Out of Band Authentication

Have you logged into your bank or investment accounts recently? If so, perhaps you entered your username and password, clicked a button, and then you were asked to enter a PIN or password that was emailed or texted to you. Do you work with sensitive information? Logging into the database from your desktop computer or laptop might involve not only your username and password but also a separate app on your smartphone or tablet. You enter your username and password; then a push notification appears in the authentication app asking you to accept or deny access. These scenarios are examples of out of band authentication.

Out of band authentication is a process that uses a different communication channel for authentication than the primary communication channel that the user is trying to access, making it more difficult for hackers to compromise the authentication process. However, this process is not foolproof. The 2018 Reddit.com data breach exposed internal data as well as employee and user email addresses and passwords. Reddit.com used 2-factor authentication via text message. According to Verizon’s 2018 Data Breach Investigations Report, worldwide, more than 43,000 data breaches involving stolen customer credentials occurred in 2017, 91% targeted banking institutions.

Today’s market size shows the amount spent on out of band authentication software and services for 2018 and projected for 2023. Because of the growing threat of ever more sophisticated cyber attacks and increasingly stringent information security regulations, this market is expected to grow at a compound annual growth rate of 23.5%. The demand for cloud-based out of band authentication solutions is expected to grow at an even higher rate. Several companies comprise this market including Gemalto, CA Technologies, Symantec, Ping Identity, and RSA Security, to name a few.

Geographic reference: World
Year: 2018 and 2023
Market size: $533 million and $1.53 billion, respectively
Sources: “The OOBA Market Size is Expected to Grow From USD 533 Million in 2018 to USD 1,532 Million by 2023, at a Compound Annual Growth Rate (CAGR) of 23.5%,” PRNewswire, March 12, 2019 available online here; “Out of Band Authentication (OOB),” The Secret Security Wiki available online here; “Reddit Breach Highlights Limits of SMS-Based Authentication,” Krebs on Security, August 1, 2018 available online here; 2018 Data Breach Investigations Report, 11th Edition, Verizon, April 2018 available online here.
Image source: William Iven, “office-business-accountant-620822,” Pixabay, February 3, 2015 available online here.

Social Media Management

social media management

Facebook, Twitter, Instagram, YouTube, Pinterest, LinkedIn. Social media platforms with millions of active users. For businesses that have products to sell or services to offer, posting on these sites is a way for them to advertise to potential customers and to engage with current customers. In 2017, 77% of marketers used at least one social media site to promote their company’s product or service; however, only 48% reported a return on their investment.

To try to increase their chances of success many companies develop social media strategies. As part of these strategies, they choose which platforms to utilize. Not all platforms may be appropriate for all types of marketing. A social media strategy considers who the target audience will be, what types of content will be posted and how often to post content. Because each platform may target a different demographic, posting the same content across all platforms is not always beneficial. Therefore, a posting schedule may need to be implemented showing what to post and when to post it to each platform.

After a strategy is in place, the work of creating the written content, images, and videos is undertaken. Companies may find that sharing relevant third-party content is also a favorable way to engage followers. Once followers are engaged, responding to comments or questions in a timely manner is important. Some companies may reach out through social media to other businesses and influencers in the same industry to increase the number of people seeing their content. Creating advertising campaigns, contests, and giveaways are other ways of promoting a product or service.

Once a strategy is in place, content is posted, and followers are engaged, a company then evaluates the strategy’s effectiveness. Whether a company employs one person or a team of people to handle its social media presence, social media management tools and services exist to help a company optimize its resources. Social media management software can help employees use their time more effectively, and social media management services can provide experts at all levels of the process from strategizing to post creation, customer engagement, and analysis.

Today’s market size shows the amount companies spent on social media management worldwide in 2018 and forecast for 2023. Demand for cloud-based software is expected to grow the most during this time period. Cloud-based tools can be implemented rapidly, may cost less, and are easy to use. They can also be customized to an organization’s current and future needs. The major companies that provide social media management tools and services include IBM Corporation, Oracle Corporation, Salesforce, Adobe Systems, Hootsuite Inc, Sprout Social Inc., Google Inc., Sysomos, Sprinklr Inc., Digimind, Clarabridge, Spreadfast, Falcon.io, Zoho Corporation, and Lithium Technologies LLC.

Geographic reference: World
Year: 2018 and 2023
Market size: $9.2 billion and $17.7 billion, respectively
Sources: “MarketsandMarkets Expects The Global Social Media Management Market Size to Grow From USD 9.2 Billion in 2018 to USD 17.7 Billion by 2023, at a Compound Annual Growth Rate (CAGR) of 14.1%,” Cision PR Newswire, February 25, 2019 available online here; Sean, “What Is Social Media Management and Why You Need a Social Media Management Company,” LYFE Marketing Blog, January 12, 2018 available online here; Robert Allen, “Does Social Media Marketing Actually Generate ROI?” Smart Insights, June 26, 2017 available online here.
Image source: 905513, “marketing-social-media-advertising-1573711,” Pixabay, August 8, 2016 available online here.

Feed Additives

cows feed

The five types of feed additives are nutritional, sensory, zootechnical, technological, and antibiotic. Nutritional additives, such as vitamins, minerals, and amino acids, are food supplements that provide added nutrients to improve the animals’ health. Sensory additives include flavored supplements used to increase appetite. Zootechnical additives, such as enzymes and probiotics, are used to help with digestion so that the animals can absorb nutrients from their food better. Technological additives, such as mold inhibitors and anti-caking agents, are preservatives that extend the shelf life of the feed.

Antibiotic supplements are used to fight infections and diseases; however, these supplements have been controversial because they have also been used for decades by farmers to promote the growth of livestock. In response to the growing problem of antibiotic-resistant bacteria due to overuse of antibiotics, the European Union banned the use of antibiotics as growth promoters for farm animals in 2006. A similar ban in the United States took effect on January 1, 2017. After the ban in the U.S., the use of antibiotics in animal feed dropped from 14.03 million kilograms in 2016 to 10.93 million kilograms in 2017. In recent years, retailers have also been putting pressure on suppliers to reduce antibiotic use in response to customer preferences for antibiotic-free meat.

Today’s market size shows the amount spent on feed additives in 2018 and projected for 2023 worldwide. Demand for preservatives is expected to grow the fastest over this time period. Consumers’ preferences for lower-fat meat such as poultry is expected to increase demand for poultry feed additives. Several companies produce feed additives including Cargill, DowDuPont, ADM, Evonik, and BASF.

Geographic reference: World
Year: 2018 and 2023
Market size: $33.0 billion and $44.3 billion, respectively
Sources: “The Global Feed Additives Market Size is Projected to Grow From USD 33.0 Billion in 2018 to USD 44.3 Billion by 2023, at a CAGR of 6.1%,” Cision PR Newswire, February 25, 2019 available online here; “Livestock Farmers Can Improve Quality With Feed Additives,” Bentoli Blog available online here; “Assessment of Safety and Efficacy for the Targeted Species: Zootechnical Feed Additives,” European Food Safety Authority available online here; Dr. Elinor McCartney, “Botanicals: From Sensory to Zootechnical Additives,” All About Feed, July 16, 2014 updated January 14, 2016 available online here; “Antimicrobial Resistance Shows No Signs of Slowing Down,” European Food Safety Authority Press Release, February 26, 2019 available online here; 2017 Summary Report on Antimicrobials Sold or Distributed for Use in Food-Producing Animals, U.S. Food and Drug Administration Center for Veterinary Medicine, December 2018 available online here; B.M. Marshall and S.B. Levy, “Food Animals and Antimicrobials: Impacts on Human Health,” U.S. National Library of Medicine, National Institutes of Health, October 24, 2011 available online here; “Animal Feed Additives,” Food Standards Agency, January 15, 2018 available online here.
Image source:skeeze, “cows-cattle-dairy-holstein-farm-526771,” Pixabay, November 12, 2014 available online here. Use of image does not constitute endorsement.

