkey ranked fifth(3) worldwide in international tourist arrivals from 2019 to 2023—while Argentina did not appear on that list—underscoring its global appeal and accessibility. Overall, hosting our event in Turkey not only stretches our budget further but also delivers a high-quality experience for everyone attending.
Sources:
(1) https://www.google.com/finance/?hl=en
(2) https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=Argentina&city1=New+York%2C+NY&city2=Buenos+Aires
(2) https://www.numbeo.com/cost-of-living/compare_cities.jsp?country1=United+States&country2=Turkey&city1=New+York%2C+NY&city2=Istanbul
(3) https://www-statista-com.proxy.library.nyu.edu/statistics/261726/countries-ranked-by-number-of-international-tourist-arrivals/
1.DEPRECIATION RATE
Argentina (ARS) –Hyperinflation
Depreciated~716%
Turkey (TRY) – Severe decline
Depreciated~151%
Japan (JPY) – Moderate decline
Depreciated: ~13%
Europe (EUR) – Mildest impact
Appreciation~14.7%
2.EFFECTS ON CONFERENCE COSTS:
From 2022 to 2025, the Argentine peso went from 130 ARS/USD to 1068 ARS/USD.
1068/130=8.22
This means that 1 USD can now buy over 8 times more pesos than it did in 2022, which is a 721% increase in purchasing power.
The original cost per executive in New York is $10,000. This includes hotel, meals, travel, etc.If the cost of goods and services in Argentina remained relatively stable in local currency, then theoretically, we could get the same services at:
1/8.22= 12.2% of the original USD cost: the event could cost as little as $1,220 per person instead of $10,000.
However, Argentina has faced very high inflation. Account for inflation, only about 40% of the theoretical currency advantage can actually be realized, that is $6,000 per person while staying, but transportation costs may slightly increase due to the geographical spread out the the executives away from Argentina.
Similar calculation can be applied to other regions, Turkey and Argentina will offer the most cost effective solution due to depreciation.
3.OTHER ASPECTS
Relocating the annual executive event outside of New York presents a strong opportunity to reduce expenses, but some other aspects should also be taken into consideration:
Turkey offers the best balance between cost savings, geographic centrality, and accessibility.
Japan provides high quality and reliability, and is ideal for a large portion of attendees (Asia & Oceania), though costs are slightly higher.
Argentina offers unmatched cost advantages, but logistical and economic risks exists.
Southern Europe is favorable for North American and European attendees, but not economically efficient.
I would prioritize Turkey or Japan, as they provide the most strategic mix of savings, infrastructure quality, and global accessibility. These choices align well with both our financial goals and the geographic distribution of our executive team.
Option 2 Explaining Sales Growth
According to Meta, the sales of FY2024 increased by 21.94%. More specifically, Meta has 2 business units— its family apps, which gain profits mainly from advertising, and reality labs, some VR products and services. The sales of family apps increased by 22.06% from 2023 to 2024. However, the sales of reality labs only increased by 13.19%.
The reasons why Meta has positive sales growth may be as follows.
1. Strong digital advertising demand
Nowadays, a growing amount of companies place advertises on social media platforms and other digital channels, which means that there’s an increasing demand of digital advertising. Following the trend, the advertising sales on Meta’s apps—-Instagram, Facebook, and What’s app—might greatly increase as well.
2. More user engagement and large consumer base
According to Meta, its apps are attracting more and more people, and the number of active users is increasing, resulting in more ad impressions. With a larger consumer base and more active users, the chances of better advertising effects will be greater. Thus, the advertising sales in these social media apps may increase.
3. Advancement in AI technology
During the past year, Meta has improved its advertising service and mechanism, applying more AI-driven ad tools for better ad efficiency and relevance. According to the data it posted, the effects are salient and successful, leading to higher advertising sales.
4. Limited market and high competition for slow growth of reality labs
Although the sales of reality labs has indeed grown, the progress wasn’t good enough compared to the family apps. It’s because Meta has just started the VR market, a market that is relatively new and smaller than other mature markets. What’s more, the market is already taken up by other stronger competitors, such as google and apple, which makes Meta harder to compete with them. Last, Meta has invested a huge amount of money into R&D for these VR devices and technologies, thus leading to higher pricing of these VR products, a potential barrier that Meta cannot reach many consumers.
Option 1:
To optimize costs for American Express, we would like to suggest selecting an international location for the annual executive meeting where the local currency has drastically depreciated against the US dollar. Several countries have experienced depreciation, Argentina with the Peso, Turkey with the Lira, Japan with the Yen, and the Euro. The first option is Argentina, where there would be an estimated 40% savings compared to New York, as the Peso has depreciated by 300% in 2025 (Focuseconomics.com). This seems to be the most significant savings and provided that safety and political stability are taken into account, would be the best option.
https://www.focus-economics.com/countries/argentina/news/exchange-rate/new-government-devalues-official-peso/
Option 1:
To optimize costs for Google to plan its annual executive meeting, we have a prime opportunity to significantly reduce costs while maintaining or even enhancing the experience by relocating from New York to destinations where currencies have depreciated against the dollar. Over the past three years, the Turkish Lira (down 80%), Japanese Yen (down 30%), Euro (down 15%), and Argentine Peso (down 90%) have created exceptional value in their local markets. Istanbul stands out as the optimal choice, offering 5-star hotels at just 200/night (versus200/night) (versus 800 in NYC), unique historic venues, and superb geographic accessibility for our globally distributed team. Lisbon presents another strong option with Euro-denominated savings of about 25%, while Buenos Aires could deliver dramatic 50% cost reductions. Beyond pure savings, these locations offer memorable cultural experiences that could elevate engagement beyond what New York provides at its premium price point. The math is compelling: we could either maintain our current 1Mbudget for an upgraded experience or realize 1M budget for an upgraded experience or realize 300K+ in direct savings. Given Istanbul’s ideal balance of cost (projected 6,500/executive vs.NYC′s6,500/executive vs.NYC′s10,000), infrastructure, and novelty factor, I recommend piloting the 2024 summit there, with Lisbon as a secondary option if travel logistics prove challenging. Added Benefits being Novelty factor increases engagement, Savings could fund unique experiences (private museum tours, etc.) and Demonstrates financial responsibility to shareholders. This strategic relocation would help the company can optimize expenses while delivering a successful event.
In recent years, Apple has experienced both progress and difficulties. The company has seen steady revenue growth, but the increase has been modest compared to its past performance. One of the main contributors to this growth is Apple’s services business, including platforms such as iCloud and Apple Music, which continue to attract more users. This shows that digital services are becoming a more important part of Apple’s success. On the other hand, hardware sales have shown mixed results. iPhone sales have remained mostly unchanged due to the smartphone market becoming saturated in many major regions. Mac computers have shown slight improvement, but products like Apple Watch and AirPods have faced declining demand, suggesting consumers are becoming more careful when spending on accessories.
Regionally, Apple’s performance is uneven. The Americas still generate the highest revenue, showing some growth. Europe has also performed well, despite strong competition from other tech brands. However, sales in China have declined, likely due to economic challenges and the rise of local competitors. Markets like Japan and other Asia-Pacific countries have remained relatively stable. These regional trends highlight both the advantages and challenges of Apple’s global business.
Beyond product sales, exchange rate changes have also played a role in shaping international business decisions. In recent years, the U.S. dollar has become stronger, while many other major currencies have weakened. This situation creates both risks and opportunities. For companies like Apple, a strong dollar can reduce the value of international sales when converted back to U.S. dollars. On the positive side, businesses that need to spend money abroad, such as when organizing international conferences, may benefit. Choosing countries where local currencies are weaker can help reduce costs for hotels, venues, and other expenses. However, companies must also consider other factors like inflation, travel convenience, and the quality of local services when making these choices.
Moving the annual executive conference from New York to a destination with a currency that has depreciated against the dollar is a smart cost-saving move. Over the past three years, the currencies of several key markets (particularly Turkey, Argentina, Japan, and parts of Europe) have depreciated significantly. This means that in these places, one dollar is now worth more, providing significant opportunities to cut costs without sacrificing quality.
Considering the distance and currency devaluation, Turkey is the most compelling choice. The Turkish lira has plummeted against the dollar, depreciating by about 75% since 2021. Istanbul, a cosmopolitan city with luxury hotels and world-class venues, now offers five-star accommodations for a fraction of the price of New York. In the United States, a conference can cost $10,000. In Turkey, it can drop to $6,000 or less, saving companies hundreds of thousands of dollars.
Argentina is another interesting example – hyperinflation in the peso means that dollar holders can enjoy significant discounts. However, logistical challenges (long-distance flights, economic instability) make it a riskier option. Meanwhile, Japan offers modest savings (20-30%) due to the depreciation of the yen, but is still a more expensive destination than Türkiye.
Europe (Germany, Spain, etc.) offers modest savings (10-20%), but the euro has not depreciated as dramatically as the lira. However, for companies that want to strike a balance between savings and stability, cities such as Berlin or Barcelona may be worth considering.
In 2023, Adidas experienced a sales decline of 4.82% compared to the previous year, dropping from €22,511 million to €21,427 million. This negative growth reflects a combination of regional performance trends and broader macroeconomic challenges. Europe, which remains Adidas’s largest market in 2024 (31.88% of global net sales), saw relatively flat growth in 2023 due to inflationary pressures and cautious consumer spending. North America, accounting for 21.65% of 2024 sales, declined in 2023 by around 6.5%, largely impacted by excess inventory and declining wholesale demand. Greater China, representing 14.61% of 2024 net sales, also underperformed in 2023, reflecting a slower-than-expected market recovery and geopolitical tensions. Conversely, Latin America, which now contributes 11.7% to global sales, was one of the few regions that saw strong growth, benefiting from effective pricing strategies and expanding consumer bases. These regional dynamics collectively explain the overall revenue contraction in 2023, setting the stage for potential stabilization or rebound in 2024.
https://www.wsj.com/market-data/quotes/ADDYY/financials/annual/income-statement
https://www.statista.com/statistics/531733/share-of-adidas-retail-sales-by-region/
Considering the significant depreciation of local currencies against the U.S. dollar in recent years, hosting our annual executive event outside New York could offer substantial cost savings. Turkey and Argentina stand out as especially attractive options. Over the past three years, the Turkish lira has sharply depreciated, falling nearly 77% against the dollar, which dramatically increasing the purchasing power of our USD-based budget. Similarly, Argentina’s peso experienced a massive depreciation of approximately 250% over the same period. Hosting the event in either country would allow us to significantly reduce expenses on hotels, meals, entertainment, and local transportation, potentially enabling enhanced experiences or savings within the same $1 million budget. However, while the financial benefits are clear, we should also carefully weigh these against local economic conditions, such as inflation in Argentina or political stability concerns in Turkey, to ensure the overall success of the event.
Despite entering a more challenging phase, I believe Lululemon can continue to grow consistently over the next three years. Leadership has noted that the brand has become “too predictable,” and recent reports indicate weaker U.S. sales and a softer growth outlook. This indicates that product innovation has to be updated, and global expansion needs to be accelerated. Starting from $9.6 billion in 2024, a realistic projection using a 12% compound annual growth rate could bring revenue to around $12 billion by 2027.
Growth should focus on three core drivers: global expansion, by strengthening retail and e-commerce in Asia and Europe (+$1 billion); menswear acceleration, Lululemon’s fastest-growing segment, through athlete partnerships and product innovation (+$700 million); and digital and community engagement, enhancing loyalty, resale, and personalized app experiences (+$600 million).
Together, these strategies represent roughly $2.3 billion in incremental sales, supporting sustainable growth, deeper loyalty, and renewed brand excitement.
Sources: Lululemon Annual Report; Wall Street Journal
Despite entering a challenging phase, I believe Lululemon can continue to grow consistently over the next three years. Leadership has noted that the brand has become “too predictable,” and recent reports indicate weaker U.S. sales and a softer growth outlook. This indicates that product innovation has to be updated, and global expansion needs to be accelerated. Starting from $9.6 billion in 2024, a realistic projection using a 12% compound annual growth rate could bring revenue to around $12 billion by 2027.
Growth should focus on three core drivers: global expansion, by strengthening retail and e-commerce in Asia and Europe (+$1 billion); menswear acceleration, Lululemon’s fastest-growing segment, through athlete partnerships and product innovation (+$700 million); and digital and community engagement, enhancing loyalty, resale, and personalized app experiences (+$600 million).
Together, these strategies represent roughly $2.3 billion in incremental sales, supporting sustainable growth, deeper loyalty, and renewed brand excitement.
