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TOP 10 SAUDI ARABIAN BRANDS 2017. (US$ MILLION) ... THE TOP NAMES IN THE RANKING FOR BRAND CONTRIBUTION. ARE LED BY ... 78 “Social Media 'Cottage Industry'. Empowering ..... opportunity. Repackaging a campaign for.
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THE BRANDZ™ TOP 20 MOST VALUABLE SAUDI ARABIAN BRANDS 2017 REPORT WAS PRODUCED BY WPP AND KANTAR MILLWARD BROWN, AND DEVELOPED IN PARTNERSHIP WITH PRINCE MOHAMMAD BIN SALMAN COLLEGE FOR BUSINESS AND ENTREPRENEURSHIP.

IMAGE COURTESY OF KAEC

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SAUDI ARABIA'S MOST VALUABLE BRAND

TOP 10 SAUDI ARABIAN BRANDS 2017 (US$ MILLION)

(US$ MILLION) Jabal Omar

US $6,589

US $5,569

US $4,887

US $3,964

US $2,929

US $2,500

US $1,352

US $1,309

US $1,142

US $1,082

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Telecom Providers

Banks

Real Estate

Food and Dairy

Banks

BRICKS-AND-MORTAR RETAILERS MAKE STRONG SHOWING

TOP 20 BRAND VALUE (US$ BILLION)

The combined value of the BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

RANK

7

RANK

US $

37.2

Telecom Providers

Retail

Insurance

Banks

Retail

LOCAL BRANDS MAKE DEEP IMPACT

FMCG BRANDS LEAD BRAND CONTRIBUTION THE TOP NAMES IN THE RANKING FOR BRAND CONTRIBUTION ARE LED BY HOUSEHOLD NAMES IN FOOD AND RETAILING.

BRANDS FOUNDED IN SAUDI ARABIA DOMINATE BOTH THE TOP 20 RANKING AND THE LOCAL MARKETPLACE. OF 334 BRANDS THAT WERE MEASURED IN THE COMPILATION OF THIS RANKING:

10 RANK

17

5

BILLION

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The telecommunications brand STC has a BrandZ™ brand value in 2017 of US$6.589 billion, and this one brand alone accounts for 18% of the total value of the Saudi Top 20.

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69 % 5 % 26

%

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Local Brands

Retail

US $1,352 Million

US $1,082 Million

US $449 Million

BANKS AND INSURANCE BRANDS TAKE FOUR OF THE TOP 10 PLACES, AND 10 OF THE TOP 20. TOGETHER THEY ACCOUNT FOR 40% OF THE TOP 20’S TOTAL VALUE.

Telecom Providers

Real Estate

Food & Dairy

Retail

34 24 15 13 8 %

%

%

%

%

Insurance

6

%

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

8 Brands

2 Brands

2 Brands

3 Brands

3 Brands

2 Brands

Retail

Insurance

Brand Contribution measures the influence of brand alone on earnings, on a scale of 1-5 with 5 the highest.

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86% of adults use a smartphone

FORTUNE FAVORS THE BRAVE

Regional Brands

BRANDS IN THE TOP 20 ARE MORE LIKELY THAN OTHER BRANDS TO BE SEEN AS BEING:

BRAVE

Global Brands

TRUSTWORTHY

THIS COMPARES TO:

Connected Devices Each

Turkey

90

%

of adults are online

Download the Mobile App www.brandz.com

Retail

CONSUMERS ARE HIGHLY CONNECTED

6 CATEGORIES MAKE UP THE TOP 20

Banks

Food and Dairy

CARING & GENEROUS

UK

34% 45% 33% Local Brands

INNOCENT

Indonesia

Local Brands

Local Brands

CONTENTS

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Foreword



Fahd Al Rasheed, Vice Chairman of the Board of Trustees, Prince Mohammad Bin Salman College of Business and Entrepreneurship

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Welcome



David Roth, CEO, The Store WPP, EMEA & Asia

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Introduction

16 Overview 20 Key Results 26 Cross-Category Trends 30 Key Take Aways 40 Economy and Demographics 42 Media 48 Brand Value 52 Brand Contribution 58 Brand Health 62 Brand Saudi Arabia 66 Brand Age

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Thought Leadership

72 “Where to Now? From CMO to CExO”

118 “Recipe For Regional Success – Five Ways Local Brands Can Grow Their Value”

by Fahd Hamidaddin, Secretary General of NEXT Festival Chief Commercial Officer, KAEC

74 “2030 Vision – The Role of Brands in a New Saudi Arabia” by Ramel Kabbani, Executive Director, Landor

76 “Riding Out The Storms – Agility at the Heart of Success in the Digital Age” by Bengt Eriksson, Managing Director, Landor

78 “Social Media ‘Cottage Industry’ Empowering Saudi Youth” by Olga Kudryashova, Regional Head of Strategy and Planning, MENA, and Hussah Al Sudairy, Associate Creative Director, MENA, Y&R

82 “Meet Saudi Youth: Smart, Sophisticated and Switched-on” by Sunil John, Founder & Chief Executive Officer, ASDA’A Burson-Marsteller

Brand Building Best Practices

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Saudi Arabian Top 20

98 The BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 100 Brand Profiles 112 Our Insights

by Aurobindo Choudhury, Head of Customized Research, Kantar AMRB

120 “Pioneering Disruption – Making Fresh Connections” by Dana Alkutoubi, Strategic Planning Director, Saudi Arabia, J. Walter Thompson

122 “Hungry For Health – Catering To Saudis’ Unique Appetite For Wellness” by Edwin Coutinho, AVP, Kantar AMRB,

124 “Millennials Uncovered: The Paradoxical Generation” by Mariagrazia De Angelis, Head of Client Service, Landor

130 “Look Out, Because Now Here Comes Generation Z” by Sheila Morrison, Strategy Director, Lambie-Nairn

86 “Global Strategy, Local Relevance” by Gagan Bhalla, Managing Director, Kantar Insights, North Africa & Iran, Kantar AMRB

88 “Back To The Future – Using Programmatic to Predict Future Behavior” by Marcus Siddons, Managing Director, MENA, Xaxis

134 “Burning Impressions – Making Experience Count for Brands” by Satish Dave, Regional Head - Customer Experience, Dubai, Kantar TNS

136 Our Insights

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Resources

142 BrandZ™ Valuation Methodology 145 BrandZ™ Reports, Apps and iPad Magazines 154 WPP Company Contributors 158 WPP & BrandZ™ Contacts 162 BrandZ™ Saudi Arabian Top 20 Team

FOREWORD At MBSC we are concerned with one thing above all – unlocking entrepreneurial potential in Saudi Arabia to create the jobs of the future and contribute to Saudi Arabia's knowledge economy.

Fahd Al Rasheed Vice Chairman of the Board of Trustees, Prince Mohammad Bin Salman College of Business and Entrepreneurship

Developing entrepreneurs is about more than passing on business skills and knowledge. Successful entrepreneurs recognize that the brand they create will add at least as much value to their business as the products they manufacture or the services they require.

The BrandZ™ methodology uniquely combines both the subjective and the objective elements of valuation. As the basis for long term assessment and management of a brand’s performance it provides both an external benchmark and an internal index against which brands can be measured.

Strong brands don’t arise through good fortune or by creative advertising. They are built through sustained investment not only in the external face of the business but in its ability to deliver on a promise of quality. Investment decisions, especially in new companies where demands on capital are high, must be carefully assessed against the benefits they bring to the business as a whole. Not only entrepreneurs but all businesses and institutions need a meaningful framework against which to measure brand value. What cannot be measured cannot be managed and what cannot be managed should not be financed.

This study of Saudi Arabia’s Most Valuable Brands provides emerging businesses with evidence, if such is needed, of the power of brands to drive success. Those companies that are inspired by this report and by subsequent studies to embrace the brand path to value will become the next talent developers and the creators of new job opportunities. And as these companies grow and expand regionally, they will become the next ambassadors for the nation, benefitting not only their customers but also the many other people for whom they create value – their local employees, partners and contractors, the communities in which they operate and the causes they support.

Brands enjoy a symbiotic relationship with business. Absent good business practice a brand cannot succeed. Without a strong brand, a business cannot achieve its full potential. A meaningful measure of brand value must embrace both subjective perception and objective analysis.

IMAGE COURTESY OF KAEC

MBSC is proud to support this report and we look forward to building on this body of knowledge in years to come.

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WELCOME

AMBITIOUS VISION DRIVING CHANGE IN REGION’S LARGEST MARKET Economic and social reforms offer longterm opportunity for brands to flourish

David Roth CEO, The Store WPP, EMEA and Asia

For decades, the Kingdom of Saudi Arabia has been synonymous with one word: oil. The country’s development – its economic growth, its stability and the prosperity of its people – has come as a direct result of its rich natural resources. Now, Saudi Arabia is embarking on a hugely ambitious and far-reaching program of transformation. Through the government’s Vision 2030 blueprint for change, the country hopes to move away from its reliance on oil, develop a thriving private sector, foster entrepreneurship, and improve people’s health and quality of life. This focus on Saudi Arabia’s human capital and on diversifying the economy presents local and global brands with an exciting opportunity and is the reason why, in 2017, we are inaugurating WPP’s BrandZ™ Top 20 Most Valuable Saudi Arabian Brands.

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Our pioneering study ranks the country’s most accomplished brands, analyzes their success, and identifies the key forces that are driving brands’ growth in this market. It is the first edition of what will be a regular study to track and anticipate the rapidly evolving environment for brands in the Kingdom, and will chart the changing value of the country’s most valuable brands. Saudi Arabia is the largest economy in the Gulf region, and changes in the structure of the economy provide opportunities for start-ups to grow into strong national and, ultimately, regional and global brands.

For international companies, there is the chance to play a role in the Kingdom’s transformation and longer-term future. Vision 2030 targets include increasing the private sector’s contribution to GDP from 40 percent to 65 percent. There are targets for renewableenergy production, improving the competitiveness of major cities, boosting home ownership, and increasing household spending on culture and entertainment. These all present opportunities for brands. At the same time, the government has set a target of 80 percent of retailing comprising the modern trade and e-commerce by 2030. Saudi Arabia has the largest population in the region, with close to 32 million people. But it is the youth of its population, not just its scale – 46 percent are aged under 25 – that is most exciting for brands. The Kingdom’s young people are respectful of tradition but are highly brand-aware; they are passionate about technology and seek out the products and brands that deliver innovation. In producing this report, we’re cooperating with the Prince Mohammad Bin Salman College of Business and Entrepreneurship (MBSC) at King Abdullah Economic City. MBSC is Saudi Arabia’s first tertiary educational institution to focus specifically on developing entrepreneurship and leadership skills among a new generation of business and government leaders. The College is emblematic of the country’s goal of supporting the development of new businesses and new opportunities for the young people who will drive the future of the economy. Saudi youth are both the consumers of brands and the creators – and the creatives – behind the value brands of the future. Whether you’re a Saudi brand or an international company, in this report, you’ll find knowledge and insight to help you grow more effectively in Saudi Arabia – and beyond.

On page 30, our Top 20 Take Aways provide succinct, action-oriented recommendations for brands based on our expert analysis of the market. We’ve also included guides to each of Saudi Arabia’s Top 20 Most Valuable Brands, along with market wisdom and sharp insights from WPP experts working in the Kingdom through Thought Leadership and Best Practice essays. All of this is presented with stunning photography and a vibrant design that reflects the change under way in this market. WPP is the global communications services leader and our companies have been working in Saudi Arabia for over 35 years. Today, over 400 people work across WPP companies in this market, providing advertising, marketing, insight, media, digital, shopper marketing and PR expertise. It’s part of our global presence in 112 countries. By linking all of this talent, creativity, wisdom and horizontality, we amplify global trends and insights to help our clients in useful and unique ways. We invite you to access our unrivalled BrandZ™ resource library. Along with the new BrandZ™ Top 20 Most Valuable Saudi Arabian Brands, the library includes these annual studies: BrandZ™ Top 100 Most Valuable Global Brands, BrandZ™ Top 100 Most Valuable Chinese Brands, BrandZ™ Top 50 Most Valuable Indonesian Brands, and BrandZ™ Top 50 Most Valuable Latin American Brands. To download these and other reports, please visit www.BrandZ.com. For the interactive BrandZ™ mobile app, go to www. BrandZ.com/mobile. The backbone of all of this intelligence remains the WPP proprietary BrandZ™ study. It is the world’s largest and only consumer-focused source of brand equity knowledge and insight, using the unique, authoritative BrandZ™ brand

valuation methodology by Kantar Millward Brown. First, we analyze corporate financial data and strip away everything that doesn’t pertain to the branded business. Then we take a crucial step that makes BrandZ™ unique among brand valuation methodologies: we conduct in-depth consumer research with more than 170,000 consumers a year, across more than 50 countries, to assess consumer attitudes to and relationships with more than 100,000 brands. Our database includes information from over 3.2 million consumers. It reveals the power of the brand in the mind of the consumer; it shows how brands create a predisposition to buy and, crucially, shows a positive correlation between strong, valuable brands and better sales. At WPP, we’re passionate about using our creativity to build and nurture strong, differentiated brands that deliver lasting shareholder value. To learn more about how to apply our experience and expertise to your brand, please contact any of the WPP companies that contributed expertise to this report. Turn to page 86 for summaries of each company and the contact details of key executives. Or feel free to contact me directly.

David Roth CEO The Store WPP, EMEA & Asia [email protected] Twitter: davidrothlondon Blog: www.davidroth.com

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T H I S I S S T I L L A L A R G E LY C A S H C U LT U R E . . .

. . . C A R D S A R E U S E D F O R B I G -T I C K E T I T E M S

INTRODUCTION

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

OVERVIEW

FROM FOSSIL FUEL TO GROWTH FUELLED BY TECHNOLOGY AND IDEAS One day in March 1938, a discovery was made in Dhahran, in the east of Saudi Arabia, that not only transformed the fortunes of this country but that reshaped the political geography of the Middle East and its relationship with the rest of the world.

