Theory is great!!

Dear CEOs and Founders,

Thought

I know most of you do not like theories or theorists but allow me to shed some light on some pressing issues. Further discussion of these issues is essential so please participate and engage.

In any great organization, top management is usually made up of theorists and visionaries while middle and bottom management are packed with practitioners.

Set the case

In the Middle East generally, all levels of management are only practitioners. Therefore, the overarching attitude is short-sighted and limited to the scope of day-to-day deliverables.

What comes first: the the concept and theory behind the idea or the product? What comes first: the idea of the business and theory behind the business idea or the manufacturing plant and office building?

These are pressing questions but often left unanswered. Let me be the first to answer.

First, you need the idea, theory, and rational and well-strategized plan before you place a brick in your plant or buy an office building. Second, you need to look at the human capital and culture that will affect everyone, top to bottom.

So long you parachute to the bottom-line and skip all the necessary steps, your business will be focused on short term results, which is the status quo of business in the Middle East.

Before you exhaust your budget on the supply side of the business, you need to determine the demand first and how you will plan to allow your values penetrate on the short-, mid- and long- term.

Remember, Rome was not built overnight and certainly not even the most basic idea.

Rational thinking!

All biblical’s are theories sent from god and we practice everyday, what makes your business any different?  You lack Confidence  and belief, so how do you expect to succeed?

Uber and Careem! Brand or Commodity?

 

When it comes to hiring a chauffeur driven car, Uber, is an app that is globally known. However, when looking at the success regionally, Careem is also another app that makes the list.

Uber led to many passenger transportation apps popping in different parts of the world today and helped the industry make billions as a result. It operates in 65 countries under passenger transportation and has an array of payment options.

In recent years, the Middle East witnessed the need for such apps in order to have better services and avoid the hectic cab rides.

Two brands that come to mind are Uber, a San Francisco based company and Careem, a Dubai based company. Both brands share similar values but Careem still holds the unique value over Uber by giving the option of “book later” and leading the region with cash option payment.

Uber’s first regional destination was Riyadh, Saudi Arabia then it gradually expanded throughout the region. Careem, in recent years, has expanded to most of the region but not all of it.

My goal, in this article, is to focus on as a brand what their brand message to their audience is and which company is more intact when it comes to the commodity of transportation. I fully understand when a brand chases quick expansion it intends to lose its focus.

So for the past two months, I used both brands aggressively to experience all the brand touch points. So let’s look at each of the brands.

You can clearly see from the name and the few of the brand touch points, Careem as a brand is positioned as your local app. Given that positioning, the core question always was “who is Careem?” The simple answer is a regional transportation app, which is generic. If the app takes you from one point to another then it’s a commodity. You can’t hold the company responsible if the management treats the brand as a commodity. Question is and will remain, what idea as a brand are they trying to sell to the public? A transport app? Well so is Uber and others.

During each of the experience, you’ll notice Careem calls their drivers “captain” while Uber calls them “chauffeur”. So which of the two holds premium? Clearly Uber. When you travel to a congested city like Cairo, the two offer a totally different experience as they speak to completely different audiences. Careem caters more to the middle and lower class while Uber is targeting a higher class. The Careem app is user friendly. However, you are in for a few surprises once you have placed the order and their brand promise becomes a reality.

Careem has GPS issues – it has an accuracy problem. Drivers either end up on the wrong side of the road or a block away. Second, because proximity is not added, like it is in Uber, you end up waiting longer for the driver to arrive. What I mean by proximity is that Uber is closer from your point of pickup and is available in less time.

Before I start with Uber let me finish Careem. Firstly, for the life of me, I just can’t figure out what Careem’s brand essence or promise is? I feel the brand was developed as an app and went only through a design experience.

Today, customers can’t expect so much from Careem other than the most shared value “convenient”. You order a car and the car shows up. Other services including the recent launched “go”, propose more value but remember many of Careem’s values are originally owned by Uber. During my different visits to Cairo, Riyadh and Jeddah, my experience with Careem changed. When Careem first launched, it made every effort to retain customers, different types of drivers and cars. Today Careem doesn’t cares as much, I guess. To test the brand experience, when I was recently in Riyadh, I ordered Careem and at the same time I ordered Uber. The Careem driver failed to find my location which was the Al Faisalia hotel. It took him almost an hour from the time I ordered. The Uber driver showed up in twenty minutes due to rush hour. While I was heading to my meeting in Uber, I called the Careem driver and the customer service to locate the driver. Both failed to respond so I finally cancelled the order.

What is Careem’s brand promise? What’s its brand essence? We understand that Careem was good in positioning itself as the regional brand but sorry that’s not good enough to deliver what customers expect. Customers are paying for the entire experience of the brand. Sometimes, I feel the brand Careem we knew became a commodity. The amount of price discount they give away is crazy. The text messages they send for discounts is not any different from Al Ahram in Jeddah that sells low priced clothing. I never received an email from Careem like I do from Uber which focuses on experiencing the city you are travelling to. So is Careem a brand?! I need to get my brand facts book out to be convinced.