Sources: Lululemon Annual Report; Wall Street Journal
PepsiCo generated approximately $91.9B in FY2024 revenue. Based on the company’s guidance for low-single-digit revenue growth, a realistic three-year outlook assumes ~3% average annual organic growth, positioning PepsiCo to reach roughly $100B+ in revenue by 2027. To support this trajectory, Strategy 1 focuses on accelerating international expansion in Latin America and Asia through localized product portfolios and retail partnerships, contributing an estimated +$2.5B. Strategy 2 builds leadership in functional wellness beverages and protein-forward snacks, leveraging platforms like Gatorade and Quaker to compete with fast-growing energy and sports nutrition brands, adding ~$3B. Strategy 3 emphasizes pricing, pack innovation, and digital direct-to-consumer offerings in North America to unlock ~$1.5B. Combined, these initiatives deliver ~$7B in incremental revenue, aligned with proven global demand trends and PepsiCo’s scale.
Sources: PepsiCo Annual Report; The Wall Street Journal
Based on Uber’s 2024 annual revenue of $43.98 billion and the mid-year estimated revenue of approximately $48.4 billion for 2025, the company’s overall growth is expected to become steadier as its core markets mature and reach greater operational efficiency. Looking ahead, Uber is projected to achieve around $57 billion in total revenue by 2028, representing a realistic and sustainable annual growth rate of about 9–10%.
This gradual yet consistent upward trajectory will be driven by several strategic initiatives. Strengthening the Uber One membership program will help increase user retention, encourage higher spending across services, and enhance overall brand loyalty. The expansion of Uber Advertising will open new, high-margin revenue opportunities by monetizing app engagement and delivery traffic more effectively. Additionally, continuous improvements in delivery efficiency through AI-driven dispatch, route optimization, and other advanced technologies are expected to reduce costs while improving customer satisfaction. Finally, stabilizing the freight segment through long-term partnerships and reliable contracts will provide a stronger foundation for predictable revenue streams. These combined efforts will allow Uber to balance profitability with sustainable expansion, reinforcing its leadership in mobility, delivery, and logistics while continuing to build long-term value for both customers and shareholders.
Sources: Uber Annual Report 2024; Wall Street Journal (Q1–Q2 2025 Data)
Using fiscal 2024 as the base year ($10.6 billion in net revenue), I assume Lululemon can achieve steady growth over the next three years through four main focus areas: international expansion, growth in the men’s category, omnichannel innovation, and selective category extensions.
Based on my research, international markets remain Lululemon’s largest opportunity. In fiscal 2024, China Mainland revenue increased 41.3% year-over-year, rising from $964 million to $1.36 billion, which represents approximately 13% of the company’s total revenue (Lululemon’s 10-K, 2025). To sustain this growth, Lululemon can continue to expand in China and other promising international markets, both in-store and online, which can increase total sales.
Lululemon’s men’s business, which accounts for 24% of total revenue, offers significant room for further expansion through new product lines and global reach. According to the company’s Form 10-K (2025), “During 2024, our women’s range represented 63% of net revenue and our men’s range represented 24%. Our comprehensive men’s line is a key pillar of our strategic growth plans. We believe net revenue from our men’s range is growing as more guests discover the technical rigor and premium quality of our men’s products, and are attracted by our distinctive brand.” (Lululemon’s 10-K, 2025). In other words, the men’s segment continues to demonstrate strong momentum and presents meaningful potential for expansion through new collections, broader distribution, and deeper global reach.
At the same time, stores and e-commerce generate nearly equal revenue (around $5.0 billion vs $4.6 billion), which can potentially create opportunities to enhance conversions through greater personalization and convenience. And finally, new categories, such as footwear and accessories, which currently account for 13% of revenue, provide additional upside.
I believe that these strategies can add approximately $1.6 to $2.7 billion in revenue within three years, bringing total sales to around $12 – $13 billion by FY 2027, which is a fairly achievable and data-backed path consistent with Lululemon’s recent performance and current market conditions.
Sources: Lululemon Athletica Inc. 2024 Annual Report (Form 10-K, SEC)
LVMH generated $46B in revenue during the first half of 2025, compared to $98B for the entirety of 2024, which indicates a likely yearly decrease in revenue for 2025. In Q3 2025, LVMH reported $21B in earnings, which reflects a 1% increase driven by stronger demand in China. Last year’s Q4 earnings was $27B, and based on the current 2025 trajectory, LVMH is expected to experience another year of declining revenue, which would mark a second consecutive year. While forecasts suggest a downward trend, there are several avenues LVMH can take to drive growth in 2025 and beyond. LVMH will prioritize three key strategies, including expanding its flagship retail network, accelerating e-commerce initiatives, and launching exclusive product lines for core fashion houses. Opening additional stores in cities such as Shanghai and Dubai will capture rising demand and add $1-2B in revenue. Further, investing in e-commerce will broaden global reach and contribute an additional $2-3B. Finally, the rollout of exclusive product lines for brands like LV and Dior can generate more than $1B in new sales by creating demand and urgency.
Sources: LVMH, WSJ, Reuters
In my opinion, Lululemon has a strong and achievable path to grow from $10 billion in FY2024 to around $17 billion by 2028, representing a steady annual increase of roughly $1.5 billion per year. Despite a more competitive market and slower U.S. sales, Lululemon’s fundamentals remain robust with no debt, a growing global footprint, and strong brand loyalty across markets.
Growth over the next four years will be driven by three key strategies. First, global expansion will remain the most powerful lever. In 2024, China Mainland revenue grew 41% year-over-year, and new company-operated stores in Mexico and Europe are expected to further contribute to international momentum. Second, product innovation continues to differentiate the brand through high-performance, high-style apparel and new categories such as men’s footwear, which will deepen engagement with both male and female consumers. Third, brand elevation through global visibility, including partnerships as the official outfitter for the Canadian Olympic and Paralympic Teams for Paris 2024 and the upcoming 2026 Winter Games in Italy, will enhance awareness and inspire emotional connection worldwide.
Together, these initiatives could realistically generate about $7 billion in incremental revenue by 2028, positioning Lululemon for sustainable, long-term growth and reaffirming its role as a global leader in premium activewear.
Sources: Lululemon 2024 Annual Report
LVMH reported revenue of €84.7 billion in 2024 which was down 2% since the previous year (€86.2 billion) but organic growth was +1%.
Given the current market situation (slowing luxury demand in certain regions including China, US tariffs and currency headwinds), it would be unrealistic to assume a double digit growth rate immediately. We can assume a moderate growth rate of 12% over the next 3 years. That would bring revenues to ~€95 billion by the end of 2027.
(€84.7 bn × (1.04)^3 ≈ €94.2-95 bn)
Proposed strategies to ensure LVMH’s upward growth trajectory: Geographic Diversification, Premiumisation and Retail Experience.
LVMH should start by deepening their presence in markets such as Japan, Southeast Asia, India and the Middle East since they continue to show resilient luxury demand and an expanding affluent consumer base. Particularly in Southeast Asia, in countries like Singapore & Thailand, LVMH will pursue selective boutique openings and omnichannel integration to capture a younger demographic. This strategy is projected to deliver 2% annual uplift in revenue, roughly €4 billion in incremental sales by FY 2027.
Limited edition collections (artist partnerships or city-specific releases) and high-end collaborations through Louis Vuitton, Dior and Bvlgari will create scarcity and anticipation. An additional increase of 1% in annual sales is expected, approximately €2–3 billion incremental revenue by FY 2027.
Developing multi-sensory flagship stores blending fashion, art and gastronomy (Dior Cafe, Sephora Studio) will transform customer visits into experiences rather than simple transactions. Sephora stores can become hubs for innovation seamlessly blending beauty retail with technology and personalisation. Expected to contribute 2% annual uplift, translating to €3–4 billion in additional revenue by FY 2027.
LVMH reported revenue of €84.7 billion in 2024 which was down 2% since the previous year (€86.2 billion) but organic growth was +1%.
Given the current market situation (slowing luxury demand in certain regions including China, US tariffs and currency headwinds), it would be unrealistic to assume a double digit growth rate immediately. We can assume a moderate growth rate of 12% over the next 3 years. That would bring revenues to ~€95 billion by the end of 2027.
(€84.7 bn × (1.04)^3 ≈ €94.2-95 bn)
Proposed strategies to ensure LVMH’s upward growth trajectory: Geographic Diversification, Premiumisation and Retail Experience.
LVMH should start by deepening their presence in markets such as Japan, Southeast Asia, India and the Middle East since they continue to show resilient luxury demand and an expanding affluent consumer base. Particularly in Southeast Asia, in countries like Singapore & Thailand, LVMH will pursue selective boutique openings and omnichannel integration to capture a younger demographic. This strategy is projected to deliver 2% annual uplift in revenue, roughly €4 billion in incremental sales by FY 2027.
Limited edition collections (artist partnerships or city-specific releases) and high-end collaborations through Louis Vuitton, Dior and Bvlgari will create scarcity and anticipation. An additional increase of 1% in annual sales is expected, approximately €2–3 billion incremental revenue by FY 2027.
Developing multi-sensory flagship stores blending fashion, art and gastronomy (Dior Cafe, Sephora Studio) will transform customer visits into experiences rather than simple transactions. Sephora stores can become hubs for innovation seamlessly blending beauty retail with technology and personalisation. Expected to contribute 2% annual uplift, translating to €3–4 billion in additional revenue by FY 2027.
According to PepsiCo’s 2024 annual report and data from The Wall Street Journal, the company’s net revenue for fiscal year 2024 appears to have reached $91.85 billion, a mere 0.42% increase from 2023. Within this broader analytical framework using 2024 as the base year, projections indicate that if a 2% average annual growth rate is maintained over the next three years, total revenue will reach approximately $96.5 billion by 2027, representing an additional $4.6 billion in revenue.
From these considerations regarding how to achieve this goal, and from the overall improvement in our main revenue streams, it appears we intend to expand our global reach and strengthen our premiumization strategy. Particularly noteworthy in this analytical context is our Strategy One, which will expand the distribution of snacks and beverages in high-growth markets such as AMESA and APAC, which is expected to generate approximately $900 million in additional revenue. Data shows that these regions have seen an average growth rate of approximately 7% to 8% over the past three years, with AMESA and APAC accounting for approximately 12% of the total base. Therefore, if this growth rate is maintained for the next three years, the additional revenue is expected to reach approximately $900 million.
About strategy two, we plan to focus on accelerating the development of e-commerce and direct sales channels to attract younger, more convenience-conscious consumers, especially in countries with a strong online shopping culture, such as the Asia-Pacific region. Within this evolving framework, this strategy is expected to generate approximately $370 million in revenue. Wall Street Journal data shows that by 2024, PepsiCo’s e-commerce sales will account for approximately 8% of global net revenue, representing a year-on-year growth of approximately 14%. Therefore, after adjusting for overall growth discrepancies and assuming that the company’s e-commerce channel growth rate remains primarily at 12%, multiplying by revenue yields approximately $370 million in revenue.
About strategy three, within a broader strategic framework, we tend to focus on food segments, such as strengthening our premium and sugar-free product lines to meet evolving consumer preferences. This strategy is expected to generate approximately $550 million in new sales, but based on current data, this is only our best current forecast. The 2023-2024 annual report shows that the sugar-free product line grew by approximately 12%, and notably, this category accounts for about 20% of total beverage revenue. Taking all these factors into account, our growth forecast is approximately $550 million, but this forecast assumes that current market conditions and consumer behavior patterns remain unchanged.
As long as these strategies are strictly followed, barring unforeseen events such as the US-China trade war or a financial crisis, I am very positive about the continued growth resulting from these strategies.
Sources:
PepsiCo 2023 Annual Report
PepsiCo 2024 Annual Report
WSJ PepsiCo Market Data
Stock analysis
According to the 2024 annual report, LVMH reported revenue of €84.7 billion in 2024 which was down 2% since the previous year (€86.2 billion) but organic growth was +1%.
Given the current market situation (slowing luxury demand in certain regions including China, US tariffs and currency headwinds), it would be unrealistic to assume a double digit growth rate immediately. We can assume a moderate growth rate of 12% over the next 3 years. That would bring revenues to ~€95 billion by the end of 2027.
(€84.7 bn × (1.04)^3 ≈ €94.2-95 bn)
Proposed strategies to ensure LVMH’s upward growth trajectory: Geographic Diversification, Premiumisation and Retail Experience.