Pet Insurance

pet dog and woman in nature

In 2017, pet parents in the United States owned more than 393 million animals, nearly 184 million of which were cats and dogs. At some time in their lives most, if not all, of these pets will need medical care, whether that be spaying or neutering, routine physical exams and immunizations, or more specialized care. Veterinary care is expensive. Pet owners reported paying an average of $182 per year for routine exams for cats and $257 for dogs. Average surgical costs climb into the hundreds, with some types of specialized care, such as chemotherapy for cancer or cataract surgery, costing thousands of dollars. Add to that the cost of medications and some pet parents may need to spend upwards of several hundred to several thousand dollars a year to keep their pets healthy. Overall, in 2018, pet parents spent an estimated $18.26 billion on veterinary care in the U.S., up from $17.07 billion in 2017. Knowing that pet health care is expensive, an increasing number of pet parents are buying pet insurance policies.

Today’s market size shows the total amount of premiums paid for pet health insurance in 2013 and 2017 and projected for 2022 in the United States. The first animal insurance policy was written in Sweden in 1890. At the time, coverage focused on horses and livestock. In the United States, TV star Lassie received the first pet insurance policy in 1982. By 2017, 1.83 million pets were insured, a 17.5% increase from the year before. An overwhelming majority of policies, 98%, were accident and illness plans or insurance with embedded wellness plans. Premiums for accident and illness plans averaged $516 per year. The other two percent were accident-only policies, with premiums averaging $181 per year. In North America, 88.9% of policies provide coverage for dogs.

The pet health insurance market will continue to grow according to a report1 by the research firm Packaged Facts. Insurance companies’ use of their websites and social media for marketing as well as partnerships with veterinarians, animal shelters and breeders are expected to increase consumer awareness of insurance offerings and discounts. The use of technology to handle customer interactions more efficiently as well as expanding coverage to pets other than cats and dogs will also contribute to future growth in the industry according to the report.

1 Pet Insurance in the U.S., 6th Edition

Geographic reference: United States
Year: 2013, 2017 and 2022
Market size: $499.8 million, $1.03 billion and $2 billion, respectively
Sources: State of the Industry Report 2018 Highlights, North American Pet Health Insurance Association, April 2018 available online here; “Five Trends That Will Double The U.S. Pet Health Insurance Market by 2022,” Veterinary Practice News, October 6, 2018 available online here; “Pet Industry Market Size & Ownership Statistics,” American Pet Products Association available online here; “History of Pet Health Insurance,” North American Pet Health Insurance Association available online here; Grace Schneider, “Pet Insurance Company Success is Off the Leash,” USA Today for the Lansing State Journal, February 27, 2019, page 3B.
Image source: Seaq68, “nature-friends-dog-pet-woman-suit-3042751,” Pixabay, December 27, 2017 available online here.

Marijuana Drying and Curing Equipment

In the United States, 46 states have decriminalized small amounts of marijuana, allow the use of medical marijuana, or allow the adult use of recreational marijuana. Twenty other countries also allow some form of marijuana use.1 Cultivating and harvesting marijuana plants are only two parts in the process of creating a usable product. The plants also need to be dried and cured.

The drying and curing process, if done properly, enhances the flavor and smell, inhibits mold and bacteria growth, increases the shelf-life of the product, and may increase potency. Drying and curing require precise humidity and temperature, both of which can be influenced by several factors including seasonal temperatures, elevations, barometric pressures, different cultivars, and quantities, to name a few. Some smaller processors that have only a few plants may prefer to dry and cure the product manually, using drying racks and containers for curing, while personally monitoring the environment in the drying room and checking on the progress often. Mid-size and larger processors that dry and cure several pounds of product at a time are more likely to use stand-alone drying and curing machines that automatically maintain the correct temperature and humidity within, thereby needing less oversight.

Today’s market size shows the sales of marijuana drying and curing equipment worldwide in 2017 and projected for 2025. The United States led with a 55% share in revenue in 2017, followed by Canada with 32.2%. Australia, Uruguay, Israel, and Colombia combined composed the other 12.8%. More countries are expected to legalize the use of marijuana for medical or recreational use. As a result of this and technological advances in the equipment, demand is predicted to increase.

1 As of January 2, 2018.

Geographic reference: World
Year: 2017 and 2025
Market size: $76.7 million and $157.1 million, respectively
Sources: “Marijuana Drying and Curing Equipment Market Size, Share & Trends Analysis Report By Country (U.S., Canada, Germany, Australia, Uruguay, Israel, and Colombia), and Segment Forecasts, 2019 – 2025,” Grand View Research Report Summary, January 2019 available online here; “The Global Marijuana Drying and Curing Equipment Market Size is Expected to Reach USD 157.1 Million by 2025,” Cision PR Newswire, February 18, 2019 available online here; “All of the Places in the World Where Pot Is Legal,” Kindland, June 2, 2017, updated January 2, 2018 available online here; Kenneth Morrow, “Master the Art of Drying and Curing Cannabis,” Cannibis Business Times, April 2017 available online here; Nebula Haze and Alltatup, “Complete Drying & Curing Marijuana Guide,” Grow Weed Easy, February 1, 2019 available online here; “Top Tips to Successfully Dry and Cure Your Fresh Cannabis Buds,” Royal Queen Seeds Blog, October 30, 2017 available online here; “The Drying and Curing Process,” Cann Systems available online here.
Image source: gjbmiller, “marijuana-cannabis-weed-bud-green-2174302,” Pixabay, March 27, 2017 available online here.

Injectable Cosmetic Treatments

injectable cosmetic treatments syringe

The two most popular types of minimally-invasive cosmetic treatments in the United States are botulinum toxin type A and soft tissue filler injections. Both are used to temporarily reduce or eliminate wrinkles. Botulinum toxin type A — commonly known as Botox, but other brand names include Dysport and Xeomin — is a neurotoxin derived from bacteria. It blocks nerve signals to the muscle in which it’s injected. The muscle is unable to contract thereby eliminating wrinkles. It’s most commonly used to smooth frown lines, forehead creases, and crows feet. Soft tissue fillers, also known as dermal fillers, are gel-like substances injected under the skin to smooth out wrinkles. They’re also used to enhance lips and improve symmetry among facial features. The U.S. Food and Drug Administration has approved several types of fillers: hyaluronic acid, calcium hydroxylapatite, poly-l-lactic acid, and polymethylmethacrylate. Hyaluronic acid and calcium hydroxylapatite are naturally found in skin and bones, respectively. Poly-l-lactic acid and polymethylmethacrylate are synthetic, biocompatible substances. Some brand names include Juvéderm, Radiesse, Sculptura, and Bellafill.

Today’s market size shows the amount spent on injectable cosmetic treatments in 2016 and forecast for 2025 worldwide. In the United States, more than 10 million injectable cosmetic treatments were performed in 2018. Botulinum toxin type A procedures were the most popular; 7.4 million were performed, up 5.4% from 2016. Nearly 2.7 million soft tissue filler procedures were performed in 2018, a 2.9% increase from 2016. While women still comprise the vast majority of patients, globally an estimated 15% of injectable cosmetic treatments are performed on men.

