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Beyond the Bale : December 2010
3 December 2010 BEYOND THE BALE UPFRONT Getting on with business e are continuing with initiatives to help increase the demand for wool through investments in marketing, innovations and R&D -- from farm to fashion. I would like to inform you of some recent advancements the organisation is making: Campaign for Wool: This campaign has been a great success with a series of events and promotions held across the UK in October, including sheep grazing on historic Savile Row in London. The event was phenomenal, achieving a great deal of media coverage in the UK, Australia and in overseas markets. The strategic importance of this campaign is growing as is the broad support at designer, brand and retail levels. The campaign will roll out globally next year. Woolmark Gold: We have launched a new consumer education program aimed at the rapidly growing Chinese domestic market for luxury goods. The story and heritage of Merino wool as a premium natural fibre is being told through a co-ordinated media and retail campaign. I am especially delighted to see luxury European fabric and tailoring brands united under a common banner for the first time in a century to sell the message. No Finer Feeling campaign: AWI is set to launch a new global marketing campaign that talks to a new generation of consumers about the attributes and benefits of Merino wool. The campaign's theme-line is 'Merino wool: No finer feeling' The campaign will be undertaken in partnership with manufacturers, retailers and the media over the next three years across all AWI's marketing initiatives. Measurement of our marketing and R&D: All our investments are measured; this also applies to our three marketing initiatives. As the northern hemisphere selling season ends, we will analyze media reach and value for this expenditure and report it to you via Beyond the Bale. We have also developed a new measurement software program to help us evaluate our R&D investments, pre and post their commissioning. IWTO meeting: AWI gave a presentation about recent AWI activity to the International Wool Textile Organisation (IWTO) Wool Round Table at Biella, Italy. The presentation was extremely well received. Francesco Botto Paolo closed the day with the remarks that AWI's three current projects (see above) were absolutely 'right for the industry at this time'. This was echoed by the Vitale Barberis Canonico representatives, Pier Luigi Loro Piana and several other Biellese glitterati. One-year-on Review of Performance: I am happy to inform woolgrowers that an independent 'One Year On Review of Performance' of AWI has reported an improved performance of the company. The review concluded AWI had acted upon all 11 recommendations from last year 's three year review. I look forward to demonstrating further improvements, with AWI volunteering for another review next year. Organisational restructure: The structure of the AWI's international network has been aligned to support our strategic plan. A new General Manager of Business Development role has been created, responsible for building strategic alliances with key accounts globally and driving business development opportunities. The role will also be responsible for the leadership of the international network. The role of Regional General Managers has been made redundant. BBC Peschardt's People: In October, a half hour TV program 'Peschardt's People' featuring the Taylor family of 'Winton' Tasmania was broadcast on BBC World News to all 200+ countries on the BBC network, reaching an audience of 76 million people around the world. The program, supported by AWI, demonstrated that wool is a wonderful natural fibre with a unique heritage and pedigree. The episode is available on the Woolmark channel on YouTube at www.youtube.com/ WoolmarkOnline. A second episode will feature the Australian Governor-General. Marketing claims: AWI management has introduced a new process in relation to approving/rejecting the use of the marketing claims that it wishes to make about wool fibre, fabric and end products. The marketing claims being assessed include both environmental claims as well as claims about functional benefits associated with wool, for example "comfortable next to skin". E-commerce license purchasing: Through our analysis of the Woolmark business unit it was identified that the process of buying a Woolmark license is arduous and considered a barrier. We are developing an e-commerce processing website to ensure those companies keen to become a licencee can do so in a prompt fashion. Industry Consultative Committee meeting: An ICC meeting was held on 4 November in the offices of AWI. The ICC was expanded temporarily to include State Farming Organisations so that the AWI Annual Report, 2009/10 accounts and marketing strategy roll out could be discussed. Productivity Commission: The draft report by the Productivity Commission's inquiry into the Rural Research and Development Corporations was released in September. In general it was supportive of the current model, with some modification to the model and funding formula. There were some critical comments relating to AWI, however it is important to note that the timing of submission process did not allow us to articulate changes within the Statutory Funding Agreement, nor has it taken into account the company's new strategic and operating plans. AWI's one- year-on review of performance has formed the basis of our subsequent submission to the Commission. Production forecasting: AWI has reviewed the operations of the Australian Wool Production Forecasting Committee with a view to reduce costs and improve the scope and skill of the forecasts. We have subsequently made excellent progress in refining the operational aspects of this important service, although there is more to achieve in the coming months. Stuart McCullough CEO, AWI