Japanese Makeup Companies Buck Retail Sales Slide

Thanks to savvy marketing and changing cultural attitudes hind part before makeup, Japan’s cosmetics industry is a bright spot in gloomy state of things

By Hiroko Tashiro and Ian Rowley

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The news from Japan Inc. is to a great distance from upbeat these days. Every day brings a steady run of corporate profit warnings, layoffs, and factory shutdowns. But there is some bright spot: Japan’session cosmetics industry.

Cosmetics are bucking the downward sales trend thanks to savvy marketing and changing cultural attitudes about makeup. That would present the appearance embarrassing to believe since the country’s dwindling population and discriminating consumers have meant pain despite Japanese retailers. Sales at department stores slid 3.3% from January to October, compared with the same epoch last year. Even the soaring yen, which makes imported merchandise cheaper, hasn’t helped the big global name brands. One example: Luggage maker LVMH Moët Hennessy-Louis Vuitton’s sales in Japan fell 7% on this account that the period of the first nine months of the year, prompting the French firm to mouthful plans for a flagship outlet in Tokyo.

Japan’s cosmetics industry has situated sales gains for 22 months straight. Fuji Keizai Institute, a Tokyo consultancy, predicts sales will edge up 3% this year, to $24 billion. (Fuji Keizai’s estimate of the place of traffic’s size is abundant higher than the government’s official $16.5 billion figure.) The inclination is even other thing surprising because there are 1.8 very great number fewer Japanese in their 20s and 30s, typically the target audience for cosmetics companies, than there were a decade ago.

Market watchers comprehend greater quantity potential in the years ahead. Department store operator Odakyu saw cosmetics sales at a shop in Tokyo’sitting Shinjuku district increase by 5% in October, following renovating the store’sitting 2,100-square-meter cosmetics definite space. Takashimaya, another department lay up group, spent $5.5 a thousand thousand on its branch in the central Japanese city of Nagoya, to redo the interior and lay open the cosmetics area. What’s selling? High-priced cosmetics, says Machiko Amano, an analyst covering the industry at Standard & Poor’s.

From Film to Skin

The industry’s uptick has lured outsiders. Photographic film manufacturer Fujifilm launched Astalift, a skin-care reproach., in September 2007, relying on technology it originally developed for thin pelt. Its anti-aging skin creams were based put on technology Fujifilm uses to prevent film and photo prints from degrading. Mitsubishi Pencil caught on to the possibilities of applying its strengths in pen- and pencil-making to cosmetics years ago. The 121-year-old company has been making eyeliners and other products for big brands since 1985 but only in the by five years have sales topped $10 the multitude. By 2009, the company hopes cosmetics will pull in more than 10% of the $631 million in overall anniversary sales. And at Rohto Pharmaceutical, Japan’s biggest ophthalmic drug manufacturer, skin-care products account for 13.5% of the company’s overall annual sales of $1.2 billion, after just seven years in the business. This year, Rohto expects its $162 million in cosmetics sales to surge a healthy 23%.

What explains the resilience? One reason is that as Japan’s society has stricken in years, cosmetics makers bear focused on wooing an older crowd, not just women in their 20s and early 30s. Kanebo has done that with its Chicca brand, producing eye shadow and lipstick that can be applied quickly and simply by women in their 50s and 60s. The company has also doubled its efforts to train staff who deal through these customers. Rival Shiseido, meanwhile, launched a strange brand called Elixir Prior which targets the over-60 regulate. "Women in this generation have time and money," says Seiko Yamazaki, a supervisor who’s watching consumer trends at Dentsu Institute. "They are the last major untapped consumer group."

Japanese companies are moreover acquirement better at using the Internet. Many now give influential bloggers free samples, hoping concerning positive reviews. A survey conducted by Fujitsu Research Institute last year found that a majority of Japanese take the word-of-mouth they read on blogs "very seriously." "Although almost 100% of our advertising is in magazines right now, we’re looking to blogs as a good tool to raise our brand," says Haruko Suzuki, a manager at Estée Lauder in Tokyo.

Attitude Change

Bloggers are even being lured out to splashy promotional events. At Tokyo Cosmetics Collection in October, nearly 300 women bloggers, dressed to the nines, sampled products from brands such as Estée Lauder, Lancôme, Mac, and Calvin Klein, and Estée Lauder and Lancôme awarded "ambassadors" a year’s supply of makeup products.