Geographic reference: World
Year: 2016 and 2025
Market size: $6.5 billion and $17.2 billion, respectively
Sources: “Facial Injectables Market Analysis by Product (Collagen, Hyaluronic Acid, Botulinum Toxin Type A, Calcium Hydroxylapatite, Polymer Fillers), by Application (Aesthetics, Therapeutics), by Region, and Segment Forecasts, 2018 – 2025,” Grand View Research Press Release, May 2017 available online here; “Global Facial Injectables Market Size Worth $17.2 Billion By 2025,” Grand View Research Press Release, May 2017 available online here; 2018 National Plastic Surgery Statistics, American Society of Plastic Surgeons, March 2019 available online here; 2017 Plastic Surgery Statistics Report, American Society of Plastic Surgeons, 2018 available online here; “What Is Botulinum Toxin Type A?” American Society of Plastic Surgeons available online here; “Hold Still,” The Economist, February 9, 2019, page 22; “Injectable Fillers Guide,” American Board of Cosmetic Surgery available online here.
Image source: qimono, “syringe-shot-medicine-bottle-1884758,” Pixabay, December 6, 2016 available online here.


radiopharmaceuticals technetium injection

Radiopharmaceuticals are medicinal products containing radioactive isotopes. Radiopharmaceuticals can be swallowed, injected or inhaled and are selected based on the type of tissue or organ that will be scanned or treated. In the manufacturing process, radioactive isotopes and organic molecules bond. It is the organic molecules that transport the radioisotopes to specific tissue or organs. Of the more than 10 million nuclear medicine procedures performed in the United States every year, 85% use the radioisotope technetium-99m.

For diagnostics, after the radiopharmaceutical is administered, the patient’s tissue or organ is scanned using a SPECT or PET scanner,1 allowing the doctor to detect changes at the cellular level. Radiopharmaceuticals are helpful in diagnosing various diseases of the blood vessels, bones, brain, kidney and liver as well as detecting heart disease, heart muscle damage and cancer.

Radioisotopes for diagnosis emit radiation that can be detected outside the body by scanners. Radioisotopes for treatment emit all their energy in a small area; therefore, they’re used for localized destruction of cancer cells. They are also used to treat hyperthyroidism and pain as a result of bone cancer and severe arthritis.

Today’s market size shows the amount spent on radiopharmaceuticals globally in 2018 and forecast for 2023. More than 100 radiopharmaceuticals have been developed using radioisotopes produced by nuclear research reactors or cyclotrons. As of the end of 2018, fifty FDA-approved radiopharmaceuticals were used for the diagnosis and treatment of medical ailments in the United States. GE Healthcare, Curium, Lantheus Medical Imaging, DRAXIMAGE, and Pharmalucence are 5 of the 18 manufacturers of these approved products.2

1 SPECT stands for single photon emission computed tomography. PET stands for positron emission tomography. Often these scans are combined with CT or MRI scans to provide more detailed images.
2 Top 5 based on the number of different FDA-approved radiopharmaceuticals the company manufactures.

Geographic reference: World
Year: 2018 and 2023
Market size: $3.95 billion and $5.26 billion, respectively
Sources: “Radiopharmaceuticals/Nuclear Medicine Market by Type (Diagnostic (SPECT (Technetium), PET (F-18)), Therapeutic (Beta Emitters (I-131), Alpha Emitters, Brachytherapy(Y-90))), Application (Oncology, Thyroid, Cardiology) – Global Forecasts to 2023,” MarketsandMarkets Press Release, Accessed February 18, 2019 available online here; “FDA-Approved Radiopharmaceuticals,” Cardinal Health, December 28, 2018 available online here; Phillippe van Put, “What Is Nuclear Medicine?” available online here; “Radiopharmaceutical (Oral Route),” Mayo Clinic available online here; “Radiopharmaceutical Production,” International Atomic Energy Agency available online here; “Nuclear Medicine,” National Institute of Biomedical Imaging and Bioengineering, July 2016 available online here; Haley Hansen, “Niowave Enters $4 Billion Medical Isotope Market,” Lansing State Journal, February 18, 2019, pages 1A and 4A; Dr. Craig Hacking and Dr. Ayush Goel, et. al., “SPECT vs. PET,” Radiopaedia available online here.
Image source: Bionerd [CC BY-SA 3.0], via Wikimedia Commons. No alterations were made to image.

Independent Record Labels

record label

What do Adele, Radiohead, and Tobacco have in common? They all have signed with independent record labels sometime in their careers.

According to the Association of Independent Music, an independent record label is one in which 50% or less of the company is owned by a major record company, its affiliates, or its subsidiaries. The three major record companies are Universal Music Group, Sony Music Group, and Warner Music Group. Even if an independent record label is not owned by one of the majors, in some cases it may not be totally independent of them. Some independents partner with major record labels to boost promising artists and distribute the music they produce. In 2017, 22.4%1 of the music produced by independent record labels were distributed by major record labels.

In the United States, independents’ share of music sales, licensing and other revenues totaled 32.2% in 2017. Independent publishers’ market share was higher, 41.2%. Globally, independents’ share of the music recording industry reached 39.9%, with some countries’ shares outpacing major labels. Independent record labels in South Korea garnered 83% of the market in 2017 and in Japan, 63%.

The industry is fragmented. There are more than 500 independent record labels in the United States alone, representing every genre of music. Well-known artists, as well as lesser-known musicians, have signed with independent labels throughout the years. Many artists generally get their start at independent labels and a majority stay. Globally, 77% of artists renewed with their label in 2017. In the United States, 84% did.

Today’s market size shows the total independent record label revenues for 2017 worldwide. This represented 11.3% year-over-year growth, higher than for the major record labels (+9.7%) and the industry overall (+10.2%). Fans tend to be loyal to independent artists and are more likely to buy album LPs, CDs, and cassettes, which generate higher revenue than streaming. Independent labels comprised slightly more than 39% of physical album sales. Independents’ share of streaming was 28.3%.

Wait, cassettes? Yes, cassettes. “People still want to hold something, look at images, see it move,” said Stephen Bishop, founder of cassette label Opal Tapes. In recent years, cassettes have made a comeback. Although still a minuscule amount of overall revenue, sales doubled from 2016 to 20172 in the United Kingdom alone, with a 90% increase in the first half of 2018. According to Nielsen Music, in the United States, cassette album sales increased from 178,000 units in 2017 to 219,000 in 2018.3 Releasing an album on cassette gives an emerging artist a way to release a limited-edition album with a creative presentation for less cost than releasing it on vinyl. But, it’s not just lesser-known artists doing this. The top-selling album on cassette in the first half of 2018 in the U.K. was Kylie Minogue’s Golden.

1 Based on revenue.
2 From 10,912 units sold in 2016 to 22,011 in 2017.
3 In 2018, this was less than two-tenths of a percent of overall album sales.

Geographic reference: World
Year: 2017
Market size: $6.9 billion
Sources: Wintel Worldwide Independent Market Report 2018, December 2018 available online here; Paul Resnikoff, “Collectively, Indie Labels Are Now Bigger Than Any Major Label,” Digital Music News, May 20, 2018 available online here; “Labels and DIY Artists,” Association of Independent Music available online here; “Who Is A2IM?” available online here; “Forget The Vinyl Revival: The Cassette Tape Revival is in Full Flow, Honest,” Louder, November 27, 2018 available online here; Eoin Murray, “Why the Cassette Revival Is Essential for Electronic Music,” DJ, September 21, 2018 available online here; Rob Copsey, “The Official Top 20 Best-Selling Cassettes of 2018 So Far,” Official Charts, July 25, 2018 available online here; Joyce, Joe Price, Alex Gardner, “33 Independent Record Labels You Should Know,” Complex, July 26, 2017 available online here; Keith Caulfield, “U.S. Cassette Album Sales Grew 23% in 2018, Aided by Britney Spears, ‘Guardians,’ Twenty One Pilots & More,” Billboard, January 17, 2019 available online here.
Image source: AliceKeyStudio, “turntable-vinyl-sound-music-1208177,” Pixabay, February 19, 2016 available online here.

Staff Training

staff training

According to the Bureau of Labor Statistics, in November 2018, more than 6.0 million people were unemployed in the United States. That same month, nearly 6.9 million job openings were reported. Forty-five percent of employers have jobs open, they say, because they cannot find qualified applicants to fill those positions. In a CareerBuilder survey, 66% of employers reported that they planned to hire and train workers who may not have the skills needed but who showed potential.