LVMH should start by deepening their presence in markets such as Japan- which accounts for 9% of total revenues, Southeast Asia, India and the Middle East since they continue to show resilient luxury demand and an expanding affluent consumer base. Particularly in Southeast Asia, in countries like Singapore & Thailand, LVMH will pursue selective boutique openings and omnichannel integration to capture a younger demographic. This strategy is projected to deliver 2% annual uplift in revenue, roughly €4 billion in incremental sales by FY 2027.
Limited edition collections (artist partnerships or city-specific releases) and high-end collaborations through Louis Vuitton, Dior and Bvlgari will create scarcity and anticipation. An additional increase of 1% in annual sales is expected, approximately €2–3 billion incremental revenue by FY 2027.
Developing multi-sensory flagship stores blending fashion, art and gastronomy (Dior Cafe, Sephora Studio) will transform customer visits into experiences rather than simple transactions. Sephora stores can become hubs for innovation seamlessly blending beauty retail with technology and personalisation. Expected to contribute 2% annual uplift, translating to €3–4 billion in additional revenue by FY 2027.
Source: LVMH annual report
According to FY2024 net revenue of $10.6B as the baseline, lululemon’s revenue is projected to reach $14B by 2028 (8% annual growth rate). This reflects the shift from 36% CAGR (2020–2022) during post-pandemic expansion to 14% CAGR (2022–2024) as North America—the company’s largest market—has matured. Women’s remains the largest segment but is stabilizing, while Men’s and Other (accessories, footwear, studio) continue to outgrow the total business.
Strategy 1 — “The Reset” Mindful Movement in North America
Increase purchase frequency among existing members through community-based wellness activation. A modest 3–5% member adoption and 1.3× frequency lift translates to $1.1B incremental revenue.
Strategy 2 — Expand Men’s Versatile Performance
Position men’s core + commuter apparel for everyday movement. A 5–7% penetration increase across existing channels contributes $1.1B.
Strategy 3 — Scale International Markets with Localized Community
Localized store experiences in China & Europe drive brand familiarity and repeat usage, contributing $1.2B.
Combined, these three grounded drivers support a credible total uplift of ~$3.4B. The above data represent a conservative estimate for Lululemon.
Sources：Lululemon Annual Report; Wall Street Journal
According to FY2024 net revenue of $10.6B as the baseline, lululemon’s revenue is projected to reach $14B by 2028 (8% annual growth rate). This reflects the shift from 36% CAGR (2020–2022) during post-pandemic expansion to 14% CAGR (2022–2024) as North America—the company’s largest market—has matured. Women’s remains the largest segment but is stabilizing, while Men’s and Other (accessories, footwear, studio) continue to outgrow the total business.
Strategy 1 — “The Reset” Mindful Movement in North America
Increase purchase frequency among existing members through community-based wellness activation. A modest 3–5% member adoption and 1.3× frequency lift translates to $1.1B incremental revenue.
Strategy 2 — Expand Men’s Versatile Performance
Position men’s core + commuter apparel for everyday movement. A 5–7% penetration increase across existing channels contributes $1.1B.
Strategy 3 — Scale International Markets with Localized Community
Localized store experiences in China & Europe drive brand familiarity and repeat usage, contributing $1.2B.
Combined, these three grounded drivers support a credible total uplift of ~$3.4B. The above data represent a conservative estimate for Lululemon.
Sources：Lululemon Annual Report; Wall Street Journal
According to FY2024 net revenue of $10.6B as the baseline, lululemon’s revenue is projected to reach $14B by 2028 (8% annual growth rate). This reflects the shift from 36% CAGR (2020–2022) during post-pandemic expansion to 14% CAGR (2022–2024) as North America—the company’s largest market—has matured. Women’s remains the largest segment but is stabilizing, while Men’s and Other (accessories, footwear, studio) continue to outgrow the total business.
Strategy 1 — “The Reset” Mindful Movement in North America
Increase purchase frequency among existing members through community-based wellness activation. A modest 3–5% member adoption and 1.3× frequency lift translates to $1.1B incremental revenue.
Strategy 2 — Expand Men’s Versatile Performance
Position men’s core + commuter apparel for everyday movement. A 5–7% penetration increase across existing channels contributes $1.1B.
Strategy 3 — Scale International Markets with Localized Community
Localized store experiences in China & Europe drive brand familiarity and repeat usage, contributing $1.2B.
Combined, these three grounded drivers support a credible total uplift of ~$3.4B. The above data represent a conservative estimate for Lululemon.
Sources：Lululemon Annual Report; Wall Street Journal
Using FY2024 net revenue of $10.6B as a starting point, lululemon is projected to grow to roughly $14B by 2028, reflecting a steady ~8% annual growth rate. The shift from the rapid 36% post-pandemic CAGR (2020–2022) to ~14% CAGR (2022–2024) signals a more mature North American market. Women’s remains the largest revenue driver but is leveling off, while the Men’s and “Other” categories (accessories, footwear, studio) continue to grow at a faster clip.
Strategy 1 — “The Reset” Mindful Movement (North America)
Deepen engagement with existing members through community-based wellness and movement programming. Even a modest 3–5% increase in member participation, paired with a ~1.3x lift in purchase frequency, can generate around $1.1B in incremental revenue.
Strategy 2 — Expand Men’s Versatile Performance
Reframe men’s performance and commuter apparel as everyday wardrobe essentials. A 5–7% increase in penetration across current distribution channels can add another ~$1.1B.
Strategy 3 — Localize Global Growth (China & Europe)
Invest in localized store experiences and community-driven brand education to build familiarity and repeat usage. This expansion is expected to contribute approximately $1.2B.
Taken together, these three levers support a realistic and grounded revenue uplift of about $3.4B, representing a conservative projection for lululemon’s next growth phase.
Sources：Lululemon Annual Report; WS
Using fiscal 2024 as the baseline year, when Lululemon reported $10.6 billion in net revenue, I project total revenue could reach $12.5–13.0 billion by FY2027, implying a 9–11% compound annual growth rate. This outlook is grounded in three realistic, data-based strategies: international expansion, men’s category growth, and omnichannel innovation with new categories.
International expansion remains Lululemon’s biggest opportunity. In 2024, international revenue grew 54% year-over-year to $2.5 billion, with China Mainland up 41%. Continued store openings, digital investments, and localised assortments in Asia and Europe could add $1.0–1.2 billion in incremental revenue over the next three years.
Men’s growth offers another major driver. The segment represents 24% of total revenue and continues to outperform. By expanding product lines, introducing athlete partnerships, and deepening its global presence, Lululemon could generate an additional $600–700 million in sales.
Finally, omnichannel innovation and category expansion can lift conversion and spend per guest. Stores and e-commerce currently contribute nearly equal revenue ($5.0B vs. $4.6B). Enhancing personalisation, loyalty, and resale along with scaling footwear and accessories (now ~13% of revenue) could add $400–500 million.
Together, these strategies represent about $2.0–2.4 billion in incremental growth, bringing revenue to roughly $12.5–13.0 billion by FY2027. This reflects a disciplined, credible path that builds on Lululemon’s brand strength, global momentum, and digital leadership.
Using FY2024 net revenue of $10.6B as a starting point, lululemon is projected to grow to roughly $14B by 2028, reflecting a steady ~8% annual growth rate. The shift from the rapid 36% post-pandemic CAGR (2020–2022) to ~14% CAGR (2022–2024) signals a more mature North American market. Women’s remains the largest revenue driver but is leveling off, while the Men’s and “Other” categories (accessories, footwear, studio) continue to grow at a faster clip.
1.“The Reset” Mindful Movement (North America)
Deepen engagement with existing members through community-based wellness and movement programming. Even a modest 3–5% increase in member participation, paired with a ~1.3x lift in purchase frequency, can generate around $1.1B in incremental revenue.
2.Expand Men’s Versatile Performance
Reframe men’s performance and commuter apparel as everyday wardrobe essentials. A 5–7% increase in penetration across current distribution channels can add another ~$1.1B.
3.Localize Global Growth (China & Europe)
Invest in localized store experiences and community-driven brand education to build familiarity and repeat usage. This expansion is expected to contribute approximately $1.2B.
Taken together, these three levers support a realistic and grounded revenue uplift of about $3.4B, representing a conservative projection for lululemon’s next growth phase.
Source：Lululemon Annual Report; WSJ
Using FY2024 net revenue of $10.6B as a starting point, lululemon is projected to grow to roughly $14B by 2028, reflecting a steady 8% annual growth rate. The shift from the rapid 36% post-pandemic (2020–2022) to 14% (2022–2024) signals a more mature North American market. Women’s remains the largest revenue driver but is leveling off, while the Men’s and “Other” categories (accessories, footwear, studio) continue to grow at a faster clip.There are three strategies to achieve the goal:
“The Reset” Mindful Movement (North America): Deepen engagement with existing members through community-based wellness and movement programming. Even a modest 3–5% increase in member participation, paired with a 1.3x lift in purchase frequency, can generate around $1.1B in incremental revenue.
Expand Men’s Versatile Performance: Reframe men’s performance and commuter apparel as everyday wardrobe essentials. A 5–7% increase in penetration across current distribution channels can add another $1.1B.
Localize Global Growth (China & Europe): Invest in localized store experiences and community-driven brand education to build familiarity and repeat usage. This expansion is expected to contribute approximately $1.2B.
Taken together, these three levers support a realistic and grounded revenue uplift of about $3.4B, representing a conservative projection for lululemon’s next growth phase.
Sources：Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon’s revenue is projected to reach approximately 14B USD by 2028 (around 8% annual growth). This reflects the slowdown from the 36% CAGR during the post-pandemic period (2020–2022) to about 14% in 2022–2024 as the North American market matures. Women’s remains the largest revenue driver but is stabilizing, while Men’s and Other (accessories, footwear, studio) continue to outpace total growth.
Strategy 1: The Reset – focus on mindful movement and community engagement in North America to increase purchase frequency. Even a 3–5% increase in active member engagement with a 1.3x frequency lift can add around 1.1B USD in incremental revenue. Strategy 2: Expand Men’s versatile performance apparel by positioning core and commuter styles for everyday wear. A 5–7% penetration lift across existing channels may generate about 1.1B USD. Strategy 3: Localize international expansion in China and Europe through in-store experiences and community-based brand education, adding about 1.2B USD. Together, these strategies support approximately 3.4B USD in incremental revenue through 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon is projected to reach approximately 14B USD by 2028 (about 8 percent annual growth). This reflects the slowdown from the 36 percent CAGR during 2020-2022 to about 14 percent in 2022-2024 as the North American market matures. Womens remains the largest revenue driver but is stabilizing, while Mens and Other categories (accessories, footwear, studio) continue to grow faster than the total business.
Strategy 1: The Reset – Focus on community-based mindful movement programming in North America to increase purchase frequency. A modest 3 to 5 percent lift in active member participation with a 1.3 times frequency increase can generate about 1.1B USD. Strategy 2: Expand Mens versatile performance apparel by positioning core and commuter styles as everyday essentials. A 5 to 7 percent penetration increase across current channels may add about 1.1B USD. Strategy 3: Localize international expansion in China and Europe with store experiences and community-led brand education, contributing about 1.2B USD.
Together, these strategies support approximately 3.4B USD in incremental revenue by 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon is projected to reach approximately 14B USD by 2028 (about 8 percent annual growth). This reflects the slowdown from the 36 percent CAGR during 2020-2022 to about 14 percent in 2022-2024 as the North American market matures. Womens remains the largest revenue driver but is stabilizing, while Mens and Other categories (accessories, footwear, studio) continue to grow faster than the total business.
Strategy 1: The Reset – Focus on community-based mindful movement programming in North America to increase purchase frequency. A modest 3 to 5 percent lift in active member participation with a 1.3 times frequency increase can generate about 1.1B USD. Strategy 2: Expand Mens versatile performance apparel by positioning core and commuter styles as everyday essentials. A 5 to 7 percent penetration increase across current channels may add about 1.1B USD. Strategy 3: Localize international expansion in China and Europe with store experiences and community-led brand education, contributing about 1.2B USD.Together, these strategies support approximately 3.4B USD in incremental revenue by 2028.
Lululemon
2025: $11B
2029: $17B (+$6B, ~11.6% CAGR)
To achieve this growth, we will focus on four key strategies:
1. Community-Centric Flagship Stores / +$2.5B
Our flagship stores will combine retail, workout studios and cafés, creating spaces where customers want to meet and socialize. This will increase traffic, engagement and loyalty.