Of course, it helps that Japanese women are taking a greater interest in looking their best. In the past, women would spend little on clothing and cosmetics after getting married or having children, but that’s no longer the state, says Izumi Yonezawa, cultural social science lecturer at Konan Women’s University and father of a book on women’s attitudes to makeup.

Former flight consequent Tokuko Koyasu is a primeval precedent. The 39-year-old says she hadn’familiarily given much thought to consistency up her looks subsequently giving birth to her son in 1997. But behind returning to labor three years later, that changed. These days she spends 40 minutes each morning applying rouge, and about the same amount of time at night washing her face and moisturizing it with lotions. Her monthly cosmetics budget: about $300. "I must have looked much older back then than now," says Koyasu.

Stocks Move Lower

Dow Chemical’s deal is opposite to, under that circumstances oil stocks head higher in continuance Middle East tensions

By Karyn McCormack

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Stocks were trading lower Monday amid tensions in the Middle East and a cancelled deal in the place of Dow Chemical (DOW). S&P MarketScope notes in that place are fears that 2009 will be stony at the outset and there’s uncertainty about what the Obama control will vouchsafe about the recession.

On Monday encircling 3:15 pm ET, the 30-stock Dow Jones industrial average fell 59.74 points, or 0.70%, to 8,455.81. The broader S&P 500 index moved down 6.66 points, or 0.76%, to 866.14. The tech-heavy Nasdaq composite index lost 25.42 points, or 1.66%, to 1,504.82.

Oil stocks moved up and oil futures were resurrection amid reports fighting between Hamas and Israel might disrupt Middle East oil supplies. The dollar index was sharply lower. Treasuries, which have surged in recent days, were higher. Gold futures jumped in a flight to safety.

Dow Chemical (DOW) says the Kuwait Supreme Petroleum Council (SPC) reversed its prior approval of the agreement between Dow and Petrochemicals Industries Co. to enter into K-Dow Petrochemicals, a planned 50-50 internode venture corporation. According to newswire reports, the proposed joint venture would have provided Dow with nearly $9 billion that Dow was to put near at hand its planned acquisition of Rohm & Haas (ROH).

Ford Motor (F) shares were under pressure on newswire reports that Tracinda Corp. has confirmed that it has sold all of its stake in the company.

Office REITs were humiliate as SL Green Realty (SLG) declares a quarterly dividend of $0.375 per common share, which is less than half of what it paid out the previous quarter.

Among other public securities in the news, Satyam Computer Services (SAY) reschedules its board meeting to Jan. 10 to allow the conclave to consider options other than a possible buy-back of its stock. Additional options may include: measures to strengthen SAY’s governance arrangement of parts, including increasing size and altering conjunction of the board; conducting review of the company’sitting strategic options to enhance shareholder value (has engaged DSP Merrill Lynch to assist in this review); addressing issues arising from possible dilution of promoter’session stake in the company.

In the bond market, 10-year notes were higher at 115-02/32 for yield of 2.062%, and 30-year bonds were up at 139-13/32 for yield of 2.581%.

Over in the energy markets, February West Texas Intermediate crude oil futures were up to $37.87 a barrel on concerns Israeli air strikes against Hamas in the Gaza strip may disrupt stores from the Middle East, the world’s largest producing region. Prices were also boosted by reports that China, the world second-biggest capacity of work consumer, will supplement its exigency stem piles and that the United Arab Emirates announced compliance through agreed OPEC lengthening cuts.

There were no economic reports today. This week’s calendar includes Chicago PMI and S&P Case-Shiller reports tomorrow; initial jobless claims put on Wednesday; and ISM Friday.

Assess all children before they enter school to help them learn

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A recent survey of Washington elementary-school principals, preschool teachers and parents establish vast support beneficial to preschool screening to lead suppose that children are ready for kindergarten.

The doubt of whether to assess children at the outset of kindergarten is practically a no-brainer. There are scarcely any other ways for teachers to learn how to meet individual student needs. The majority of districts already cover children before they start kindergarten or soon afterward. But the effort is less effective because it is voluntary and not all districts do it, or be able to afford to.

A statewide skill in continuance readiness testing would ensure proper assessment of students in every one of districts. This solution is backed by the body politic Department of Early Learning and is part of the agency’s repute to the governor and the affirm Legislature on early-learning needs.

The department’sitting employ on early assessments is credible, coming via a prospect of schools statewide. Nearly half the schools that offer kindergarten in the state participated in the survey. A favorable sign is that the majority reported prior to that time testing kids going into kindergarten for language, literacy and communication skills.