In 2018 companies spent an average of $986 per employee on training. The highest percentage of training dollars budgeted, 39%, went to training hourly workers, followed by non-managerial salaried workers (27%) and salaried managers (24%). Only 10% of the average training budget went to train executives. Training can take many forms, from instructor-led classroom learning to webcasts to self-directed online courses. In practice, most companies use a variety of methods to train their workers. Of those that use only one method, most prefer instructor-led classroom learning, followed by online or computer-based courses and virtual classrooms or webcasts.

More companies expect to purchase online learning tools and systems next year than any other type of training product. At least some mandatory or compliance training is done online at 82% of companies, with 28% of companies providing this training completely online. A vast majority of companies also use online training for sales training, IT systems training, and desktop application training. Online training is least likely to be used for onboarding and executive development.

Today’s market size shows the total amount companies in the United States spent on training in 2018. This figure includes payroll for staff assigned to do the training and spending on external products and services, travel, facilities, and equipment. Overall spending in 2018 declined from $93.6 billion in 2017 due to a 33.5% decrease in expenditures for travel, facilities, and equipment. However, spending on outside products and services increased during this time period, from $7.5 billion to $11.0 billion. Payroll for training staff also increased, from $41.6 billion to $47.0 billion.

Geographic reference: United States
Year: 2018
Market size: $87.6 billion
Sources: “2018 Training Industry Report,” Training, November/December 2018, pages 18-31 available online here; “Job Openings and Labor Turnover – November 2018,” News Release, Bureau of Labor Statistics, U.S. Department of Labor, January 8, 2019 available online here; “Labor Force Statistics From the Current Population Survey: (Seas) Unemployment Level,” Series ID: LNS13000000, Bureau of Labor Statistics, U.S. Department of Labor, Data extracted on February 6, 2019 available online here; “44 Percent of Employers Plan to Hire in the New Year, According to CareerBuilder’s Annual Forecast,” CareerBuilder Press Room, January 8, 2018 available online here.
Image source: claude_star, “convention-conference-meeting-1410870,” Pixabay, May 24, 2016 available online here.

Catastrophe Bonds

hurricane catastrophe

Catastrophe bonds, first issued in 1997, are a way for insurance companies to raise money to pay customer claims in the event of a catastrophic natural disaster. The insurance company issues bonds through an investment bank. The investment bank serves as a liaison between the insurance company and the investors, which are typically hedge funds, mutual funds, and pension funds. The investment bank invests the proceeds from the sale of the bonds and pays interest to the investors. It also dispenses the proceeds from the bond sales back to the issuer when a predefined disaster risk happens. The disaster risk could be the issuer’s actual losses, the issuer’s losses based on disaster parameters input into modeling software or the industry’s losses beyond a defined threshold. It can also be a specific condition linked to a natural disaster, such as an earthquake of magnitude 7.0 on the Richter scale.

Although investors risk losing their principal investment, some investors feel that the risk is worth it for the high yields and diversified portfolio of assets. Catastrophe bonds are not correlated with other financial markets. Since the financial crisis of 2008, and the collapse of Lehman Brothers, investment banks have been investing catastrophe bond collateral in Treasury money market funds, seen as safer than the investments in financial instruments made prior to the collapse.

Insurance and reinsurance companies make up 85% of the issuers of catastrophe bonds. The other 15% of issuers are states. California and Florida have the two largest catastrophe funds. These catastrophe funds were put in place to ensure that the insurance structure in the states continues to function after a major disaster. After 1992’s Hurricane Andrew and 1994’s Northridge earthquake, insurance companies, required by law to cover losses from natural disasters, paid out considerably more than they took in premiums. As a result, they either reduced coverage or left the state entirely. The California Earthquake Authority began issuing earthquake insurance on its own rather than requiring insurance companies to do so. The Florida Hurricane Catastrophe Fund reimburses private insurers for losses due to coverage of hurricane damage. Both issue catastrophe bonds to reduce the risk to state funds.

Today’s market size shows the total value of catastrophe bonds in the United States as of the first half of 2018. From 2010 to 2017 the amount in outstanding catastrophe bonds doubled and despite the historically high losses due to Hurricanes Irma, Harvey, and Maria in the first half of 2018, the catastrophe market continued to grow. In the future, catastrophe bonds may cover more than losses from natural disasters. Insurance companies are currently developing better catastrophe bond modeling to cover losses due to cyber attacks and terrorism.

Geographic reference: United States
Year: First half of 2018
Market size: $30 billion
Sources: Oliver Ralph, “Global Catastrophe Bond Market Size Climbs to a Record $30bn,” Financial Times, September 6, 2018 available online here; Andy Polacek, “Catastrophe Bonds: A Primer and Retrospective,” Chicago Fed Letter, No. 405, 2018 available online here; “Catastrophe Bond,” Wikipedia, December 10, 2018 available online here.
Image source: 12019, “hurricane-earth-satellite-tracking-92968,” Pixabay, March 13, 2013 available online here.

Recreational Vehicles

Recreational vehicle

With Spring right around the corner and summer not far behind, have you been thinking about taking a vacation? Do your daydreams of a relaxing getaway include camping? If so, you are not alone. More than 77 million households in the United States include someone who enjoys this activity.

Most campers use tents but nearly one-quarter prefer the safety and comfort of a recreational vehicle, or RV. While a large percentage either borrow or rent their motorhome or towable camper, 56% own theirs. Just a few years ago, in 2014, a majority of people who camped using RVs were baby boomers or older. By 2017, 70% of RV campers were Millenials and Generation Xers. RV manufacturers are taking notice. The recreational vehicles of today are not the rustic accommodations of yesteryear. Newer models are equipped with solar panels, USB ports, entertainment systems, and wi-fi signal boosters.

Today’s market size shows the total wholesale shipments of RVs in the United States in 1998, 2008, and 2018. Leading manufacturers include Thor Industries, Forest River, and Winnebago Industries. Ford Motor Co. makes the chassis, engines, and transmissions for most of the motorhomes in the United States. By state, the highest percentage of recreational vehicles were shipped to Texas, followed by California and Florida. Ohio and Michigan tied for fourth.

Shipments for 2018 were down from a high of 504,600 in 2017. They are forecast to drop farther in 2019. According to Frank Hugelmeyer, President of the RV Industry Association, “slowing sales were inevitable due in part to the fact that so many Americans have bought RVs over the past decade.” Another factor may be RV prices. They are expected to climb due to increases in the cost of raw materials and components, such as microwaves, stoves, and lighting as a result of the tariffs imposed on goods from China and Canada. While 83% of recreational vehicles are manufactured in Indiana, many of the components are imported from other countries.

Geographic reference: United States
Year: 1998, 2008 and 2018
Market size: 292,700, 237,000 and 483,700, respectively
Sources: Trevor Hughes, “Youth Movement Is Driving RVs,” USA Today for the Lansing State Journal, January 28, 2019, pages 1B and 2B; “Addition of 6 Million New North American Campers Since 2014 Showcases Continued Popularity of Camping,” The National RV Dealers Association News Release, April 11, 2018 available online here; The 2018 North American Camping Report, Kampgrounds of America, Inc. available online here; RV Industry Association Staff, “RV Industry Association’s 2017 Profile Now Available,” RV Industry Association, June 6, 2018 available online here; “Historical RV Data,” RV Industry Association available online here; Dale Buss, “RV Sales Boom Is Fueled By Millenials as They Overturn Stereotypes and Enjoy The Itinerant Life,” Forbes, December 29, 2017 available online here; Peter Valdes-Dapena, “RVs Are Back and Bigger Than Ever,” CNN Business July 12, 2017 available online here.
Image source: Airstream Inc., “Airstream Travel Trailer in Nature,” Unsplash, October 2, 2018 available online here. Use of image does not constitute endorsement.

