STRATEGY AND BUSINESS IN THE MIDDLE EAST

Do we need Social Media in Emerging Markets?

I’m writing this post for two reasons.  Firstly, because a lot of people think i “do social media”, and secondly, I feel we’re all missing a trick as to how we can actually use it to achieve local business objectives.  

Given the current state of haggling to find the cheapest price for who will execute brands’ social media campaigns, its clear that both client and executioner treat this as a pure commodity. 

Let’s refresh our memory as to what the definition of commodity is:

“…a class of goods for which there is demand, but which is supplied without qualitative differentiation across a market. A commodity has full or partial fungibility; that is, the market treats it as equivalent or nearly so no matter who produces it”

That should save hours in powerpoint presentations then. Just get down to the final price and have done with it. 

No matter how many Seth Godin, Forrester Research, Malcolm Gladwell and Mashable posts you read and quote, lets not forget they operate in a market very very different to ours in the Middle East.  We are currently experiencing extremely high growth rates for many industries, notably retail. 

When sales are going up of their own accord - Dubai Duty Free alone is on track to make $1.63 billion worth of sales this year (registering an 11% increase already in the first half of 2012 to reach $772 million) - then using social media seems rather superfluous, certainly in order to facilitate sales right? 

For the majority of brands and businesses, they will outsource their social media to an agency.  This typically involves a last minute frantic email around the office asking everyone in the agency to “like” the page and then the contractual 1 or 2 hour per week “content creation”ensues. Until the weekend of course. Because it makes sense that the time when most people are actually USING social media channels, your brand / agency isn’t active on them right?

Inevitably the majority of the content is incentive based. Do this, win that. An ipad, a blender, a personalized USB, a recipe, a bunch of recipes, a trip to Russia etc.  The type of audience that incentive based content attracts is usually markedly different to the initial target group that the client stated (the brief opens with: we want to target High net worth Individuals from the local Arab population and rich expat europeans). 

That’s not to say these brands have failed to draw large audiences on Facebook, Kiri Middle East for example has 106,000 likes.  Competition prizes have included a Blackberry Torch, a Trip to Dubai and stay in a hotel, and most recently a Galaxy Tab. 

This time last year, it had 6,640 likes, so over 12 months there has been an almost 1500% increase in likes.  What effect has it had on the volume of sales if any?

No one is saying this isn’t a great result, by any marketing measure the amount of “likes” and “talking about this” shows the brand is really top of mind for thousands of people. But we’d like to know how that translated into sales so we can prove the efficacy of social media. 

The reason i press on this point is because fortunately Facebook does allow you to do everything including sell.  And who should be doing this here but the comparatively unknown WCF Group, a Ras Al Khaimah Freezone company which distributes Solar Light Caps, Ethylene Gas Guardians and other innovative products.

Here’s their facebook shop:

You might say its not really feasible to start selling Kiri online, even though Carrefour has an online store and there are new grocery stores coming online regularly.  Indeed looking at the Google searches done for “Kiri” compared to “Philips” one can clearly see a higher intent for Philips products: 

Surely then the effects of the social engagement should be able to be translated into sales, at least for Philips. 

Thousands of “likes” across all these brands - and then what? Why is no one bothering to turn them into direct sales? 

Why is every single piece of content on these pages from soft drinks, to home appliances, to teabags all concerning 1 of 3 topics? 1) How was your weekend 2) what do you prefer to have your [insert brand product here] with and 3) don’t forget to enter for a chance to win.  

Given the amount of data one can get over the course of such questioning over a year, brands should be able to adjust what they put in the market.  They could use this data to come up with new product lines, to target specific groups, to help in other marketing communications and more.

Clearly we’re only scratching the surface of the power of social media here. Apart from its ability to assist in sales, there are other reasons why people would use social media to engage with a brand, most notably customer service. 

A look at the Nokia UAE facebook Support Discussion page has a load of very recent questions, but no answers, neither from the brand or the rest of the community.  Admittedly you do have to do a bit of digging in the tabs on the home page to find it, there aren’t regular links to it in the main timeline.  Perhaps this could be helpful

Ultimately the best use of social media channels for brands will be when a real understanding of the communities that use them can be reached.  FMCG brands may uncover trends that assist their supply chain, or be able to make efficient market research.  Electronic device makers could use it as a channel to develop customer support and problem solving.  Food brands could sponsor an instagram channel. 

Data from social channels needs to be looked at in conjunction with data from other marketing channels to see if there are correlational or causational effects and if so, how to capitalise on them.  

Differentiation amongst providers of these services (agencies and freelancers) will occur by specialisation in particular areas, eg facilitating communities of practice, delivering online sales, analytics and more. By extension, we should see a rise in costs as brands perceive higher value. 

It is my belief that social media can be used to make companies competitive if executed correctly and if tied as closely as possible to the transaction.  Installing a Live Chat app seems to be doing well for ecommerce based outfits like MarkaVip: