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LBC; Recovery Plan Failure

25 Oct
Picture from http://www.lbcgroup.tv
Picture from http://www.lbcgroup.tv

The ‘Saudi sex bragger’ case is back to surface after sentencing a Saudi female journalist to 60 lashes for her participation in the infamous episode that allegedly shocked the Saudi community and has been produced by LBC TV (Lebanese Broadcasting Corp.).

What interests me in this post is the behavior of LBC management toward this case since its outbreak few months ago.

First of all, it should be highlighted that the channel strategy was built upon targeting the Saudi market in a very direct way by producing programs that are entirely designed to address Saudi local issues. News, cultural, commentary, and sports shows have been aired presenting and hosting Saudi figures to discuss Saudi matters. The reason is obvious, the huge Saudi advertisement market. Increase our Saudi audience, so Saudi advertisers would keep coming. This strategy proved to be successful and they kept a fair share of the Saudi advertisement market.

After the disruption broke out because of that episode, the Saudi authorities closed the channel offices in both Riyadh and Jeddah; they asked all the local media related agencies to stop working with LBC, and many companies decided to stop advertising on the channel.

From a business perspective, this is a disaster. I can understand that the case is debatable in so many ways; free speech rights, ethicality, the LBC own values, and its audience cultural backgrounds are all mixed up in a very complicated way. However, given all this, the management reaction which was ‘almost nothing’, is still unexplainable to me.

In such incidents, a management recovery plan should be geared up to ensure the minimum possible losses. I am not taking the side of any possible point of view to suggest a particular course of action, but I am supporting taking an action at the first place. Now, the lack of reaction is costing the corporation a lot of its brand value. People are explaining its ‘nothing reaction’ as an ignorance sign to the whole Saudi culture. Consequently, the confidence and credibility of the channel is spiraling downward, and this is something not a single TV channel would like to go through!

The lesson here is straight forward, when you have a disaster, act fast … act now!

(Just for calrification, after this post by one day, the Saudi female reporter mentioned above has been pardoned by King Abduallah)

 
5 Comments

Posted in Advertisement

 

Flirting with Customers

24 Oct

If you are not familiar with the retail market in Saudi Arabia, then you have to note that when I say flirting with customers, then I mean salesmen flirting with female shoppers because around here, it is not allowed to women to be sales representatives (we may take Fitihi as an exception, it is the only retile brand that employs women as sales agents).

The problem of having salesmen making indecent gestures and inappropriate moves towards women shoppers is not new especially in the femininely dominated part of retailing (e.g. cosmetics, lingerie, and women ware). It must be shocking to realize this fact in the Saudi market; in the society known for its over rated conservatism, its women are discussing their intimate body sizes with total strangers!

There are so many dimensions to this problem. However, I would like to tackle it from the customer service point of view. All over the world, having sweet talking sales personnel is definitely a must. Nevertheless, sweet talks and genuine smiles is something and giving some sexual harassment comments is something else. And justifying these inappropriate acts by labeling them as sales tactics is just sick (you may want to read this Arab News article).

Moreover, and after reading this another Arab News article as well, it is really troubling to see that there is a huge number of women going through such situations without standing up for their rights by not reporting such indecent acts. And if some of them actually do, the lame reactions of marketing managers (some of them, at least) to such incidents are despicable.

There are always some cultural and ethical factors that should be weighted when designing or looking into any customer encounter experience. And when it comes to a market where the most legal or acceptable way of interaction between males and females in public is within the retail markets boundaries, then these issues should be carefully treated. I am not referring to those women who are seeking such kind of attention, those are another story, but my concern is women who are harassed by those ‘thinking they are all cute’ kind of sales personnel.

It seems to me that stricter regulations should be put on place to prevent such ethical crimes. In addition to that, encouraging affected women to place complains and thoroughly investigating them should be emphasized to both customers and staff.

p.s. I am sure that of one the logical questions that you may want to ask; why women are not allowed to work in retail sales sectors especially in these female oriented markets … mmm … ok, that’s may need another post!!

 
4 Comments

Posted in Customer Service, Marketing

 

Okaz Creative Advertising Awards; Building Hope

21 Oct
Picture from http://www.okaz-caa.com

Picture from http://www.okaz-caa.com

 

Yesterday was a good day for the advertisement business in Saudi. The first awards of its kind have been distributed under the name of Okaz Creative Advertising Awards.