2. Local Ambassadors & Collaborations / +$1.5B
Partnering with regional ambassadors and launching culturally relevant capsules will strengthen brand relevance and gain market share, for example a Hello Kitty collection in Japan.
3. Pop-Ups with Athlete Capsule Collections / +$1.3B
Pop-up stores during major sports events with workout-classes and exclusive drops to attract new customers and strengthen our community. Limited-edition capsules collections with top athletes will boost visibility, for example Simone Biles Collection during the Olympics or Serena Williams Collection during the US Open.
4. Trend Forecasting & Color Analytics / +$0.7B
Investing in trend forecasting and color analytics will ensure early adoption to fashion trends to stay relevant and increase purchase frequency.
Source: WSJ
For our company Pepsi, we totals $91.9B for the year of 2024, only a 0.4% increase from $91.5 in 2023. Over the last couple of years, our growth has slowed down dramatically due to increased tariff rates and production cost eating away at our margins. An ooptimisic annual revenue for 2026 would look to be around $94.7B, a 4% growth to get us back on the right track. There are several ways that we can accomplish this as a company. The first would be to start moving our concentrate production to domestic factory, allowing us to cut down on importing fees. Most of our concentrate is being made in Ireland, causing us to spend a lot of money to distribute this for our products with the increasing tariff rates. Our next strategy would be to increase our products pricing by approximately 5% in the United States, raising product pricing by an average of 0.20$. This will maintain our customer loyalty with a minimal. while allowing a profits to icnrease with a slow and steady pricing strategy. Finally, we aim to utilize more influencer marketing on social media in our AMESA and APAC regions to bring in new, younger customers into our brand sphere. We currently do not utilize channels of marketing for Gen-Z consumers internationally, so the use of trustworthy influencers for product reviews and events could potentially grow our reach by 20%. With this increased reach, we are projecting our AMESA revenue to increase by $300M to $6.7B from $6.4B and APAC to increase $250M to $4.85B from $4.6B. On average, these strategies could potentially increase our profits by $3.2B, a promising increase to keep us in the green for our annual reports.
Source: WSJ, Pepsi Annual Reports
*No AI was used for this assignment*
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon is projected to reach approximately 14B USD by 2028 (about 8 percent annual growth). This reflects the slowdown from the 36 percent CAGR during 2020-2022 to about 14 percent in 2022-2024 as the North American market matures. Womens remains the largest revenue driver but is stabilizing, while Mens and Other categories (accessories, footwear, studio) continue to grow faster than the total business.
Strategy 1: The Reset – Focus on community-based mindful movement programming in North America to increase purchase frequency. A modest 3 to 5 percent lift in active member participation with a 1.3 times frequency increase can generate about 1.1B USD. Strategy 2: Expand Mens versatile performance apparel by positioning core and commuter styles as everyday essentials. A 5 to 7 percent penetration increase across current channels may add about 1.1B USD. Strategy 3: Localize international expansion in China and Europe with store experiences and community-led brand education, contributing about 1.2B USD.Together, these strategies support approximately 3.4B USD in incremental revenue by 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon is projected to reach approximately 14B USD by 2028 (about 8 percent annual growth). This reflects the slowdown from the 36 percent CAGR during 2020-2022 to about 14 percent in 2022-2024 as the North American market matures. Womens remains the largest revenue driver but is stabilizing, while Mens and Other categories (accessories, footwear, studio) continue to grow faster than the total business.
Strategy 1: The Reset – Focus on community-based mindful movement programming in North America to increase purchase frequency. A modest 3 to 5 percent lift in active member participation with a 1.3 times frequency increase can generate about 1.1B USD. Strategy 2: Expand Mens versatile performance apparel by positioning core and commuter styles as everyday essentials. A 5 to 7 percent penetration increase across current channels may add about 1.1B USD. Strategy 3: Localize international expansion in China and Europe with store experiences and community-led brand education, contributing about 1.2B USD.Together, these strategies support approximately 3.4B USD in incremental revenue by 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon is projected to reach approximately 14B USD by 2028 (about 8 percent annual growth). This reflects the slowdown from the 36 percent CAGR during 2020-2022 to about 14 percent in 2022-2024 as the North American market matures. Womens remains the largest revenue driver but is stabilizing, while Mens and Other categories (accessories, footwear, studio) continue to grow faster than the total business.
Strategy 1: The Reset – Focus on community-based mindful movement programming in North America to increase purchase frequency. A modest 3 to 5 percent lift in active member participation with a 1.3 times frequency increase can generate about 1.1B USD. Strategy 2: Expand Mens versatile performance apparel by positioning core and commuter styles as everyday essentials. A 5 to 7 percent penetration increase across current channels may add about 1.1B USD. Strategy 3: Localize international expansion in China and Europe with store experiences and community-led brand education, contributing about 1.2B USD.Together, these strategies support approximately 3.4B USD in incremental revenue by 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of 10.6B USD as the baseline, Lululemon’s revenue is projected to reach approximately 14B USD by 2028 (around 8% annual growth). This reflects the slowdown from the 36% CAGR during the post-pandemic period (2020–2022) to about 14% in 2022–2024 as the North American market matures. Women’s remains the largest revenue driver but is stabilizing, while Men’s and Other (accessories, footwear, studio) continue to outpace total growth.
Strategy 1: The Reset – focus on mindful movement and community engagement in North America to increase purchase frequency. Even a 3–5% increase in active member engagement with a 1.3x frequency lift can add around 1.1B USD in incremental revenue. Strategy 2: Expand Men’s versatile performance apparel by positioning core and commuter styles for everyday wear. A 5–7% penetration lift across existing channels may generate about 1.1B USD. Strategy 3: Localize international expansion in China and Europe through in-store experiences and community-based brand education, adding about 1.2B USD. Together, these strategies support approximately 3.4B USD in incremental revenue through 2028.
Source: Lululemon Annual Report; WSJ
Using FY2024 net revenue of $10.6B as a starting point, lululemon is projected to grow to roughly $14B by 2028, reflecting a steady 8% annual growth rate. The shift from the rapid 36% post-pandemic (2020–2022) to 14% (2022–2024) signals a more mature North American market. Women’s remains the largest revenue driver but is leveling off, while the Men’s and “Other” categories (accessories, footwear, studio) continue to grow at a faster clip.There are three strategies to achieve the goal:
Strategy 1: “The Reset” Mindful Movement (North America)
Deepen engagement with existing members through community-based wellness and movement programming. Even a modest 3–5% increase in member participation, paired with a 1.3x lift in purchase frequency, can generate around $1.1B in incremental revenue.
Strategy 2: Expand Men’s Versatile Performance
Reframe men’s performance and commuter apparel as everyday wardrobe essentials. A 5–7% increase in penetration across current distribution channels can add another $1.1B.
Strategy 3: Localize Global Growth (China & Europe)
Invest in localized store experiences and community-driven brand education to build familiarity and repeat usage. This expansion is expected to contribute approximately $1.2B.
Taken together, these three levers support a realistic and grounded revenue uplift of about $3.4B, representing a conservative projection for lululemon’s next growth phase.
Sources：Lululemon Annual Report; WSJ
Uber’s 2024 Annual Report lists a total revenue of $43.9 billion, up 17% from FY23, establishing a solid base year for projection. Over the past three fiscal years, Uber’s growth has matured from 83% in FY22 to 17% in FY23 which signals a shift from post pandemic rebound to a steady expansion. A realistic three year compound annual growth rate of around 10-12% would bring revenue to roughly %59-$60 billion by FY27, driven by a disciplined execution across four key strategies. First, Uber would have to optimize Mobility pricing and expansion, raising fares by 12% and increasing trip volume by 4% through new city launches and improved airport partnerships, which would generate them an estimated $6.5 billion in additional revenue. Then, Uber would have to also enhance Delivery margins and vertical integration, including sponsored listings and grocery or retail partnerships, which would gain Uber around $5 billion more in earnings. Third, Uber Freight will leverage AI-driven load matching and contract logistics to stabilize growth and contribute an additional $3 billion. Finally, scaling advertising and subscription services like Uber Ads and Uber One , could add $1.5 billion as a different way to monetize the platform. Altogether, these initiatives would increase Uber’s total revenue from $43.8 billion to about $59-60 billion by FY27.
Sources: WSJ
For FY2024, Costco recorded net revenues of $249.63 billion (Source: Costco 2024 Annual Report). With an average yearly growth rate of 7%, revenues are projected to reach around $267 billion in FY2025. Costco should concentrate on three practical tactics in order to maintain growth over the ensuing three years.
First, add benefits to increase Executive Membership from 45% to 50%, which could generate an additional $2.5 billion in revenue.
Second, expand Kirkland Signature by launching more health and organic items, which may boost sales by $5 billion.
Third, increase online sales from 8% to 12%, adding more than $10 billion, by bolstering global e-commerce, particularly in Asia and Europe.
By 2028, these efforts could increase Costco’s overall revenue to between $285 and 290 billion, demonstrating sustained, attainable growth in line with its successful membership loyalty and operational efficiency model.
In my opinion, the sales are forecasted to increase in the next three years. Costco Wholesale has consistently increased in net sales by 5-6% per year since 2021. Using the annual report of Costco Wholesale confirms net sales at $249.625 billion. The net sales for the first 44 weeks of 2025 were $227.46 billion, an increase of 8% from the $210.55 billion of the first half of the previous year. At the current run rate, sales are expected to reach $268.8 billion in 2025.
Growth will be driven by expanding the warehouse from 815 locations in 2021 to 890 in 2024, ongoing expansion locations in both the United States and international markets supports sales growth. The more warehouses mean greater sales volume, higher membership growth, and deeper market penetration. Moreover, an increase in membership rates and deepen in membership engagement contribute to strong renewal rates, which in turn generate additional recurring revenue. Lastly, accelerating e-commerce, especially in grocery and household categories which are high-frequency, essential purchases that benefit greatly from delivery convenience. The e-commerce growth supports operation performance and sustainable revenue growth.
Together, these three strategies, including the expansion of warehouses, increase Costco’s membership rates, and fast growing e-commerce platform, will make net revenue reach $340 billion by 2028.
Source : Statista, Costco annual report, Costco News Details
I believe that CVS has an incredibly solid path forward if it keeps on leaning into what’s already working for them instead of chasing big, flashy targets. The company closed 2024 with $372.8B in revenue with a steady 4-5% annual growth rate.
The focus should really be on strengthening the ecosystem it’s already built. Expanding Oak Street Health and Signify Health means they’d reach m ore patients through in home care as well as Aetna integration, which changes retention and overall care quality in such a major way. By doubling down on its 9,000+ retail locations which already see around 11% same store growth, the result very well could add billions by maximizing what’s already there. The digital side including telehealth, virtual pharmacy, and chronic care management continues to open new revenue streams while making healthcare more accessible.
In my opinion, all of this together could realistically drive another $10-$16B over the next few years from proven strategies by playing into CVS’ strengths.
According to LVMH’s 2024 annual report, the Group delivered $100 billion in revenue, growing by 1% in a year marked by tough economic and currency challenges. (Currency challenges here simply mean that when the U.S. dollar gets stronger compared to the euro or other currencies, international sales, once converted back to dollars, are worth less—even if the company sold the same amount abroad. This made reported sales growth look smaller than it otherwise would have been.)
After a period of rapid luxury growth, LVMH is approaching the next three years with realistic expectations instead of hoping for a big rebound. To estimate future sales, it’s most honest to assume a steady 3% organic growth from the 2024 baseline, matching what luxury markets are currently showing. This would bring total revenue to roughly $112.5 billion by 2027:
100bn×(1.03)^3≈112.5bn
Growth will be driven by these strategies:
Strategy 1: Expand in Asia & U.S.
Focus new store openings and specialized product launches in core markets—Japan, China, Southeast Asia, and the U.S.—which make up nearly 40% of LVMH’s business. Well-targeted investments here are expected to deliver an extra $3.5–5 billion in annual sales by 2027.
Strategy 2: Reinvent Retail Experiences
Upgrade flagship stores (such as Tiffany & Co.’s new flagship and Sephora Studios), while boosting online services. These efforts will create better customer experiences and are forecast to add $2.5–3.7 billion in revenue across divisions.
Strategy 3: Drive Product Innovation
Launch more limited editions, artist partnerships, and unique collaborations—particularly for Louis Vuitton, Dior, and Bulgari. These proven traffic drivers are expected to contribute an additional $2.5 billion each year.