Medical Marketing

Does it seem like you’re seeing more ads for prescription medications and medical services? You’re not imagining it. In 2016, the last year for which data were available, pharmaceutical companies alone bought 4.6 million direct-to-consumer ads, up from 79,000 ads in 1997. Spending increased nearly six-fold, from $1.3 billion to $6.0 billion during this time period. Total medical services advertising expenditures grew at a similar rate, led by cancer centers, mental health and addiction services, and cosmetic surgery services.

According to PhRMA, the largest pharmaceutical trade group in the U.S., direct-to-consumer advertising provides “scientifically accurate information to patients so that they are better informed about their health care and treatment options.”1 Around half of the consumers in a 2015 analysis by the U.S. Food and Drug Administration believed these ads did not contain enough information about the medications’ risks and benefits to be of use. That year, the American Medical Association (AMA) called for a ban on pharmaceutical and medical device advertising, saying that ads such as these encourage consumers to seek out more expensive treatments when less expensive, more appropriate, effective alternatives may be available. In addition, the AMA was concerned that increased spending on advertising led to higher prescription drug prices. Banning such advertising would not be easy, even if Federal lawmakers agreed that such a ban should take place. Several court cases throughout the years determined that this type of advertising is protected by the United States Constitution.

Today’s market sizes show total medical marketing spending and spending on a subset of that, direct-to-consumer advertising, in 1997 and 2016. Medical marketing includes advertising of prescription drugs, health services, and laboratory testing. It also includes disease awareness campaigns. Marketing to health care professionals by pharmaceutical companies accounted for most of the spending during this time period. However, as a percentage of total spending, this has been dropping. In 1997, 88.1% of medical marketing dollars were spent on free samples, direct physician payments for such things as speaking engagements and meals, and prescriber detailing, in which pharmaceutical sales representatives educate physicians about their products. In 2016, 67.9% of marketing dollars were spent this way. Direct-to-consumer marketing comprised the balance.

1 PhRMA spokesperson Tina Stow. Source: Susan Kelly, “U.S. Doctor Group Calls for Ban on Drug Advertising to Consumers,” Reuters, November 17, 2015, available online here

Geographic reference: United States
Year: 1997 and 2016
Market size: (Total) $17.7 billion and $29.9 billion, respectively
Market size: (Direct-to-consumer advertising) $2.1 billion and $9.6 billion, respectively
Sources: Lisa M. Schwartz, MD, MS and Steven Woloshin, MD, MS, “Medical Marketing in the United States, 1997-2016,” JAMA, Special Communication, January 1-8, 2019 available online here; Susan Kelly, “U.S. Doctor Group Calls for Ban on Drug Advertising to Consumers,” Reuters, November 17, 2015, available online here; Alison Kanski, “7 Things to Know from Dartmouth’s Medical Marketing Study,” MM&M, January 14, 2019 available online here; Margaret Rouse, “Pharmaceutical Detailing,” TechTarget, February 2011 available online here.
Image source: Martin Brosy, “Doctor with a Stethoscope,” Unsplash, July 30, 2018 available online here.

Auto Industry Economic Impact

auto industry camaroGeneral Motors’ announcement of the 2019 closing of assembly plants in North America created uncertainty for 14,000 families in Michigan, Ohio, Maryland and Oshawa, Ontario, Canada. These 14,000, both blue-collar and white-collar workers alike, are direct employees of General Motors. But sadness and uncertainty reverberated throughout many industries. According to the Center for Automotive Research, in the United States, more than 7 million private sector jobs are supported by the auto industry. Steel mills, logistics companies, grocery stores, restaurants, gas stations, and child care centers are just some of the businesses negatively impacted by plant shutdowns and layoffs,1 as automotive companies buy fewer supplies and services and workers cut back on expenses. Businesses in close proximity to auto plants, those that rely on workers spending money in their stores and restaurants, are more heavily impacted than some when plants close.

Today’s market size shows the amount of annual compensation of employees working in industries supported by the auto industry in the United States. In 2014, the last year for which data are available, 570,000 jobs were supported by the auto industry in Michigan, where auto industry employment accounts for more than 11% of the labor force.

1 According to General Motors, some of the workers that will be laid off at General Motors’ plants will be offered jobs at other manufacturing facilities either in Michigan or in another state.

Geographic reference: United States
Year: 2018
Market size: $500 billion
Sources: Eric D. Lawrence, “Pain of GM Closures Is Far-Reaching,” Lansing State Journal, December 3, 2018, page 6A; Jamie L. LaReau, “General Motors to Close Detroit, Ohio, Canada Plants,” Detroit Free Press, November 26, 2018 available online here.
Original source: Center for Automotive Research
Image source: AnSICHThoch3, “auto-chevrolet-camaro-road-1112183,” Pixabay, January 2, 2016 available online here. Use of image does not constitute endorsement.

Public Transportation in the Lansing, Michigan Area

Public TransportationThe Capital Area Transportation Authority (CATA) is the largest public transit provider in the tri-county area around Lansing, Michigan. The tri-county area consists of Ingham, Clinton, and Eaton counties. CATA has been operating public transportation in the mid-Michigan area since 1972 and has been twice named the best transit system of its size in North America by the American Public Transportation Association.

Ridership grew steadily during the 1970s, before leveling off during the 1980s and most of the 1990s. During the 1980s and 1990s, the number of rides fluctuated around 3-4 million annually. In 1999, CATA took over the Michigan State University bus service. Since then ridership has increased nearly 3-fold. In contrast, the population of the tri-county area grew by 22.6% from 1970 to 2010.

In 2013, CATA set a fourth consecutive yearly record for number of rides. By 2014, however, ridership was down overall despite seeing increased ridership on its Michigan State University routes and increased requests for its paratransit services. In the fourth quarter of 2014, gasoline prices fell which could account for the decreased ridership. Bus ridership both nationally and locally continued to decline in 2017. Nationally bus ridership dropped by 4.3 percent in 2017. CATA saw a ridership decline of 6.0 percent overall that same year.

According to the American Public Transportation Association, several factors contributed to the multi-year decline in bus ridership overall. Gas prices remained low and the ability to obtain car loans, including sub-prime car loans for those with poor credit, became easier. More employees are working from home. In 2016, 66% of employers allowed some of their employees to work from home occasionally; 40% allowed some employees to work regularly from home, a drastic change from a decade ago. The use of transportation network companies such as Uber and Lyft along with bike-sharing services and biking, in general, have become more popular. Customers who employ these services may find them more convenient to use, allowing them to get to their destination sooner than if they would take public transportation.

In response to the increased popularity of bike-sharing across the country, CATA partnered with Michigan State University and the cities of Lansing, East Lansing and Meridian Township to study the feasibility of bike-sharing programs in the region in 2018. Bike-sharing is one way of meeting a commuter’s need for transportation to and from a bus stop or transit facility in order to more easily access the public transportation system.

Today’s market size represents the number of rides annually on CATA vehicles in 1972 and 2017.

Geographic reference: Lansing, Michigan area
Year: 1972 and 2017
Market size: Less than 1 million rides and 10.2 million rides respectively
Sources: Pam Latka, “Fiscal 2017 Ridership Closes at 10.2 Million,” CATA Drives: 2018 Community Report, September 2018, page 5; Understanding Recent Ridership Changes, American Public Transportation Association, April 2018 available online here; “National Trend Leaves Its Mark on Ridership,” CATA 2016 Community Report, June 2016, page 3; “Ridership Trends Vary by Service Type,” CATA 2015 Community Report: Where Public Transportation Goes Community Grows, June 2015, page 3; “Passenger Trips Reflect Stable Demand,” CATA 2014 Community Report: Moving You Forward With Pride, June 2014, page 3; “Growth in Ridership Remains Strong,” CATA 2013 Community Report: Moving You Toward Your Dreams, June 2013, page 4; “Riding High with Record Ridership,” CATA 2012 Community Report 40th Anniversary Edition: Greater Lansing on the Move, August 2012; “CATA Demand Grows with Community Need,” CATA 2011 Community Report: Greater Lansing on the Move, August 2011; Tri-County Regional Planning Commission, “Tri-County Regional Growth: Choices for Our Future,” Draft Report, August 2002 available online here; “Ingham County, Michigan” available online here; “Clinton County, Michigan” available online here; and “Eaton County, Michigan” available online here.
Image source: “CATA Administrative Offices,” available online here. No copyright infringement intended.