That Thursday, drills identified what was soon to become known as the world’s largest source of oil. What followed was the rapid transformation of an economy that had been largely reliant on subsistence agriculture, limited longdistance trade, and tourism – essentially providing shelter and supplies to pilgrims headed to Makkah (Mecca) and Madinah (Medina). The desert still defines most people’s impressions of this country, but the desert outpost that was pre-oil Saudi Arabia is no longer. Saudi Arabia is now the 11th richest country in the world based on purchasing power parity; the capital, Riyadh, is a thriving high-rise business center, and there are more than 15 million smartphone users in the Kingdom.

Shifting sands There is now a clear understanding, however, that what has served Saudi Arabia well in the past will not be enough to secure it a sustainable future. At the highest levels of government, there is both the pressing need and the volition to move away from reliance on oil, and to do it quickly. Low oil prices in recent years have put significant pressure on the national budget, which are being addressed through the 2016 National Transformation Plan announced in June. The plan, backed by Deputy Crown Prince Mohammad Bin Salman, involves a cut to state-sector salaries and reduced holidays and bonuses. Energy and utility subsidies have been dropped, and there is the likelihood that some state assets will be sold. The aim is to have half of Saudis working in the private sector by 2020 – a huge shift given that Saudis occupy only 15 percent of privatesector jobs now. It also means a shift in mentality for a population that has for generations come to expect a safe and well-paid government job. IMAGE COURTESY OF KAEC

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SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

OVERVIEW The transformation plan is part of the Saudi government’s ‘Vision 2030’, a longer-term blueprint for change. This emphasizes technology and innovation in the private sector, and prescribes a more balanced economy for a healthier population and more vibrant society.

Index by 2030; it is currently 36th. Growth in e-learning and e-commerce are key parts of the vision.

is transforming the way people shop, make friends, share ideas – indeed, the way they live.

The opportunity for brands

Start-ups are being encouraged, with financial institutions urged to allocate up to 20 percent of overall funding to small and medium enterprises, helping SMEs grow their contribution to GDP from the current 20 percent to 35. Other signs of shifting priorities include the rollout of new rail lines to reduce reliance on diesel trucks for transporting goods around the country, most recently a link between the King Khalid International Airport and the northern borders.

This transformation will not be without its challenges, particularly for the lower middle classes most affected by government belt-tightening. But there are significant opportunities for entrepreneurs and established businesses to ride these waves of change and help Saudi people adjust to a new normal.

Saudi people are seeking out the brands that help them embrace modernity, progress and technology, but without making any compromises on their heritage and religion.

Women’s participation in the workforce is benchmarked to rise from 22 to 30 percent, and there are ambitious targets for public education, household spending on culture and entertainment, and public health. Faced with a widespread obesity problem and high rates of smoking, the Saudi government aims to get four in 10 people exercising at least weekly (it’s currently 13 percent) and to increase average life expectancy from 74 years to 80. Technology is at the heart of many of the proposed adjustments, with Riyadh seeking to make the Top Five of the United Nations E-Government Survey

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The ride-sharing service Uber, for instance, is proving instrumental in giving women, who are not allowed to drive in Saudi Arabia, the means to get to work. The Saudi government has invested $3.5 billion in the company, a further signal of its intention to back nonoil, tech-based business. As the focus of economic activity shifts, there will be expanding opportunity for brands in the healthcare, food, education, technology, business services and infrastructure sectors. There is hope for growth in the arts and entertainment sectors, and the Kingdom is seeking to expand its tourism industry, luring new visitors and encouraging pilgrims to extend their stay. Coinciding with the economic realignment are several other major forces that brand builders in Saudi Arabia must consider. There are an estimated 140,000 Saudis studying overseas, who will come back with fresh ideas about the future they want and how they can be part of it. The workforce is forecast to double in size by 2030 as many in this young population reach working age, and digital communication

BrandZ™ research into what sets the strongest brands apart from the competition shows that awareness is a key ingredient in consumer choice. But it is a brand’s ability to make a meaningful connection with a consumer that matters most. Brands must get noticed, but then they must have something of value to say. Successful brands in Saudi Arabia are telling stories that resonate with contemporary Saudis, and that help them navigate the tensions they face between tradition and modernity. Consumers are sophisticated and selective. They expect an increasingly complex relationship with the brands they make part of their lives. Advertising has immense power to help consumers identify the products, services and brands that can enrich their lives. But to advertise successfully in Saudi Arabia means achieving a delicate balance between reflecting deeply held and rigorously enforced cultural values, and at the same time being sufficiently bold and creative to make a lasting impression. Some of the local names featuring in the inaugural BrandZ™ Top 20 Most Valuable Saudi Brands 2017 are not just a domestic success but are also pioneers in the region. In the coming years, it is likely that more home-grown brands will start to realize bigger aspirations. The opportunity is there for local and international brands that can align themselves with the new vision that the Saudi government has for its country’s future.

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Introduction >  KEY RESULTS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY RESULTS

SPOTLIGHT ON OPPORTUNITIES FOR BRANDS Saudi Top 20 Brand equity together worth is strong US$37 billion

Banks are the biggest performers

The combined value of the BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017 is US $37.2 billion. This compares to the $57.2 billion total value of the Top 20 Most Valuable Indonesian Brands 2016, and the Top 20 Most Valuable Indian brands 2016, which are together worth $69.2 billion. The Saudi Top 20 is worth about 9 percent of the Chinese Top 20 of 2016, and is dwarfed by the Global Top 20 of 2016 ($1,869.7 billion), which are 50 times the value of the Saudi brands.

Finance brands – banks and insurance providers – make a strong showing in the Saudi Top 20, reflecting the role of the financial services sector in the Saudi economy and in Saudi life. Finance brands occupy four of the Top 10 places in the ranking, and the Top 20 features 10 banks and insurers, which between them account for 40 percent of the Top 20’s value. Finance brands are similarly strong in Indonesia, where in 2016 they made up 41 percent of the Top 20’s value, and in India (47 percent in 2016). In the Global 2016 ranking, however, which is dominated by technology brands; finance brands contribute only 11 percent of the value of the Top 20. Real Estate and Telecom Providers also feature strongly in the Saudi Top 20; brands that are essential to the development of a country’s infrastructure tend to perform well in these rankings and their strong showing in Saudi makes sense in light of government efforts to diversify the economy away from reliance on oil.

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The most successful brands in Saudi Arabia are proving effective at creating a connection with consumers that gives them a predisposition to purchase and a readiness to pay a premium. This is measured through the BrandZ™ Power Index, a brand equity measure that assesses how meaningful, different and ‘top of mind’ a brand is compared to its competitors. The Top 20 Saudi brands have an average Brand Power score of 283, which puts them on a par with leading brands around the world. The average score of all brands in each market is 100. In China, the Top 20 have a Brand Power score of 235, in Indonesia it’s 274 and in the Global ranking, the Top 20’s Brand Power averages 245. What is clear in Saudi Arabia, however, is that many of the less valuable brands are yet to make an impression on consumers. Almost one-third of all Saudi brands measured by BrandZ™ are “Clean Slate” brands consumers often don’t know they exist, or if they do, they are not well defined in people’s minds. This is a key area of opportunity.

STC is Saudi’s Retailers most valuable prove strong brand performers The telecommunications brand STC tops the inaugural BrandZ™ Top 20 Most Valuable Saudi Arabian Brands rankings, having built a presence not just in Saudi Arabia but also across the Middle East and North Africa over almost 20 years. Now a major provider of fixed-line, mobile and internet services, STC grew out of the Ministry of Post, Telegraph, and Telephone. It has a BrandZ brand value in 2017 of US$6.589 billion, and this one brand alone accounts for 18 percent of the total value of the Saudi Top 20. Such dominance of the ranking by the Number One brand is something we see in other markets; in China, the Number One brand (Tencent) holds 21 percent of the Top 20’s value, and in India (where HDFC Bank is top) it’s 19 percent. Telecommunications brands are among the biggest investors in advertising in Saudi Arabia, and are wellknown and understood by consumers.

Mega brands dominate The Top Two brands in the ranking, STC and Al Rajhi Bank, account for one-third of the total value of the Top 20, and the Top Five between them hold two-thirds of the Top 20 brands’ combined value. This concentration of value at the top of the ranking is also seen in China, India, Indonesia and Brazil. The exception to this pattern is the Global BrandZ™ valuation ranking, in which the value of brands is more evenly distributed throughout the rankings. In the 2016 Top 100 Most Valuable Global Brands, the Number One brand, Google, accounts for only 12 percent of the Top 20’s value.

Three retail brands make the Top 20 ranking in Saudi Arabia, and what’s interesting is that all three are primarily bricks-and-mortar stores. In the case of Panda and Al Othaim, they are supermarkets and hypermarkets, and Jarir Bookstore is a books, stationery and technology store. This prevalence of primarily physical retailers in the ranking has also been observed in Indonesia, though retailers in the China and Global BrandZ™ rankings tend to be those focused on e-commerce. As e-commerce takes off in the Kingdom – penetration is currently 23 percent, compared to 57 percent in the UK and just under 70 percent in Korea – we can expect to see physical retailers investing in more digital options to keep consumers loyal.

Local brands have deep connections Brands that were founded in Saudi Arabia dominate both the Top 20 ranking and the local marketplace. Of the 334 brands that were measured in the compilation of this ranking, 69 percent were local, 26 percent were global brands with a presence in the Kingdom, and the remaining 5 percent were regional brands. A high proportion of local brands is often seen in markets that are just beginning to open up; in Indonesia 45 percent of brands are local, while in Turkey it’s 34 percent and the UK 33 percent. BrandZ™ data shows that brands regardless of their origin can, however, build strength and value in Saudi Arabia by being meaningfully different to the competition and by achieving fame and widespread distribution.

Leaders justify their premium Innovation and positioning creativity key ingredients of brand health Among the Top 20 most valuable Saudi brands, there is a strong correlation between consumers’ sense of these brands being more highly priced than the competition, and a firm sense of that higher price being worth paying. More than 72 percent of Top 20 brands are in what we call the ‘sweet spot’ of being able to justify their premium to consumers. Some brands are operating in risky territory, however; nearly a quarter of the value of the Top 20 comes from brands that are perceived to be expensive but aren’t considered to be worth the extra money. These brands may be generating sales revenue for now but they are vulnerable to competition.

Saudi Arabia’s most valuable brands are doing as good a job as the strongest global brands when it comes to being seen as innovative, creative, providing a great experience, serving a purpose and being lovable. Jarir Bookstore and Almarai, the food and dairy producer, are up with Google and Ikea on these key measures of brand health, and brand health has a direct correlation with brand value.

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Introduction > KEY RESULTS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY RESULTS

TOP 5 LEARNINGS FOR MARKETERS

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Now is the time to invest in brand Saudi consumers are brand sensitive, talk about brands and take seriously brand recommendations from friends and family. The large number of brands that are not well-established in consumers’ minds, or are not even recognized, means the conditions are right for little-known brands to reinvent themselves and become challenger brands – and for those brands that now dominate their categories to demonstrate to consumers the value they offer and show that they deliver on their brand promise. The success of the brands that make the Top 20 show that this investment in brand generates results.

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It pays to be trusted Trust is a key ingredient of brand success in any market, but its role is underlined by analysis of the Saudi Top 20. BrandZ™ research shows there is a strong link between those brands that consistently deliver good value for money and the trust they have in the minds of consumers, and the most trusted brands are those that people feel are worth paying a premium for. Trust is not won overnight, but it is clearly worth making an investment in providing quality and value for money. The BrandZ™ Top 20 Most Valuable Saudi Brands 2017 outperform the Saudi average for all brands on measures of trust – and on their likelihood of making consumers’ consideration list.

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Emotional connections give brands a boost Brands that focus on making meaningful connections with consumers can punch above their financial weight in the BrandZ™ rankings. A meaningful connection means more than simply being well-known through spending big on advertising, and it goes beyond delivering quality and value, although this is expected too. Brands need to deliver meaning through their products and services and through their communications by creating emotional and memorable links with consumers’ lives.

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A great brand is a great brand A comparison of the attributes of brands that originate in Saudi Arabia and leading global brands shows many more consistencies than anomalies. While an understanding of local culture and media consumption patterns is essential for brand growth, what will be reassuring for global brands looking to grow in Saudi Arabia is just how much valuable global and local brands have in common. The strongest brands, regardless of origin, are seen as being trustworthy, wise, friendly and playful. Local Saudi brands tend to be seen as more generous, caring and brave, while global brands are more assertive, different and creative.

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Outstanding advertising with a big idea is essential, but it’s not the whole story Brands that not only do something great for consumers but also shout about it – in a creative, memorable way – improve their chances of being brought to mind when a consumer considers their category. But producing creative communications is just one of the ingredients of brand health. The strongest, most valuable brands are also seen as innovative, provide a great experience, serve a purpose and are lovable. When brands can do all of these things, they turbo-charge their Brand Power, a key ingredient in brand value.

SHOPPING TENDS TO FOCUS ON MALLS...

. . . A I R - C O N D I T I O N I N G O F F E R S R E S P I T E F R O M T H E H E AT

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Introduction > CROSS-CATEGORY TRENDS

CROSS-CATEGORY TRENDS

PROGRESS AND TRADITION IN UNIQUE BLEND Religion dictates behavior The strict form of Islam enforced in Saudi Arabia plays a role in determining almost every aspect of people’s lives, from what and when they eat, to how they dress, who they socialize with and their family structures. The way people interpret religion varies by region, however, and those in Jeddah are generally more liberal than consumers in Riyadh. For marketers, it is important to know that messages that are accepted and effective in other Muslim markets do not necessarily translate here. But some of the principles of religion – charity, dedication, self-improvement, and the importance of family – are themes that resonate with consumers of most ages here and can be linked to brands’ own sense of mission. At a more practical level, brands can look to the Ramadan fasting month for ways to add to the

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occasion. They can provide Eid gifting options, share in the social aspect of fasting and dining, and bring convenience to housewives under pressure to prepare large meals for their extended family. Domino’s Pizza, for instance, launched its Do-Minis mini pizzas for Ramadan and turned the usual 80 percent drop in sales during Ramadan into a 35 percent increase.