On the other hand, Uber lives as your private chauffeur. A promise they made and delivered in so many ways. Now let’s get the record straight here, I don’t favor any. In fact, when Careem first launched, I was an advocate of theirs but you can’t be an advocate to something that has ignored the core of their experience. Uber is expanding to 65 countries and the experience in each of the country differs due to local laws and so forth. For example, Uber in Germany has to operate under a licensed cab company but not in Austria. But, for the most of it, Uber still manages to keep its promise. Even though, Careem’s app is much more user friendly, Uber’s app is still friendly. During the time of order, their driver’s proximity is much closer than the Careem drivers and GPS is much more accurate. Recently Uber realized they are more than just passenger transportation and evolved their brand. Today, Uber is hire a driver, helicopter, order food and courier. Don’t be surprised at what’s next.

Since the company is evolving so fast they need a core essence that will hold everything together. Something that says who they’ve become. Today, in simple term Uber is “logistics”. You can hire a car, they will arrange it. You can hire a helicopter, they’ll arrange it. You can order food, they’ll arrange it. You can send a parcel, they will arrange it. They simplified logistics to one single app which is just a click away. The brand has evolved and so did their marketing mix. Their positioning is reflected in their new look and feel. You will notice the key word “availability” and their promise is “reliable at all times”. The rationale behind Uber’s new brand idea is to bring together two things that were in separate worlds for over seventy years. And they are doing this by bringing them together as the “Bits” and the “Atoms”. The bits for Uber is the technology and its ability to express its efficiency, ability and power. The “Atoms” is responsible for how technology moves cities and their citizens, and the goods that are transported everyday. The brand tells its story from its inception of the famous tweet to its recent evolution of serving its new created purpose. We all can agree that Uber has disrupted the transportation industry across the 65 countries and 400 cities but we can never disagree that Uber is one of the most talked brand in this era.

Uber and Careem are two different brands. While one is massively evolving and other is catching up. Uber provides the experience and Careem is turning into a commodity.

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

Hello Al Baik, what went wrong?

From fresh fried chicken to automated fried chicken, the world of fast food and Quick Service Restaurants (QSR) are moving in the opposite direction of the mass movement on health across the globe. Recently brands like McDonald’s, the fast food giant who specializes in fried burgers, decided to evolve in a way that addresses today’s concern on junk food

With the current context on junk food that serves audience flavored taste in little time, the subject has become irrelevant when it comes to time and the focus is now on health

Al Baik, is a well-known fast food chain in Saudi Arabia that primarily sells deep fried Broast Chicken. The brand holds great sentiment to nationals and expats that live or have lived in the country. Many see Al Baik as a national icon, with part of the brand signals conveying a Saudi impression globally. The founders are very people oriented and work with humbleness, integrity and consciousness. Al Baik, as a brand throughout the years has appeared and been experienced as being humble, caring and charitable. It has touched many people’s lives through its community work and activities

So the billion dollar question becomes, does Al Baik sell chicken? No! Al Baik sells more than chicken. Through its sales it’s helping improve the communities and spreading goodwill throughout the land. If the battle was only focused on chicken then KFC and others options are available too. Al Baik, as a brand sells more than just a product. Keeping in mind the fact, the product fundamentals are of great quality and secret recipe which further resonates with the audience

Because Al Baik is a conscious and honest brand, when you visit their stores, meet their team or come close to anything that has their name, no one questions its integrity. Since the seventies, it demonstrated consciousness and transparency by showing how food is being prepared and served, something that other fast food chains like Five Guys are doing today

What went wrong today? Al Baik decided to evolve from the fresh home look and feel, something that has greatly resonated with the locals and people of all income, to what McDonald, Pizza Hut, Burger King and others looked and felt like for years

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Recently opened branch of Al Baik at King Abdul Aziz International Airport (KAIA), Jeddah, Saudi Arabia  

Am I questioning Al Baik’s recent brand evolution that’s displayed, as pilot, in KAIA? Yes indeed! As much as I love Al Baik, the brand’s legacy and how I call it our “own”, anything and everything is wrong with this brand evolution. Perhaps there was a design strategy but I strongly doubt there was a brand strategy. Al Baik’s new look and feel has thrown out what has worked and resonated with millions for years, which was the core essence of it. Who Al Baik is, in the old look and feel could be easily answered but when you look at it today, you start questioning it. It is a junk food joint? Is that the reference Al Baik wishes to bench on? I doubt it

The old identity is widely used, by many restaurants which have no link with the original, in many parts of Asia and North Africa like Egypt and Malaysia, so Al Baik decided to battle this threat by evolving. Perfect! But if you are the original source, how far do you evolve? Why throw away something you own as equity? Why give up all the brand signals you’ve created that resonates with the brand from far and close?

I think logic should prevail, it’s either that brand strategy is poorly understood in our region or that these business owners and shareholders have started to care less about their brands. In less than 2 years, Al Nahdi, Kick by Rabea, Cofique, STC, Fly Nas have become case examples of brand mistakes. Something is very wrong here. These are very costly and detrimental to any business

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

Brand Strategy vs Absolutely No Clue

Background:
A few years ago, João and I had a debate on “How art as a design is more relevant than the strategy”, at the Chamber of Commerce, in Riyadh. The audience had ambivalent feelings, some agreeing with it while others disagreeing. João and I always had our differences. I never seem to agree on his field of advertising while he never agrees on my field of strategy

I’m a hard believer that advertising has failed or the advertising we knew has failed to evolve because of its continuation of false claims. I asked João to write an open letter with his views on Brand Strategy. Even though, I do not fully agree with what he has to say, I would like to, nevertheless, share his thoughts which are as follows:

The Rise and HARD fall of the Brand Strategist
by João Almeida

The trendy – short lived – age of the Brand strategist is coming to an end. Faster than you can say ‘Brand Evangelist’. Traditional advertising is already dead, an outcome welcomed and brought forward by many Brand experts. But little did they know, the death of the ‘Mad Men’ also meant the death of the ‘Strategy Men’

So you may ask who’s going to replace all those wonderful ‘what-people-think-and-how-to-make customers-feel-the-brand’ experts? The answer: Mathematics, Statistics and AI software

In a not so far away future, software algorithms will be able to personalize ads not for the 1%, but for the .0001% of consumers. This means strategy for the ‘long term’ will be redundant. Decisions will be made in a millisecond. Content, stories and ads will be delivered to you (and you specifically) without the need of human planning or strategic input. Facebook is already doing this to some extent. It’s still in its beginning stage, but imagine a brand story being told differently to a vast audience. Imagine that an ad seen by you will only also be seen by 50 other people (who share your statistical history). That’s 50 out of almost 2 billion FB users! That’s a strategy no human mind can beat

So who’s left? The content creators and the storytellers will survive the Brandpocalypse. Everyone else needs to start re-branding

Here are my thoughts:

The Fall Of Advertising and Design (Art) without The Essence of Strategy
by Said Baaghil

Let’s be serious, whatever we do as strategists and advertisers is for the purpose of the brand which is the business. Things need to be have a logical business model for any brand to work. As a strategist, on brand and marketing and even branding, the first and foremost thing we need to think of is the business model and then align the rest according to that model. The thought of a beautiful logo and art is irrelevant to support any business sense, João said. In fact, he claimed, it’s irrational and may produce high a level of business threats. Also the death of human expertise and the drive of technology as the core thinker to support the business line is crazy!!!

João debates, in a not so far away future, software algorithms will be able to personalize ads not for the 1%, but for the .0001% of consumers. The first question is would a software be continually able to understand the human senses? No matter how things evolve, human to human will remain the best practice for brands to thrive. Brands are like humans,they live and die so they continually need to evolve to sustain growth

When you look at McDonald’s and compare it to Five Guys and the health movement that’s revolutionizing the industry, what impression would it give to you if everything is automated including the communication? We are speaking here of the customer senses. Even if technology massively evolved in the communication platform, you still need a human brand strategist to deal with the evolving needs of people

No matter what happens to our world as technology changes, brands are like humans. They grow and die, unless they evolve. This is why they need to have the human experience for it to be logical and make sense to the customers

João Almeida is a Creative Professional with over 15 years experience in leading multi-disciplinary, multi-national teams both in Europe and the Middle East that have helped in developing successful Brands and Business Strategies across different industries

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

Uber: The New Identity

Uniting the “Bits” and “Atoms” for the first time, the bits is the refined “technology” and atoms is everything around us “objects”. Uber’s rationale behind the new identity is unifying the two for the first time, the technology and the atoms. The technology is used as process and the atoms is the object that moves from one point to other. If we look at the business strategy of Uber which evolved from passenger transportation to logistics and transportation, the new “Uber” brand core perfectly says who they’ve become

I’m a strategist not a design expert, many designer could disagree on the use of font, color palette and so on and that’s not my argument here but from a brand strategy point Uber successful reflected their evolution and their new rationale perfectly reflects their evolved business strategy

On the other hand many argued why Uber will ditch the slick stylish logo the most recognized in today’s app world, I agree but the more the brand delivers values the higher chance the symbol becomes recognized. Google’s identity looks like grade school kids drawing but since the company delivers constant values you can’t help but constantly recognize their identity

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

Sustainable Brands and Universities

Just like other organizations in other industries, institutions of higher learning need to compete in order to survive. But because of the fear of sounding too corporate, universities often hesitant to borrow proven methods from business, or are late to the game. Branding is a case in point. At the turn of the century, universities started to dip their toes in the branding waters. Many of the early approaches focused on creating new taglines, changing logos and spending a great deal of money on advertising. Those attempts reinforced the skepticism that many stakeholders had about branding, especially the faculties.