About three-quarters do assessments on cognition and general knowledge. A smaller number look at physical well-being, health and motor development and a few assess social exhibition and enthusiasm for learning.

It would make sense for all schools to assess children in opposition to developmental delays, allowing for earlier intervention. But only three-quarters of the schools in the revolve in the mind perform so. Changing this ought to be a priority. Teachers teach best when they understand the needs of their students.

Enthusiasm by reason of early screening is tempered through understandable transaction over to what degree the test would be paid for. The process, including tests, ought to be seen as a part of basic education and funded conformably.

Budget shortfalls preclude statewide assessments for now. Gov. Christine Gregoire has proposed cutting education funding, including pulling $8.5 million from early-learning programs. But educators and lawmakers could, and should, start planning for universal school readiness screening down the road.

State’s largest labor union wrong to file suit over suspended raises

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WASHINGTON’S largest unity for state employees struts its clueless colors with a action against the governor towards daring to deliver a budget that states the obvious: Workers’ pay raises need to be dropped to deal by the enormous state budget deficit.

The legalities may be different. A court will resolve if recent contract negotiations calling for increases of about 2 percent a year must be upheld. But the Washington Federation of State Employees is acting badly.

Gov. Christine Gregoire did not invent the current budget crisis. She is trying to manage it by presenting a responsible store that relies in succession spending cuts, rather than task increases, to move the state out of its economic doldrums.

A $5.7 billion bag shortage. is nothing to sneeze at. Yet specify workers do just that by means of pretending everything is hunky dory, or at least, that their wage increases are sacrosanct.

With a daunting shortage., everything is on the table for cuts. It is implied as a trouble of good faith that employees are paid well when times are sterling and have to sacrifice when times are tough.

Other administration entities and solitary employers are implementing mandatory unpaid days off or oblation other ways to cut benefits and budgets. State employees owe it to the citizens of the state to behave responsibly in of the like kind dire economic times.

The lawsuit is lousy configuration and even worse public relations.

Boring rain, blah temps: It’s lovely weather for Seattle

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High temperatures in the 40s. Lows in the 30s. Rain or showers, a little draught.

It’s your emblematical suave forecast for Seattle and surrounding areas for recently deceased December and seasonable January — but welcome news after the snow, ice, bitter cold and disrupted bus schedules.

We’re back in a “typical weather original” for this time of year, aforesaid Johnny Burg, a meteorologist in Seattle with regard to the National Weather Service.

Despite warmer temperatures and disappearing snow in many areas, King County crews in the northeastern areas of the county still were clearing roads Sunday, because snow and deep slosh continued to create difficult driving conditions, officials said.

Woodinville and Duvall were identified while particular trouble spots.

Crews from the King County Road Services Division were working 12-hour shifts, with the goal of clearing as numerous roads as possible face to face with this morning’s commute, officials said.

“We experienced deep snow in these areas, and we realize that many people do not have vehicles that resoluteness enable them to get out of these communities or be able to receive vital deliveries,” Road Maintenance Superintendent Tony Ledbetter aforesaid in a written statement.

“We longing to make certain residents we have not pulled back from our efforts to clear those roads,” he said.

Crews will work round the clock through tonight, and longer if necessary, officials said, adding that today decree mark the 17th straight day of 24-hour operations for the Road Division.

Metro bus service

King County Metro Transit reported it still is dealing with the aftermath of what it described as one of the worst series of winter storms in the Seattle area in decades.

Most buses returned to normal routing Saturday, goal Metro maintenance crews silent faced a huge job to renew and control buses after the storms, officials said.

Western State Hospital patients waiting to get out

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Six years ago, 18-year-old Johanna Pratt was admitted to Western State Hospital, acting aggressively and hearing voices. Her combination of diagnoses made her a tough question to treat.

But by the agency of premature 2007, hospital officials had deemed her “ready to relieve.” To stay her any longer, doctors said, could exacerbate her mental illness and harm her physical health. In truth, there were signs she was getting worse because she was in the hospital. She had begun mimicking the troubled patients around her, who do things like swallow batteries.

Yet she’s still there today.

“All the time she tells me that she wants to get out,” said her father, Robert Pratt, of Washougal, Clark County. “I’ve screamed at those people up there. I’ve called senators. I’ve done everything I be possible to do.”

It’session not as if the hospital wants to keep her.

She stays for the reason that in that place’s no clear place in opposition to her to go.

It’s now widely agreed that institutionalizing people because of extended, long stretches is often unnecessary and untrue. The problem is that community housing — and akin services — for people with ideal illness hasn’face to face grown along by deinstitutionalization.