Online Dating

Online dating

For many finding a spouse or someone to have a long-term relationship with is difficult. From the 1940s through the 2000s a large percentage of people met their significant other through friends. In addition, many couples met in bars and restaurants, at college, church, and their workplaces. When meeting people through these avenues failed, some people decided to expand their social network in nontraditional ways. Over the years this has included placing personal ads in newspapers, signing up for computer dating, and using online dating services.

What was likely the first personal ad appeared in 1695 in the Collection for the Improvement of Husbandry and Trade, a periodical published in London, England. A 30-year old gentleman wanted to “willingly match himself to some Good Young Gentlewoman that has a fortune of £3,000 or thereabouts.” Over the centuries, personal ads became commonplace in newspapers, including for most of the 20th century, however; few marriages resulted. In the United States, only about 1% of relationships that led to marriage began with couples meeting via these ads.

Before the Internet, in the 1960s and 1970s, several companies offered computer dating services. Applicants would fill out questionnaires and mail them to the company, then their responses would be compared to responses from other applicants via a computer. A person would need to wait days or weeks for a packet of information to arrive in the mail if the computer found one or more matches.

In the 1990s, personal computers and access to the World Wide Web became more prevalent and graphical browsers became more popular. In 1995, match.com became the first company to offer an online service similar to newspaper personal ads and computer dating services. For a fee users would be allowed to post profiles online—a picture, biographical information, and answers to a questionnaire—and then be able to browse the profiles of other users and contact those with whom they were interested in dating. Match.com’s initial target audiences were the gay and lesbian community and technology professionals. Women, in particular, were also encouraged to sign up with the belief that if there were a large pool of women to choose from, men would then be willing to sign up for the service also. In 2004, Guinness World Records recognized Match.com as the largest online dating site, with 15 million active members worldwide at the time and 42 million members registering with the service since its debut in 1995. Since the late 1990s, thousands of other companies have offered their own online dating services, both for the general public and catering to specific groups based on political views, religious beliefs, hobbies, lifestyle or profession. In 2010, more than 20% of opposite-sex couples met online. The internet overtook churches, neighborhoods, classrooms, and offices as a more popular place for couples to meet. That same year, nearly 70% of same-sex couples met online.

As usage of personal computers and laptops gave way to mobile devices and smartphones, online dating apps flourished. In 2013, Tinder became the first online dating app that introduced a simple interface for accepting or rejecting a potential partner: swipe right for “yes” and swipe left for “no”. If two people swiped right, they were given each other’s contact information. Location-based services became part of some apps. Users could be matched with others who frequent the same public places, such as restaurants, bars, or concert venues. While some of these online services and apps have a reputation for facilitating hookups rather than long-term, meaningful relationships, 84% of users surveyed said they use these sites to find romantic relationships. Only 24% reported looking for hookups. In 2018 in the United States, nearly one in six relationships that led to marriage started through an online dating service or app. More than half of adults aged 18-34 know someone who uses online dating and a third know someone who entered into a long-term relationship as a result. College graduates and those earning more than $75,000 per year are most likely to know someone who uses online dating and who has entered a long-term relationship after meeting someone online.

More than 260 million people worldwide and tens of millions of people in the United States have tried online dating, and yet there is still a stigma attached. A Pew Research Center survey in 2015 found that 23% of people thought that those who use online dating services are desperate. However, this is down from 29% in 2006.

Today’s market size shows the total revenues of online dating services worldwide. Revenues for Match Group, which owns Tinder, match.com, and 40 other similar businesses totaled $1.3 billion in 2017, more than a quarter of the global revenue for the entire industry.

Geographic reference: World
Year: 2018
Market size: $4.6 billion
Sources: “Putting the Data into Dating,” The Economist, August 18, 2018, pages 19-21; “History of the Web Browser,” Wikipedia, December 18, 2018 available online here; “Match.com,” Wikipedia, December 16, 2018 available online here; Louise Matsakis, “Tinder’s Days as a Hookup App May Be Over,” Wired, April 23, 2018 available online here; “Timeline of Online Dating Services,” Wikipedia, September 4, 2018 available online here; John Hendel, “Old, Weird Tech: Computer Dating of the 1960s,” The Atlantic, February 14, 2011 available online here; Aaron Smith and Monica Anderson, “5 Facts About Online Dating,” FactTank: News In the Numbers, Pew Research Center, February 29, 2016 available online here; “Online Dating,” Statista available online here; Aaron Smith, “15% of American Adults Have Used Online Dating Sites or Mobile Dating Apps,” Pew Research Center, February 11, 2016 available online here; Hayley Matthews, “27 Online Dating Statistics & What They Mean for the Future of Dating,” DatingNews.com, June 15, 2018 available online here.
Image source: Athree23, “heart-love-keyboard-enter-button-3698156,” Pixabay, October 2018, available online here.

Natural Beauty Products

natural beauty productsWhat is your New Year’s resolution? Perhaps, like many, you plan to exercise more and eat less processed food and more organic, whole food such as fruits, vegetables, and whole grains. If you are a woman, maybe you want to incorporate more natural and organic personal care products into your daily care regimen.

The average American woman uses a dozen personal care products every day, one reason women, on average, are exposed to 83 more unique ingredients on a daily basis than men. The younger a woman is, the more likely she is to look for natural cosmetics and other beauty products. In a survey by beauty brand Kari Gran, 75% of women aged 18-34 said that buying natural beauty products is important to them. Fifty-four percent of women aged 55-64 said the same.

The top ingredients that buyers of natural beauty products try to avoid are fragrances, parabens, phthalates, sulfates, and gluten. Meanwhile, cosmetics companies are incorporating ingredients such as green tea, jojoba, moringa, rice, and sea buckthorn, to name a few, into their products. Individually, these ingredients are promoted as detoxifying, moisturizing, hydrating, anti-aging, and rich in antioxidants.

Today’s market size shows the total sales of natural beauty products in the United States in 2017 according to Nielsen. Despite the growing demand for “clean” and “natural” beauty products, there are currently no regulations defining these terms. Worldwide, organic personal care product sales are expected to rise to nearly $25 billion by 2025.

Geographic reference: United States
Year: 2017
Market size: $1.5 billion
Source: Rina Raphael, “The Beauty Industry Goes Au Naturel,” Fast Company, October 2018.
Image source: mohamed_hassan, “cream-skin-care-cosmetics-lid-3521957,” Pixabay, July 2018 available online here.

Edible Insects

edible insects

John wore clothing made of camel’s hair and had a leather belt around his waist. His food was locusts and wild honey.

— Matthew 3:4, New American Bible Revised Edition

People around the world have been eating insects for thousands of years. In 2018, the Asia-Pacific region accounted for nearly 43% of the edible insect market worldwide, followed by Latin America (22.7%), and Europe (20.2%). By country, some of the largest markets include Thailand, Japan, China, Australia, and Peru. In Thailand, many people enjoy deep-fried insects as snacks and typically wash them down with their favorite beer. Globally, traditional diets include around 1,900 insect species.1 Beetles are the most numerous (659 species); followed by caterpillars (362); ants, bees, and wasps (321) and grasshoppers and locusts (278). Several species of true bugs, dragonflies, termites, flies, cockroaches, and spiders among others are also considered edible.2

Insects are high in protein (nearly equivalent to that of beef, pork, and poultry), require significantly less land, feed, and water than livestock, and farming them emits significantly fewer greenhouse gases (2 grams of greenhouse gases per kg of weight for insects vs 2,850 grams of greenhouse gases per kg of weight for cattle). As a result, insects are considered by some to be an eco-friendly alternative to beef, pork, and chicken. According to Innova Market Insights, insect protein will become a popular meat alternative in 2019 as consumers continue to demand healthy and eco-conscious foods. Recently some high-end restaurants in the United States and Europe began incorporating insects into some of the dishes offered on their menus. But what about the “ick factor”? According to Christine Couvelier, a chef and food industry consultant, “cricket powder is the best way to introduce this.” Crickets, processed into a tasteless powder or flour, can be added to a variety of foods such as sausages, granola, soups, pasta, desserts or bread to give the foods added protein, vitamins, and amino acids. The increasing use of insects in sports and dietary supplements used by athletes is expected to help drive demand also.