The youth of today Saudi Arabia’s young people have grown up with mobile phones and internet connections, and are among the world’s heaviest users of social media and YouTube. Across the Middle East, today’s young people are better-educated and more worldly than older generations, but in Saudi Arabia they are entering a workforce under pressure in which good jobs are no longer guaranteed; youth unemployment is almost 30 percent.

Dating before marriage is culturally unacceptable, but the Burson-Marsteller Arab Youth Survey 2016 shows that the majority wants greater personal freedoms, particularly for women. Messages that resonate with the complex world in which young people now find themselves are important, not just to sell to people today, but to build relationships with the adults and parents of tomorrow. Young men wear a traditional thobe robe during the week but in free time wear sportswear and jeans in social gatherings at the beach, desert or in coffee shops. Young women tend to spend their free time online or talking to friends on the phone or social media, and increasingly meet other female friends at their homes or for shopping. Accessories such as sunglasses, perfumes and mobile phones are important ways for young people to express themselves in a market where daytime dress is largely uniform.

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Introduction >  CROSS-CATEGORY TRENDS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

CROSS-CATEGORY TRENDS Retail and e-commerce

The rise of social media

Women’s unique and changing role

The shift towards the modern trade and e-commerce has been going on for some years but is accelerating now that smartphone ownership is universal in Saudi Arabia. Under the government’s Vision 2030 transformation plan, the modern trade and e-commerce together should contribute 80 percent of total retail sales by 2020, with the remainder tending to be individually owned stores, often clustered by category in different parts of a town. While consumers are well connected to the internet, there remains plenty of room for growth in online shopping. The global Kantar TNS Connected Life 2016 study shows that e-commerce penetration is 23 percent in the Kingdom, compared to 40 percent in China, 57 percent in the UK and just under 70 percent in South Korea and Norway. For brands and retailers that can earn consumer trust, and reassure people about payment security and product quality, there is room to stand out.

It is difficult to overstate the role of social media as a source of information, entertainment and influence in Saudi Arabia, particularly among the young but also across the broader population. Internet penetration is 70 percent, and the Kingdom reportedly has the heaviest per-capita YouTube use of any country in the world. There are more than 12 million Facebook users, and the country is home to more than 40 percent of all active Twitter users in the Arab region. Among the young, social media is to some extent replacing TV as a source of entertainment and news, but TV remains the primary source of news for Saudi youth, with 79 percent saying it’s their main news resource and one third watching TV news daily. Social media is therefore an essential part of brand-building in Saudi Arabia, and the unique characteristics of each network and the way it is used by consumers presents brands with a challenge and an opportunity. Repackaging a campaign for use in multiple places is not the answer; match the content to the audience and the platform for maximum impact.

The lives of Saudi women are to some extent dependent on their male relatives, under guardianship laws that require women to have permission to marry, to work and to travel outside the country. This restriction, along with the requirement that women wear an abaya (black gown) in public, and the bar on women driving, is a sign of the challenges a woman faces in Saudi society. Rules and expectations are evolving, however, particularly since the reign of the late King Abdullah, who in his later years accepted women onto the Shoura Council (advisory body) and relaxed rules on women in work. A handful of women have since represented Saudi Arabia at the Olympics, and in local elections in late 2015 women could vote and run for office for the first time. Change is slow, but gradual. While women are still scarce in public life, their influence behind closed doors is strong. Even if her husband does the shopping, for instance, it will often be with a brandspecific list prepared by the woman.

The search for wellbeing More than a quarter of adult men in Saudi Arabia smoke, more than a third of all Saudis are obese, with as many as seven in 10 overweight, including children. Poor food and drink choices combined with a sedentary lifestyle are leading to high levels of diabetes and heart disease, and consumers – who generally don’t have health insurance – are seeking ways to do something about that. People are looking to take control of their health, not just physically but also their emotional wellbeing, and are seeking products that help them achieve that. Food and drinks that offer health and a great taste will be in demand. As the government seeks to increase the number of people taking regular exercise, brands have an opportunity to gain prominence by promoting activity. The telecommunications brand Mobily has for several years sponsored the annual Jeddah Marathon.

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Introduction >  KEY TAKE AWAYS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY TAKE AWAYS

BUILDING VALUABLE BRANDS IN TODAY’S SAUDI ARABIA Be aware of regional variation in attitudes Consumers differ significantly in their tastes and expectations depending on where in Saudi Arabia they live. For this reason, new brands tend to launch first in Jeddah, the main entry point for Hajj pilgrims. People here have been exposed to other cultures for generations, and they pride themselves on being liberal and outward-looking, provided progress doesn’t conflict with their core beliefs. In the capital, Riyadh, the mood is more conservative; people are beginning to open up to ideas from outside the country, but with great caution for fear of changing too rapidly. In the industrial center of Dammam, in the east, there is a sense of conflict between change brought by progress and a strong desire to preserve tradition and defend the status quo.

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2

The population is young, but wealth is with the old The median age of Saudi people is 27 (compared to 36 in China and 38 in the US), and brands are usually drawn to the younger tech-savvy and generally outward-looking sector of the Saudi consumer audience. But much of the country’s wealth remains with this younger generation’s parents and grandparents. This creates a curious dynamic for brands; older consumers have more money to spend, but the big spenders of the future are looking at forming brand loyalties now. At the same time, young people who are earning their own money for the first time, rather than relying on their parents’ support, are using brands to make a clear statement of independence and selfexpression. When Dad is paying for their new shoes, they are unlikely to choose a style that will upset him, but when it’s their own money, they feel free to buy what they truly want.

3

Make promises and nurture trust

Trust, reliability and authenticity are essential qualities for a brand to succeed in Saudi Arabia. Trust is earned over a long period of time, and if lost, is almost impossible to recover. A bad experience is not just remembered but also shared, and in a society where the views of family and friends matter immensely, this is especially important. The benefits of building trust are huge, and favored brands often run through generations; sticking with a brand is seen as a way of continuing a family tradition and provides reassurance. At its simplest level, trust depends on ensuring that a brand’s promise matches up with what is ultimately delivered, and doing that consistently over time.

4

Offer value, enable smart choices

Consumer confidence has dropped five percentage points in the past year as economic growth has dipped to its lowest level in five years. While GDP growth is forecast to rebound in 2017, consumers have adjusted their spending habits and are rethinking the categories, products and brands they buy. This is an opportunity for brands. Buying quality remains a high priority, but people are looking for ways to buy smarter, and to get better value for money. Don’t make goods seem cheap, but show them as the answer to considered decision-making. This is particularly the case in categories that tend to be driven by impulse, or that are big-ticket items.

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Introduction >  KEY TAKE AWAYS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY TAKE AWAYS

5

People are keen to try new things The Saudi culture may appear conservative but there is a strong appetite, especially among the young, for trying new products and brands, and a sense of pride in being the first in a social group to have the latest thing. Being ahead of the curve is a badge of honor, particularly when it comes to technology items, which are highly prized and regularly updated. Brand awareness is high, even of brands that aren’t officially sold in Saudi Arabia. Wealthy Saudis are well travelled and have a knowledge and experience of global brands that goes beyond what is available locally.

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Shopping is fast becoming a family event Restrictions on the movement of women mean that men have traditionally done the family shopping, often with a list provided by their wife in which she sets out not just the product required but usually her preferred brand as well. The rise of modern, air-conditioned malls and a relaxation of this rule means that families frequently now shop together. Malls have huge appeal to consumers looking to escape the fierce Saudi heat and are a one-stop shopping destination. Beyond the malls, smaller stores tend to be clustered by category, so there are streets for buying mobile phones and another part of town for plumbing supplies or shoes. Corner stores called ‘baqala’ have been important destinations for families topping up between bigger shopping trips, but these are declining in number as supermarkets and hypermarkets expand their footprint.

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6

Align with consumers’ quest for good health In recent years, consumers have taken a growing interest in healthy living and how their consumption decisions affect their physical and mental wellbeing. This is leading to growing demand for products seen as fresh and natural, and a decline in interest in goods perceived as being fattening or otherwise overly indulgent. This shift affects not just food and drink but also the personal care and home care categories. There is a new openness to products with “alternative” ingredients that reduce harm or improve health.

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Retail for women is more than just shopping, it’s social Women are not allowed to drive in Saudi Arabia but are permitted to go out alone or with a driver, which means women are seeking out places to meet socially with friends. Shopping for clothing, accessories and items for the home is becoming a social activity to be shared among women, providing a change of scene, respite from the heat outdoors, and a chance to catch up with friends. While stores used to be primarily staffed by men, women are now increasingly taking jobs in retail, making shopping for women a more pleasant and easier experience.

9

Cards matter, but cash still rules

Most consumers have a bank account and penetration of debit cards is almost universal, but most people use their cards to withdraw cash, rather than using the cards to pay for goods directly. Credit cards are used mainly for biggerticket items, when it would be inconvenient to carry around so much cash, though card payment systems are widely available at the point of sale. Mini-marts, supermarkets and shops within malls all have electronic payment available, but ‘baqala’ corner stores only accept cash. There is an opportunity for payment-service providers, banks and retailers to encourage wider use of cards.

11

Get online and get mobile, but don’t forget TV

Video viewing levels on mobile phones are among the highest in the world, partly due to consumers’ passion for all things digital and partly because mobile phone subscriptions tend to be generous with data allowances by world standards. Between a third and half of all time spent watching video content is spent on a mobile device; everyone is online and has a mobile phone, so digital must be part of any media plan. But traditional television is still a powerful draw, and when combined with catch-up TV, still accounts for more of consumers’ time than mobile video: 41 percent. Look at the opportunity for cross-screen advertising that takes into account the multi-screening habits of Saudi consumers.

10

Mind the clutter, watch for gaps

There are key advertising seasons when every brand is active, and while the brand landscape is busy at these times, there’s a sense that if you want to maintain a presence in people’s minds, you have to be there too. Ramadan and the post-Ramadan holiday period of Eid are the busiest, along with the back-toschool season and events of national significance, during which brands take the opportunity to, for instance, publicly congratulate the king on a new achievement, or mark another historic event. Outside of these times, there are clear opportunities for brands to make a bigger impact on consumers, not just because media rates become more affordable, but because they can also experiment with ideas unrelated to festivals or events.

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Think social – consumers are ahead of the game

Brands are lagging behind consumers when it comes to social media. More than 90 percent of Saudi adults are online and nearly all of these people are using YouTube and other social media platforms, primarily Facebook and Instagram. Yet few brands have so far made real inroads into social media here, beyond having a branded page and inviting people to ‘like’ it. The closeness and immediacy that social media promises – and which is being used so effectively as a customer service and e-commerce tool in other highly social markets such as China – is an area for brands to explore in Saudi Arabia.

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Introduction >  KEY TAKE AWAYS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY TAKE AWAYS

13

Close the deal online Browsing and buying online – particularly via mobile – accounts for a large and growing proportion of the time that consumers spend with their devices. Already, 30 percent of financial services and 72 percent of hotel bookings are made online, and there are thriving local e-commerce sites. But shoppers in many categories are still not actually making their purchases online, and need reassuring about security and authenticity. There is also scope for improvement in logistics, as ‘needing it now’ is one of the common reasons people give for buying in a physical store rather than online.

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Make country of origin count Local, regional and global brands all stand to do well in this market if they present the right offering. There is great Saudi pride in local brands, and if a local brand is the best in its category then Saudis will usually prefer to buy it, particularly when it comes to food and drink. They are also open to brands from neighboring markets such as Egypt and Lebanon, and will opt for these over a local brand if the quality is superior. Consumers also have an open mind regarding global brands, and iPhone and Samsung are as popular here as in any other affluent market. The foreign-ness of these brands lends consumers assurances on product quality and innovation. Across categories, there is a general preference for American brands over European or Asian labels, but Saudis are sophisticated shoppers and are looking for the item or brand that best meets their needs, so being Korean is an asset in the technology sector, US cars are popular, and being French counts in luxury. Brands need to be aware that they represent their country of origin and vice versa, regardless of whether they promote their provenance, and in times of political tension, brands can often be made to pay for events beyond their control. A controversial cartoon of the prophet Mohammed in a Danish newspaper a decade ago had a damaging effect on sales of Danish products in Saudi Arabia.

15

Function sells, but consumers want more

Most ads in Saudi Arabia focus on price and function, and the emotional benefits of brands are frequently overlooked. There are many more rational ads in this market, yet it’s the ads that give weight to emotions such as parental love, admiration, pride, generosity and empathy that consumers say are the most enjoyable and the most memorable. Kantar Millward Brown research has found that the most persuasive ads of all, however, are those that combine a functional, rational message with emotion, and link the two very clearly to the brand.

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Families are at the heart of Saudi life, but in ads, they’re overused

In Saudi life, there is only family life. Children grow up with their parents and don’t usually move on until they are married and form their own family. Extended families often live under one roof and in neighboring properties, but there is no time in a Saudi person’s life when they live alone or share with friends. People cannot live with a partner outside of marriage. Family harmony is, not surprisingly, an oftused device in advertising in this market, but it is so widely deployed that one image of a well-stocked dining table often blends into the next. ‘Happy families’ imagery is growing tired, and for brands seeking to stand out, one easy way to do this is to steer clear of the standard ‘family around the table’ poses and seek a fresh take on happiness and togetherness.