Today universities realize that in order address affordability, competition, innovation, equality, employability, divestment, funding and other issues that challenge their image and future, universities need to embrace an approach based on mission and core values. They need to adopt an approach that focuses on culture and stakeholders. They need to stand for something. They need to be authentic. This approach aligns the internal culture and external reputation of the university, and ensures sustainability.

It’s vitally important that universities in the Middle East and specifically in GCC understand the value of owning a brand and how the brand reflects the institution, students and recruitment processes. Today there are many great local universities in Saudi Arabia such as Effat, Dar Al Hekma and King Saud. They are all considered reputable, but even reputable universities need to connect their missions and their core values to their stakeholders.

Rex Whisman is the Founder and Chief Strategist at BrandED Consultants Group that guides organizations/institutions beyond logos, taglines and Advertising campaigns. In the last 25 years, he has held many senior-level positions in Branding, Communications, Engagement and Marketing, on both the institution and consultant sides

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

 

 

Looming Financial Crisis, Brands and Commodities

I don’t see the Financial Markets settling soon. Global Financial Markets will stay volatile till 2020, possibly beyond. It’s like a FINANCIAL BAZOOKA, like a train coming straight at you and you are not going to stop it by standing in its way. I see more financial bloodbath and rocky times ahead for many countries & their markets. Simple investors will have sleepless nights and smart investors will have peace of mind with their funds. But the question is where to park your funds when markets are so uncertain and unpredictable?

The Answer: Follow the basic rule of LIFE and invest in REAL ASSETS for Wealth Preservation. The global economy stands at a crossroad of growth and decline and few financial markets might even collapse. If we analyze economic history, we see that there is a recession in the global economy after every 7/8 years. So it’s long overdue now and which is why 2016 has started on a rocky note as markets went down in China, Europe, US and Asia. Financial markets look too choppy at the moment. According to Sam Zell—American Business magnate and Real Estate mogul:

US economy is knocking at the doors of deep recession in the next 7 to 11 months. Global economy is witnessing a bigger crisis which will last longer and perhaps will be more severe than the 1930s… History is repeating after 83 years and many investors are not aware of the gravity of the situation

So what’s a MARKETERS ROLE IN TOUGH TIMES? Consumers are very sensitive to Brands. FMCGs are much stable even in hard times when the economy hits rock bottom but the same doesn’t apply to Retail especially for Auto and Luxury markets as these two sectors suffer the most. The question that Economists frequently ask: Can Brands sustain themselves in times of hardship when companies cut their Marketing budgets?

The answer is simple; Brands can live long if they are real Brands (and not commodities) because of their relevance for and being the preference of their target segment. In a volatile Economy, Brands who share the same Category Values suffer the most because consumers end up making decisions based on Price. In these times, Marketers who depend on huge budgets suffer the most because they depend on Advertising as a means of influencing Consumer decisions unlike Brands which are grown organically and are sustainable in a recession economy simply because their consumers’ habits and reactions depend least on communications or any tools that influence their call to action. In tough times, Brands survive and thrive over commodities, for example: McDonald’s globally and Saudi Brands such as Al Baik and Al Marai will still perform well, like previous times

It is only in uncertain times that Marketers can innovate and come up with strategies to move ahead and support the companies’ reservation on spending

Shan Saeed is Chief Economist at IQI Holdings whose expert views have been aired on CNBC, Bloomberg and Al Jazeera English. He advises clients in the Middle East and South East Asia

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, an author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renowned Brand Consultancy firm Siegel+Gale on Branding in the Middle East

Case Study: Huge Marketing budget doesn’t mean Sales!!!

Generally, most Middle Eastern FMCG and Retail brands spend enormous amount of money on communications each year to sustain survival or grow by a small fraction. Most of these Brands hardly double their digits over the years; some claim that they’ve doubled their sales, HOW? You need to grow in channels to double your sales but it’s merely impossible to double your sales from the previous two years without Channel Reach. We witness price increase every few years and that should not be the comparing yardstick with previous years. Only by Innovating values to address different segments of the Market, over extending SKUs, can add to growth

Now most marketers base their decision on Market Research, hardly any that I’ve met or known is thinking outside the box to move away from the long repetitive patterns that we all witnessed throughout the past generations. For example, what Nescafe started as a trend is followed by many local Brands, what Pampers started as a trend is followed by many to this day

The look and feel of Brands are relatively the same across the board and since most professional marketers in the region are graduates of the two multinational schools i.e. P&G and Unilever, they intend to follow the same pattern of their respective experience at local level, even the practice remains the same. Now, we understand at the local level that the scope is different as it requires all sort of development unlike the previous experience on both Brand and Marketing strategy as well as Tactics