I believe such awards come to give some credits and recognition to a long time forgotten business sector in the kingdom; a sector that has been, and still, dominated by non-Saudis. According to the Saudi Gazette coverage, about 96% of workers in this industry are non-Saudis. But this is not the main point; I am usually a supporter of mixed culture working environments and I am, surely, not discriminating against non-Saudis. But here comes the shock; most of these workers have no specialized degree! For me that means they are only acting as facilitators helping foreign agencies to get contracts out of the Saudi market. And please keep in mind that it is estimated that the Saudi business expenditure on advertisement reached about 22.5 billion SAR (6 billion $) in 2008.

I really hope that such initiatives would open the Saudi businessmen eyes and ears on a profitable sector that has always been overlooked. I know that building a long term competitive advantage in a fiercely competitive sector is not an easy job. But given the chance to Saudi young talents in this creative business may turn out to be a whole country competitive strength.

 
5 Comments

Posted in Advertisement

 

Let’s imitate Google

20 Oct

How many times have you been through those meeting, speeches, and even trainings advocating certain managerial or behavioral traits? And how many of these preached traits have been really embraced by your management/organization?

In management world, it happens that there are some processes/practices that gain popularity and, in no time, develop to be a cliché that everybody wants to imitate. But the problem here is that those practices are not only actions; they are actions with souls. The soul in here is a metaphor to the organization culture; its inner beliefes and shared values. Yes, actions could be imitated, but not souls. There is a huge difference between imitating something and really embrace it based on a belief.

Let me give you an example, you must’ve heard about how Google offices look like. Just imagine if an organization (may be yours!) comes and says that it would like to rebuild its offices to imitate Google. Yes, that would be nice, do not you think? The problem is that although everybody will be thrilled by the new furniture for a while, efficiency would eventually stumble. The reasons should be obvious; Google offices are a representation of its culture, its belief in innovation and its management trust that their employees will produce more in such an open environment.

A lot of Saudi businesses have been through such experiments. One of the fashions that took place about 3-5 years ago was the development of internal values and slogans for the employees to believe in. You know, those slogans based on enthusiasm, team work and, my favorite, open door policies. A lot of meetings are held, a lot of press releases are distributed, and, sometimes, big celebrations and gatherings prepared for high management to initiate the super campaign. But when leaving all this behind and start living the reality, I mean going back to office, you will see how enthusiasm is usually killed by bureaucracy, how team spirit is mostly shattered by micromanagement, and, also my favorite, how open doors policies are actually based on closed doors and deaf ears. I am sure you can come up with so many similar examples whether in Saudi or anywhere else (e.g. friendlinessto the environment, supporting innovation, learning organization, etc …)

The idea itself is definitely good, and it is a step toward building the organization identity and culture, but without a deep belief, it won’t work and could even demoralize the organization in the eyes of its own staff.

 
1 Comment

Posted in Culture, Saudi business

 

Saudi Executives Salaries!

18 Oct

One of the most important issues that accompanied the current financial crisis was the debate over the excessive pays top executives were receiving despite the fact that their organizations were failing, and failing big time!  President Obama was the one who disturbed those Wall Street giants by starting to shed the light on their unbelievable compensations when compared to their lousy performance; he even described the situation as being ‘shameful’ in one of his speeches. Now, although Saudi Arabia has been going through this crisis with a lot of dignity because of its conservative financial policies, still we are part of the world and we have been hit by the recession in a way or another. However, the issue of executives’ salaries has not made it to the public attention, given that it should’ve made it a long time before, in the time of the repeated stock market failures.