IMAGE COURTESY OF KAEC

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Introduction >  KEY TAKE AWAYS SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

KEY TAKE AWAYS

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Respect religion, but don’t preach Religion is at the heart of Saudi law and every aspect of daily life, and brands need to be mindful of this in their communications. But it is simply expected that brands in this market will be respectful of religion, and there is no need to address it specifically. In fact, while consumers like brands to acknowledge their beliefs and the way they live their lives, they object to the idea of Islam being used in any kind of sales pitch. Overtly religious messages – even those with positive associations – are best avoided, and any ideas that are disrespectful to Islam should not be contemplated in this market. They will not only fail with consumers but also put a brand on the wrong side of the law.

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Famous faces have pulling power

While marketing in many other markets is awash with celebrities, in Saudi Arabia, only about 10 percent of ads include a famous person. Consumers say their enjoyment of ads is much higher, however, when there is a celebrity involved. Choose a celebrity ambassador carefully, to ensure their values chime with those of your brand so that the link is credible. While the celebrity needs to be instantly recognizable to have an impact, brands should think not just about people in entertainment but also stars of the digital world, such as prominent bloggers, and deploy them to highlight not just product benefits but to draw attention to corporate activity that reflects social responsibility.

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18

Don’t be afraid to crack a joke

The conservative nature of Saudi culture by world standards means brands are often reluctant to consider using humor in their communications for fear of causing offence. Consumers here love to laugh, however, and brands can use humor to cut through cluttered categories. The popularity of YouTube here is fuelling the appetite for humor and consumers want more. Visual humor appeals to people of all ages, and word play is seen as not just funny but also clever, reflecting well on the brands bold enough to use it. The Snickers campaign ‘You’re not you when you’re hungry’ shows how it’s done. These ads have proved popular and effective in Saudi Arabia.

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Ask about taboos – there’s often a workaround

It’s true that there are a lot of rules to abide by when it comes to building a brand in Saudi Arabia, but there are also a lot of myths, and sometimes rules aren’t as absolute as they seem. It’s not forbidden, as some people believe, for instance, to play music, though some of what’s often associated with music, such as dancing and mixing of the sexes, isn’t allowed. Drinks brand Vimto and Afia cooking oil are known in this market by the memorable music in their TV commercials, and the Zain mobile network is among brands using singers and other celebrities in their ads. It’s true that faces are often blurred or cropped from images on billboards, but faces do appear in other forms of advertising.

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CONSUMERS LOV E TO T RY SOME T HING NE W...

. . .T H E R E ’ S K U D O S I N B E I N G F I R S T

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

CENTERS OF POPULATION

ECONOMY & DEMOGRAPHICS

IRAN

IRAQ

LITERACY RATE

JORDAN

MEDIAN AGE

(aged 15 and over who can read and write)

Saudi Arabia

GDP

94.7%

KUWAIT

US $646 Billion

Saudi Arabia

26.8

97% of men & 91% of women

Malaysia

Iraq

Jordan

Japan

Oman

Oman

Turkey

Qatar

19.7

94.6%

GDP PER CAPITA

46.5

95.4%

Saudi Arabia

US $20,482

91.1%

Bahrain

Dammam

US $23,396

95%

1.0 million

Kuwait

US $28,985

25.1 32.8 UK

40.4

BAHRAIN

Oman

US

US $15,645

37.8

Turkey

US $9,130

Madinah

Riyadh

1.3 million

6.2 million

QATAR

RELIGION

US

US $55,837

Islam is the official religion, and the vast majority of Muslims are Sunni, with a small proportion of Shia Muslims. Other religions are present, particularly among the large expatriate population, but public expressions of non-Muslim faiths are not permitted.

EGYPT

GDP GROWTH

UNITED ARAB EMIRATES

5% 4%

3.6% 3.4%

3% 2.3%

2.7% 2% 1.9% 2.0% 1% 0%

2013 2014 2015 2016 2017 2018 (e) (f) (f) (f)

FOREIGN DIRECT INVESTMENT Saudi Arabia

US $215,909 Mil. Turkey

US $144,357 Mil. South Korea

US $174,573 Mil. UK

US $1,553,683 Mil. 40

POPULATION

31.5m

Jeddah

4.1 million

Makkah

1.8 million

OMAN

URBAN POPULATION

83.1

%

SUDAN

RATE OF URBANIZATION

2.1

%

POPULATION BY AGE

TECHNOLOGY LAND AREA 2,149,690 Sq. km (about the same as Mexico and about one-fifth the size of the US)

KSA

Fixed line subscriptions per 100 people: Internet users per 100 adults: Mobile subscriptions per 100 people:

14 90 190

Mexico

0-14 years

Male 3,850,992 Female 3,661,194

15-24 years

Male 2,839,161 Female 2,463,216

25-54 years

Male 7,244,386 Female 5,495,284

55-64 years

Male 710,827

Female 587,281

65 years and over

Male 460,209

Female 439,766

27.07% 19.11% 45.90% 4.68% 3.24%

YEMEN Sources: World Bank, CIA, Google, Kantar TNS

ERITREA

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Introduction >  MEDIA

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

MEDIA

MULTI-SCREENING CHANGES SPEND TRENDS IN UNIQUE MEDIA MARKET A young and technologysavvy population is embracing smartphones and the digital world they are connected to, and advertising investment is pursuing them.

Saudi Arabia reportedly has the heaviest consumers of YouTube of any country in the world. It is home to more than 40 percent of all active Twitter users and 10 percent of Facebook users in the Arab region. Twitter users include prominent clerics and members of the Saudi royal family. Saudi Arabia is unique in that it has primarily been an ad market driven not by television, as we see in most countries in the world, but by newspapers, which account for half of all measured media spend. There are more than 10 national daily papers as well as regional newspapers. The Saudi Arabian media landscape is closely monitored to guard against any content that is disrespectful of Islam, disparaging of the government

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or culturally offensive. Almost all domestic broadcasters are operated by the state-run Broadcasting Service of the Kingdom of Saudi Arabia (BSKSA). GroupM monitoring in this market shows that as online grows in appeal, newspapers have been losing significant ground with advertisers; spend in newspapers fell by 7 percent a year in each of the past two years, and dropped 34 percent in the first half of 2016. Magazines, too, are suffering as brands drift away from print. Television investment has declined heavily since 2013 but the pace of the decline has begun to slow, and radio, which accounts for about 20 percent of total monitored spend, is flat. Digital ad spend is not yet monitored.

Going digital

Online activity % of online population

2.3 % 86 % 90 % 13 % 34 % 89

Connected devices each

91 69 95 71 %

Listening to music

of adults use a smartphone

%

Shopping (made their last purchase via smartphone)

%

Watching YouTube

%

Search for local businesses

Source: Kantar TNS/Google

Ad spend by medium 2008

2012

2016

estimate

of adults are online

are ‘triple screeners’, using a smartphone, tablet and a PC to go online $68 million $55 million $810 million $46 million $196 million

use only a smartphone to access the internet

$94 million $197 million $921million $23 million $377 million

$39 million $251 million $677 million $27 million $230 million

Total Media Spend

Total Media Spend

Total Media Spend

$1,174 million

$1,612 million

$1,223 million

TV

Radio

Newspapers

Magazines

Outdoor Source: GroupM

of smartphone users use their phone while watching TV Source: Kantar TNS/Google

The “Connected Consumer” study by Kantar TNS and Google shows that Saudis have an average of two internet-connected devices each, and nine in 10 adults are online, compared to 37 percent in Egypt and 91 percent in the UAE.

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SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

MEDIA Leisure

Ad spend by category

2014

Leisure and personal care brands are the biggest investors in advertising in the Gulf Cooperation Council region, with finance, food and clothing among the fastest-growing. The chart below covers all six GCC markets, of which Saudi Arabia is by far the biggest. Saudi Arabia’s GDP is only slightly less than the GDP of the other five GCC member states combined. 2014

Personal Care 2015

2014

2015

$1,852 $2,715 million million

$1,622 $1,750 million million

+47% YoY increase in spend

+8% YoY increase in spend

Most popular brands on Facebook in Saudi Arabia

2015

1. Panda

2. Jarir Bookstore

3. STC

4. eXtra Stores

5. Souq.com

6. Souq.com UAE

7. Mobily

8. Lexus KSA

9. Samsung Mobile Saudi

10. Carrefour Saudi Source: socialbakers

Finance

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+

Food & Dairy

35

% +

YoY increase in spend

Clothing

31

% +

YoY increase in spend

%

YoY increase in spend

Leisure Personal Care Auto Food and Dairy Telecoms Providers Soft Drinks Finance Household equipment Pharmaceutical Real Estate Public Sector Household Care Technology Media Retail Education Clothing Source: GroupM

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Using social media to make a splash

THEORY IN ACTION

Virgin Mobile entered Saudi Arabia in 2014 as a new name up against well-established and trusted local and regional brands. The brand drew on the popularity of Facebook – which at that time had 9 million Saudi subscribers – to quickly gain awareness of the Virgin brand ahead of its launch, and retarget people who had shown an interest. Video and still ads in Facebook users’ news feeds helped get the message out, encouraging consumers to visit the Virgin site and select their new mobile number. Within a year, Virgin Mobile had signed up more than one million subscribers. 45

TRADITIONAL DRESS IS EXPECTED IN THE WORKPL ACE...

. . . B U T Y O U N G M E N G O C A S U A L AT W E E K E N D S

Introduction >  BRAND VALUE

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND VALUE

VALUE CONCENTRATED AMONG TOPRANKING BRANDS The majority of the value of the BrandZ™ Top 20 Most Valuable Saudi Arabian brands 2017 is concentrated at the top of the ranking, and is focused on just a handful of key categories. The Top 2 brands account for 33 percent of the total value of the Top 20, and among the Top 5 – which make up two-thirds of the ranking’s total value – four of the leading brands are involved in sectors that are essential to the development of infrastructure.

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Banks, insurers, real estate developers and telecommunications service providers dominate the Top 20 rankings, and this is a pattern we see in other markets that are developing quickly and opening up. Such a high concentration of brand value at the top of the ranking is also consistent with other markets. The Top 5 make up 64 percent of the total value of the Saudi Arabian BrandZ™ Top 20 – almost exactly the same proportion of value that the Top 5 in Brazil contributes to the Top 20 brands there, and a little more than China (the Top 5 Chinese brands make up 59 percent of the Top 20’s value) and India (56 percent). Outside of the Top 5, the brands in the Top 20 help paint a picture of the Saudi economy and daily life for Saudi consumers. Online connectivity is clearly a big part of people’s

lives, along with food brands and supermarkets. There is slightly less diversity among the Top 20 in Saudi Arabia than in other markets, where airlines, entertainment brands such as pay TV providers, personal care brands and drinks tend to feature, but this too reflects the focus of the national economy and the priorities of the people.

The Top 20 Breakdown

Top 5 brands

Top 2 brands

33

64

20

%

%

Brands 11-20

Brands 6-10

16

%

%

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

$12.16 billion

$23.94 billion

$7.39 billion

$5.93 billion Source: BrandZ™ / Kantar Millward Brown

The Top 5 STC

Al Rajhi Bank

Jabal Omar

Almarai

NCB

18 15 13 11 8 %

%

%

%

%

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

$6,589 million

$5,569 million

$4,887 million

$3,964 million

$2,929 million Source: BrandZ™ / Kantar Millward Brown

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Introduction >  CATEGORIES AND BRANDS

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND VALUE Categories and brands Financial services brands – banks and insurers – perform extremely well in the inaugural Saudi Arabian BrandZ™ Top 20 Most Valuable Saudi Brands study, taking one in every two places in the ranking, two places in the Top 5, and contributing 40 percent of the Top 20’s total value. Brands that are essential to economic development tend to perform well in BrandZ™ valuation rankings around the world. As the providers of funding for new infrastructure that forms part of the government’s efforts to provide more housing and diversify the economy, banks and insurers are playing a crucial role in the economy. This is also a highly competitive banking market, and brands invest heavily in communications to highlight their individual strengths. Fast-moving consumer goods brands make up three brands in the Top 20 and 13 percent of the ranking’s total value. This is broadly comparable to what we see in other markets, but while soft drinks and personal care brands –

in the holy city of Makkah (Mecca), while Dar Al-Arkan focuses on residential development.

particularly hair and skin care products – tend to feature heavily, in Saudi Arabia it is food brands that make the strongest showing. The role that meal times play in Saudi family life – along with strong demand for snacks on the go – is behind this emphasis on food and dairy brands. What also sets apart the Saudi ranking from those in other markets is the prevalence of Real Estate brands in the Top 20. While telecommunications brands, banks and FMCG brands tend to be among the most valuable in markets from China to Brazil, there is usually one stand-out category in each market that makes it distinct – and provides some insight into what makes the economy and consumers in that country different. In Brazil, for example, that distinctly Brazilian category is beer, with beer brands contributing 39 percent of the Top 20’s brand value. In India, it’s automotive brands, which are 29 percent of the Top 20 brands’ value, and in the Indonesian Top 20, tobacco brands comprise 37 percent. The strong showing by Real Estate brands in the Saudi ranking shows the sector’s importance and growing role in the local economy. Jabal Omar is behind the vast development taking place

As we have also seen in India and Indonesia, technology brands do not feature in the Saudi Arabian Top 20 rankings because local tech businesses have not yet reached the scale at which they become listed companies, one of the criteria for inclusion in BrandZ™ valuation studies. Major international technology brands such as YouTube, Google, Apple, Facebook and Twitter are widely used in this market, meaning there has been little need for homegrown alternatives to develop. This is quite a different picture to that in China, where many global tech brands such as Google, YouTube and Facebook are not available, so domestic brands have risen to prominence. Three of the Saudi Top 10 are technology-related brands, however, reflecting the role that connectivity plays in Saudi consumers’ lives: STC and Mobily provide consumers with their connection to the internet, via computer or mobile phone, and Jarir Bookstore has a strong focus on technology and is a leading supplier of phones and other tech hardware.