Most of the local Brands hardly own any Brand strategy; they carry two types of strategies:  ‘Design’ and ‘Communication’ (both are extremely evident on their Brands). Now, most require a massive Communication budget in order to maintain the current level of sales or increase by few percentages each year, why? In most cases if you don’t own a relevant Brand or Marketing Strategy, you’ll depend on Advertising to push your message forward, for example: Management and Advertising agencies are aware of Rabea’s new Positioning and Promise but is the public aware? Did Rabea educate the public on their recent evolution? Not from what I saw but apparently this seems to be the current logic which is commodities over Brands

If we look deeper, into the local FMCG Brands, their 2 major problems are their ‘Brand Strategy’ and ‘Marketing Mix’ that’s resulting in a small fraction in growth which is between 5-10% because most are missing the point that Brands are about Values and not Market Research Data that dictates what they should do next. For instance, if we take Cofique and Rabea as local brands from FMCG sector, hardly their audience can understand their Market Positioning, Brand Promise or even the single idea they’re trying to sell, they are relatively offering the same values of their Direct Competitors who are also the category owners, Nescafe and Lipton respectively

If you take Al Nahdi as a Retail Brand, hardly their audience is connected with their Repositioning, though their goal is to move from Pharmacy to Lifestyle (to grab Market share from Faces, Paris Gallery etc.), that’s a Category Shift in which the Brand must resonate before the Marketing Mix. Today after 3 years, customers still think of Al Nahdi as a Pharmacy same as before (with only a face lift and addition of more product categories). The incredible amount  Al Nahdi spent on communication at the launch with the message ‘Hope’ addressed a particular value, NOT all of values that Al Nahdi  had planned to offer. It had a message but lacked the Brand strategy that could’ve helped the evolution. If one plans to apply the Boots model, then you need to apply the model across the board. I must say that they’ve done an incredible work if compared with their past

There are reasons why would we use massive Communications budgets, there are reasons why we need them and how will they support our overall goals. If the single goal is to help deliver your tactical strategies (promotions) then fine because it’s relevant to be in store (customer experience).  There are fundamental issues here, so what will a huge communication budget do? Rabea for instance has over 40 SKUs, Cofique has a good number of SKUs for a Brand that launched 5 years ago, I mean the Brand never fully matured and the management already extended their SKUs. Cofique is offering Nescafe’s values and that’s very evident but management need to understand that to solve the problem is to offer different values as consumers find Nescafe relevant and preferred, not Cofique.  Cofique spent enormous amount of money on Marketing since its launch and yet for the past 5 years the brand suffered enormously. I predicted Cofique’s failure from the day they launched. I advised the management of their approach but they seemed to take things personally and they ignored my advice, the sad reality in our region is that no one likes to be corrected or be recipients of advice from subject matter experts

Let’s looks at sales of the following brands for 2015 and you, the readers, be the judge. This case study is based on 4 different Brands (3 FMCG & 1 Retail). The Brands are Rabea, Cofique, femi9 and Code Red (the energy drink)

  • Rabea tea is a heritage tea brand with over 60 years in the business, founded by a family with great legacy in the tea business. Today in 2015, Rabea’s annual sales stand at SR. 400 million ($ 107 million) with 40 SKUs more or less. Rabea’s annual sales 5 years ago were approximately SR. 300 Million, an additional hundred million increase since five years is partially due to Price increase. Rabea annual marketing budget is relatively good amount of money that goes across all activities. Here’s the breakdown:
    • Rabea Sales 2015: SR. 400 million
      • Loose Tea: SR. 150 million
      • Tea bags: SR. 150 million
      • Other SKUs: SR. 100 million

Loose Tea is losing sales because of Tea bags as they are considered more trendy and convenient by younger generation

Tea as a category is losing 2% to Coffee because the latter is becoming more favored by the younger generation due to its variety of tastes (Mocha, Espresso, Cappuccino etc.) plus it’s also considered as a trendy drink due to growth in café culture that is adding to this perception. Rabea should own the tea category but that’s not the reality today. 5 years ago with a SR. 30 million budget, Rabea was growing 5% and bottom line 10%, on average. Today, Rabea has aggressively evolved the proposition and introduced different SKUs like long leaf in Tea bags, yet sales are not very high compared with past levels

  • Cofique is a local coffee brand which since its launch has went through aggressive Brand visit exercise for the past 5 years and yet suffers to connect with the audience till today, why? Well the sales values that are owned by Nescafe. Their total annual Sales are almost 10 to 15 million with over 20 SKUs. Sounds crazy, doesn’t it? Well they’ve spent enormous amount of money since launch and one will expect that in their 5th year they’ve reached maturity in their sales. In 2010, I had the honor of meeting the head of Marketing and I advised him NOT to go ahead with his plans but he felt offended, took things personal and decided to go ahead anyway. A free advice could have saved a lot trouble. They should’ve launched a subcategory than go head to head with the category owner
  • Code Red is a local energy drink focused mainly on Marketing Mix and a defined audience. Their total sales in 2015 have been SR. 350 million from one single SKU, Code Red spent around SR. 100,000 on Advertising in the past 10 years, they don’t own a website, nor they are active on Social Media. In fact all the videos and social media pages are created by their ‘loyal customers’, Code Red offered a unique set of values to their audience. Many might argue and say, Code Red is not in modern trade, therefore not much Marketing budget is required but the reality is that Code Red had a clear Marketing strategy addressing the entire Mix. It focused on a target audience more relevant to Code Red i.e. which doesn’t shop for energy drinks in modern trade

    Branding and Marketing is all about relevance which is why today Code Red is a Brand!