Source: LVMH 2024 Annual Report, LVMH official 2025 press releases, LVMH Key Figures, Reuters, The Fashion Law.
Based on the increase in total sales Costco experienced from 2021 to 2025, I think there will be a gradual rise over the next three years. As noted in its financial statement, Costco’s total sales was $254,453 in 2024(Costco annual report). In 2025 it jumped to $275,235 amid international trade events(Wall Street Journal).
To sustain this growth, Costco should implement several key strategies to bring this favorable outcome. First the company should continue improving its membership model to maintain high customer loyalty. Another strategy is Costco could release new products under their private label, Kirkland Signature to ensure consistent high-quality product options. Third, Costco enhance its e-commerce by adding a purchase option where customers can purchase their goods ahead of time and then pick them up at their own convenience. By strengthening these areas, Costco is likely to see a rise in total sales over the next 3 years.
Base Year: 2024 Sales
LVMH recorded €86.15 billion in revenue for 2024. First-half 2025 revenue would enable a double-up estimate for full-year 2025; as of this review (early November 2025), only annual 2024 results are considered. Over the last three years, LVMH’s average annual top-line growth has ranged around 8–10% per year, but 2024 saw signs of recession, with luxury demand leveling in key markets.
Strategy 1: Deepen Brand Penetration in Asia-Pacific
LVMH’s Asia-Pacific region represented a major growth engine, but China’s recovery lags while Southeast Asia accelerates.
To maximize growth: Expand top-performing brands (Louis Vuitton, Dior) in South Korea and ASEAN markets. Also launch new flagship boutiques in Seoul, Bangkok, and Singapore, plus exclusive digital campaigns tailored for affluent millennials.
Revenue Upside Estimate: Asia-Pacific’s share in 2024 was over 38% of group sales (~€32.7B). With targeted expansion, anticipate an incremental gain of €3.5B over three years—assuming 10% CAGR in new store districts, slightly above average regional growth.
Strategy 2: Accelerate High-Margin Categories and E-commerce
Key activities: Drive e-commerce for leather goods and watches/jewelry (segments with the highest gross margins). Invest in direct-to-consumer platforms with personalized shopping and virtual try-ons.
Revenue Upside Estimate: Watches and jewelry accounted for €11.5B of sales in 2024. Online sales currently make up <20%, but shifting another 10 percentage points online (through conversion and new customers) could add €1.2B, based on actual margins and conversion rates from recent annual reports.
Strategy 3: Sustainability-Led Product Innovation
Key actions: Promote new product lines with eco-certifications (bio-based leathers, circular packaging). Launch “conscious luxury” marketing in EU and North America targeting Gen Z/Gen Y.
Revenue Upside Estimate: If new launches capture even 2% of global sales, mirroring successful historical rollouts, this would yield an incremental €1.7B growth over the three years, with the majority from younger luxury consumers.
Realistic Revenue Projection and Logic
2024 Baseline: €86.15B
Total Incremental Revenue from Strategies:
Asia-Pacific Expansion: €3.5B
E-commerce Acceleration: €1.2B
Sustainability Innovation: €1.7B
Total Gain: €6.4B
Estimated Group Sales by the end of Year 3: €92.55B
This scenario reflects a compound growth rate in line with recent history (~2.5%–3% per year after macro adjustments), with each strategy’s activities mapped directly to revenue gains. There are no outsized promises; each assumption is carefully calibrated against LVMH’s real performance and current business context.
Summary: By using the last reported annual results, historical growth rates, and proven expansion strategies, the projected €6.4B uplift over three years is both plausible and rooted in LVMH’s actual business strengths. Each strategic activity is chosen for its clear causal link to likely revenue impact, ensuring that the pathway for company growth is visible, logical, and achievable.
In 2024, CVS Health brought in $372.8 billion in revenue, a 4.2% increase from the previous year. With recent quarterly growth between 7.8% and 8.4%, the company’s on track to reach around $400–$405 billion in 2025. That’s consistent with CVS’s typical 4–8% yearly growth and reflects steady momentum across pharmacy and healthcare services. Some strategies for growth revenue include:
1. Expanding and Retaining Pharmacy Customers
After taking on Rite Aid’s pharmacy customers, CVS added around 9 million new customers. Prescription volumes and front-store sales have both jumped and same-store sales were up 14.2% in Q1 2025. Keeping these new customers engaged and loyal could bring in around $20 billion in extra annual revenue.
2. Growing PBM and Specialty Pharmacy Services
The Caremark division has been a major driver, reporting $36.2 billion in quarterly revenue (up 11.7% year-over-year). Continued growth in specialty medications and new contracts with employers and government clients could add another $6–10 billion each year.
3. Strengthening Healthcare Services
CVS is also fine-tuning its Oak Street Health and MinuteClinic operations by focusing on value-based care and better performance from existing locations. This shift toward efficiency and profitability could bring in another $4–8 billion annually while strengthening the company’s Medicare Advantage presence.
Altogether, these strategies could lift CVS’s revenue by about $30–38 billion over the next few years, bringing total revenue to roughly $403–$411 billion by 2027. These are grounded in what CVS is already doing well by expanding its customer base, growing its services, and refining its healthcare operations for long-term, sustainable growth.
Sources:
2024 Q4 Earnings Release PDF
Separate Annex
The company that I have researched is CVS which has grown in sales. For CVS there has been a 4.2% increase with the revenue being 372.8 Billion for the year 2024. Over the next three years I predict that CVS will grow based on past reports. Given that the growth was about 4.2% in 2024 I predict that the company will keep growing with a growth rate of 5%. Using the revenue from 2024 I can estimate that the revenue for 2025 will be 391.4 billion (get this number by doing 372.8 x 1.05). A strategy that CVS can focus on to expand is their healthcare services which can be segmented into three parts:
Expand App: The new CVS health app provides an all-in-one solution which provides greater visibility to navigate their app. For instance, they can create more in person services and can schedule their appointments on the app. This will increase clients and revenue overall because more people are using CVS services.
Expand MinuteClinics: There is an ongoing access problem for people seeking primary healthcare. CVS can combat this issue by expanding more locations that have Minute Clinics which they are starting to do. They can expand by having more CVS locations that have minute clinics in them. This will increase revenue because this will expand their customer base.
Increase retail pharmacy prescription: CVS can expand on their prescriptions including specialty drugs which will attract more consumers.
Disclaimer: This comment reflects my personal opinion as an executive of LVMH.
Based on LVMH’s latest financial reports and data from the Wall Street Journal, the Group generated approximately €84.7 billion in revenue in 2024. Over the past five years, LVMH has achieved an average annual growth rate of ~9.5%, reflecting consistent brand strength and diversification across segments. Applying this historical rate, I estimate 2025 year-end revenue at roughly €92.3 billion. This is also taking into account the slight decline in sales from 2024.
For our company to sustain realistic growth over the next three years, I project revenue could reach around €107 billion by 2028, representing a growth rate of about 5%. This stays consistent with the current global luxury climate. This increase can be supported through three confidentially focused strategies:
1. Being able to reinforce our clientele in key urban markets (Paris, Shanghai, New York) to deepen loyalty among high-value local customers. Estimated impact: +€1.5 B.
2. With social media’s continued positive influence on selling our products, we will be able to accelerate the production of multiple media channels in regions like Latin America and the Middle East. In turn, this will drive accessible luxury growth in the market due to a larger outreach through each sector’s social media channels. Estimated impact: +€2.0 B.
3. Launch limited-edition products in each sector of our brand, from Watches and Jewelry to Wine and Spirits, to Fashion and Leather Goods. Being able to do this while amplifying sustainability-driven storytelling for our company, we will be able to elevate brand desirability. Estimated impact: +€1.0 B.
Collectively, these strategies could generate approximately €4.5 billion in incremental revenue, positioning LVMH to reach ~€107 billion by 2028. This trajectory balances our ambition with and capacity to adapt to evolving consumer behavior.
Source: LVMH 2023 Annual Report; WSJ; LVMH Q3 2025 Press Release.
Lululemon enters 2025 from a strong position. The company closed 2024 with approximately $10.6 billion in global revenue, showing that even in a year of higher costs and new trade regulations, the brand’s customer base remains loyal and engaged. Despite tighter conditions in retail, Lululemon continues to balance innovation with disciplined growth. Future growth will depend on staying grounded in what the data shows. Based on recent performance, a 10 percent sales increase in 2025 is a credible estimate. That would bring revenue to around $11.6 billion, reflecting both moderate demand recovery and the effect of selective price adjustments that help offset a 30 percent rise in production and tariff costs.
Three Strategic Growth Options
1.Expanding in Asia-Pacific (+ $1.2 billion)
Mainland China remains Lululemon’s fastest-growing market. Store traffic, brand awareness, and community engagement have all surged in the past year. By opening additional stores and localizing product assortments, sales in the region could rise from about $1.4 billion today to roughly $2.6 billion within three years.
2. Accelerating Digital and Omnichannel Growth (+ $0.9 billion)
Digital channels already represent nearly half of total revenue and deliver stronger margins than physical stores. Enhancing mobile experiences, expanding membership programs, and growing the Like New resale platform can add close to $900 million in incremental sales by 2028.
3. Expanding Men’s and Footwear Offerings (+ $0.7 billion)
Men’s products now account for about one quarter of total revenue and continue to grow at a healthy pace. By investing in new technical lines and footwear innovation, Lululemon could generate an additional $700 million in annual revenue over the next three years.
Altogether, these initiatives could lift revenue from $10.6 billion to about $13 billion by 2028, representing a cumulative increase of roughly 23 percent. The plan is focused, data-based, and achievable within the company’s current operating model. Lululemon’s disciplined approach to expansion, supported by strong customer loyalty and product innovation, provides a solid foundation for continued success.
I focused on PepsiCo’s Digital Beverage Acceleration strategy within PBNA and APAC through a new product concept called Smart Hydration+. This is a zero-sugar, electrolyte-infused sparkling water connected to the PepsiCo+ app, allowing users to track hydration and earn rewards. The idea combines PepsiCo’s beverage expertise with digital engagement, targeting Gen Z and Millennials who seek personalized and health-driven products.
To estimate the marketing investment, I projected production and promotional costs over three years. The total investment is about $145 million, covering R&D ($25M), marketing and advertising ($60M), production setup ($40M), and distribution partnerships ($20M). With a phased rollout — beginning in the U.S., Japan, and South Korea, and later expanding to India and Southeast Asia — the Smart Hydration+ line is expected to generate about $838 million in total sales and $270 million in gross profit over three years, making it a meaningful addition to PepsiCo’s $90B portfolio.
The payback period is estimated at around 2.5 years, based on projected net cash inflows of $20M in year one, $70M in year two, and $120M in year three — reaching the $145M investment midway through the third year. Consumers would choose Smart Hydration+ because it delivers hydration, health, and personalization in one connected experience. While competitors like Coca-Cola Smartwater or VitaminWater Zero may react with stronger digital promotions, PepsiCo’s advantage lies in combining product innovation with data and technology.
Similar launches have proven successful — for example, Coca-Cola’s Aha! Sparkling Water reached nearly $1 billion in retail sales within three years, confirming strong global demand for healthier, functional hydration. Overall, this marketing investment is both realistic and strategically aligned with PepsiCo’s next growth phase — merging innovation, affordability, and digital engagement for sustainable, long-term success.
I focused on PepsiCo’s Digital Beverage Acceleration strategy within PBNA and APAC through a new product concept called Smart Hydration+. This is a zero-sugar, electrolyte-infused sparkling water connected to the PepsiCo+ app, allowing users to track hydration and earn rewards. The idea combines PepsiCo’s beverage expertise with digital engagement, targeting Gen Z and Millennials who seek personalized and health-driven products.
To estimate the marketing investment, I projected production and promotional costs over three years. The total investment is about $145 million, covering R&D ($25M), marketing and advertising ($60M), production setup ($40M), and distribution partnerships ($20M). With a phased rollout, beginning in the U.S., Japan, and South Korea, and later expanding to India and Southeast Asia. The Smart Hydration+ line is expected to generate about $838 million in total sales and $270 million in gross profit over three years, making it a meaningful addition to PepsiCo’s $90B portfolio.
The payback period is estimated at around 2.5 years, based on projected net cash inflows of $20M in year one, $70M in year two, and $120M in year three, reaching the $145M investment midway through the third year. Consumers would choose Smart Hydration+ because it delivers hydration, health, and personalization in one connected experience. While competitors like Coca-Cola Smartwater or VitaminWater Zero may react with stronger digital promotions, PepsiCo’s advantage lies in combining product innovation with data and technology.