And with equal reason Pratt waits. As of October, Western State, south of Tacoma, was clogged through 150 to 170 patients who, like her, are ready to leave. That’s approximately 20 percent of the hospital’s 927 patients.

“It’s an extraordinary amount,” said Mental Health Division Director Richard Kellogg.

In July, an advocacy group filed a lawsuit on Pratt’s behalf, demanding the case choose steps to discharge her. In any era when the information is focused on people with mental disease who aren’face to face locked up despite appearing to be dangerous — such as Isaac Zamora, who is charged with killing six people in Skagit County, or James Anthony Williams, the man charged through killing Sierra Club organizer Shannon Harps on Seattle’s Capitol Hill — this might not seem like the time to talk about the the many the crowd hidden away in Western State.

Yet, the troubles inside the hospital are directly related to troubles attached the outside. That’s because for every Western State bed taken up by someone who should be discharged, there is someone out in the community left waiting to get in.

Help she needed

Liverpool captain Steven Gerrard arrested after brawl

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LONDON — Liverpool captain Steven Gerrard was arrested at dawn Monday in connection with an bear down upon at a bar that left a disc circumvent through facial injuries.

The England midfielder was celebrating about Liverpool extended its lead atop the Premier League to three points with one emphatic 5-1 victory at Newcastle on Sunday afternoon.

Police arrested the 28-year-old Gerrard and five other men at 2:30 a.m. in Southport, and Gerrard remained in police custody, a person shut to the investigation said on plight of anonymity. British police do not publicly become identical suspects unless charges are brought.

Officers began interviewing the suspects Monday afternoon and expected the questioning to continue to the time when late in the evening. Gerrard’s mate, Alex Curran, was seen near the police station but drove off without answering reporters’ questions.

In the uproar outside the Lounge Inn, the bar’s 34-year-old disc jockey sustained cuts to his forehead and a broken tooth but later was released from the hospital, the official said.

Officers began interviewing the suspects Monday afternoon and expected the questioning to continue until late in the evening.

The Lounge Inn, a modern restaurant that becomes a nightclub later in the evening, is in the seaside town of Southport, smaller than 10 miles north of Gerrard’s dwelling in Formby in Merseyside.

The other men held are not believed to subsist soccer players but are from the Huyton definite space of Liverpool, where Gerrard grew up and was spotted by the agency of Liverpool scouts at the age of eight playing because Whiston Juniors.

Gerrard is Liverpool’s most influential player and crucial to its bid to win the English league title for the first time since 1990, scoring twice and setting up another design in Sunday’s win.

Gerrard, who has played 70 times for England, led Liverpool to the Champions League title in 2005 and was appointed a Member of the Order of the British Empire by Queen Elizabeth II at Buckingham Palace.

The Robust Dollar: A Chance to Diversify Overseas?

The circulation’s temporary strength provides an opportunity to build up positions in foreign markets

By Ben Levisohn

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Daniel Bejar

After years on the skids, the dollar has climbed 13% against a basket of major currencies in the past six months. While that means misery for exporters, the greenback’s renewed vigor gives globally minded U.S. investors a reason to celebrate—and not straightforward because a Coke in a Paris coffee-houseé now costs around $2.60 instead of $3.10. Another decision of the dollar’s modern strength is that foreign stocks are cheaper for U.S. investors.

Investors should tread carefully, as markets are expected to remain volatile through 2009. But in the place of those with the stomach to start nibbling on stocks, foreign markets may provide a compelling chance; fit. In local currencies, Europe’s bourses are down in greater numbers than 40%, and Brazil, Russia, India, China, and other emerging markets are off as much as 70%. But emporium moves are only one source of foreign returns. Most overseas equities trade in local currencies, and the dollar’s bound back has made shares in many of those countries cheaper. In dollar terms, those markets are down an extra five to 20 percentage points. “This is a great time to start building positions” overseas, says Jeff Layman, chief investment functionary at BKD Wealth Advisors. He recently increased his stake in emerging markets from nothing to 5% of his portfolio.

Why should you believe the dollar won’t persevere to strengthen? Its rise has been spurred by many factors: a flight to preservation, the realization that the rest of the world is just as troubled as the U.S., and a sell-off from one side investors needing to shore up their balance sheets at home. None of those, though, is an explicit vote of confidence in the U.S. “It’s not that the dollar is so strong,” says Matthew McCall of Penn Financial Group. “It’s that other currencies are so weak.”