  • Femi9 is a Saudi fashion retail outlet focused on women casual wear that started from a humble beginning with two stores in Riyadh. The owner is a visionary and ambitious, today Femi9 operates in most of GCC, North Africa and Switzerland with total approx. sales of SR. 200 million. The Brand spent less than SR. 10 million on advertising in the last 15 years. Its growth continues to this day

So I beg to ask, what would a huge Communications budget achieve? Great results? No! Can any of the Marketers work without a Communications budget? Well, a brilliant Brand and Marketing strategy would achieve enormous growth. Code Red and Femi9, both local Brands, are able to continuously grow with minimal Marketing budget and yet both Brands have their loyal customers that advocate for them. Today out of one SKU Code Red earns 75% of what Rabea earns with over 40 SKUs, you would expect Rabea to sell more given the fact that they spend more on Marketing. Cofique which also spends a lot on its Marketing but with such sales, it needs to re-visit their proposed values and the Brand itself  

Some might discount this case study because I consulted both Femi9 and Code Red in the past which is why I favor them but that’s not true. I intend to speak on huge Communications spendings that should equal results i.e. SALES, therefore logic must prevail for businesses to grow. A brilliant Brand and Marketing strategy is more than enough to create short and long term growth which is why Brands are supposed to be sustainable unlike commodities. Create Your Space and evolve from the old school of Marketing

*All figures obtained from Euromonitor, Nielsen and other sources

 

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renown Brand Consultancy firm Siegel+Gale on Branding in the Middle East

He can be reached on AskBaaghil.com

The article was first published on Linkedin Pulse on 13th January, 2016

Category, Brand & Unique Values

Always, Category leaders face those that replicate their values on the same propositions. As they say: one success story copied by many BUT always the biggest part of the story is that which one sustains continues growth. On many case studies of existing Brands we’ve seen values evolve to maintain continued growth and those values eventually are replicated by the second and third leading ones within the Category. One of the strongest values is Price but again that’s defined on which segment you’re addressing. In case of candy bars such as Mars, Snickers etc., it’s irrelevant to address a specific target audience as they’re for all demographics that wish to consume frequently or occasionally whereas with respect to timings of consumption, the segment differs on the basis of psychographics i.e. the older segment of the audience is less motivated to consume frequently and to consumer on particular kind of day while the younger audience has no preference when it comes to timing at all. Brands with a single unique set of values and those with more than one, matter but few that have ‘Signal Values’ can easily over shadow a Competitive Category. For example:

In the Saudi market, Al Baik addresses all audiences and not a specific one, is it because of Price? The values are much greater today as a Brand than just Price. Al Baik is not a Commodity; Al Baik is purely a Brand with clear Core Values. If we look at the Fried Chicken category in which Al Baik operates, it is the undisputed owner and champion of the category and many have tried to copy and sell the same values of Al Baik but the Brand is fundamentally deep rooted within the hearts and minds of the audience. To add more, Al Baik is one of the very few timeless Brands easily inherited through generations. Al Baik created its space and the only single way that it can lose that space is when they stop innovating their values or their current values start deteriorating

Countless times we’ve seen the no. 2 within a Category either upholding to Category leader’s Brand values or offers Price as a value. We’ve seen this example with many of the local/regional Brands as latter entrants to any of the FMCG categories. Price as single strong value can turn a Brand into a Commodity, just walk into any supermarket aisles and see the amount of tactical approach to push products off shelves. Brands are about values and great brands improve their values. Look at Apple in general or its iPhone, look at Google, Emirates, Visa, Mercedes-Benz and other great Brands; see the unique values these Brands hold and ask why their customers or users are willing to find them to be the most relevant/preferred. The value of owning a Mercedes-Benz is extremely different than the value of owning a Lexus, the value of owing Samsung is completely different than the value of owning an iPhone, the value of having a Starbucks coffee is different than the value of having Duncan Donuts coffee, the value of owning a Mac is much different than the value of owing a PC

Another great local examples is Rabea. In my previous article about the Brand, I touched a bit on the evolution of Rabea Tea to address the current generation. The management decided to evolve across most of their SKUs and introduce one more (SKU or Brand) named Kick. Let’s analyze the current situation:

149cf45Rabea evolved the entire value proposition but left the Brand as is. This might serve the short-term goal but in the long-term, Rabea would have to rely on the Brand and not commodity. Rabea looks at tactical approach and immediate returns over a long-term strategy that would evolve both the Brand and the (Marketing) Mix. The recent launch of Kick (SKU to management, Brand to consumers) is a sign of both evolution and the quest for immediate returns. Kick by Rabea tea is an extra caffeine tea that keeps you awake, the concept is brilliant but the core problem is that Kick tried to own strong Coffee values, namely:

  1. Caffeine
  2. Keeping You Awake

These two values are well-Branded with Coffee so how did Rabea Marketing planned to evolve these two values which are too strong to hold on to? That’s just mission impossible because it’s a war with an entire Coffee Category. Kick clearly lacked a fundamental Brand strategy; even the visual communication had functional attributes such as ‘Alarm clock’

Suggestions:

Kick by Rabea Tea is a brilliant idea but the trouble is that Tea is not inspiring it’s boring to most youth and that requires behavior change. Tea is much healthier than coffee, there are 190 or more type of teas Rabea needs to address within the Wellness segment which is one of the fast growing population, globally

Rabea needs to revisit their Brand strategy to align with their current proposition and align the essence of the Brand with the core values

I’m not attacking Rabea, l’m addressing where I see the mistake and am suggesting the way forward. Most in our region hate to be corrected; in fact they ride on what’s wrong that’s why we’re several decades behind in almost everything

Brands are about unique sets of values. Each of these values is a reference to the owned Category. Evolving values owned by a Category is an impossible task in Branding unless several supporting unique sets of values are associated
Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renown Brand Consultancy firm Siegel+Gale on Branding in the Middle East

He can be reached on AskBaaghil.com

The article was first published on Linkedin Pulse on 21st December, 2015

What comes first: Category or Brand?

Most confuse the process as they think that Brand comes before the Category. We’ve seen so many battles with this thought as most focus on the Brand than the Category while consumers think of the Category instead of Brand. Do you say I need to buy a new phone or an iPhone? Do you say I need to travel or I need Expedia or Thomas Cook? The strongest Brand will be the reference to a category. So what comes first: Brand or Category? Category comes first not the Brand. Whenever we say tissue we think of Kleenex, whenever when we think of information or search we think of Google, whenever we think of tablets we think of iPad and the story continues. Some of these Brands created their respective Categories and they’re the dominant players thereof

Let’s think how Brands can evolve a Category to own. The best example is Yahoo vs Google, Yahoo created the Search Engine, it was the reference before Google but Yahoo was everything not just search engine, the management decided to expand the portal and be the One-source Destination. Google came in with a new experience to search with great sets of values but Google (unlike its competitor) was focused on search and became relevant and preferred which is why today everyone says Google it, not search it. Yahoo Mail and hotmail faced the same scenario as that of search, Gmail came with new sets of values and took over which is why today Gmail is the largest Free Web based Email

Categories are created through Values, followed by Brand as a reference. Brands are ideas with sets of values as their core. If the Brand offers great sets of values as well as a very unique experience to consumers/users then the Brand is the reference to the Category

For example: in the US, the courier category within the shipping industry had many players till the mid-90s (Brands like DHL, Airborne Express, TNT and FedEx). When FedEx introduced the great value of delivering package overnight and before 10 am, it took over much of the local market making it the Category Reference. No one today says ship/courier the document in the US anymore; everyone says: FedEx It! Since then FedEx grew enormously and as a result DHL stopped serving the local US market while others like Airborne Express folded. FedEx evolved the category to own and they own it to this day

Today when we think of the category of smartphones, both iPhone and Samsung occupy our minds and not the operating systems iOS, Android or Windows. The Power of the Category serves the Brand in many ways as each of these Brands i.e. iPhone and Samsung; address two different target audiences. iPhone is more chic and appeals to intellectual and deep pocket users whereas Samsung appeals to Price sensitive users. So who owns the smartphone category? Both. Who owns the App category? Apple. Each Brand that owns a Category hardly spends money on Advertising e.g. Starbucks, The Body Shop and few others. Think of Kleenex, does Kleenex ever advertise? Does Starbucks ever advertise? Today Categories play a great role for those that create a Category or Sub-category. Yahoo created the Search Category, Google owns the Information Category, two different sets of values so what comes to mind first: Information or Search? Of course Search as its actionable followed by Information

Social Media had players like Friendster, My Space and others; today Social Media Category is dominated by facebook. It created new sets of values and therefore, is the first reference to the Category itself whereas Twitter, LinkedIn, YouTube etc. are Sub-Categories with each focused on its own purpose. Example: Youtube=Videos, Instagram=Pictures. The Social Media phenomenon comprises of two sets of environments and two different experiences i.e. Web and Apps. So focused Brands such as Instagram and Snapchat are creating great presence. Considering how dynamic technology is, everything could change overnight and different Categories and Sub-Categories will emerge

Things to consider:

  1. Think of the Category first and not the Brand
  2. Think of the Target Audience. Which segments you plan to address and concentrate more on Demographics and Psychographics
  3. Think of the Brand idea that’s relevant to your Audience (not to the Management)
  4. Plan both your short-term and long-term visions to own the Category or to create a Sub-Category
  5. Don’t battle within a Category that some other Brands own unless the Category is still maturing and your second or max third entrant in the market
  6. Research is a benchmark not a guideline to follow and most, unfortunately, fail to create but are clever to follow

If we look at the regional market, the biggest economy is Saudi Arabia. Most Category owners in the region are foreign Brands while very few are dominated by local Brands. This brings us the question: How rich is the region on Brand Knowledge and Experience? The obvious answer is that the region still works on Commodities while thinking of them as Brands. The region comes from strong trading mindset with short-term goals, completely opposite to its Western counterparts. Let me share both the prevailing Market logic and examples with reference to the regional behavior

  • Logic: The region is a trade market more familiar with tactical approach than strategy. The region aims for short-term gains over long-term ones which put pressure on the entire organization thereby resulting in continuous changes to its business model in order to acquire immediate sales. You can hardly build Brands on these termsThe organizational behavior within the region with most companies is more relevant to Commodity selling than selling the idea of the Brand which facilitates the users’ experience

    Let’s use one great local example:

    • Al Nahdi, the local Saudi Pharmacy chain, decided to evolve and move from the category of Pharmacy to Wellness Lifestyle. The company has done a remarkable job in restructuring and building great fundamentals to support the new evolution of the Brand from Pharmacy to Wellness Lifestyle Category. As much as I think that Al Nahdi did a great development within the Pharmacy Category by bringing a new meaning to the overall Pharmacy Experience in the Kingdom compared to others, at the same time I think Al Nahdi’s evolution from Pharmacy to Wellness Lifestyle will take a longer period to mature as an idea for Audience to embrace it as a way of everyday experience, Why? In the past three years the brand sold “Hope” and not the Brand idea that supports the evolution
      1. Al Nahdi’s approach on Brand is clear: To Reposition the Brand as Wellness Lifestyle which is a lifestyle that means to Stay Healthy and Look Great
      2. The Repositioning approach lacked both Brand Idea and Purpose. If the idea was to sell to the public “Hope” then how would that support the Repositioning of the Brand? Hope is more of a community initiative than a Brand Idea. So what’s the Idea or the Brand Purpose? I pondered on both for long and I can’t seem to nail them. We all know that Positioning controls the entire Marketing Mix but the Brand Essence needs to be more aligned
      3. Since Al Nahdi planned to evolve into the Wellness Lifestyle Category, what experience did they offer? Usually experience comes from a single promise. Is that also Hope? If I have to agree on Hope then how do you apply it to Wellness Lifestyle? Or how do you bring hope to Makeup, Skincare or Haircare products? These are part of Al Nahdi’s evolutions and they’re its reality
      4. I think the company did a remarkable job on the Marketing Mix and I salute them for it but the Brand was completely disconnected from the entire Mix and both are about one single purpose
      5. How the name Al Nahdi resonates with the audience as Wellness Lifestyle? Well not today but if the Brand is focused enough and more aligned, they will eventually evolve to resonate but this approach takes longer to materialize (they will have to witness generation change). Today Al Nahdi, after three years of Repositioning, is still perceived as a Pharmacy
      6. In store experience needs tremendous amount of work. You have to ask a human being for directions as in store lacks proper guidelines

Suggestions:

  1. Al Nahdi (with such a name) and Repositioning the sets of values should’ve been extremely unique in order to influence change
  2. Entering a new category or evolving from an existing one takes a long time because during that process others competitors can respond fast. Al Nahdi should’ve developed a clear Brand Idea that serves the essence of the Brand i.e. Wellness
  3. The Brand needs more focus, it also needs to break away from Hope because it rarely serves all the values that Al Nahdi is trying to sell to their customers
  4. Bring the Brand promise to the store level. Let customers experience the values
  5. Align the Brand with the Marketing Mix: Opening in malls was brilliant because that enforces your evolution

Overall, Al Nahdi has come a long way and I’m hopeful that with the new CEO, growth will continue. To evolve a Brand from one Category to another Category is not an easy task. It requires time, investment, education and momentum until the Brand is recognized in the new position. Creating a new category is the same as evolving as it requires time, education and acceptance

Said Baaghil is the ‘Unconventional’ Branding and Marketing Adviser to reputable companies in the Middle East, author of many reputable books including the ‘The Power of Belonging’ and a Speaker. Baaghil appeared in books published by America’s experts on Branding and Marketing such as Dan Hill and Libby Gill. Most recently Baaghil was interviewed by world renown Brand Consultancy firm Siegel+Gale on Branding in the Middle East

He can be reached on AskBaaghil.com

The article was first published on Linkedin Pulse on 17th December, 2015