Similar launches have proven successful like Coca-Cola’s Aha! Sparkling Water reached nearly $1 billion in retail sales within three years, confirming strong global demand for healthier, functional hydration. Overall, this marketing investment is both realistic and strategically aligned with PepsiCo’s next growth phase, merging innovation, affordability, and digital engagement for sustainable, long-term success.
Concept, for a business:
Lululemon is gearing up to plant its flag in budding European metropolises opening brand‑new boutiques and striking franchise deals to tap untouched markets while easing its dependence, on North America.
Cost:
Getting an outlet off the ground runs at roughly $1.5 million per site. If thirty fresh locations roll out each year for three years the total capital outlay swells to about $135 million. With each store pulling in around $3 million in sales and a 20 % operating margin the combined revenue, over the three‑year span would sit near $270 million.
Selling:
The rollout will draw on a mix of locations and company‑owned outlets nestled within high‑traffic urban nodes, reinforced by hyper‑local digital drives and influencer tie‑ins.
Understanding Consumer Motivation:
The latest wave of consumers chase high‑end activewear that doubles as a lifestyle statement and a tight‑knit community a duality Lululemon epitomizes.
Competition:
Nike and Adidas may respond with collaborations yet Lululemon’s focus, on upscale athleisure creates a distinct point of differentiation.
Getting Paid Back:
The marketing and training budget totals $40 million with an expected payback, in about two and a half years as brand awareness climbs and store maturity spurs same‑store growth.
Well here’s a global example:
Comparable success: Lululemon’s 2023 expansion, into China spurred a revenue surge exceeding 60 % (Source: WSJ).
Company: Lululemon
Ana Dennis
Business idea:
My business idea will build off of my third strategy in my sales growth presentation, which is product innovation. Specifically, we will launch a Lululemon X On Running collaboration called, “pace and purpose”, a limited edition performance collection which will be designed for both running and cross training. This business idea will directly support our innovation pillar and region, and help us achieve our $2B by 2028.
Revenue/cost:
Over the next 3 years, this initiative is aimed to generate a total of $354M, with a total investment of about 60M in marketing materials. The payback period will be about 2 years with a positive return on investment by about mid 2027.
Marketing investment:
How did I calculate the marketing investment? Based on our previous SG&A in 2025, it was about 37.7% of revenue. Based on this, I allocated about 6-7% of our total campaign revenue to marketing. The initial amount we will spend on marketing in year 1 will be higher to spread more awareness, but it will decrease in the following years after publicity has built. (Source: Forbes, WSJ)
Launch:
Where are we planning to launch? We are planning to launch online and in our flagship stores in North America, Japan, and Australia as these are our highest revenue regions. We will launch during the summer near marathon season. We will also have pop ups and influencers supporting the launch. We are planning on first launching digitally and then in stores and tracking performance.
Why consumers would buy it:
Lululemon does not do a lot of collaborations, this would be a shocking, new, initiative with another popular company. It will combine our high end athletic wear with On Running’s performance gear. This initiative will also appeal to men, which is a huge market we are trying to target.
How will competitors react:
Nike has already done collaborations with other brands, for example the recent Nike X Skims collection. Alo and Vuori may try to target their marketing campaigns towards men as well. Our advantage is that we already have strong brand loyalty and retail presence. (Source: Nike US)
Global example of success:
The Adidas X Gucci collaboration is a global example of success as it generated over $90M in the first quarter and increased both brand’s online traffic by 35%. The Lululemon X On collaboration can follow this model as they are both very similar and combine performance with fashion. (Source: Adidas US)
Company: LVMH
Student: Ethan Chou
Business idea:
My proposal builds on LVMH’s strategy of cross-brand innovation. The idea is to create a “Louis Vuitton × TAG Heuer Capsule Collection” that fuses luxury fashion and precision technology. This collaboration would merge Louis Vuitton’s craftsmanship with TAG Heuer’s expertise in high-performance watches, launching limited-edition smart accessories such as digital timepieces and leather wristbands connected to the LV app. The goal is to attract younger, tech-savvy consumers who value both style and innovation.
Revenue & cost:
We estimate total revenue of about €380 million over three years. Initial investment will be €70 million—€45 million for product development and €25 million for marketing. With strong cross-brand visibility and premium pricing, the project is expected to break even within 2 years and yield a 15 percent ROI by 2027. (Sources: LVMH Annual Report 2024; Statista)
Marketing investment:
LVMH usually allocates around 6–7 percent of its division revenue to marketing. The first-year budget will emphasize storytelling around innovation and craftsmanship through short-form digital videos, esports sponsorships, and experiential pop-ups. Later spending will focus on maintaining community engagement via the Louis Vuitton app and connected-watch updates. (Source: Forbes)
Launch plan:
The capsule will debut in 2026 in Louis Vuitton and TAG Heuer flagship stores in Paris, Tokyo, and Los Angeles, accompanied by a simultaneous online release. Influencer partnerships and pop-up showcases at major fashion weeks will amplify awareness.
Why consumers would buy it:
Consumers today seek multifunctional luxury—products that combine aesthetics with technology. Bain & Co. (2024) notes that over 70 percent of Gen Z luxury buyers favor brands that merge innovation with identity. This collaboration embodies that shift.
Competitor reaction:
Kering and Richemont are both integrating tech elements into luxury; for instance, Cartier’s connected jewelry. However, few have succeeded in making wearables aspirational. LVMH’s fashion + watch synergy offers a stronger emotional and visual appeal.
Investment & payback:
Total required investment: €70 million. Payback period: about two years. Continuous digital service features will generate post-purchase revenue through app subscriptions and accessories.
Global example of success:
A comparable success is the Prada × LG smartwatch collaboration, which generated over €120 million in its first year and proved luxury–tech partnerships can attract new audiences while elevating brand perception. (Source: Business of Fashion)
Business Idea
Building on my third sales growth strategy, product innovation, LVMH will launch a sustainability-focused luxury collection called “Conscious Elegance,” combining bio-based leathers and circular packaging across select Louis Vuitton and Dior lines. This initiative supports our innovation and sustainability pillars while targeting Gen Z and Gen Y consumers in Europe and North America, helping us reach our revenue goal of €92.55 billion by year three. The collection will be introduced via new flagship boutiques in Seoul, Bangkok, and Singapore, as well as exclusive online platforms, with pop-up events and top-tier influencers supporting the rollout.
Revenue & Cost, Marketing Investment, and Launch
Over the next three years, this initiative aims to generate an incremental €1.7 billion for LVMH, with an investment of about €90 million in product development and €75 million in launch marketing. The payback period is projected at just under two years, thanks to high margins and strong consumer demand for sustainable luxury. Marketing investment was calculated using LVMH’s historical marketing ratio (3–5% of incremental revenue), with initial spend front-loaded to build awareness through digital campaigns, influencer partnerships, and immersive launch events. Products will debut online and in flagship stores in Asia-Pacific and top European and North American cities, coinciding with peak travel and luxury shopping seasons. Exclusive content, personalized digital experiences, and targeted launches will drive early interest, with performance tracked digitally and in-store.
Why Consumers Will Buy and Competitive Response
Luxury consumers, especially younger buyers, are increasingly driven by a desire for authentic brands with real environmental commitments, making “Conscious Elegance” both a statement and a status symbol. The collection’s limited availability, innovative materials, and association with heritage brands bring additional appeal. Competitors like Kering and Prada have already experimented with eco-innovation, but LVMH’s scale, brand network, and integrated retail presence offer a unique advantage. Gucci’s recent sustainable launches, for example, saw double-digit growth in their target demographic, a global precedent that suggests LVMH’s investment is not only well-founded but also competitive in today’s luxury market.
Business idea:
We are launching a collaborative capsule collection between Lululemon and The Row, featuring limited-edition pieces that balance performance wear and everyday luxury. The collection will be priced slightly higher than similar products, reflecting its exclusive design and premium positioning. The main goals are to expand our audience base and enhance brand value and image. This collaboration gives us a solid reason to increase prices while attracting more consumers and boosting overall sales, aiming to generate at least $1 billion in additional revenue.
Revenue & Cost:
Over the next three years, a new collection will be designed and produced each year. The annual production cost is estimated at $300 million, while the sales price will range from $100 to $500 per item, leading to approximately $800 million in total annual revenue. As sales grow year by year, the collection will also drive demand for other Lululemon classics, increasing their sales and price points. These existing products are expected to generate $1 billion or more in revenue, with a $400 million cost.
Sales Strategy:
The collection will first be introduced online through pre-launch campaigns and VIP early access, followed by in-store sales and pop-up events. Online sales will include both limited-quantity and limited-time purchasing options to maintain exclusivity.
Why Consumers Will Buy:
The Row is a luxury fashion brand with strong cultural influence and loyal followers. Since Lululemon and The Row have never collaborated before, the partnership will generate significant attention. Consumers will be excited by the opportunity to purchase The Row’s design aesthetic at Lululemon’s price range, making the products both fashionable and wearable in daily life.
Target Markets:
The main focus will be on North America and China, where most of the inventory will be distributed, followed by Mexico and other regions with smaller allocations.
Competitor Reaction:
Competitors may respond by offering discounts, launching their own premium sub-lines, or seeking new collaborations to maintain visibility and differentiation. They will likely reinforce their brand identity while trying to retain consumer attention.
Investment:
The total investment will be $1 billion, including $300 million in production costs, $200 million in R&D, and $500 million for marketing and promotional activities.
Successful Case:
The collaboration between Nike and Off-White successfully opened up a younger market segment for Nike and significantly boosted its brand value. Nike’s brand revenue reached $32.2 billion, an 8% increase. The co-branded products generated massive social media buzz, and resale prices in the secondary market were over four times the original retail price, proving the strong impact of strategic collaborations.
(Sources: WSJ, Complex, Baike)
This only represents my personal opinion.
Business idea:
We are launching a collaborative capsule collection between Lululemon and The Row, featuring limited-edition pieces that balance performance wear and everyday luxury. The collection will be priced slightly higher than similar products, reflecting its exclusive design and premium positioning. The main goals are to expand our audience base and enhance brand value and image. This collaboration gives us a solid reason to increase prices while attracting more consumers and boosting overall sales, aiming to generate at least $1 billion in additional revenue.
Revenue & Cost:
Over the next three years, a new collection will be designed and produced each year. The annual production cost is estimated at $300 million, while the sales price will range from $100 to $500 per item, leading to approximately $800 million in total annual revenue. As sales grow year by year, the collection will also drive demand for other Lululemon classics, increasing their sales and price points. These existing products are expected to generate $1 billion or more in revenue, with a $400 million cost.
Sales Strategy:
The collection will first be introduced online through pre-launch campaigns and VIP early access, followed by in-store sales and pop-up events. Online sales will include both limited-quantity and limited-time purchasing options to maintain exclusivity.
Why Consumers Will Buy:
The Row is a luxury fashion brand with strong cultural influence and loyal followers. Since Lululemon and The Row have never collaborated before, the partnership will generate significant attention. Consumers will be excited by the opportunity to purchase The Row’s design aesthetic at Lululemon’s price range, making the products both fashionable and wearable in daily life.
Target Markets:
The main focus will be on North America and China, where most of the inventory will be distributed, followed by Mexico and other regions with smaller allocations.
Competitor Reaction:
Competitors may respond by offering discounts, launching their own premium sub-lines, or seeking new collaborations to maintain visibility and differentiation. They will likely reinforce their brand identity while trying to retain consumer attention.
Investment:
The total investment will be $1 billion, including $300 million in production costs, $200 million in R&D, and $500 million for marketing and promotional activities.
Successful Case:
The collaboration between Nike and Off-White successfully opened up a younger market segment for Nike and significantly boosted its brand value. Nike’s brand revenue reached $32.2 billion, an 8% increase. The co-branded products generated massive social media buzz, and resale prices in the secondary market were over four times the original retail price, proving the strong impact of strategic collaborations.
(Sources: WSJ, Complex, Nike Investor Report)
Company: Lululemon
Business idea: “CourtFlow” Collection: Expanding into Padel & Pickleball
In my opinion, Lululemon’s next growth opportunity lies in launching the “CourtFlow” Collection, a high-performance line for the booming sports of padel and pickleball. These fast-growing sports align perfectly with Lululemon’s brand mission of combining performance, lifestyle, and community while expanding beyond yoga and running.
