A UAE Brand Product History
Etisalat is a UAE brand that provides telecommunication services. Its operations are in Asia, the Middle East, and Africa. Its mission is to be the leading and most admired emerging markets telecommunications group (“Etisalat Annual Report 2014” 11). The company first introduced GSM services in the Middle East in 1994 in the UAE thus becoming a pioneer in GSM service providers in the region. The company was formed in 1976 as Emirates Telecommunication Corporation.
In 2007, the company acquired a stake in a green-field operator in Nigeria, which is the largest and fastest-growing market in Africa (7). The company has continuously expanded its operations to various countries. For instance, in 2005, it expanded its operations to West Africa by taking stakes in Atlantique Telecom that operates in Benin, Burkina Faso, the Central African Republic, Gabon, Ivory Coast, Togo, and Niger (7). Between 2006 and 2012, Etisalat expanded its market share in Asia, Afghanistan, and Sri Lanka.
Industry dominance is very crucial to the success of a firm. Etisalat has ensured dominance through the adoption of the latest technologies to suit and satisfy its clients. The investments carried out by the company in developing economies are massive thereby indicating the aggressiveness of the company in entering untapped economies. The risk-taking capacity of the company’s management is indicative of visionary leadership and their desire to drive profitability through investment. The company had 169 million subscribers as of 2014, which was an increase of 21 million from the previous year. The increase was because of subscriber growth in UAE and Nigeria (“Etisalat Annual Report 2014” 11).
The telecommunications’ company growth in revenues can be attributed to an increase in its investments in different countries. The use of bundled packages on voice, short message service, and data in the market has enabled substantial growth of the company. Since culture is not a major factor in telecommunication services, pocket-friendly charges and bundling of services are the major determinants of success in the telecommunication industry. The impression the company creates to the locals or natives matters a lot. To gain acceptance, the company uses local slogans and translates them into the national language. It also uses local celebrities to market its products (Song 56). Such actions help in attracting and retaining new customers.
A Non-UAE Brand Product History
KFC (Kentucky Fried Chicken) is an American fast-food brand that operates in the UAE. The company started as a small hotel in the 1930s in Corbin, Kentucky. The original chicken recipe was developed in 1940. This recipe formed the basis of franchising with other hoteliers. The cultural difference between Arabs and Americans is crucial to understanding the consumption of the giant retailer’s products in the UAE market. Cultural adaptations are important in ensuring the success of a venture in a new cultural area.
There is an increase in the number of shared products in the international arena. Consequently, every company’s dream is to become a multinational corporation with global branches. The two major causes of increased global business are improvements in technology and the enrichment of products. There is an increase in the diversity of products, which allows consumers to choose what suits them. KFC is a major food chain in the UAE despite the differences in culture between the UAE and the brand’s country of origin (USA). The food chain has customized its operations to suit the culture of the UAE, which has led to an increase in sales.
Product innovation to cater to the UAE’s taste has enabled KFC to expand its business. KFCs dedication to adjust its operations to match the lifestyle of the residents of the UAE has played a significant role in the success of the company. KFC has modified some of its recipes to include certain ingredients that are specific to UAE cuisine. For example, the use of UAE ingredients in the seasoning of food makes it possible to create a UAE taste. As a result, KFC products have gained acceptance in the UAE market thus enabling the company to fit in the legal, cultural and climatic environment of UAE.
The acceptance of customized recipes has allowed the company to introduce menus comprising more of their standard recipes without resistance. Also, KFC’s target market is diverse and includes people of all ages (from kids to the elderly) and economic status, which creates a large market for its products. The marketing approach used by KFC has also contributed to its success. The firm uses storylines and funny scenes in its commercials, which simulate an appealing approach to normal life and increase the acceptance of the brand.
Standardization of products is not always feasible. Bearing this in mind, KFC has perfected its customized recipes to ensure that its customers receive quality products. The presence of 116 KFC branches in the UAE is an indicator of its market share in the country. The success realized from the modification of KFC’s recipes in the UAE has encouraged it to use the same tactic in other countries such as China (Yu and Zhang 87).
Schuiling and Kapferer (90) suggest that consumers reinterpret the brand’s marketing actions according to their cultural backgrounds and viewpoints. The authors further assert that the closeness of a company’s brands to the cultural background leads to improved relations between the company and its consumers. KFC has endeared itself to the people of UAE by offering native cuisines and incorporating local spices in other exotic dishes, which has led to the success of the business.
Individuals in all parts of the world are likely to have cultural biases despite media exposure, travels and consumption experiences gained from visiting places with different cultures (Ghantous14). Sometimes the different exposures lead to the development of a ‘culture’ that is neither global nor specific to any region. Such a situation is referred to as a state of “fragmentation” (Firat 81) where different cultures coexist. For these reasons, international companies need to strike a middle-ground to fill the new fragmented consumer culture (Ghantous 17).