It should be noted here that the debate about executives’ salaries and compensations is not new. It has been around in the management literature for a while now. Most of the recent articles on the subject tend to argue that executives should be compensated for their performance in reaching their organizations’ long term strategies. On the other hand, there are those who argue that these pays are justified in a sense that they are paid to attract management talents and provide the required incentives for them to perform. Furthermore, there are always some ethical issues surrounding any such argument especially towards shareholder in general and, nonetheless, toward the organization own employees. It could be expected and, somehow, accepted to reward outperforming leaders; those who are revolutionary in their visions and contributing a great deal of their time and efforts to maximize their shareholder value. But how can a one justify the skyrocketing benefits to underperforming, typical, visionary-less kinds of managers (I did not say leaders) who happen to be on the top of big companies, and yes, they exists! My favorite management thinker, Peter Drucker, is arguing that everybody in an organization play his/her own part in deciding the whole organization destiny. So Drucker stated, while talking about US big shots, that ‘executive salaries at the top were clearly out of line with the responsibilities of those holding these positions.’ Moreover, he recommended that the executives’ salaries should not be more than 20 times the average employee salary.

Now let’s get back to the Saudi business world. It’s a fact that some companies are paying their big guys some big chunks of money. But we have to be honest; on average, they do not resemble their counterparts in USA. The Saudi corporate governance regulations for the publicly listed companies rule that companies have to show the total salaries and compensations paid for the top five executives (CEO and CFO should be included if they are not among the big five (yeah … right!)). However, these regulations are not mandatory yet, but some companies already started to adhere to them. So I did some research and calculations and found some interesting results. Some successful companies (successful=making a reasonable profits and paying rewarding dividends) are not doing bad at all, the average of executives paying is about 30 times the average salary in their organizations. While some average performing companies, and sometimes underperforming ones, are paying up to 150-200 times the average salaries! And please note that this is a quick-not-so-scientifically-accurate prediction.

At the end, with the repeated stock market failures, recession, and bad performance; companies’ leaders should be held accountable as they are responsible for their companies’ performance. After all, they are playing a big role in our economy, and their decisions, sometimes, have a direct impact on our lives. As it is encouraged to reward distinctive talents, poor managers should not be rewarded for wasting their shareholders value.

 
No Comments

Posted in Saudi business

 

Saudi Business World and Climate Change

15 Oct

I am writing this blog post in response to the ‘Blog Action Day 09, Climate Change’.

To be honest, writing about this subject, in Saudi Arabia, is a bit weird!! You know why? Because the whole philosophy of preserving the environment and taking serious measures to fight the climate change is still young in the minds of both; the public and the business world.

For that, thinking about the climate change prevention idea in the Saudi business world will definitely lead you to consider the concept that contains such ideas; that is the concept of corporate social responsibility (CSR). This concept is still new in the Saudi business environment. And even more, it is not totally understood, let alone embraced. Following the subject in the media, you would be encountered with a bunch of articles; most of them are written by Saudi academics trying to explain the concept. I am not saying this is wrong; on the contrary, it is advisable and certainly good to bring such concept to the public attention. But still, most of the examples provided to illustrate the concept are based on employees’ benefits and charity. Yes, these are main elements of the CSR, but they are not everything.

I believe it is reasonable to claim that preserving-the-environment awareness is a cultural issue before any nothing else. Unfortunately, showing respect to nature, saving power resources, and respecting the green life in general are some things we are not growing up with around here. So any initiatives to address such matters should always consider this cultural lack of understanding.

Nonetheless, hope is there and it is not all a black picture. There are some companies’ initiatives to promote environmental awareness and practices. ARAMCO and SBIC (Saudi Electricity, to some extent) always come to mind, at least for their fields of interests if not for anything else. However, although the efforts to adhere to modern industrial standards are important, the effort to raise employees’ environmental awareness is something we should concentrate on, at least, to compensate for the lack of it in our normal life. Maybe building this awareness in the corporate culture will be pay its dues and we will start seeing its results in the normal life.

Finally, more regulations, incentives, and programs are required to address this issue. And they better to be real and sincere and not to be used as way of advertisement! Such efforts are needed from both, public and private sectors, to raise the awareness of such critical matters. Critical matters to the essence of our existence on this planet.

 
2 Comments

Posted in Saudi business

 

Lomar Thobes; A Saudi Entrepreneurial Story

13 Oct
Picture from www.lomarthobe.com

Picture from www.lomarthobe.com

 

Just pick any generic product around you and think if you can transform it into a differentiated big business. If you can do that, then you must have a genuine innovative and entrepreneurial spirit.