Revenue & Cost (3 years): The estimated investment is $75 million over three years (R&D, production, and marketing). With an average selling price of $150 and roughly 600,000 projected units, total revenue could reach $90 million, with a 2.5-year payback period and margins similar to current product categories.
Launch plan: CourtFlow would debut in North America and Europe, supported by flagship stores, e-commerce, and partnerships with padel and pickleball clubs. Marketing would center on pop-up courts, community tournaments, and influencer activations to build buzz and exclusivity
Consumer appeal: Pickleball and padel are becoming increasingly popular worldwide, particularly among women and urban professionals who make up Lululemon’s target market. A collection for these sports would attract new consumers while reinforcing loyalty among existing fans who trust the brand’s quality and design.
Competitive outlook: No brand currently dominates the luxury courtwear market, although Nike and Adidas have made a slight entry. Through creativity and compelling community narratives, Lululemon can achieve early dominance.
Comparable success: Lacoste’s recent push into U.S. sportswear, driven by the rising popularity of tennis, shows how a premium lifestyle brand can expand into performance categories. The brand expects to double its U.S. sales from about $400 million as part of its goal to reach €4 billion by 2030.
Sources: Lululemon Annual Report 2024; WSJ; McKinsey Sports Report 2025; Statista; Vogue Business; Financial Times.
From 1st Jan 2026 (2026-2028)
1. Business Idea: The business idea is to introduce laser engraving services at some of Lululemon retail stores in China, the United States, and Canada (one store for each city). Consumers can personalize items such as water bottles, yoga mats, and backpacks, with custom text or designs using high-precision laser engraving. This service aims to boost customer engagement and brand loyalty by providing exclusive, memorable, and shareable product experiences like successful personalization trends seen in global retail.
2. Revenue and cost estimation: one laser Engraving Machine will cost $ 2,000 in average. There are around 165 stores in China mainland, 475 stores in the US, and 71 stores in Canada. Among these stores, we pick 45 stores in China, 50 stores in the US, and 16 stores in Canada. The total amount is 111, so we need to prepare 111 machines for each store, which is $ 222,000. Professionals will do equipment maintenance every four months, so the total cost for maintenance will be around $ 166,500/year. Regarding to the promotion of this service, we plan to adopt the cost-effective way – using UGC to motivate consumers to post their stories with Lululemon customization on their social media – to spread our brand in a viral way. And we can give our special yoga mat ($128) as a reward to the top 10 customers who get the most likes and comments. Based on this, we can get the final cost for this service – $ 389,780/year. There are two ways to add this personalized service into regular sales – one is paying additional $ 9.99 to get a pattern, the other is buying over $ 300 at one time to get it for free. As for the revenue, there will be a 40% surge of store traffic compared to current situation, and we assume that 50% of them will pay for the laser engraving service separately and 30%of them will buy more than $ 300 to get free one. From the previous data, we know that the average annual revenue of each store in China is $ 8 million, in the US is $ 14 million, in Canada is $ 20 million. So based on all the information, we can predict that the total revenue will increase by $ 1,821.6 million.
3. Consumers buy personalized products for many reasons. First, they have a desire for uniqueness and self-expression. Second, the personalized product can be an ideal gift for birthdays, milestones, and group events, because the customization can make the gift differentiated from others. Third, this unique service can offer a trigger to them to share their special experience proactively with lululemon on their social media to enhance the sense of community and belonging.
4. Competitors (Nike, Adidas, Puma, Alo) may respond by launching similar customization programs or discounting existing personalized products. Success depends on Lululemon’s brand prestige, retail presence, and tech-enabled experience. Lululemon is already known for premium, community-driven branding, making differentiation more sustainable.
5. Starbucks China: Laser-engraved tumblers drove a 30% jump in localized product engagement (2019). Apple’s personal engraving (worldwide): Widely cited as enhancing gift appeal and customer satisfaction. Stanley’s laser engraving service in their pop-up stores in China in 2024 shows significant sales boost.
source:
Stanley x xTool: Boosting Store Traffic with Laser Customization;
Lululemon’s official website; Scrapehero: Number of Lululemon stores in the United States in 2025;
Statista: Number of Lululemon stores in Canada from 2013 to 2024;
Chinadaily: Lululemon sees healthy growth in key sectors
Lululemon’s annual report
I’m XUE WENMU.
LVMH under the cosmetic brand Benefit is going to launch a new gel moisturizer. The idea is to launch a new product specifically to sensitive skin, called Benefit Brisa, to be launched in January 2026 in Brazil, to the Brazilian Summer. The main product benefits are: non-sticky, relieves dry skin promoting comfort and itchy skin sensation.
São Paulo has 46 million people according to IBGE, the target segment is 6.6 million people (15% of the population of SP with dry skin) and the Target Segment Potential is 80% of this population, because the main attribute of the product is to be non-sticky, perfect for the hot summer, so 5.3 million people. The total predicted sales for 2026 is R$40 million, assuming that the person would buy 1 cream every month for 12 months at R$90,00 each 400ml jar and the brand would have 2% market share. Total product cost is predicted to be R$9 million reais, so total predicted revenue is going to be R$31 million. Given that, the initial investment will be R$10 million as we will profit from the existing structure Benefit already has. ()
The product will be launched in São Paulo, in a soft launch with a live-commerce followed by an event in Ibirapuera park, with influencers covering the event and a pop up store in the park, with a lot of green elements and sampling. The product then, after launch will be sold in Benefits website and main retailers such as Sephora and RaiaDrogasil, DPSP, mais drugstore/beauty retailers. Competitors won’t be pleased about the launch, specialty competitors like Encerin and Cerave will mostly likely launch a similar product within 6 months, so we will need to profit from the first months of launch as only players.
Benchmark: Carmed BFF – Carmed is a lip-care product from Cimed a Brazilian Pharmaceutical Company. Even though Carmed is lip-care, it’s a recent Brazil case of a very successful launch. They used live commerce + cultural influencers, followed by category expansion and high share retention.
Carmed Launch in numbers:
• Sales: Launch livestream with celebrities (Larissa Manoela & Maísa) drove R$40 million in sales in 20 minutes for the new Carmed BFF line. Source: Exame
• Brand Impact: After launch, Carmed sold 2 million units in a month without taking share from rivals, lifting the entire lip-care category from 1 million to 3 million units/month.Source: Exame
• Year-one result: In 2023 the Carmed franchise reached R$400 million in revenue and 73.6% market share, showing sustained growth. Source Forbes Brasil
The benchmark proves that a well done launch has the power to increase the market and impact the brand as well, and as our new product is specialty, it is really important to have a well done launch.
From my opinion, Uber can expand its pooled-ride service, UberX Share, by introducing a new concept called the “Commuter Pass.” This pass would focus on weekday rides, offering automatic pooling and price caps to make daily commuting more predictable and affordable. The goal is to encourage more riders to shift from solo rides or short private car trips to shared travel.
In the first year, the target is to bring in about 200,000 new monthly active riders across ten major cities. Each rider is expected to take around six shared trips per month. On average, Uber earns about three dollars per pooled trip after driver earnings and fees, while variable costs are about two dollars and forty cents per trip, leaving roughly sixty cents of contribution margin. The customer acquisition cost per rider is estimated at fifteen dollars, which means the payback period is about four months.
With these assumptions, revenue in the first year would reach about 43 million dollars, generating eight and a half million in contribution profit. Marketing investment would be around 25 million, resulting in an initial net loss of about 16 million. In year two, as awareness grows and marketing becomes more efficient, revenue could rise to 75 million with a smaller marketing spend of 18 million, bringing the business close to breakeven. By the third year, with around half a million active riders, the project could generate over 100 million in revenue and turn a profit of nearly 10 million dollars.
The marketing rollout would rely mainly on Uber’s own app through homepage placements and notifications, combined with outdoor ads around transit hubs and city centers. Partnerships with employers and universities would help introduce the Commuter Pass as part of commuter benefits. Dynamic “price cap” messages during rush hours and referral incentives would further attract and retain riders.
Commuters would likely choose this service because it offers predictable travel costs—up to 30% cheaper than standard rides—while also being more sustainable and convenient. The automatic pooling during weekday hours would make the experience simple and consistent. The plan would first launch in ten high-density cities where average pickup times are under six minutes and commuter populations are large.
Competitors like Lyft might try to counter with temporary discounts, but Uber’s focus will be on reliability, shorter wait times, and transparent pricing rather than price wars.
The total investment required would start at around 25 million dollars in the first year, then gradually decrease to 18 million in year two and 12 million in year three, as marketing efficiency improves and organic growth from referrals increases. If Uber invests partly in product upgrades rather than pure marketing, only about 2 million dollars in the first year would be needed for app adjustments such as the auto-pooling logic and capped-fare feature, without requiring large capital expenses or fleet ownership.
Globally, UberX Share has already proven successful in countries like the United States and Brazil, where shared rides help lower costs and congestion. Similar commuter-focused initiatives, such as transit-linked programs in London and Paris, have also boosted repeat ride frequency and commuter adoption.
Costco:
Costco plans to introduce a new Kirkland Signature line of shampoos, conditioners, and treatments that emphasize clean ingredients and everyday affordability. The U.S. hair-care market is valued at approximately $13.86 billion in 2025 and is expected to grow annually by 1.66% from 2025 to 2030 (Statista). Globally, most hair-care revenue is generated in the United States, making Costco’s entry into this segment strategically timed to capture consumer demand for affordable, high-quality products (Statista). In recent years, the beauty market has seen a significant rise in consumer interest toward clean and sustainable products, as well as a growing acceptance of private brands. Over 70% of U.S. consumers now believe that store brands are as good as or better than national brands (McKinsey). This shift in sentiment supports Costco’s opportunity to expand the Kirkland Signature portfolio into personal care, leveraging its reputation for quality and trust to compete with premium national brands. Many clean beauty shampoos and conditioners currently retail for $20–$40 per bottle, leaving a large price gap for Costco to exploit. By pricing its new Kirkland Signature Hair-Care line at around $11.99 per bottle, Costco offers a premium yet accessible alternative that balances quality and value. Comparable products on Costco’s website, such as other premium hair-care offerings, are sold at higher prices, reinforcing the attractiveness of this mid-tier positioning (Costco). Production costs are estimated at about $2.50 per bottle, allowing for a gross margin near 80% (Supliful). Projected sales volume begins at 150,000 units in Year 1, increases to 250,000 units in Year 2, and reaches 400,000 units by Year 3, generating total revenue of roughly $9.6 million and estimated profits of $7.6 million over three years. The payback period would be less than one year, as Year 1 profits exceed initial production costs, achieving full payback within approximately three months after launch. The launch strategy will target high-traffic warehouses in major U.S. cities and include value-sized two-packs available on Costco.com. Marketing initiatives will leverage Costco’s established tools such as in-store sampling, member-exclusive email promotions, and features in Costco Connection magazine, which reaches more than 14 million subscribers. Collaborations with social-media beauty influencers will further drive awareness among younger, ingredient-conscious consumers. By aligning affordability, clean formulation, and trusted branding, Costco is positioned to gain share in a growing category and strengthen Kirkland Signature’s image as a premium private label that competes directly with leading national brands.
Based on recent research and industry evidence, Uber can realistically expand its advertising platform globally, scaling JourneyTV in-ride screens and programmatic Journey Ads to reach about $9 billion in annual revenue by 2028. This growth leverages Uber’s unique, high-intent audience of over 180 million Monthly Active Platform Consumers across Mobility and Delivery, creating a powerful, data-driven advertising network. To achieve this, Uber will need to invest approximately $275 million over three years (2026–2028) in hardware deployment, ad technology, creative content partnerships, and sales team expansion. During this period, expected annual ad revenue is projected to grow from roughly $3.5 billion in 2026 to $6.2 billion in 2027, reaching $9 billion by 2028, an estimate supported by current growth rates and JourneyTV’s exceptional 98% ad completion rate.
The business model is based on proven CPM (Cost per Mille) pricing, with in-app Journey Ads earning $6–10 CPM and JourneyTV averaging $15–25 CPM, in line with digital ad trends and advertiser demand shifting toward mobility platforms. Uber will continue to partner with leading brands, agencies, and content publishers to offer a mix of curated entertainment and targeted advertising both in-app and on in-vehicle tablets. Riders themselves benefit from engaging local content, information, and personalized offers enabled by Uber’s vast first-party data, with high attention and satisfaction rates recorded.