WAYS TO WIN

Businesses in Saudi Arabia that focus on building their brands and nurturing the power of strong brands get a significantly greater return on their investment; investment in brand affects the bottom line. In the Saudi Top 20, the 10 brands with the strongest Brand Power scores are together worth $24.962 billion, while the 10 with the lowest Brand Power scores have a combined value of $12.287 billion. Brand Power is a BrandZ™ metric of brand equity; it reflects a brand’s ability to predispose consumers to selecting that brand, and consumers’ willingness to pay a premium for it.

have Brand Power scores that are almost triple those of the average among all Saudi brands. During a period of economic rebalancing, marketers and CEOs in Saudi Arabia should be looking afresh at the role of brand building in their strategy for business growth. And, in a market where trust and personal recommendations are key, they should ensure they are clearly communicating what their brand represents. Brands that make the 2017 BrandZ™ Most Valuable Saudi Brands are almost 10 times more likely than other brands to be recommended to family and friends.

It is clear that many Saudi businesses are currently underinvesting in brand-building. The brands that make the 2017 Top 20

Saudi Arabia Top 20 Category Breakdown

Finance

Telecom Providers

Food & Dairy

40 24 13 %

of the total value of the BrandZ™ Saudi Arabian Top 20

%

of the total value of the BrandZ™ Saudi Arabian Top 20

$14,859 million $9,089 million 10 Brands

2 Brands

%

Retail

8

%

of the total value of the BrandZ™ Saudi Arabian Top 20

of the total value of the BrandZ™ Saudi Arabian Top 20

$4,782 million

$2,883 million

3 Brands

3 Brands

Real Estate

15

%

of the total value of the BrandZ™ Saudi Arabian Top 20

$5,636million 2 Brands Source: BrandZ™ / Kantar Millward Brown

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THEORY IN ACTION

Bupa Arabia will this year mark 20 years in Saudi Arabia, during which time it has established itself as the Kingdom’s leading provider of health insurance. Its mantra “With you for better health” gives the brand a clear mission – and a purpose that is evident in its offering and amplified through its communications. This brand purpose chimes with a series of innovations, including a telemedicine service that allows patients to consult with international doctors via teleconferencing, and access to ongoing health and wellness services such as elderly care and services for child health. The brand also strikes a balance between highlighting its international connections as part of the global Bupa Group, and its local relevance, through charity work over Ramadan. 51

Introduction > BRAND CONTRIBUTION

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND CONTRIBUTION

RETAILERS LEAD ON BRAND CONTRIBUTION Brand Contribution measures the proportion of brand value that comes from brand equity alone, without financials or other factors. Strong brand equity indicates that a brand is resilient, is able to increase sales volume, and is able to charge a premium, and a high Brand Contribution score, on a scale of five down to one, is a measure of the impact that brand strength is having on sales.

Behind Brand Contribution, there are three aspects of brands that we know make people buy more of a brand and willingly pay more for it. These are: being Meaningful, Different and Salient, or top of mind. Being Meaningful is the foundation of any brand; to be Meaningful, a brand needs to meet people’s needs and be liked. If not, it is unlikely to be bought. Trial of a product has a huge influence on whether people find a brand meaningful or not, but to get consumers to the point of trial means having advertising that focuses people’s attention on how the brand can enhance someone’s life. Being Different means the brand has a competitive edge when compared to other brands in the same category. Brands need to be different and come across in their communications as different if they are to stand out, but simply standing out is not enough. Brands must be Different in a way that is Meaningful to the consumer.

Salience – coming to mind when a consumer thinks about a category – is the main lever of growth for a brand, and sales growth is rarely present when Salience is low. Boosting awareness is therefore essential to drive brand growth, but unless a brand is also Meaningful and Different, then Salience alone is unlikely to deliver that.

The Top 20 Most Valuable Saudi Brands are:

28 % 31 % 46 %

more Meaningful

more Different

more Salient

than the average of all Saudi brands.

52

The Brand Contribution measure is what helps make the BrandZ™ rankings unique and the most authoritative. BrandZ™ is the only brand valuation methodology that obtains this customer view on brands through in-depth quantitative consumer research, both online and face-to-face, building up a global picture of brands on a category-bycategory and market-by-market basis. Saudi Arabia’s top-ranking brands for Brand Contribution are wellknown and much-loved brands that are a regular part of consumers’ everyday lives – and have been part of people’s lives for more than a generation. The Top 5 brands based on Brand Contribution are all between 30 and 40 years old; today’s consumers have grown up seeing their parents shopping at Panda, Jarir Bookstore and Al Othaim. They have seen Almarai products in their fridges and in stores for as long as they can remember. Repeated happy experiences over a long time generate a strong affinity between consumers and brands. Global brands with strong Brand Contribution scores include Coca-Cola and Nike. Panda and Al Othaim are both supermarket chains that continue to adapt to consumers’ changing needs and are expanding both in Saudi Arabia and in neighboring markets. Almarai is another Saudi brand that is exported around the region, famous for milk, fruit juice, cheese and yoghurt. Jarir Bookstore has evolved from its launch in the late 1970s as a supplier of books and school supplies into a modern-day books and technology hub. Panda, Almarai and Jarir all registered the maximum score of five on the Brand Contribution scale, with Al Othaim and the insurance company Tawuniya, which has been operating for 30 years, close behind with a score of four.

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Introduction >  BRAND CONTRIBUTION

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND CONTRIBUTION Starting from scratch There are many brands in Saudi Arabia that are not readily recognized or are not well understood. This is common phenomenon in countries that are either less economically developed or, as in the case of Saudi Arabia, are only just beginning to open up. We call these brands ‘Clean Slate’ brands, and in Saudi Arabia, 30 percent of all brands fall into this category, compared to a global average of 14 percent. Clean Slate brands have little brand equity driving consumer demand or margin, as they are not doing anything to justify a premium in consumers’ minds. The opportunity for these brands is to relaunch or reposition themselves, to define or reinvent themselves and make it clear to consumers what they promise. They must make their proposition highly relevant to their target audience, build visibility of the brand, through marketing, and of the product itself, through distribution, to reinforce awareness, build credibility and deliver sales.

% of brands that are regarded by consumers as ‘clean slates’ Vietnam 39

Cuba 38

Egypt 30

Saudi Arabia

India 28

China 22

Global Average

Australia 13

United States 9

Japan 6

14

30

Top 5 Brands by Brand Contribution

Brand Contribution Index

Brand Contribution Index

Brand Contribution Index

Brand Contribution Index

WAYS TO WIN

Brands can punch above their financial weight in the BrandZ™ rankings by focusing on making meaningful connections with consumers. These connections are about more than being top of mind when they people think of a category, or delivering dependable quality and value. Meaningful connections are based on emotional links, and the most successful brands bring meaning to consumers’ lives through their products but also through their communications, with emotiondriven and memorable messages that are clearly relevant to the

Brand Contribution Index

5 5 5 4 4 Brand Value

Brand Value

Brand Value

Brand Value

Brand Value

$1,082 million

$3,964 million

$1,352 million

$449 million

$969 million

Top 20 Rank

Top 20 Rank

Top 20 Rank

Top 20 Rank

Top 20 Rank

10

4

7

17

11

Top 20 Saudi Arabian Brands Average brand contribution index of Top 20

Average brand contribution index of brands 1-10

Average brand contribution index of brands 11-20

3.5 3.9 3.1 54

audience. Fast-moving consumer goods brands have frequent contact with consumers so find it easier to build meaning, but service brands can also build meaning, by looking beyond the traditional role their sector plays in people’s lives and developing new experiences through which consumers can experience the brand and share their values.

Brand contribution measures the influence of brand alone on financial value, on a scale of 1 to 5, 5 highest. Source: BrandZ™ / Kantar Millward Brown

THEORY IN ACTION

Mobily is a challenger brand in the telecommunications sector and has grown since its launch in 2005 to capture more than one-third of the mobile market. In a sector where quality is simply expected, Mobily has been a pioneer in developing packages of services priced together and in offering first-to-market services, such as personalized ringtones and unlimited data overseas. Its primary target audience has been young consumers. Mobily’s stores have a loungestyle layout to them, a first for the sector, and the brand’s community work and communications are also distinctive; Mobily focuses on connectivity in education, and has a ringtone that is instantly recognized across the Kingdom. Other challenger brands can learn from Mobily’s initial focus on a specific demographic with services that break the mould for the category before broadening the offer. 55

RELIGION AFFECTS EVERY ASPECT OF LIFE...

. . . M A RK E T IN G O F T E N F O C USE S O N RE L I G I O US F E S T I VA L S

Introduction >  BRAND HEALTH

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND HEALTH

Just as there are many contributors to human wellbeing, there are multiple factors that contribute towards a healthy brand. BrandZ™ analysis has identified five key attributes shared by healthy, strong and valuable brands.

1 4 INNOVATIVE BRAND PURPOSE 2 5 CREATIVE LOVE 3 BRAND EXPERIENCE Brands must be

There’s a strong sense of

which means they’re seen as leading the way in their sector and shaking things up.

so the brand makes people’s lives better.

They must also be

Over time, consumers develop a strong sense of

with powerful, memorable advertising.

towards the brand.

They provide a great

In Saudi Arabia, there is a small group of brands that performs well on all five Lifeblood measures, and these rank highly among the Top 20 Most Valuable Saudi Brands. They include: the telecommunications provider STC, which tops the ranking, Panda supermarkets, Jarir Bookstores and Almarai, the food and dairy brand. They have very healthy Lifeblood.

BrandZ™ analysis of 334 brands in Saudi Arabia, including the Top 20 Most Valuable brands, shows that only 8 percent are classed as healthy, while 57 percent are in the ‘OK’ range – healthy in some ways and struggling in others – and 35 percent are ‘out of shape’. Among the Top 20, 50 percent of brands have healthy Lifeblood, 35 percent are ‘OK’ and 15 percent are ‘out of shape’.

Because they’re worth it When brands have strong Lifeblood, they are seen as more valuable to consumers and are able to charge more. Among the Top 20 Saudi brands, there is a strong correlation between consumers’ sense of these brands being more highly

priced than the competition, and a strong sense of that higher price being worth paying. More than 72 percent of Top 20 brands are in what we call the ‘sweet spot’ of being able to justify their premium to consumers. Some brands are operating in risky territory, however; nearly a quarter of the value of the Top 20 comes from brands that are perceived to be expensive but aren’t considered to be worth the extra money. Brands that have healthy Lifeblood tend to have stronger Brand Power than those that are OK or out of shape. Brand Power is the proportion of volume driven by what the brand stands for, and the healthiest brands in the Top 20 have Brand Power scores that are seven times those of the less healthy brands.

Top 20 Brands % Value The Top 20 are mostly in the ‘sweet spot’ quadrant – and almost all are rated as being higher priced than the average brand. WORTH MORE

THE FIVE FACTORS IN BRAND WELLNESS AND FINDING THE ‘SWEET SPOT’

When a brand has all five of these attributes, they have healthy ‘Lifeblood’; if they are lacking in any one area, they are at risk of damaging their brand health and underperforming in the market. If they fail on all five measures, they are classed as being ‘out of shape’. Some of the best-known and most valuable brands in the world that score highly on all five of these measures include Ikea and Google.

2

72

2

24

%

Could charge more

%

Need repositioning

%

‘Sweet Spot’

%

Driving volume but at risk HIGHER PRICE Source: BrandZ™ / Kantar Millward Brown

that meets consumers’ needs, and is available when and where consumers need it.

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59

Introduction >  BRAND HEALTH

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND HEALTH

WAYS TO WIN

Brands should be aiming to get into the top right-hand side of the graph on page 59, and working hard to stay there. Those brands in the bottom right may be generating sales revenue for now – charging more than others in their category – but they are vulnerable to competition that either undercuts them on price or provides greater value to consumers at the same price. Those in the top left are undervaluing themselves and can afford to charge more if that is consistent with their business model, and those at the bottom

THEORY IN ACTION 60

left are ‘out of shape’. They need to rethink entirely their approach to brand building as they are perceived as cheap, yet still not worth the money. There is a strong link between brand health, or Lifeblood, and a strong performance in all of the five factors of wellness; one or two alone is not enough to sustain a healthy brand.

“Not just a bookstore” has long been the tagline of Jarir Bookstores, and its range lives up to the promise, with computers and electronics as well as art and school supplies and books. It ticks the box for innovation by frequently being first to market with new mobile phones and other technology, and prides itself on in-store service. Many consumers have grown up buying their school supplies from Jarir and now shop here for their own children, and years of dependable service have led to love. The ability to shop in multiple categories during one shopping trip makes Jarir a destination for family shopping and, although it’s not the cheapest in its sector, consumers see the brand as one that justifies its premium pricing for specific shopping missions. 61

Introduction >  BRAND SAUDI ARABIA

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND SAUDI ARABIA

GENEROUS AND BRAVE – THE FEATURES THAT SET TOP SAUDI BRANDS APART

Top 20 Brand Characteristics Brands in Saudi Arabia have much in common with the most valuable global brands. They share trustworthiness and friendliness, though are seen as less rebellious and more caring.

Brave

Idealistic

The BrandZ™ country personality profile for Saudi Arabia, compiled from the descriptions local consumers use about the country’s most valuable brands, shows that the Top 20 most valuable brands in this market share many of the attributes of the most valuable global brands.

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This profile is created by asking consumers to select from a collection of 20 personality traits, and having them match the terms to the brands they know. The personality map on the right represents the cumulative impression that Saudi consumers have of the country’s Top 20 most valuable brands. Saudi brands emerge as more brave and idealistic than leading global brands, and more caring and generous. They are more trustworthy and wise than the average of brands in this market – attributes that the most valuable global brands also over-index on. They also project a sense of being in control. While Saudi brands are seen generally as playful, the Top 20 are much less rebellious and more innocent than the global Top 20.

