In the November 2019 AGM, global media and marketing company Crowd Media Holdings Limited’s (ASX:CM8) Chairman Steven Schapera laid down the Company’s strategic vision to sell exemplary products integral to the lives of European-based millennials on a Direct to Consumer model.
Adhering to the same, CM8 executed a 3-year exclusive distribution agreement with London-based KINN Living, on 1 May 2020, to sell KINN’s product range into the European market (excluding the UK). Recently, CM8 intimated that revenue is already beginning to flow from the agreement.
Revenue Flow from KINN Agreement
Ahead of schedule, the Company launched the KINN Living EU website, across the most popular European languages, including English, German, French, Spanish, and Italian. It is also multicurrency, accepting Euro, GBP, USD and AUD across all the popular payment methods including credit card and Apply Pay.
CEO, Domenic Carosa stated that revenue has begun to flow from the agreement, adding to the revenue from I Am Kamu and London Labs. “This is a remarkable achievement”, he adds, as in the short span of merely two months, CM8 has been successful in adding three new revenue streams, each pivoting off the Company’s digital know-how.
KINN Website Features
The KINN Living EU-based website’s aim is to facilitate CM8 for the sale of KINN’s natural, eco-friendly, home-cleaning, sanitiser, and laundry-care products into the European market (apart from the UK).
Below are the key features of the website:
CM8’s Bullish Outlook Towards KINN Living Agreement
As per the agreement, the Company will act as the exclusive digital distributor for KINN’s reputed and well-recognised home-cleaning and laundry care products in all EU markets outside of the UK.
The agreement, another milestone in the execution of CM8’s strategic vision after the I Am Kamu and London Labs agreements, leverages CM8’s core strengths of digital social media/influencer marketing across a database of over 10k influencers/conversational commerce. An add on is the pervasive Amazon ecommerce marketplace which is likely to catalyse web sales of KINN products across Europe.
CM8 has extensive expertise in digital marketing to Gen Z and millennials in a lot of European countries, in more than 12 diverse languages. This will drive KINN sales as the Company utilises its well-tested influencer and performance marketing strategies.
Moreover, a recent market report from the world’s largest market research store, Research and Markets forecasts that the global household green cleaning products market is likely to grow to a momentous USD $27.83 billion by the end of 2024. The market segment is growing rapidly, more recently accelerated by COVID 19. CM8’s research advocates that eco-friendly cleaning products account for more than 30% of the prestige household cleaning market.
Post the pandemic environment, CM8 believes that awareness of the importance of laundry-, surface- and hand-hygiene will continue to endure.
KINN Living Agreement Details
Terms of the agreement are commercially sensitive, and thus confidential. However, CM8 confirms that the agreed distribution margin is consistent with standard distribution/reseller margins of between 60%-75%, which fits strategically with the Company’s vision of selling high-margin products and services with which it is closely aligned.
CM8 and KINN have been working in close co-ordination to ramp up the development and production of a World Health Organisation (WHO) formulated sanitiser and handwash and plan to further develop the KINN product portfolio.
As per the agreement, CM8 has the exclusive right to market, advertise, promote, distribute, and sell KINN products via the EU KINN website and Amazon in the EU (excluding the UK). The first six months of the agreement, ending 28 October 2020, are a Pilot and the Company has the right to terminate the agreement for no reason within the Pilot term. In case this does not happen, the agreement then continues for a period of three years to 28 October 2023.
CM8 has agreed to a ‘buy back’ mechanism with KINN should CM8 have excess inventory. Until CM8 has established its own distribution/logistics facility in Europe via a 3PL, KINN will provide fulfilment services to CM8. influencer marketing, performance marketing, and other digital marketing initiatives costs are to be borne by CM8.
CM8 quoted $0.026 on 18 May 2020 (AEST: 3:23 PM), with a market cap of $8 million.
There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.
Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.
As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.