I would suggest to use the Saudi Thobe as an example (I hope you know what a Saudi thobe is, if not, check out this Wikipedia page.  And yes, it is on Wikipedia!!). This product has been around for hundreds of years now. Although the fabrics and final touches have evolved a bit throughout these years, the general design, style and color almost kept unchanged. Now making a big, new and profitable business out of such a product is a real challenge.

Loai Nassem and his wife Mona Al Haddad did just that, they chose to be different in a saturated market, in a market that kept its status quo for hundreds of years.

The story of their initiative can be found here, but I would like to shed some light on the interesting marketing tactics they used to build their business:

-          Setting the imagination: One of the interesting quotes said by Mr. Loai, the founder of Lomar, that I particularly like is ‘I wanted this business to start big.’ It is obvious that he had imagined the business before its start.  Such perspective enabled him to set a reliable track for his business and brand. One of the most common problems of entrepreneurs is to have the idea and … that’s it!! Picturing the idea, the way it will be realized and how it will be recieved by people are all major factors determining the success of any entrepreneurial project. Once the picture is clear, the project business plan will be based on a solid ground; it will be more focused and will lead to more reliable results.

-          Careful Targeting: The well known golden rule in marketing is: you cannot sell to everybody. Lomar thobes is using this rule effectively. They wanted their brand to be associated with a specific group of people. People who are daring to change, and yet have the money to do it! That’s why Lomar thobes is charging a premium price in exchange for its products. Their prices are greater than the rest of the market by around 40%. Their boutiques are located in premium locations and their internal designs are unique and modren.

-          Emphasizing the brand: They are using their brand name on buttons, zipper sliders, or even somewhere on the thobe itself. This is certainly a unique approach in the thobes market. Usually seeing the brand name will start conversations about Lomar designs, colors and fabrics. In other words, by using this approach they are encouraging word of mouth marketing.

However, Lomar thobes are dealing with considerable challenges; such as:

-          Cultural Difficulties: Although recording a remarkable success among young customers (those between 25 up to 35 years old), Lomar is still facing some cultural acceptance issues. Surviving all these years with minimal changes, Lomar approach is seen as a threat to local costume traditions.  These difficulties can be sensed when comparing the popularity of Lomar designs amongst the Kingdom’s regions. Its success is still concentrated in Jeddah although are some moves to make it more acceptable elsewhere. 

-          Typicality and Competition:  Lomar made a surprise, a wave of shock if you want to call it, to the status quo in thobes designs. This was definitely a part of its success. However, people will soon start to wonder, what else? What is new? Especially when realizing that their first-player-in-the-market-position will last no longer, new entrants already started to position themselves in the market!

 

Finally, such initiatives should always to endorsed and given the chance to grow and prosper. And for young entrepreneurs, it is important to see peers from their own culture, their own environment who can face the challenges and come out with successful business examples. Modern economies are now built on such entrepreneurial spirits, on small businesses generating jobs and adding to GDP.

I think it is time to conclude now by stating that I do not know the owners of Lomar Thobes, or any one working there for that matter.

 
2 Comments

Posted in Entrepreneurship

 

One Fries please, I am going to see the Mona Lisa!!

10 Oct

Louvre

You could have visited the Louvre; if not, you must’ve heard about it (otherwise, mmm … I do not know what to say!!). And you probably heard the news about the upcoming opening of  McDonald’s resturant and McCafé in the underground approach to the Louvre, known as the Carrousel du Louvre.

As expected, the idea is igniting a hot debate between supporters and those who are unfavourable of it. On one hand, the museum staff, historians and gastronomists are accusing the project of being as of an insult to the museum name, to its cultural value, and to what it means to the French people. They are seeing the case in which a fast food chain name being associated with such a historical figure is totally unacceptable. While on other hand, supporters’ main argument is that the restaurant will not be part of the Louvre itself, and after all, people have to eat!

Now this is a very interesting case for marketers. And let me put it this way: if you are in the position of McDonald’s marketing director, what will you do?

Are you going to go ahead with the project? Of course you will be thinking about your brand name being associated with such a major destination. All these people from all over the world visiting the Louver will be taking ‘hanging around your restaurant’ expereince as a part of their dream trip.

Or are you going to stop the project? You know a lot of people will be looking down on you, and your brand will be accused of fostering consumerism and demeaning the infamous French gastronomy.