While the Top 20 most valuable global brands are perceived as less kind than the average of all brands around the world, the Saudi Top 20 ranks average for kindness. The most valuable global brands are seen as 7 percent more ‘different’ than Saudi brands, and this is an area brand managers in the Kingdom can focus on. A country’s brand personality helps brand owners understand how a particular brand fits into consumers’ general view of brands across categories. For brands with international aspirations, country comparisons, or comparisons with the global average, can highlight potential areas of advantage and disadvantage, where association with the country of origin can either slow down or help propel a brand as it expands into new markets.

Saudi Arabia has a fairly low profile on the international stage, known outside the region mainly for being deeply religious and little understood beyond that. This affects the way people around the world regard the country, its people and – crucially for brand-builders looking to export Saudi brands – the products and services that come from there.

Caring

Generous

Saudi Arabia Global

Kind Source: BrandZ™ / Kantar Millward Brown

The J. Walter Thompson Intelligence Personality Atlas, a 27-country study of the stereotypes and perceptions of people around the world, highlights a divergence of opinion between how Saudis think about their country and its products and brands, how others in the region see them, and the views of people from the rest of the world. The Personality Atlas, based on interviews with more than 6,000 people, shows there is a ‘positivity gap’ in Saudi Arabia, as with many other markets; this means people tend to feel more positively about their own country than people in other markets do. Locally, half of Saudis say they feel very positively about their country overall; this compares with 35 percent of Chinese who feel very positively about China, 36 percent of Indonesians who say the same about their country, and 45 percent of Pakistanis who feel very positively about Pakistan.

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Introduction >  BRAND SAUDI ARABIA

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND SAUDI ARABIA Around the Middle East, however, 33 percent of people (excluding Saudis) feel very positively about Saudi Arabia, and globally, 28 percent of people feel the same. This level of global positivity is roughly on a par with people’s views on Hong Kong and Finland. The countries with the highest levels of global positivity are Canada and Australia; Saudi Arabia ranks higher than China, Spain and Egypt on this measure. When asked specifically about the attributes they associate with Saudi Arabia, the Kingdom’s personality is described as being religious and a bit dull. People around the world do not

see Saudi Arabia as being cultured or creative; perceptions are very similar to the way Pakistan is seen around the world. There are other countries that are also seen as religious – including Thailand, India and Indonesia – but rather than making those countries seem dull, a religious focus is associated with contentment for these countries. Saudis themselves, however, don’t just see themselves as religious; they describe their country as welcoming, family-focused, consistent, trustworthy and humorous. Consumers in other Middle Eastern countries are more likely than local Saudis to appreciate the Kingdom’s culture.

When asked specifically about products and brands from Saudi Arabia, global consumers don’t have the best impressions; they describe Saudi products as being “not for me” and “boring”, which is similar to perceptions of brands from other Middle Eastern markets, though consumers in neighboring markets, who perhaps know more about the Kingdom, are more open to buying Saudi. They are more likely than Saudis to see ‘made in Saudi Arabia’ as a marker of quality and trust, while Saudi consumers see local brands as reliable, ethical and built with pride.

Saudi Arabian Product Perceptions Innovative

Ethical

Has questionable ingredients

Poor Safety Boring

High Quality

Reliable

Built with Pride

Sexy

Impressive

Low Class

Stylish

Trustworthy

Mass Produced

Expensive

Well Designed Environmental

Cheap Not for Me

Interesting Source: J. Walter Thompson Intelligence Personality Atlas

64

trustworthy, but Saudi brands looking to export beyond the Middle East have some work to do to convince consumers they are worth considering. Global consumers have difficulty seeing how Saudi brands might connect with their lives and brands are readily dismissed as lacking excitement.

Ordinary

Trendy

Local Regional Global

WAYS TO WIN

The BrandZ™ Top 20 Most Valuable Saudi Brands 2017 ranking shows that local consumers take pride in local brands and their success. These brands have become an important part of people’s lives by being relevant; the same rules of relevance apply to international brands looking to expand here. The key is making a locally relevant connection with consumers. Brand Saudi, meanwhile, is somewhat understood around the region as a symbol of quality and as being

THEORY IN ACTION

Panda was the first supermarket chain to open in Saudi Arabia, and has managed to establish a network of stores across all regions of the Kingdom, which is something other grocery brands have not been able to match so far. Panda has adapted store formats to shoppers’ changing needs, and drives footfall with brochures in stores featuring special offers. Its communications go beyond price and assortment, and highlight the brand’s community work as well as fun activities that on occasion have broken Guinness World Records. Panda has expanded beyond Saudi Arabia and is now established across the United Arab Emirates and in Egypt. 65

Introduction >  BRAND AGE

SECTION 1 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND AGE

THE POWER OF NEW - YOUTH OF SAUDI BRANDS REFLECTS TIME OF ECONOMIC CHANGE

Average age of Top 20 brands around the world

Saudi Arabia 1980

Brazil 1936

LatAm 1949

Global 1955

India 1961

Indonesia 1961

China 1982

Oldest brands – year of launch The age of brands in the Saudi Top 20 is very young by global standards. In the Top 20, the average age is 37 years, which correlates with a launch date of 1981. The average age of the BrandZ™ Top 20 Most Valuable Global brands is 62.

The Saudi average reflects the relative youth of many national businesses in the Kingdom; until the 1970s, the big companies with nation-wide recognition tended to be banks and other financial services providers, which were involved in building the infrastructure of modern Saudi Arabia. In the late 70s and 80s, retailing began to change, and retailers such as Panda and Jarir Bookstore first opened their doors. Local FMCG brands, including Almarai, another brand in the Top 20, also launched at this time.

In the 1990s and 2000s, as the Kingdom’s economy – and consumers’ lives – evolved, brands linked to technological developments were launched, including mobile phone networks. At the same time, global brands started looking to Saudi Arabia for growth, and this explains the presence of brands such as Bupa Arabia in the Top 20. China shares with Saudi Arabia a young set of Top 20 brands, but for a different reason; many of China’s Top 20 brands are technology brands, and these are inherently young.

Saudi Arabia BANK

Brazil BANK

LatAm BEER

Global BANK

India BISCUIT

Indonesia BANK

China BANK

1926

1808

1888

1852

1892

1895

1912

Youngest brands – year of launch

Saudi Arabia L’USINE

Brazil TELECOMS

LatAm RETAIL

Global FACEBOOK

India BANK

Indonesia TOBACCO

China INSURANCE

2007

2003

2004

2004

2003

2005

2003

Source: BrandZ™ / Kantar Millward Brown

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WOMEN ARE NOT ALLOWED TO DRIVE...

. . . B U T U B E R I S G I V I N G T H E M G R E AT E R F R E E D O M

THOUGHT LEADERSHIP

SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Thought Leadership 

THOUGHT LEADERSHIP

WHERE TO NOW? FROM CMO TO CExO

The textbook approach to brand-building starts with identifying a business opportunity, developing a great product or service, then taking it to market. This is still, in essence, true today. But digital technology is now forcing businesses to think about brand building from a much broader perspective.

DuPont famously said that that “a brand is a promise.” However, that promise no longer resides solely in the boardroom or the marketing department. The social media revolution makes it impossible to manage brand reputation using traditional marketing tools and techniques. Brands today need to transition from centering on ‘promises’, to creating and sustaining truly differentiating experiences, to becoming part of a conversation with consumers within which the product is simply one aspect of the organization’s ability to delight people.

Fahd Hamidaddin Secretary General of NEXT Festival Chief Commercial Officer, KAEC

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In the digital era, the sale is not the finish line for a brand – it’s merely a step along the journey that the customer takes with the brand. In this new environment, successful brands are shifting their focus from being product-centric to being experience-centric. To succeed in this environment, the traditional Chief Marketing Officer is giving way to the Chief Experience Officer.

To succeed as an experiential brand requires the mastery of three imperatives which are simple in concept, but demanding and complex in execution:

than a place to live, or work or visit. Great city brands provide a compelling and innovative experience at every step of the customer journey.

• Communicate proactively. Tell customers what to expect before they have to ask, but simultaneously listen to what they’re saying about their own needs and your brand, and adjust your offer in line with their feedback.

At KAEC, our customers are many and varied. We focus on engaging people in a variety of conversations. Conversations about living and working in KAEC. Conversations about growing and visiting the city. Stories about the future that they want for themselves and their families.

• Make it easy. Use data effectively to understand consumers and anticipate the products, services and information they need at each stage of their involvement with the brand, making every interaction with the brand effortless for the consumer. • See the bigger picture. Work on delivering innovative experiences, not just once but again and again, so that the brand becomes more than a product or service the customer once bought. Every experience should take the consumer to a new level of appreciation and loyalty for the brand.

The city as a brand When most people think of brands they don’t usually think of cities, yet a city is the ultimate experiential brand. Indeed the experience of a city is something that stays with a visitor or resident much longer than the memory of the destination itself. Think of Paris; imagine New York. These immensely powerful city brands instantly bring to mind not just buildings and facilities but deep emotions – even for people who’ve never set foot in them. Cities exist in the most competitive brand space in the world. 247,000 cities around the world are all vying to attract and retain both investment and talented people. To compete and win in this hypercompetitive space, cities must offer more

We need to ground these conversations both in the physical product that is the city itself and the myriad experiences that residents and visitors have every day. We need to factor these experiences into every one of our assets and services. Our experience-centric brand model therefore not only helps us attract and retain customers, it also gives our customers a role in shaping and defining our brand. This shift in approach is significant. To build the KAEC brand we are no longer simply generating marketing campaigns that promote the strengths of the city. We are constantly seeking to better understand our key customer segments; we’re looking at the specific touchpoints along customer journeys so we can anticipate people’s needs; and we are striving every day to deliver a highquality, innovative experience. It is this focus on the customer experience that has enabled us to position KAEC as a premium brand, despite being one of the world’s newest cities. Customer expectations are constantly evolving. It is only by evaluating and improving the customer’s experience – not only on the day they make a purchase decision, but also before that time and well beyond it – that brands will compete and win in the future.

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SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Thought Leadership 

THOUGHT LEADERSHIP

2030 VISION – THE ROLE OF BRANDS IN A NEW SAUDI ARABIA Ramel Kabbani, Executive Director, Landor [email protected]

In April 2016, Saudi Arabia’s Deputy Crown Prince Mohammad Bin Salman delivered a blueprint for the diversification of the Saudi economy, setting out the Kingdom’s transition from its dependency on oil. Named Vision 2030, this plan sets out goals for the country that presents brands in Saudi Arabia with new opportunities, but also presents new challenges.

At the heart of the plan are the following key points: 1 Plans to privatize a big chunk of bluechip Saudi public-sector companies such as Aramco, which is the jewel in the crown, and attract more international investment into the Kingdom.

4 A drive to increase home ownership amongst Saudis so that more than 50 percent of the population fully own their homes. 5 Development of a world-class tourism industry based not only around religious pilgrimages but also history and cultural tourism. 6 Plans to empower women—a longdue move that many sceptics are doubtful will actually happen but which could have a large, positive impact on the Kingdom’s social and economic development. Vision 2030 was received very positively amongst Saudis, especially by the young, who account for almost 50 percent of the population. Privatization of publicly owned companies will, however, inevitably affect the subsidies and benefits that Saudis have enjoyed for decades. And, in the absence of a well-told narrative that people can readily relate to and rally around, when they see their “generous privileges” cut, there is a risk that consumers will become disillusioned.

2 Efforts to reduce unemployment (which is currently 29 percent among 16 to 29-year-olds) and create more private-sector jobs for Saudi’s young population who have traditionally been drawn to the comforts of the state sector.

For brand-builders in Saudi Arabia, it is important to align with the direction in which the Kingdom is moving. Brand builders and managers have to quickly realize the real meaning of the social and economic goals that Vision 2030 sets out, and the many ways in which these changes will affect their internal and external stakeholders, including consumers and employees.

3 A push to elevate educational standards to match those in leading global economies to prepare young Saudi job seekers to compete in the private-sector jobs market.

They must focus especially on what these changes mean to millennial Saudis, the very group of people whose future will be most affected and eventually shaped by Vision 2030.

In a global study that Landor conducted recently into millennials, it was found that while they are optimistic about the economy and the impact brands can have on their future, they are also deeply cynical about brands that make promises they can’t deliver on. That is why, more than ever before, strong Saudi brands from both the public and private sectors need to communicate effectively, communicate constantly, and communicate honestly. Brands are powerful in not only effectively communicating new ideas and big promises, but also in building emotional bridges and creating a sense of higher purpose and belonging with their audiences. Brands have the ability, if they do it right, to spark meaningful conversations, be multi-sensory and forge memorable experiences that influence behavior. Now, brands’ stories and the values they represent need to reflect the national goals of the Kingdom and their effect on consumers. Brands can help consumers manage the cultural, social and economic shifts that will result from the country’s transformation. Newness, youth, vigor and world-class are all hallmarks of Vision 2030 and are attributes that brands can align themselves with, along with being smart, authentic and even open-minded. Of course, brands need to do this while still differentiating themselves from the competition. Vision 2030 is an opportunity for brands to either be part of this important point in history, or to get in the way of those who are leaping forward. The latter will eventually be forced out of the game.

