How Hello Kitty Took Over the World
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How Hello Kitty Took Over the World

Investors in Sanrio have made 10 times their money as the iconic Japanese brand expands digitally

By JACKY WONG
Thu, Sep 26, 2024 8:31amGrey Clock 2 min

Hello Kitty is celebrating her 50th birthday this year. Sanrio , the Japanese company behind the iconic character, has much to cheer about too.

Sanrio’s share price is at a record high after surging 10-fold from its trough in 2020. The company is delivering record profits with strong revenue growth. Operating profit last quarter rose 80% from a year earlier.

Sanrio’s young chief executive, Tomokuni Tsuji —14 years younger than Hello Kitty—probably deserves some applause. He took over the helm from his grandfather in 2020. Sales and profit had been sliding for years when the pandemic arrived. Sanrio had created some of the best-known franchises around the world, but it wasn’t harnessing the full potential of its large portfolio of cute characters.

Tsuji has put younger management in place and finally expanded into the digital world. That includes marketing its characters through social media and other online platforms and ramping up its e-commerce business. It is also expanding its high-margin licensing business, with Sanrio’s characters now gracing products from microwave ovens to sneakers. The licensing business not only is more profitable but also allows more local designs and creates more contact points in overseas markets.

As a result, Sanrio’s business outside of Japan is booming, particularly in China and the U.S. Its profit contribution from abroad, including royalties payment from overseas subsidiaries to the parent company, nearly doubled year on year in the June quarter. Sanrio struck a deal with China’s e-commerce giant Alibaba in 2022 to license its characters in the country. But the U.S. is among its fastest-growing markets: Sales in the Americas grew 141% year on year last quarter. The younger generation is increasingly familiar with Sanrio’s characters given the company’s strong presence on social media.

And the company has also managed to diversify itself away from reliance on Hello Kitty. She has long been Sanrio’s most recognizable character, but the company has developed new characters and done a better job of promoting some existing ones. Hello Kitty accounted for around 30% of Sanrio’s gross profit in product sales and licensing in the fiscal year ended March, compared with 76% a decade earlier. Cinnamoroll, a puppy with white fluffy fur, was voted Sanrio’s top character in an online poll by the company.

The company is also using different types of media to market its characters. It has a Netflix show called “Aggretsuko,” which features an angry red panda struggling with office life, that has been airing for five seasons. A Hello Kitty movie with Warner Bros. is in the making.

Sanrio’s stock now trades at 34 times forward earnings, which isn’t cheap at face value. But if the company can manage to continue its overseas expansion with new characters, it could bring not just cuteness overload, but profit overload too.



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To Get What You Want, Try Shutting Up

Silence makes us feel awkward. Deploying it can be a superpower.

By RACHEL FEINTZEIG
Fri, Sep 27, 2024 4 min

To get what you want, try closing your mouth.

A well-deployed silence can radiate confidence and connection. The trouble is, so many of us are awful at it.

We struggle to sit in silence with others, and rush to fill the void during a pause in conversation. We want to prove we’re smart or get people to like us, solve the problem or just stop that deafening, awkward sound of nothing.

The noise of social media and constant opinions have us convinced we must be louder to be heard. But do we?

“I should just shut up,” Joan Moreno , an administrative assistant in Spring, Texas, often thinks while hearing herself talk.

Still, she barrels on, giving job candidates at the hospital where she works a full history of the building and parking logistics. She slips into a monologue during arguments with her husband, even when there’s nothing good left to say. She tries to determine, via a torrent of texts, if her son is giving her the silent treatment. (Turns out he just had a cold.)

“I should have just held it in,” she thinks afterward.

We often talk ourselves out of a win. Our need to have the last word can make the business deal implode or the friend retreat, pushing us further from people we love and things we want.

“Let your breath be the first word,” advises Jefferson Fisher , a Texas trial lawyer who shares communication tips on social media.

The beauty of silence, he says, is that it can never be misquoted. Instead, it can act as a wet blanket, tamping down the heat of a dispute. Or it can be a mirror, forcing the other person to reflect on what they just said.

In court, he’ll pause for 10 seconds to let a witness’s insistence that she’s never texted while driving hang in the air. Sure enough, he says, she’ll fill the void, giving roundabout explanations and excuses before finally admitting, yes, she was on her phone.

For a mediation session, he trained a client to respond in a subdued manner if the other party said something to rile him up. When an insult was lobbed, the client sat quietly, then slowly asked his adversary to repeat the comment. No emotional reaction, just implicit power.

“You’re the one who’s in control,” Fisher says.

Acing negotiations

To be the boss, “you gotta be quiet,” says Daniel Hamburger , who spent years as the chief executive of education and healthcare technology firms.

He once sat across the negotiating table from an executive who was convinced his company was worth far more than Hamburger wanted to pay to acquire it. What Hamburger desperately wanted to do was explain all the reasons behind his math. What he actually did was throw out a number and then shut his mouth.

Soon they were shaking on a deal.

Hamburger, who retired last year and now sits on three corporate boards, also deployed strategic silence when running meetings or leading teams. If the boss chimes in first, he says, some people won’t speak up with valuable insights.

Days into one CEO job, Hamburger was confronted with two options for rewriting a piece of the company’s software. He didn’t answer, and instead turned the question back on the tech team.

“People were like, ‘Really? Are you really asking?’” he says. By morning, he had a 50-page deck from the team outlining the plan they’d long thought was best. He left them to it, and the project was done in record time, he says.

A day without speaking

Staying mum can feel like going against biology. Humans are social animals, says Robert N. Kraft , a professor emeritus of cognitive psychology at Otterbein University, in Ohio.

“Our method of connecting—and we crave it—is talking,” he says, adding that it excites us, raising our blood pressure, adrenaline and cortisol.

For years, Kraft assigned his students a day without words. No talking, no texting. Some of the students’ friends reported later that they’d been unnerved. After all, silence can be a weapon.

Many students also found that when forced to listen, they bonded better with their peers.

When we spend conversations plotting what to say next, we’re focused on ourselves. Those on the receiving end often don’t want to hear our advice or semi related anecdotes anyway. They just want someone to listen as they work through things on their own.

The question mark trick

Without pauses, we’re generally worse speakers, swerving into tangents or stumbling over sounds.

Michael Chad Hoeppner , a former actor who now runs a communications training firm, recommends an exercise to get used to taking a beat. Ask one question out loud, then draw a big question mark in the air with your finger—silently.

“That question mark is there to help you live through that fraught moment of, ‘I really should keep talking,’” Hoeppner says.

At a cocktail party or in the boardroom, you can subtly trace a question mark by your side or in your pocket to force a pause.

Sell with silence

Fresh out of college, Kyler Spencer struggled through meetings with potential clients. Some sessions stretched to two hours and still didn’t end in a yes.

The financial adviser, based in Nashville, Ill., realized he was rambling for 15-minute stretches, spouting off random economic facts in an attempt to sound savvy and experienced.

“I basically just bulldozed the meeting,” says Spencer, now 27.

He started meditating and doing breathing exercises to calm his nerves before meetings. He now makes sure to stop talking after a minute or two. The other person will jump in, sharing about their life, fears and goals. It’s information Spencer can use to build trust and pitch the right products.

His client list soon started filling up, and happy customers now send referrals his way.

“It’s amazing,” he says, “what you learn when you’re not the one talking.”

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11 ACRES ROAD, KELLYVILLE, NSW

This stylish family home combines a classic palette and finishes with a flexible floorplan

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Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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