For me, the decision will be to go ahead with the project. I know how dangerous cultural issues could be to a business and how damaging it could be to its brand value. But, McDonalds did it once before! And where? In France.

The way McDonalds showed respect and adaptability to the French culture is a story always mentioned as an example of business’s successful cultural understanding.

So my point here is that I will go ahead with the project but with a special handling.  I mean I will consider changing the design of the restaurant, the layout, the staff costumes, adding/removing certain foods or beverages. In few words, I will redesign the whole experience in a way to match the environment of such big historical venue.

So what do you think?

(p.s. Before leaving this topic, I would like to relate this discussion to a local matter. I believe that cities and countries can be branded as any product/service can be. I am not coming with anything new here, I am just stating the obvious (think about Dubai for instance).

For that, the importance of locations similar to the Louvre does not only stem out of its historical value, they are also considered as a part of the city brand. Can you think of Paris without images of the Eiffel Tower and the Louver popping out on your mind? London without the London Tower and the Buckingham Palace?

Unfortunately, it seems that we are still far away from realizing this fact. Take Jeddah historical area as an example. Although a lot of the city residents are emotionally attached to this area, which qualifies it to be a major part of the city brand, it has been abused in so many horrible ways; illegal trading, illegal immigrants, forgotten infrastructure, and threatened by collapse old houses.

The all discussions surrounding the Louvre and McDonald’s send a clear signal that this place is important to the city, to the country, to the whole world culture. It is, simply, a brand! A brand that we should develop, maintain, and make sure it is not compromised.

I hope we will have a similar, or even stronger, enthusiastic look at our own city brand …)

 
No Comments

Posted in Branding, Marketing

 

Press Releases; Stop Lying!!

07 Oct

 I just read a press release about a local company participation in an international fair. And let me tell you how I felt; disgusted!!

Press releases are a widely known and adopted tool by PR professionals to attract attention of public in general and organization’s stakeholders in particular. Unfortunately, some of these professionals definition of press releases is nothing more than a show-off-piece-of-work. A lot of lies and exaggerations are stuffed into these few lines to show the company as the best not only in its market, but in the whole universe!!

Such companies are still to realize that those press releases are, and should be, part of their whole branding management strategy. Choosing the right words and style is mandatory to deliver the certain brand value they are trying to communicate. So bragging again and again about ‘being the best’ or ‘having the latest’ or ‘everybody was astonished by our new products/service’ while your customers actually know how exaggerated that is; then,  you are devaluing, not building, your brand!

 
6 Comments

Posted in Public Relations

 

Advertise, no more!!

06 Oct

Saudi Airlines

 

No matter how much money some organizations are budgeting for their advertisement, it won’t work and they better keep it for more rewarding plans. This occurred to me while watching the new commercial of Saudi Airlines. 

It is really sad to see some big companies lose all their sense of direction and start stumbling in the dark seeking to score a point here or there when their main concern should be realizing their critical position in the market and how customers are actually looking at them (and bad mouthing them for that matter). 

Saudi Airlines is, unfortunately, one good example of such companies. A good example of a company lost its brand value by being ignorant at times and short sighted at others. A lot of market opportunities have been lost following that behaviour, back then, when it was the largest player in the region. 

Now, should the solution lay in producing more ads? I do not think so! Saudi Airlines needs to start thinking about adapting an integrative marketing strategy to rebuild its brand. A strategy based on the main reason of its existence; that is, SERVING its customers!! 

The lack of a truly believe in the essence of customer service is the main reason why people are looking down on it, especially when comparing its services to the neighbors: Emirates Airlines and Qatar Airways. Therefore, its managment should really consider building a customer service supporting culture. Yes, not an easy job, but not an impossible one either! Thereafter, this culture should be embraced by all its members, throughout its many levels (I do not remember the last time I met someone of its staff who was genuinely smiling or really trying to help!!). 

Having said that, I really doubt people will be interested in its new comfortable seats! Because, I am sure, whenever Saudi Airlines pop up on their minds, they will be remembering the time wasted on its reservation line, the rudeness of its sales and ground staff, and the lameness of its on-flight services. 

Now, I would really like to see how many commercials could possibly fix that.

 
8 Comments

Posted in Customer Service, Marketing

 
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