Today’s market size shows the total worldwide revenues for edible insects in 2017 and 2024 according to Global Market Insights.3 The figure for 2024 is projected. Not all edible insects are consumed by humans. Grasshoppers are food for pet fish, turtles, and birds. In the aquaculture industry, black soldier fly larvae and maggots are substitutes for fishmeal. A variety of insects, including beetles, cockroaches, termites, and ants, are food sources for poultry. Demand for edible insects in this market is expected to grow in the next five years. Currently, soymeal constitutes 65% of poultry and cattle feed. Research is underway by some manufacturers of edible insects to potentially replace 10-50% of soymeal feed with black soldier fly larvae, grasshoppers, silkworms or mealworms. These insects have similar nutrient content to traditional soymeal feed. Leading firms in the edible insect market include EnviroFlight, Haocheng Mealworm, AgriProtein, and Entomo Farms.

1 Source: Agnieszka de Sousa, Hayley Warren, and Roni Rekomaa, “Bugs Are Coming Soon to Your Dinner Table,” Bloomberg, July 5, 2018 available online here.
2 Source: “List of Edible Insects of the World,” Wageningen University & Research, the Netherlands available online here. According to Yde Jongema, a taxonomist at the Department of Entomology of Wageningen University and Research, as of April 1, 2017, there were 2,111 species of edible insects in the world.
3 The North American Coalition for Insect Agriculture citing Research and Markets and Meticulous Research both predict that the edible insect market will reach $1.2 billion by 2023.

Geographic reference: World
Year: 2017 and 2024
Market size: $55 million and $710 million, respectively
Sources: Kunal Ahuja and Shreya Deb, “Global Edible Insects Market to Exceed $710 Mn by 2024,” Global Market Insights, June 20, 2018 available online here; Agnieszka de Sousa, Hayley Warren, and Roni Rekomaa, “Bugs Are Coming Soon to Your Dinner Table,” Bloomberg, July 5, 2018 available online here; “List of Edible Insects of the World,” Wageningen University & Research, the Netherlands available online here; Sean Rossman, “Bugs in Your Food? Might Be on Purpose,” USA Today for the Lansing State Journal, December 23, 2018, pages 1B and 2B; Stacie Goldin, “Eating Insects in Thailand,” Entomo Farms, May 19, 2016 available online here; Kunal Ahuja and Shreya Deb, “Edible Insects Market Size By Product (Beetles, Caterpillars, Grasshoppers, Bees, Wasps, Ants, Scale Insects & True Bugs), By Application (Flour, Protein Bars, Snacks), Industry Analysis Report, Regional Outlook (U.S., Belgium, Netherlands, UK, France, China, Thailand, Vietnam, Brazil, Mexico), Application Potential, Price Trends, Competitive Market Share & Forecast, 2018 – 2024,” Global Market Insights, June 2018 available online here; Courtney Johnson, “Edible Insects Market Seeing Growth,” Natural Products Insider, July 15, 2016 available online here.
Image source: Satya Prem, “food-insect-nutrition-eat-protein-3348724,” Pixabay, April 24, 2018 available online here.


Hemp seeds

Hemp, a variety of the cannabis plant, is a widely cultivated herb grown for its edible seeds, oil, and strong woody fiber used in cordage and fabrics. Unlike marijuana, modern-day hemp contains very small concentrations of the psychoactive substance delta-9-tetrahydrocannabinol (THC), less than 0.3%. Marijuana, on the other hand, typically contains between 5% and 20%, with some types containing up to 35%. Hemp contains higher concentrations of cannabidiol (CBD), however, than marijuana. CBD is the ingredient in cannabis thought to have medicinal properties. The Federal Drug Administration in the United States recently approved the CBD-derived epilepsy drug Epidiolex. Of all the products made from hemp sold in the U.S. in 2017, consumers spent the most on hemp-derived CBD, $190 million. One of the top food trends in 2019 is expected to be CBD-infused food and drinks, increasing demand. Spending on hemp-based industrial products totaled $144 million in 2017, much of which was spent by the automotive industry.

Hemp has been cultivated for thousands of years. Its fibers were found in pottery dating back more than 5,000 years in what is modern-day Taiwan. Textiles made of hemp were used in China as far back as 4000 BC and hemp paper was first used in 100 BC. The first recorded use of cannabis as medicine was in 2737 BC. In the 1500s, hemp was used for sailcloth for the English Navy. Because of this, English farmers and later farmers in the North American colonies were required to devote some acreage to hemp cultivation. The variety of cannabis that was grown in the American colonies was Cannabis sativa, an imported variety, not the indigenous hemp known to Native Americans. The plants were grown in tight clusters, thereby creating a taller plant with fewer branches and fewer female flowers. It’s the female flowers that contain high concentrations of THC. In the 18th-century, hemp was made into clothes, rope, bed ticking and sacks. During the American Revolution, it was in high demand for ropes and sails for the Continental Navy as well as for the state-sponsored fleets. Demand for it waned after the war but remained a flourishing domestic cash crop in the United States. After the Marihuana Tax Act of 19371 was implemented, which also taxed and regulated hemp, the popularity of hemp declined and many businesses shuttered. In the middle of the 20th century, calls for the prohibition of marijuana due to its intoxicating effects led to cannabis being banned in the Federal Comprehensive Drug Abuse Prevention and Control Act of 1970 signed by Richard Nixon. No provision was made to exempt industrialized hemp grown for utilitarian purposes.

As the tide of public opinion toward cannabis turned and more and more states started to legalize medical marijuana, hemp was again looked at as a viable domestic crop. The Agricultural Act of 2014, signed by President Obama, defined industrialized hemp as separate from marijuana and authorized research and pilot programs for the production of hemp in conjunction with universities and state departments of agriculture. In 2015, seven states planted research crops. Twenty-seven states removed barriers to hemp production and Colorado, Oregon, and Vermont licensed farmers to grow hemp under state law. Unfortunately, Federal law still classified hemp as a Schedule I substance so farmers could still go to jail and have their property taken away for growing hemp. This changed with the Agriculture Improvement Act of 2018, also known as the 2018 Farm Bill, that President Trump signed into law in December 2018. This law amended the Controlled Substances Act to exempt the THC in hemp from being classified as a Schedule I drug, opening up opportunities for farmers to grow and sell industrialized hemp in the United States without the worry of losing their property or going to prison due to Federal drug policy.

Today’s market size shows the total sales of hemp products in the United States in 2017 and 2022 according to Hemp Business Journal estimates. *Future estimates vary widely among different groups when it comes to the largest sales category in the hemp industry, CBD-based products. Marijuana research firm Greenwave Advisors predicts that CBD product sales alone will reach $3 billion by 2021. Cannabis industry analysts at the Brightfield Group predict that sales will reach $22 billion by 2022. These higher estimates are bolstered by many factors, not the least of which is the signing of the 2018 Farm Bill into law. Also, products containing CBD are now more widely available, being sold at health food stores and in beauty aisles of mainstream retailers. More doctors are prescribing CBD products for conditions such as post-traumatic stress disorder (PTSD), anxiety, multiple sclerosis, and chronic pain. The Federal Drug Administration’s approval of Epidiolex will also fuel demand. An estimated $591 million was spent on hemp-based CBD products in 2018. Demand is expected to grow as consumers continue to seek natural remedies for ailments.

