Economic View: John Brash
John Brash: Diversification has been a deliberate policy of GCC governments for some time. The drop in hydrocarbon revenues actually shows this to have been apt and robust. So while the doom-and-gloomers would have us think the region was forced to diversify, it is actually the opposite: a case of foresight being proven. The result is that the GCC has, in the main, been able to ride out the fall in oil prices with typical panache.
This diversification has seen an upsurge in retail, health care, education, aviation, tourism and real estate development – to name a few prominent sectors. Regional brands have thrived across the board, with a value growth rate that is almost double the global average. This is largely because the leading economies here, such as the UAE, are innovative, ambitious and imaginative.
Branding is at the forefront of this charge, both in terms of identifying the opportunity and creating the business, and then helping a player get its name known.
The region, and in particular the UAE, is an environment that fosters hunger and ambition. This is a market that is saturated by talent – especially the younger generations, who have seen the trajectory of somewhere like Dubai during their lifetime and are now eager to replicate that for themselves.
Through the encouragement of knowledge-based economies, GCC governments are empowering populations that strive for a new era of success. Similarly, there is always an influx of international professionals eager to access the distinct opportunity that cannot be had anywhere else. The talent pool keeps on getting deeper and wider.
Importantly too, mindsets have shifted, and brands are readily embracing this era of change. They are enjoying the opportunity to think differently, to effectively solve challenges – and to showcase their fresh ideas.
From the reform of transport fuel subsidies to an increase in utility bills, there has been a distinct drop in disposable incomes, for example. This presents a challenge for brands. How do they interact in a way that can be uplifting and hopeful?
We encourage our brands to confront the market, embodying innovation and invention – driving forward to overcome their obstacles. Yes, mind-sets are shifting and times are hard – but it is through positivity that GCC brands are succeeding at an unprecedented rate.
We are not operating in the emotional climate that existed in 2008. This time, any decline in public sector investment is purely pragmatic. This pragmatism is obvious when GCC revenue-generating measures are studied – many are designed to cause minimal consumer impact, whilst incurring significant revenue increase. For example, there is now a small tax on hotel rooms.
This region has survived economic changes in the past, and now it deals with contemporary issues with foresight and hope.
Many big brands have also taken practical measures to ensure that they remain strong during this period of volatility. From forming strategic partnerships to floating on the local stock exchange, brands are insulating themselves against harmful economic slumps.
Similarly, they also have to adapt to an on-going transition in the global market. Consumers want instant interaction and seamless experiences. They are frustrated when engagement is not quick, easy and intuitive. But with some of the highest smartphone penetration rates in the world – as well as brands that are hungry to innovate – the GCC is leading the way.
From mobile banking to online retail and fully immersive experiences – for example, for large real estate developments – it is vital that clients are well equipped to make the most of channels and technologies that will evolve their offering. The debate has moved on from digital versus print. It is now about fully integrated brand experiences, connected across all media.
Regionally, branding agencies must also take experiences one step further, creating a virtuous marriage between English and Arabic – a harmony of connotation, language and iconography. Without expert insight, it is easy to slip into uncomfortable clichés that undermine efforts to promote cultural congruence and synergistic meaning.
Similarly, with the naming process for a regional brand, it is essential the result effectively straddles language and traditions.
Overall, it is vital that brands prioritise meaning and authenticity over aesthetics. When done well, the marriage of different languages and cultures is a great way to capture the spirit of a brand and its identity.