A global leader in brand consulting and design, Landor helps clients create agile brands that thrive in today’s dynamic, disruptive marketplace. www.landor.com

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Thought Leadership 

THOUGHT LEADERSHIP

RIDING OUT THE STORMS – AGILITY AT THE HEART OF SUCCESS IN THE DIGITAL AGE

There was a time when ‘brand’ was almost synonymous with ‘logo’. This was a time when visual consistency was prized over everything else; when strict brand guidelines were preferred to seemingly vague principles. When brand experiences were almost a distant afterthought. But then came the era of digital technology – and the world has never been the same since. Digital channels of communication and social media have greatly affected the fabric of societies and cultures across the globe. They have not only given people new ways to keep in touch, but also altered how people relate to each other and the world around them. They have altered the very nature of social interactions, generally enhancing their potential. They have connected peoples and cultures, bringing the world closer together. The significance of digital tech lies in its pervasiveness – it isn’t restricted to a certain community or demographic, but affects entire populations. The digital shift has undoubtedly created great opportunity for brands. The shift has opened up multiple avenues and

By Bengt Eriksson, Managing Director, Landor [email protected]

A global leader in brand consulting and design, Landor helps clients create agile brands that thrive in today’s dynamic, disruptive marketplace.

channels for brands to reach out to their consumers. It has provided the opportunity to engage directly with individual customers, something that was nearly impossible only a few years ago. It provides the opportunity to collaborate with consumers on a scale never seen before. However, technology is a double-edged sword. Over time, digital technology has given rise to a complex, demanding set of consumers with skyrocketing expectations. It has enabled consumers to be collaborators in the brand management process, which, to brand managers, can be quite daunting. It has given consumers a voice – one that can be used to elevate a brand among its peers, or bring it crashing down. Consumers today are no longer just consumers – they’re effectively brand partners. Many brands are today grappling with this new breed of consumers. How do they effectively engage them? How do they meet their rising and ever-evolving expectations? How do they redress any missteps in an era of ‘real time’? In essence, how do they navigate this whole new consumer ecosystem? Today, change is the only constant, and it is ever-more important for brands to evolve in tandem with consumers and their world – while staying true to their heritage, principles and values. Brands that lose sight of their values risk being perceived as inauthentic and baseless, losing trust and respect among an increasingly disloyal customer base. Brands should ensure that their stories are told across channels and media in a coherent, singular voice, reflecting their core values.

That said, successful brands of the future will be those that are agile – those that ride on the pulse of change. In fact, the most successful brands will be those that can lead the change, through insight, experimentation and bold action. While the visual assets of a brand will always be important, successful brands of the future will place the focus on the experience of the brand rather than just the logo. They will be active, collaborative and transformative – in creative and relevant new ways. With this shifting definition of brand, it is essential for branding agencies to evolve accordingly. Agencies best suited to dealing with this paradigm shift are those with agile thinking at their core. Landor’s founder, Walter Landor, invented branding from the deck of a ferryboat named Klamath, a rather unconventional office, to circumvent the rising rents on land in San Francisco. His unique solution was relevant, fit for purpose, and solved the problem at hand – with panache! This was agile thinking done 75 years ago, and the Landor of today carries forth Walter’s agile legacy into the digital era. Brand managers and their agencies need to evolve. In keeping with today’s collaborative spirit, they must forge fresh alliances and new partnerships. Going forward, brands and businesses can expect to encounter more complexity, more untrodden paths and more challenges. While it’s hard to accurately predict what the world of tomorrow will look like, it may be possible to successfully ride the coming wave if we learn to find opportunity where others find distress. The coming times may be unpredictable, but they sure will be exciting – but only for those of us who think agile.

www.landor.com 76

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Thought Leadership 

THOUGHT LEADERSHIP

SOCIAL MEDIA ‘COTTAGE INDUSTRY’ EMPOWERING SAUDI YOUTH Olga Kudryashova, Regional Head of Strategy and Planning, MENA, Y&R [email protected]

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Hussah Al Sudairy, Associate Creative Director, MENA, Y&R [email protected]

Y&R is one of the leading global marketing communications companies, comprising the iconic Y&R advertising agency; VML, one of the world’s most highly regarded digital agencies; premier mobile marketing company iconmobile; shopper marketing and retail network Labstore; and Bravo, our integrated solutions agency for multicultural marketplaces.

A combination of unique socio-economic factors, cultural idiosyncrasies and the growing number of highly engaged social media users has led the “connected” generation of Saudi Arabia to develop a new business model: services, readymade and made-to-order goods are being promoted, sold and delivered by private individuals almost entirely using Instagram and WhatsApp.

This highly efficient, lucrative and modernized hybrid of cottage industry and social commerce is helping Saudi youth combat the lack of employment opportunities and diversify the private sector of the national economy. But is there more to it? Are we witnessing the beginning of a new type of economy created by self-taught mobile entrepreneurs and delivered through a seamless, on-demand merger of the physical and virtual worlds? Instagram entrepreneur “Accessories_ar” sells jewelry, watches and wallets. She has 121,000 followers and handles up to 25 orders a day. The owner of the “Ikea_del” Instagram account offers delivery and assembly of furniture bought from IKEA at more favorable rates and in a shorter time than the retailer itself. He has 278K followers. “Sh3biat3”, with over 7,000 Instagram followers,

caters for private events with homemade food. So far, the fastest-growing categories have been food and catering, delivery services, furniture delivery and assembly, and clothing. The spectrum of services is expected to expand as Saudi Arabia’s young generation gets a taste of instant income, self-reliance and experimentation. How does it work? The model can be called “social cottage industry” because it is usually a small, informal enterprise with marketing and order-handling elements performed through social media. The examples above all use Instagram as a virtual shop window and a channel for interaction. The sales and delivery logistics then take place through WhatsApp, which allows instant order placement, provides a direct communication channel between the buyer and the seller, and enables geolocation. The two channels effortlessly cover the full path to purchase, and crucially, are always open for customer feedback. The followers are the customer base; the referral mechanism is simple and free – just forward or share with a friend in one click. The good old cash-ondelivery payment practice works well, and remains the preferred method of payment for goods ordered online in Saudi Arabia. What makes it work? There are a number of factors that nurture the rapid growth of this business model in Saudi Arabia. First is the digital environment and habits of the people. According to the 2015 Arab Social Media Report, produced by TNS, over one-third of the Saudi population is active on social media. GMI 2016 Social Media Statistics show that 91 percent of those who have a social account are on WhatsApp. Instagram usage in Saudi Arabia is double the global average, Bloomberg reports. For private businesses, these platforms provide outstanding reach without requiring any investment in marketing.

Secondly, this business model presents a rare opportunity for Saudi women to establish their own enterprises, bypassing the gender restrictions they face in many aspects of their lives. For a Saudi woman, having her own income, without having to rely on male guardians, is seen as the ultimate personal achievement. Thirdly, the real-time nature of social media challenges and often exceeds the customer service standards offered by traditional retail, especially when it comes to a personalized approach, communication between the buyer and the seller, and the speed of delivery. And, finally, face-to-face interactions have always been an important part of the culture of doing business in the Arab world. Face-to-face interactions build trust, understanding and a real sense of a shared mission in business deals. Social media platforms, and chat applications in particular, create that sense of being in a one-to-one conversation that feels almost as personal as a face-to-face meeting. For the time being, although Instagram in Saudi Arabia is full of these small, social businesses, their contribution to the national economy remains unmeasured. What is evident though, is the potential of the “connected” youth to reshape the fundamentals of trade and create new value propositions. According to the CIA’s World Factbook, Saudi Arabia’s youth population “generally lacks the education and technical skills the private sector needs”. But it may be that they have lacked the formal training to develop the resourcefulness and confidence needed to explore new business avenues. Now, through the “social cottage industry” model, they are acquiring these skills for themselves, and this is just a starting point. The 13 million Saudi netizens under the age of 30 present a powerful force to pilot the formation of a new type of economy and revolutionize the way we do business.

www.yr.com

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W O M E N ’ S R O L E S I N S O C I E T Y A R E S L O W LY C H A N G I N G . . .

. . .W I T H I M P L I C AT I O N S F O R B O T H M E N A N D W O M E N

SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Thought Leadership 

THOUGHT LEADERSHIP

MEET SAUDI YOUTH: SMART, SOPHISTICATED AND SWITCHED-ON Sunil John Founder & Chief Executive Officer ASDA’A Burson-Marsteller [email protected]

Saudi Arabia is the most attractive, and possibly the most misunderstood, market in the Middle East. It has the population and the economy to transform a small local player into a regional giant. But it is perceived as a tough nut to crack, even though there’s a simple key to cracking this market: understanding its youth.

Here, 60 percent of the country’s 31 million people are under 21. The simple truth is: if you want to sell in Saudi, you need to sell to its youth. But attempting to get a handle on this most critical demographic is not easy, which is why ASDA’A Burson-Marsteller launched the annual Arab Youth Survey (AYS) in 2008. The survey covers attitudes to politics, religion, media and more. This analysis from the AYS 2016 (www.arabyouthsurvey.com) provides exclusive insight into the attitudes of Saudi youth, and contrasts them with their peers elsewhere in the region. What emerges from this is a unique profile of the Saudi youth – one that is smart, sophisticated and switched-on.

With unemployment a key challenge facing the Arab world today, young Saudis clearly see education as the key to their own and the region’s future. While 58 percent of youth across all 16 AYS markets want to pursue higher education, in Saudi this figure rises to 87 percent. A clue to this appetite for education may be found in the analysis relating to employment choices. Across the Arab world, 50 percent of young people want to work in the state sector, and in GCC

states, this rises to 70 percent. But when we look at individual countries in the GCC, things get interesting: in Kuwait, 95 percent of young people want to work in the government, but in Saudi this falls to 55 percent. Saudi youth it appears, are increasingly aware that the private sector, and not a constantly expanding public sector, is the answer to the employment issue; they see that the better their education, the better their chances of success in the competitive private sector.

Young Saudis overwhemingly want to further their education KSA

GCC

87

%

Yes No I would like to but I currently can’t Don’t know

Are you keen on furthering your education, i.e. bachelor degree, post-grad degree, or vocational qualification?

61

%

ASDA’A Burson-Marsteller Arab Youth Survey 2016

ASDA’A Burson-Marsteller is the region’s leading public relations consultancy, providing services to governments, multinational businesses and regional corporate clients through its specialist practices: Technology, Finance, Healthcare, Brand Communications, Corporate Communications and Public Affairs. asdaabm.com | burson-marsteller.com

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SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

THOUGHT LEADERSHIP According to the AYS 2016, Saudi youth are also more entrepreneurial than their peers in the Arab world. Asked whether this generation is more likely to start a business than the preceding one, just over half of all Arab youth said yes. However, almost three quarters of Saudis (73 percent) agreed with this – the third highest, after Qataris (85 percent) and Omanis (80 percent). Across the region, just over a third (36 percent) of young Arabs want to start their own business in the next five years. That in itself is an encouraging figure, but in Saudi this figure rises to 64 percent, with real estate (25 percent), technology (16 percent) and retail (15 percent) being their favored industries.

Asked what governments could do to support entrepreneurs, 46 percent of young Saudis said encouraging affordable lending, also the top pick for young Arabs as a whole at 39 percent.

young Saudis at least once a week (76 percent regionally). Instagram is used at least weekly by 91 percent of young Saudis (the regional average is 62).

Smartphone or tablet ownership stands at 100 percent among Saudi youth, but TV remains king for news. When asked ‘where do you get your news?’ 79 percent of young Saudis cited television (the regional average was 63 percent), and one-third watch TV news daily. This is a trust issue: 70 percent of young Saudis say TV is their most trusted source of news (46 percent say the same across the region).

Looking at brands, Saudi youth look more favorably than average for the region towards American brands, with 65 percent viewing US brands positively (the regional average was 41 percent). Saudis are, however, among the most likely to consider boycotting a brand for political reasons, with 57 percent saying they would, against a regional average of 29 percent, and second only to young Qataris, where 72 percent would consider a boycott for political reasons.

Young Saudis, like their peers throughout the region, are highly active on social media; WhatsApp is used daily by 92 percent of young Saudis (62 percent in the region) and YouTube, known as ‘Saudi cinema’, is watched by 88 percent of

This understanding can guide both policymakers and private-sector decisionmakers. Ultimately, understanding the hearts and minds of Saudi youth - and creating plans that resonate with them will help unlock success.

Saudi youth more keen on private-sector jobs than GCC peers KSA

GCC

29

%

15

%

Government Private sector No preference Don’t know Would you prefer to work in government or for the private sector? ASDA’A Burson-Marsteller Arab Youth Survey 2016

IMAGE COURTESY OF KAEC 84

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SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Thought Leadership 

THOUGHT LEADERSHIP

GLOBAL STRATEGY, LOCAL RELEVANCE

Multinational corporations have to make difficult decisions regarding the marketing strategy they adopt across all the markets in which they operate. Global strategies aim to maximize standardization and homogenization of marketing activities, but often global strategy has to be adapted to meet local conditions, driven by economic, political, social and cultural differences across markets.

Product-driven glocal strategy

Marketers need to consider both their product and communication strategies. Depending upon the extent of standardization or localization of each, their strategy could ultimately be “truly global”, with both a standard product and standard communication. Or, it might be “totally local”, with both a local product and communication. Perhaps it will be “glocal”. This blend of local and global is the way many multinational corporations have found they can best connect with consumers in an unfamiliar world.

Localization in communication

How can brands strike the right balance between global strategy and local relevance? Let’s look at some examples of ways brands have successfully adapted their global approach to local markets in different ways.

One of the most well-known global brands is McDonald’s. But this international brand has succeeded around the world by localizing. It has adapted its offer by appealing to local tastes in food and beverages. So, while the branding, look and feel of a McDonald’s outlet is quite standardized across the world, they offer McSpaghetti in the Philippines, the McAloo Tikki Burger in India and the McArabia wrap in the Middle East. Even in categories like technology and hospitality, product-driven localization has been used successfully. Mobile phones brands started offering features like flashlights and anti-dust keypads when they went into Asian and African markets, and most international hotel chains operating in the MENA region provide facilities in keeping with religious values of their local clientele.

Marketing communications is perhaps the element that has to be localized the most, to take into account social and cultural norms. Popular celebrities are often used to convey a brand message that is globally consistent; Lux and Coca-Cola have worked with Arab film and music stars such as Mona Zaki, Elissa and Nancy Ajram as brand ambassadors in the Middle East, to bring to life their global brand positioning. Similarly, international brands like Vimto, Quaker Oats and Tang have built up a strong association with Ramadan in Saudi Arabia, by consistently running Ramadan-specific communications and offers over the years.