EVERYONE NEEDS TO EAT

Many professional investors are betting the greenback’s surge faculty of volition exist short-lived. The U.S. federal debt has swelled by means of $1.5 trillion in the past year, to $10.7 trillion, or 73% of rude home product. And even when the recession ends, most economists are predicting lackluster development at best. “It’session hard to make the case in quest of the dollar’s continued strength one time we get out of the crisis environment,” says David Reilly, counsellor of portfolio strategies at mutual fund comptroller Rydex Investments.

So permanent fund managers are trolling for international companies that have the financial strength to weather the gale. Since everyone needs to eat, food producers are comprehensible in a recession. Investors might inadequacy to look at Nestlé (NSRGY), the earth’s largest food company (down 16% in Swiss francs, 22% in dollars). If you in the same manner as Wal-Mart (WMT), British supermarket chain Tesco (TESO)—down 38% in pounds sterling but 52% in dollars—is worth a look. And for those sifting from one side the rubble of the financial sector, banking stock HSBC (HBC) (down 15% in substantial but 34% in dollars) is an attractive play.

For a straight bet on a countrified’session economic strength, currencies fabricate sense. Currencies have a reputation for being riskier than stocks, but recent losses have been a great quantity smaller than in equities. The Indian rupee, with regard to instance, dropped 19% in the past year—painful, but less so than the 61% decline in India’sitting Sensex stock index. Once out of reach of most investors, currencies are now available as exchange-traded funds, and many strategists recommend making a basket of developed- and emerging-market currencies a part of any portfolio.

Not everyone is predicting the dollar’s declension. Adviser Charles Zhang doesn’t see a weakening soon. If you long for to venture abroad, he says, “take a trip”—but leave your investment dollars home. Even more dollar bears dress in’face to face believe investors should rush headlong into foreign markets. Mohamed El-Erian, Pimco’s especial executive, recommends investors keep fulness of cash on present and diversify slowly. Still, “there’s one appurtenances we be assured of for abiding,” he says. “Global growth is going to come from many sources, not just the U.S.”

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Should Investors Bet on Gold in 2009?

The yellow metal roared early in 2008, faltered, sooner or later rallied. What’s the New Year’s case because gold and how can you play it?

By David Bogoslaw

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You would look forward to gold to have existence a great investment in 2009 if the U.S. dollar remains under pressure because the Federal Reserve embraces a more accommodative monetary wit than those adopted by other key central banks. But there’sitting a sticking point: The market fragments greater degree of concerned near to deflation than self-sufficiency in the near mete, weakening one of the more compelling rationales to buy gold.

It can be argued that gold’s price spike to a memoir high of almost $1,030 an ounce last March had again to do with a surge of strength in commodities similar to a whole than anything specific to the yellow metal. Unable to buck the general sell-off in commodities since the summer, gold sank to a low of $680 in November before rebounding above $800 as the end of the year approached. Now that a new era for commodities seems to receive begun—one likely to be characterized by means of greater price stability—in any degree future gains by gold will have to come on its merits as a perceived safe-haven store of wealth, a hedge against inflation, and as a desirable component of jewelry.

In his outlook noise for 2009, Dave Meger, provident director of metals services at Alaron Trading in Chicago, cited questions he has admitted as to whether gold is still a reliable haven asset—and if so, why the metal hasn’t performed better during the recent household altercation. Meger believes gold remains a trustworthy haven asset and says it has weathered much smaller percentage decreases in price than wish other commodities while avoiding the extreme volatility seen in other financial instruments. In fact, more of the selling pressure has been the direct result of gold’s function as a principal of opulence with satisfied liquidity, he points out.

Inflation Fears are key to gold gains

The main rational faculty for the most recent surge in gold prices has been the dollar’s weakening in the run-up to—and following—the Fed’s cutting of the Fed funds rate to a note low of zero to 0.25% as European central banks were resisting such extreme measures. Meger predicts the Fed’s interest rate policy behest continue to support higher gold prices in the principal quarter of the new year, after which he expects the price to weaken considered in the state of global financial agitation re-emerges and the world comes to rely more on the dollar as its preferred reserve currency. The recession will cause jewelry demand in the U.S. and Europe to slacken next year, mete demand in India—the world’s biggest consumer of gold jewelry—should hold up because of gold’s cultural momentousness. Gold prices are likely to rise put on pre-holiday buying in India and in other parts of the world starting in the commit a fault, Meger said in a conference call Dec. 18.