Country of Origin Effect
According to Song (23), country of origin is a term used to describe the source of products or goods. This term applies to all types of products including industrial items, agricultural products, and services. Consumers have certain stereotypes regarding products from particular regions. Therefore, the origin of a product affects consumers’ perception of its quality. KFC is an international brand that has penetrated many markets. The use of local art and culture in the marketing of the food chain has facilitated its penetration into the UAE market. Becker (33) describes culture as everything that people have, think and do as members of a given society. Culture encompasses material objects, ideas, values, attitudes, and beliefs.
Consumers normally look for country of origin details before making purchases of certain products or before deciding the quality of the products. Therefore, a brand’s country of origin also determines the acceptability of the brand. Preference for foreign brands is common among affluent, young and educated consumers living mostly in cities. Consumers often associate foreign brands with novelty, modernity, sophistication, and prestige. Therefore, a well-calculated introduction of international brands in a given market is likely to realize high volumes of sales.
Cultural changes take time across borders of a given region due to interaction and the exchange of products and social organization. The increase of multiplicity in consumption and spending rates has caused a lot of interest because consumers exhibit different purchasing habits (Arnould and Thompson 870). Brands are considered by many people as warranties for the products they buy (Tripathi 23). The marketing policy of a firm is highly dependent on the brand strength of the company, which promotes its products to influence the purchasing decisions of the customers. Consumers in UAE are informed about the various products that exist in the market and have identified with particular brands manufactured in certain regions.
According to Kotler (272), the perceived quality of a brand determines the extent of customer perceptions and expectations about the quality of the product or brand purchased. Kotler (272) further argues that specifications, fame, and uniqueness of a given brand compared to other brands affect the customer’s decision whether or not to buy a given brand. Customers also consider the rating of a given brand against similar brands, which ultimately influences the customer’s satisfaction. In most cases, the buyers associate the quality of a brand with its country of origin.
The origin of a product forms the history of the product. Therefore, the historical tradition of a product is greatly intertwined with the traditions of a community even before the commercialization of a product or brand. Products that have been on the market for longer periods have a richer history and more popularity than new products. According to Song (35), famous brands are those that have been on the market for longer periods. Therefore, the longer a brand has been on the market, the more famous it becomes and the higher the likelihood of being sold in new markets. The influence of traditions on the sale of products can be overcome by the consistent marketing of the products and ensuring their market presence. However, it is worth noting that eliminating cultural biases on products take place gradually.
The Emirati culture has traditionally been viewed as Arab because the native language spoken is Arabic and the main religion is Islam (Arnould and Thompson 870). Arabs value family and friendship and like to spend time interacting with each other sharing meals. Some business deals are also made over meals. Additionally, the dissemination of numerous products and services in the UAE has transformed the cultural identity of the region.
Numerous opportunities have attracted people from various nationalities who have changed the country’s culture. The busy schedules of these people make it convenient for them to eat at restaurants such as KFC, which has become a major meeting point for multicultural individuals. The social gatherings lead to the exchange of ideas thereby influencing the eating habits of the natives.
The Future of UAE Brands in Global Markets
In UAE, the national law states that only UAE nationals, corporations owned by UAE nationals, or corporations with an Emirati partner or sponsor are permitted to do domestic business in the country. There are no major brands from the UAE in the 500 top list of the Brand Finance 2015 annual report. International brands invest a lot of finances in marketing their products in many ways through sports activities, music shows and features among others. Marketing communication informs and persuades people to influence their behavior towards the purchase of a particular product or to persist in the buying of a product in the presence of a competitor (Zoubi 61).
Globalization has shaken certain assumptions that were common at corporate and individual levels (Al-Olayan and Karande 78). Women in the UAE, for example, currently use Western cosmetics brands thus transforming the notion that consumers always prefer local brands to international ones. The current shopping and social interactions tend to follow universal rather than local trends, which have been brought about by technology. Advances in technology have also availed numerous products to consumers in various regions of the world.
The effect of globalization has played an important role in ensuring that major companies have equal opportunities for market access (Simadi 178). UAE companies can sell their products and services such as tourism to various parts of the world through promotional activities. The customization of local brands in foreign markets is a major tool used by the UAE brands in capturing new markets in new environments. The marketing of the brands in international events such as football matches has enabled the growth of brand strength. For instance, Emirates flights have realized tremendous growth from the massive marketing and sponsorship of particular teams in the European region. The future of the UAE brands is bright because more brands are striving to gain entry into the global business arena.
Works Cited
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