1 “Under pertinent provisions of the Marihuana Tax Act, 26 U.S.C.S. §§ 4751-4753, every person who sells, deals in, dispenses, or gives away marihuana must register with the Internal Revenue Service and pay a special occupational tax.” Also, a transfer tax was required to be paid and a form was to be filled out with the name and address of the buyer and seller and the amount of marihuana to be purchased. The form was to be filled out in triplicate, one copy going to the Internal Revenue Service, one copy to be kept by the buyer and the original to be kept by the seller. All copies and originals were subject to inspection by federal and state law enforcement. Source: “Marijuana Tax Act Law and Legal Definition,” USLegal available online here.

Geographic reference: United States
Year: 2017 and 2022
Market size: $820 million and $1.9 billion*, respectively
Sources: “The U.S. Hemp Industry Grows to $820mm in Sales in 2017,” Hemp Business Journal, May 20, 2018 available online here; “Hemp,” Merriam-Webster available online here; “The Truth Behind Hemp in the United States,” Ministry of Hemp available online here; Ben Swensen, “Hemp & Flax in Colonial America,” Colonial Williamsburg Journal, Winter 2015 available online here; “10,000- year History of Marijuana Use in the World,” Advanced Holistic Health available online here; Elisabeth Garber-Paul, “Exclusive: New Report Predicts CBD Market Will Hit $22 Billion by 2022,” Rolling Stone, September 11, 2018 available online here; Public Law No: 115-334. Agriculture Improvement Act of 2018 available online here; Daniele Piomelli and Ethan B. Russo, “The Cannabis sativa Versus Cannabis indica Debate: An Interview with Ethan Russo, MD,” Cannabis and Cannabinoid Research, US National Library of Medicine, National Institutes of Health, January 1, 2016 available online here; Brian S. Julin, “Welcome to Frequently Asked Questions About Cannabis Hemp,” 1994 available online here; “Titles II and III of the Comprehensive Drug Abuse Prevention and Control Act of 1970 (Public Law 91-513)” available online here; “Hemp vs Marijuana,” Ministry of Hemp available online here; “Marijuana Tax Act Law and Legal Definition,” USLegal available online here; Trevor Hughes, “It Won’t Get You High, But It Can Make You Full,” USA Today for the Lansing State Journal, January 14, 2019, page 1B.
Image source: ulleo, “hemp-cannabis-seeds-grains-healthy-2258608,” Pixabay, April 28, 2017 available online here.

Enterprise Drones

dronesUnmanned aerial vehicles (UAVs) have been in development since World War I for use in military operations. During World War I, the aim was to design an automatically guided, unmanned biplane that would act as a torpedo. The Kettering Bug, built by the U.S. Army, first flew in 1918 but was never used in the war. In the 1930s, the Navy continued experimenting with radio-controlled aircraft. The Radioplane OQ-2 became the first mass-produced UAV in the U.S. Fifteen thousand were manufactured for the Army during World War II.

Modern unmanned aerial vehicles, or drones, began being developed by the Air Force in the 1960s and 1970s for surveillance flights. By the late 1990s, engineers were working on arming them with missiles. After September 11, 2001, the CIA began flying armed drones over Afghanistan. The military continues to use ever more sophisticated drones of various sizes in its operations.

Drone kits for hobbyists were sold in the late 1990s and early 2000s. The first commercially successful consumer drone was released in 2010. The Parrot AR Drone was the first ready-to-fly drone controlled by Wi-Fi using a smartphone. It sold more than 500,000 units. Its successor, the AR Drone 2.0, had an improved piloting system, which made it easier for newcomers to use. According to Goldman Sachs, consumer drones are expected to generate $3.3 billion in revenue by 2020, up from $700 million in 2014.

Recognizing the potential of drones beyond military or consumer use, the Federal Aviation Administration issued permits for commercial drones in 2006. These permits removed some restrictions placed on consumer drones. At first, few companies requested commercial drone permits. Today’s market size shows the number of commercial, or enterprise, drones shipped in 2017 and 2023 in the United States. The shipment figure for 2023 is estimated.

Drones are used by civilian government entities, such as police and fire departments, and various industries throughout the United States. The construction industry spent the most on drones in 2016, $11.2 billion. The agriculture industry followed, spending $5.9 billion. Some uses for drones in the construction industry include mapping, surveying land, inspecting buildings, and monitoring on-site activities. Agriculture uses include monitoring crop health, assessing drought impacts, and analyzing the soil. According to Technavio, Aeryon Labs, 3D Robotics, DJI, Parrot, PrecisionHawk, DroneDeploy, Yuneec, Cyberhawk Innovations, Strat Aero and Dragonfly Innovations were the top manufacturers of enterprise drones in 2018.

Geographic reference: United States
Year: 2017 and 2023
Market size: 84,000 and 1,465,000 respectively
Sources: Nicholas Shields, “UberEats is Eyeing Drone Deliveries,” Business Insider, October 24, 2018 available online here; John Sifton, “A Brief History of Drones,” The Nation, February 7, 2012 available online here; Kashyap Vyas, “A Brief History of Drones: The Remote Controlled Unmanned Aerial Vehicles,” Interesting Engineering, January 2, 2018 available online here; Ed Darack, “A Brief History of Quadrotors,” Air & Space, May 19, 2017 available online here; “Drones: Reporting for Work,” Goldman Sachs, 2016 available online here; John Patterson, “An Aerial View of the Future – Drones in Construction,” Geospatial World, September 5, 2018 available online here; Meg Gerli, “Agricultural Uses of Drones,” November 9, 2017 available online here; Michael R., “Top 10 Drone Manufacturers in the Global Commercial Drone Industry – Flying High in a Competitive Business,” Technavio Blog, March 20, 2018 available online here.
Original source: Business Insider Intelligence estimates.
Image source: StockSnap, “mountain-sky-clouds-nature-drone-2574006,” Pixabay, August 2, 2017 available online here.

Fortune-Telling Industry in South Korea

fortune telling tarot cardsWhat will the future hold? A question many of us ask ourselves, especially at this time of the year. While most people just ponder this question idly, many in South Korea seek out more definitive answers, they believe, from fortune-tellers who offer services such as face-, palm-, and tarot card reading and saju, an ancient practice of analyzing the cosmic energy at the hour, day, month, and year of a person’s birth from Chinese astrological records and texts. Saju and face-reading are recognized academic pursuits in South Korea.

According to Paik Woon-san, head of the Association of Korean Prophets, there are more than 300,000 fortune-tellers in South Korea and 150,000 shamans, many of whom offer fortune-telling services. Two-thirds of people surveyed by Trend Monitor, a marketing firm, said that they visit a fortune teller at least once a year. Most visit between December and February to learn what is foretold for their lives in the new year. The practice of going to soothsayers is passed down within families. It is “one possible way by which to make sense of the world,” says Andrew Eungi Kim, a professor at Korea University.

Today’s market size shows the estimated revenue earned in the fortune-telling industry in South Korea according to the Korea Economic Daily, a newspaper.1 Whether people seek out fortune-tellers for entertainment or for decision-making guidance, some who may have sought face-to-face interactions at brick-and-mortar businesses are now downloading mobile apps. Handasoft’s most popular fortune-telling app, Jeomsin, has been downloaded more than 3 million times.

1 The source does not provide a date. It states, “[T]he otherworldly in South Korea will soon be a 4trn won ($3.7bn) business”. The editors of this blog interpret “soon” to mean in 2018 or 2019. The source article was written in February 2018.

Geographic reference: South Korea
Year: 20181
Market size: $3.7 billion (4 trillion won)
Source: “In South Korea Fortune-Telling Will Soon Be a $3.7bn Business,” The Economist, February 24, 2018 available online here.
Image source: MiraCosic, “tarot-cards-magic-fortune-telling-991041,” Pixabay, October 16, 2015 available online here.