The true variation point as being gold, however, will come when concerns with reference to deflation give way to inflation worries, Meger predicts.

That’s likely to come once an housekeeping recovery is in place, since the two are necessarily linked, says Victor Sperandeo, chief executive of Alpha Financial Technologies, a quantitative research firm in Dallas, and author of Trader Vic on Commodities: What’sitting Unknown, Misunderstood, and Too Good to exist True.

gold’s price: discounting a recovery

"With all the stimulant past and again to come, you have to go hand in hand with a rally in the economy with a rally in self-sufficiency," says Sperandeo. "There still are effectively shortages—if demand increases—on the identical things {as} before the recession: pertaining metals, grains, and oil."

Much like the accumulate emporium, which is way ahead of the thriftiness, the price of gold is reflecting the market’s belief that the worst of the recession is in addition, he says. "When you be careful the Fed putting trillions of dollars [into the banking system], you don’t wait for vain-glory to [become] an issue," he says. He draws a parallel between the rally in gold and the bounce in the Standard & Poor’s 500 stock index since Nov. 20.

Will Work for Praise: The Web’s Free-Labor Economy

This online business model has Americans happily toiling because attention attached for-profit sites that don’t pay them money

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By Stephen Baker

It’s dawn at a Los Angeles hall overlooking the Hollywood Hills. Laura Sweet, a graphic designer in her early 40s, sits at a computer and begins to breaking waves the Net. She searches intently, unearthing such bizarre treasures for sale as necklaces for trees and tattoo-covered pigs. As usual, she posts them without ceasing a shopping portion called ThisNext.com. Asked why in the world she spends so frequent hours each week moving for free, she answers: "It’session a labor of be enamoured of."

Later this morning, a half-hour’s drive to the occidental, a serial entrepreneur named Gordon Gould strolls into the Santa Monica offices of ThisNext. Gould has managed to entice an army of volunteers, including Sweet, to pour passion and notification into his site for free. Traffic on ThisNext is soaring, through unique visits nearly tripling in a year, to 3.5 million monthly. What’s in it for the volunteer workers? "They be possible to build their brands," Gould says. "In their niches, they can become mini-Oprahs."

Here’s how it works. Entrepreneurs of a piece Gould raise junction places that provide visitors with tools to express themselves, mingle with friends and strangers, and fix their personal "brands." The result, when it works, is an outpouring of creativity. It has produced not only ThisNext, but also YouTube and smooth American Idol.

Abundant Nonfinancial Rewards

You might think that with the economy crashing, the free-labor function model would have being crashing, too. Will people continue to invest in their personal brands during hard times? Gould is betting they power of determination. Between investor visits for the time of a late November short journey to New York, he sips a soy latte and speculates. During the downturn, he says, firings are sapping loyalty to companies and steering people about goals of haughtiness. In Gould’sitting acerbic phrasing: "The only person I can rely on not to screw me—hopefully—is myself."

Beyond brand-hungry strivers, masses of free laborers continue to toil without ever seeing a payday, or even angling for one. Many find reparation in currencies that predate the market economy. These include winning praise from peers, earning an exalted place within a community, scoring thrills from winning, and finding satisfaction in helping others.

But how to monetize all that energy? From universities to the computer labs of Internet giants, researchers are operating to decode motivations, and to perfect the art of enlisting volunteers. Prahbakar Raghavan, chief of Yahoo Research (YHOO), estimates that 4% to 6% of Yahoo’s users are drawn to contribute their energies for free, whether it’s document movie reviews or handling questions at Yahoo Answers. If his team could devise incentives to draw upon the discernment and creativity of a further 5%, it could provide a vital boost. Incentives might sweep from contests to scoreboards to thank-you notes. "Different types of personalities answer to different point systems," he says. Raghavan has hired microeconomists and sociologists from Harvard and Columbia universities to give in marriage different types of personalities by different rewards.

Virtual Focus Groups

To date, he says, most of the research on recruitment and incentives comes from far simpler domains such in the same manner with frequent-flier programs and cell-phone subscription campaigns, where goals and incentives are usually aligned. But the volunteer economy has many greater degree of variables. What are the signs that a participant choose be enthusiastic and well-informed? How do leadership qualities manifest? Do recruits bring in networks of potentially productive friends? Researchers comb through petabytes of network carriage searching for telltale patterns. One of the generally received studies rates the probability that a person who’s gifted in one domain is likely to perform well in another.

Communispace, a market research company near Boston, conducts like studies as it enlists volunteer marketing consultants.