In terms of competition, companies like Lyft, Bolt, and Grab are expected to accelerate their own ad offerings, but Uber maintains a strategic advantage through its global footprint, audience scale, and unique programmatic partnerships. Previous successes, such as Grab’s $176M advertising revenue in 2024 (+60% YoY) and Uber’s own in-ride ad engagement metrics, reinforce that this strategy is both credible and scalable in different regions. These facts confirm that Uber’s marketing investment plan is grounded in real-world success, offers attractive payback in less than a year, and positions the company as a leader in mobility-based advertising.
Source: Uber News, PPC Land,Uber Investor, Yahoo, B&T.
Considering recent updates and research, Uber can expand its a fully integrated autonomous ride-hailing platform, partnering with leading autonomous vehicle suppliers such as Waymo. The platform aggregates global autonomous fleets onto the Uber app, letting users book autonomous vehicles in select urban areas without relying on human drivers.
Launch investment would cost ~$300–$375M for partnership stakes, tech platform upgrades, and initial rollouts. Annual operating cost would be minimum as it is part of Uber’s current cost. Estimated sales price would be $15–$25 per trip, comparable to human-driven UberX, but with lower cost structure by removing driver commissions.
Year 1 revenue from this would be roughly $500M by implementing AV in limited cities, pilot fleets. Year 2 revenue is projected to be $2B with expanded AV supply and emerging market. Year 3 revenue would be $4B+ considering multi-city implementation and multi-AV partner integration.
The launch should be piloted in tech-forward cities (e.g., San Francisco), with existing AV infrastructure; offer free trial rides, partner with local governments for regulatory support, run targeted digital campaigns, and emphasize safety/innovation. Uber’s existing app will have an “Autonomous” booking option, including integration with Uber One and loyalty programs for retention. Consumers would choose AV because of its lower prices, higher safety record, rapid pickup times, technology appeal, and integrated experience with Uber membership programs. Eco-friendly options and premium vehicle choices would drive further adoption.
Launch cities would be in the U.S. (Dallas; Austin; San Francisco), China (Beijing; Shanghai), UAE (Dubai; Abu Dhabi). Major competitors (Waymo, Tesla, Cruise, Baidu, Lyft) will amplify their own direct-to-consumer AV platforms, expand partnerships, and potentially negotiate tougher revenue splits for rides booked through Uber. Waymo (U.S.) has over 1,500 robotaxis deployed across five cities, with mainstream usage and high consumer awareness, showing growing acceptance. Baidu’s Apollo Go (China/UAE) has more than 11 million commercial robotaxi rides; fleet expansion to Dubai and mass-market launch in China.
We propose launching a limited-edition luxury travel wrist accessory under one of LVMH’s maisons, combining haute horlogerie craftsmanship with subtle travel-smart features like world-time indication and NFC access. Targeted at affluent global travelers, the product will be limited to 1,000 units in Year 1, sold through flagship boutiques in key cities (Paris, New York, Hong Kong, Dubai), select travel-retail locations, and an invitation-only online channel. Priced at $25,000 per unit with a cost of $10,000, revenue is projected at $25 million in Year 1, $40.5 million in Year 2, and $60 million in Year 3, yielding contribution margins of $12.5 million, $22.95 million, and $37 million respectively. Consumers will buy it for brand prestige, craftsmanship, exclusivity, travel-lifestyle relevance, and experiential add-ons like concierge services and bespoke packaging. Marketing and launch investment is estimated at $5 million initially, with additional spending of $2 million in Year 2 and $1 million in Year 3, covering influencer campaigns, luxury media content, boutique and travel-retail activations, and experiential events. With this structure, the payback period is under 12 months, or approximately 14–16 months including product development costs of $5 million. Competitors may respond with similar travel-luxury offerings, but differentiation will be maintained through limited editions, brand heritage, storytelling, and exclusive service bundles. Globally, luxury limited-edition product launches by brands such as Dior have demonstrated rapid growth and strong margins, validating this approach. The launch strategy combines pre-launch teasers, global flagship events, influencer partnerships, travel-retail pop-ups, and ongoing digital engagement to ensure controlled exclusivity while scaling revenue from Year 1 to Year 3.
Company: LVMH
1. This concept builds on my fifth sales growth strategy, “Expanding Selective Retail,” with a focus on increasing the number of Very Important Beauty Insider (VIB) customers at Sephora over the next year. The VIB tier requires an annual spend of at least $350. In 2024, Sephora reported over 40 million Beauty Insider members, up 15% from 34 million in 2023. The program has three tiers: Insider, VIB (mid-tier), and Rouge (top-tier). While Rouge members represent 10% of total members and VIB figures are not disclosed, we estimate that VIB accounts for roughly 30% of the total. The goal is to grow this segment by 15% in 2025.
2. Revenue & Cost: estimate the cost to make, sales price, and revenue for 3 years
a. VIB members: 30% of 40 million = 12 million (2024)
b. Target Sales growth: 15% annually which is equivalent to=
i. 13.8 million (2025)
ii. 15.9 million (2026)
iii. 18.3 million (2027)
c. Average annual spend per each VIB: Estimated $350
d. Revenue:
i. 2025 = 13.8M × $350 = $4.83B
ii. 2026 = 15.9M × $350 = $5.565B
iii. 2027 = 18.3M × $350 = $6.405B
e. Using LVMH’s investment ratio on marketing in 2024, 11.5% (Statista)
i. 2025 incremental revenue = $4.83B – (12M × $350 = $4.2B) = $0.63 billion
ii. 2026 incremental revenue = $5.565B – $4.83B = $0.735 billion
iii. 2027 incremental revenue = $6.405B – $5.565B = $0.84 billion
f. Marketing & loyalty investment (11.5% of incremental revenue):
2025 cost = 0.115 × $0.63B = $72.45 million
2026 cost = 0.115 × $0.735B = $84.53 million
2027 cost = 0.115 × $0.84B = $96.6 million
In this case since the incremental revenue over the first year is $630 million, exceeding initial marketing investment of $72.45 million, the payback period is less than one year.
3. How will it be sold: By personalizing experiences, with tailored recommendations and tailored promotions to increase beauty insiders engagement. Also offering exclusive offers, such as early access to new product launches, offer limited edition products that are only offered to VIB customers. Offer special VIB events to beauty insiders for them to feel the sense of exclusivity that they would have as VIB.
4. Why will customers buy it: These clients value personalized attention, emotional attachment to the brand, value the sense of belonging to a community, being part of an exclusive community. It’s an enhanced status that they will receive and its what Gen Z are looking for nowadays.
5. Where will it be sold: Sephora sells it through its omnichannel network, online, onsite, mobile app. The exclusive product launches and VIB experiences are both online and onsite. Social media platforms will be utilized for advertising.
6. Competitors reaction: Main competitors such as ULTA Beauty may react in a responsive way by increasing benefits in their own customer loyalty programs that they bring. They may tend to copy Sephora which is the leader in beauty loyalty programs.
7. Investment:
a. 2025 cost = 0.115 × $0.63B = $72.45 million
b. 2026 cost = 0.115 × $0.735B = $84.53 million
c. 2027 cost = 0.115 × $0.84B = $96.6 million
8. Successful Example: A successful example of this is Joy Loyalty’s partnership with Korean Skincare brands. They enrolled over 56,000 members in 6 months and had a 71.5% month-over-month sales growth. They focused on aligning loyalty with customer purchase cycles, personalized engagement, and community building. This is something that Sephora can mimic for its VIB growth strategy.
Sources: Yahoo Finance, Modernretail.co, Statista, Joy.co
My business idea for LVMH is to create a digital access membership where members pay $200 per month for exclusive app-only drops, first access to in-real-life activations, and contact with our team. The average cost for app creation and launch, according to TopFlight, is $80k-$250k. Due to our complexity and need for high security, our costs would probably be around the $250k side for app development. Our sales price is $200 a month or $2,400 a year per member. If we grow each year by 1,500 members, we can make a revenue of $21.6 million or $21.35 million net revenue. LVMH spent over $10 billion on advertising in 2024, making this a small investment for passive revenue.
If we reach our goal, we will break even by the 104th member joining, which will most likely be in the first 3 months. This estimate is based just on subscription payments and does not account for exclusive and high-cost purchases made only through the app by members. We will launch it through an omnichannel campaign promoting it digitally, through out-of-home ads, and pop-up activations. We will launch it on the App Store and Google Play Store.
Competitors will either replicate with a similar product or stick to their traditional selling channels. The original investment will be around $500k due to app development fees, staffing costs, and beta testing. This is similar to MasterClass’ subscription success, where in 2024, they had over 140 million subscribers after starting in 2015, and have been a massive success. We are building the app around our already known brands and highly loyal community that values luxury and exclusivity, making our payback period more than attainable.
Sources: Statista, LVMH, Topflight, Contrary
Company: Lululemon
In my opinion, Lululemon’s next strategic growth opportunity is to expand into smart performance wear through a collaboration with Whoop, the fitness wearable brand known for recovery tracking. The concept “Lululemon x Whoop: Mind in Motion” combines Lululemon’s apparel technology with Whoop’s biometric sensors to create limited-edition training gear that monitors heart rate, sleep, and recovery in real time. This fits our innovation pillar and the growing wellness-tech market.
Revenue & Cost:
Each “Mind in Motion” set (leggings or shorts + Whoop sensor band) would retail at around $350, with production costs of $150. Assuming we sell 300,000 units globally in three years, total revenue would reach roughly $105M, generating an estimated gross profit of $60M.
Marketing Investment:
Based on Lululemon’s FY2025 SG&A ratio (around 38% of revenue, Source: WSJ), I allocate 7% of total campaign revenue ($7.4M) toward marketing. The first year’s spending will focus on awareness—digital campaigns, pop-up events in flagship stores, and influencer training challenges. As the collaboration gains traction, marketing expenses will gradually decline in years two and three. The expected payback period is about 2.5 years, given the premium pricing and strong engagement from fitness communities.
Launch Plan:
The rollout will begin in flagship stores and online platforms across North America, Japan, and Europe, aligning with marathon seasons and peak training months. The digital-first campaign #MindInMotion encourages users to share their recovery scores and mindfulness progress.
Why Consumers Would Buy It:
Consumers today are increasingly motivated by data-driven wellness and apparel that supports both physical and mental balance. The collaboration adds practical functionality to Lululemon’s design, creating products that are both aspirational and useful.
Competitor Reaction:
Nike and Under Armour have both experimented with wearables before but struggled to sustain consumer adoption. Lululemon, with its loyal community and Whoop’s credibility in performance analytics, has a stronger foundation for long-term success.
Global Example of Success:
The Adidas x Allbirds “Futurecraft.Footprint” collaboration—, focused on sustainable innovation, sold out rapidly and strengthened both brands’ reputations for combining performance with purpose (Source: Forbes). Similarly, “Lululemon x Whoop” could merge technology and mindfulness into a distinctive growth driver.
Total Investment: Approximately $15M, covering product development, marketing, and initial production.
PepsiCo could launch a new functional drink called “Mag-Active,” a magnesium-based beverage designed to support both hydration and functional benefit for customers. Unlike traditional caffeine drinks, this drink would offer a more balanced boost by adding magnesium, delivering long-lasting vitality.
In China, people start to consider minerals and vitamin C as healthier energy sources than caffeine, while in the U.S., magnesium is gaining trust as an ingredient for stress release and fatigue reduction. This positions PepsiCo well to meet growing demand for low-sugar, lightly caffeinated drinks that are backed by science.
On the financial side, production costs would be $0.70 per unit, with retail prices ranging between $2.00–$2.30. The revenue would be $40 million in year one, $88 million in year two, and $160 million in year three—as margins improve with scale. PepsiCo anticipates investing about $45 million across R&D, production, and marketing.
Monster Beverage, as one of the benchmarks, reported a sales growth in 2025, driven by its new “Reign Storm” line—a functional energy drink containing vitamins, electrolytes, and natural caffeine. Moreover, Genki Forest’s “Zi Zai Shui” wellness water achieved over RMB 1 billion in sales by blending traditional Chinese herbal ingredients with modern functional benefits. These cases prove that consumers respond positively to drinks that merge science, wellness, and everyday lifestyle relevance.
The product will first launch in the Asia-Pacific region, targeting high-growth markets like China, Japan, and Singapore. Marketing plans include digital campaigns, fitness partnerships, influencer outreach on platforms like TikTok and Douyin, and in-person sampling at gyms, campuses, and convenience stores.
While competitors like Coca-Cola may try to replicate the concept, PepsiCo holds a temporary edge. Developing magnesium-based drinks requires time, regulatory approval, and strong R&D—barriers that give Pepsi a head start.