Packaging-driven localization

Gagan Bhalla, Managing Director, Kantar Insights, North Africa & Iran, Kantar AMRB [email protected] 86

AMRB provides bespoke research solutions in the areas of consumer understanding, new product development, segmentation and pricing, shopper solutions, B2B and stakeholder loyalty research.

Many MNCs initially found it a challenge to make inroads into emerging markets because, while consumers had confidence in their quality, they simply couldn’t afford them. This changed when the likes of

Unilever and P&G came up with sachets for their shampoos and detergents, which brought the products within reach of midto low-income consumers. In China, many brands have used Chinese translations of their brand names to invoke positive consumer sentiment. Cadbury leverages the characters for “auspiciousness” in its Chinese name, while Bud’s Ice Cream combines the lucky number eight with one of the two characters that comprise “happiness”.

Localization in distribution Countries that are predominantly driven by the traditional trade have posed challenges for MNCs used to working in modern-trade environments. In India, for example, distribution models have incorporated cycles, rickshaws and even boats to ensure last-mile connectivity with mom-and-pop stores (called Kirana) in rural communities. Similarly, Japan’s more than 50,000 “konbini” stores are an integral part of the distribution chain as they combine a convenience store with e-commerce options. Underestimating the value of localization can be dangerous. In Japan, Facebook lost its leadership position to local social network Mixi, because it did not understand Japanese cultural nuances well enough. While in the US, having a large number of friends is seen as a sign of popularity, in Japan it is considered superficial. Mixi, in contrast to Facebook, does not have a “Like” button, does not mention number of friends and does not have a public wall, so is culturally more acceptable. The need to strike the right balance of local and global attributes does not apply just to international brands entering this market; it applies to local Saudi or regional brands with global aspirations, such as Almarai, Etisalat, Zain and Rani. They are all expanding their footprint internationally, and need to be equally cognizant of social and cultural norms in the markets that they are entering.

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SECTION 2 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Thought Leadership 

THOUGHT LEADERSHIP

BACK TO THE FUTURE – USING PROGRAMMATIC TO PREDICT FUTURE BEHAVIOR

All predictions are based on extrapolating from current trends. If we expect ‘more of the same’, it’s not difficult to make predictions about the near future. But history has shown us that the future is not always simply more of the same.

The world of finance has historically based forecasts of future returns on patterns seen over the previous 20 to 30 years. To some extent, this is still what happens. Pension fund managers are reliant on steady, comparatively high, compound returns many years into the future. Are equities and bonds likely to deliver the same sort of returns in the next 30 years as they have in the last 30 years? Nobody knows, but as Karl Marx famously noted, ‘everything that is solid melts into air’.

The world of digital media continues to use old truisms to predict future behavior. While developments in the media industry, and in programmatic in particular, have accelerated at breakneck speed, our planning and measurement standards have not kept pace. Many media plans continue to use impressions, context, clicks and click-through rates as proxies for audience engagement or an outcome. Believe it or not, we’ve been using these measurement criteria for nearly 20 years now. Much of this is understandable; like the finance industry, we have relied on historical data to predict future behavior. However, programmatic, and the data powering the decisioning, is rapidly challenging this status quo. The traditional methodology, to go from research, to insight, to big idea, is therefore evolving towards the generation of live insights. These insights can be applied to creative and media, and their impact can be predicted up front, whether those outcomes are a guaranteed audience, a certain level of engagement, or another, quantifiable outcome. There are three keys drivers of this: 1. Data processing is becoming faster and cheaper by the day 2. Data is genuinely real time, or close to it 3. Programmatic has made such data instantly actionable Brands and marketers need to quickly re-tool as the transformation takes place, and re-tooling is an apt description of what is going on. The exploitation of coal drove the First Industrial Revolution.

Marcus Siddons, Managing Director, MENA, Xaxis [email protected]

Widespread electrification, the car and cheap oil powered the Second Industrial Revolution. Software and the Internet have driven the Third Industrial Revolution. Artificial Intelligence and robotics are moving us into the Fourth Industrial Revolution. The established norms of media planning are changing rapidly, and will continue to do so. Paraphrasing Bill Gates: we often overestimate how quickly change will occur, but under-estimate its ultimate impact. It's now possible to predict both consumer interest and intent across hundreds of user segments. Such work can be carried out on an insights and analytics level, or move straight into execution. Integrating artificial intelligence capabilities is the next stepping stone. One of the genuine opportunities of growth markets such as Saudi Arabia is that we can quickly learn from what has and hasn’t worked in other more established markets. This has and will continue to allow Saudi Arabia to leapfrog digital growing pains that markets such as the US or Europe may have gone through. The explosion of innovative social and mobile work in Saudi Arabia illustrates this. Programmatic now offers brands and marketers in the region, particularly young graduates joining the industry, a chance to re-define how brands go about reaching and engaging with their target audience. It’s time to challenge our established digital currencies and, like the finance industry, adapt to a new Fourth Revolution. While no one truly knows what the next 20 years will bring, we can be fairly sure it won’t be like the last 20 years.

Through the expert use of proprietary data and advertising technology along with unparalleled media relationships, Xaxis delivers results for over 2,800 clients in 45 markets throughout the world. www.xaxis.com

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SAUDI CONSUMERS LOVE SOCIAL MEDIA...

. . .T H E Y A R E T H E B I G G E S T Y O U T U B E R S I N T H E W O R L D

Saudi Arabian Top 20  >  INSIGHTS

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

INSIGHTS There is meaningful change taking place in Saudi Arabia regarding opportunities for women. They are well educated, and many seek a balance between family life and a career. Understandably, this shift is attracting much media and public attention. But, what does this all mean for Saudi men? A cultural version of Newton’s third law of physics – that every action has an equal and opposite reaction - may well apply here. Saudi culture is rooted firmly in the paternalistic guardianship of men. Their very masculinity is rooted in the role of man as a guardian, provider and leader. As we rethink the way we communicate with women to match their burgeoning independence, we would do well to also consider what changing gender roles mean for the way we speak to men.

Arnold Miler

Qualitative Director, AME Kantar TNS [email protected]

WHAT CHANGE FOR WOMEN MEANS FOR SAUDI MEN

PARTNERING WITH THE NATION’S INNOVATION AMBASSADORS

Brands have a role to play in championing women entrepreneurs, through funding, mentorship, partnership opportunities and training. By working directly with women entrepreneurs, the nation’s top brands will reap the benefits of groundbreaking solutions that emerge from these ventures. Women entrepreneurs can then serve as the innovation ambassadors for the country, effectively influencing the future of the nation in every milieu.

Female capital – the value women bring to the world – is growing, as women take more prominent roles as leaders, politicians, economists, scientists, pioneers, activists, athletes, actors and artists. According to Euromonitor, the disposable income of women in Saudi Arabia will grow from $3,103 per capita in 2013 to $3,859 per capita in 2020 - a 24 percent increase.

J. Walter Thompson has tracked the gradual evolution of women in Saudi Arabia and the region, and identified 15 ‘tribes’ of women that brands should pay attention to but are largely ignoring. These range from ‘Donna Drapers’, who are starting to make an impression in the boardroom, to ‘Super Saudi Athletes’ who are rewriting the rules for women on sport, fitness and health.

Men will be looking for new expressions of strength, courage and pride, and to take pride in their family. Brands can help men find new reasons to be admired, and ways to retain a sense of manhood as their role changes over time.

Saudi women are both highly educated and highly unemployed. A whopping 78.3 percent of unemployed women have university degrees; women make up only 15 percent of the nation’s workforce, and own a mere 12 percent of private enterprises. Compare that to the United States, where women own 38 percent of businesses. This is changing however, and a recent study at one of Saudi Arabia’s top universities found that roughly one in four female students were keen to set up their own businesses after graduation. Market conditions are changing to make this possible, and women are looking beyond the food and fashion sectors in which women entrepreneurs have tended to launch.

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CHANGING THE CONVERSATION – THE MANY FACES OF SAUDI WOMEN, UNVEILED

It’s clearly time to change the conversation – to understand these emerging tribes and be part of the narrative that Saudi women are writing for themselves.

Mennah Ibrahim MEA Director J. Walter Thompson Intelligence [email protected]

Shifts in Saudi society are influencing family relationships. No longer does the authoritative male rule the household; couples increasingly share decision-making, and it is not uncommon to see a woman shopping alone or with just her children, without her husband. This was unimaginable just a decade ago. Women are not just buying food and household items, either; 20 percent of luxury sedans purchased in Saudi today are by women, and women account for 25 percent of traders investing in the Saudi Stock Exchange (Tadawul).

Aneesh Sharma

Edwin Coutinho

Executive Director Brand Union [email protected]

AVP Kantar AMRB [email protected]

In surveys conducted by Kantar companies, more and more Saudi women describe themselves as their family’s primary decision makers regarding big-ticket consumer durables. And when it comes to children, often a woman feels she is in control of their future. She has a strong say in the kind of education, talent development and choices that the child needs to make.

Yet women frequently feel overlooked by brands, particularly in brand communications. “The way media depict Saudi women, it is more relevant for my grandmother,” one woman told a Kantar researcher. Women are too often shown solely as a cook or caring home-maker, and feel ignored entirely by categories such as banking, tech and automotive. Alyoum chicken’s TV commercial stands out for depicting this new, emergent equilibrium by showing a mother and child taking a selfie together with the dish she has prepared. And Puck cheese’s ad celebrates the mom as a chef rather than just one who cooks. It is critical that brands recognize the new role of Saudi women within their families and the shift away from male authority in the home. As the couple, rather than just the man, increasingly becomes more central to family decision-making, it is important to celebrate and encourage this change to connect better with both the man and woman.

DECISION TIME – THE SHIFTING BALANCE WITHIN FAMILIES 93

HOUSEHOLD BUDGETS ARE UNDER PRESSURE...

...MAKE DEALS LOOK LIKE A SMART MOVE

SAUDI ARABIAN TOP 20

Saudi Arabian Top 20  >  TOP 20 BRANDS

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRANDZ™ TOP 20 MOST VALUABLE 1

6 Category: Telecom Providers Total Brand Value: $6,589 million Brand Contribution Index: 4

2

Category: Telecom Providers Total Brand Value: $2,500 million Brand Contribution Index: 4

Category: Banks Total Brand Value: $5,569 million Brand Contribution Index: 3

Category: Retail Total Brand Value: $449 million Brand Contribution Index: 4

18

13

(Formerly Saudi Hollandi Bank)

Category: Insurance Total Brand Value: $1,309 million Brand Contribution Index: 4

9 Category: Food and Dairy Total Brand Value: $3,964 million Brand Contribution Index: 5

Category: Banks Total Brand Value: $847 million Brand Contribution Index: 3

10

Brand contribution measures the influence of brand alone on financial value, on a scale of 1 to 5, 5 highest. Source: BrandZ™ / Kantar Millward Brown

Category: Real Estate Total Brand Value: $749 million Brand Contribution Index: 4

Category: Banks Total Brand Value: $344 million Brand Contribution Index: 1

20

15 Category: Retail Total Brand Value: $1,082 million Brand Contribution Index: 5

Category: Banks Total Brand Value: $372 million Brand Contribution Index: 3

19

14 Category: Banks Total Brand Value: $1,142 million Brand Contribution Index: 3

Category: Banks Total Brand Value: $2,929 million Brand Contribution Index: 3

98

Category: Banks Total Brand Value: $905 million Brand Contribution Index: 3

Bupa Arabia

Category: Real Estate Total Brand Value: $4,887 million Brand Contribution Index: 3

5

Category: Banks Total Brand Value: $473 million Brand Contribution Index: 2

17

12

8

4

Category: Insurance Total Brand Value: $969 million Brand Contribution Index: 4

Category: Retail Total Brand Value: $1,352 million Brand Contribution Index: 5

Jabal Omar

16

11

7

3

SAUDI ARABIAN BRANDS 2017

Category: Food and Dairy Total Brand Value: $478 million Brand Contribution Index: 4

Category: Food and Dairy Total Brand Value: $339 million Brand Contribution Index: 3 Saudi Hollandi Bank launched a new corporate identity Alawwal Bank on November 2016. This brand valuation is based on the consumer study of the Saudi Hollandi Bank brand.

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Saudi Arabian Top 20  >  BRAND PROFILES

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND PROFILES 1 2 Company: Saudi Telecom Company (STC) Total Brand Value: $6,589 million Headquarter City: Riyadh Industry: Telecom Providers Year Formed: 1998

STC was the first telecommunications service provider in Saudi Arabia and has established a reputation for reliability in the provision of landline, internet and mobile services. The brand was established in 1998; prior to that, the business was part of the Ministry of Post, Telegraph, and Telephone. STC is now the largest telco provider in the Middle East and North Africa, with a presence in nine countries outside the Kingdom. In several markets it operates under the VIVA brand name. In May 2016, STC announced the launch of a new mobile brand, Jawwy, aimed at the huge number of young and techsavvy consumers in Saudi Arabia. The app-based service allows consumers to build their own data plan to suit their needs, access help and offers, and earn free data by inviting friends to join. Other developments include the launch of free high-speed Wi-Fi for spectators at the King Abdullah Sports City Stadium, and plans for a public Wi-Fi system along the corniche in the south-western city of Jazan, which would be the largest public Wi-Fi network in the Kingdom. Its Air Roaming service allows customers to use their mobiles during flights with partner airlines. STC remains 70 percent owned by the Public Investment Fund, with remaining shares listed on the Saudi Stock Exchange (Tadawul).

100

Company: Al Rajhi Bank Total Brand Value: $5,569 million Headquarter City: Riyadh Industry: Banks Year Formed: 1957

Al Rajhi Bank claims to have the largest banking network in the country, with around 500 branches, including 118 that are exclusively for use by women, as well as ATMs and remittance centers. It has a strong Islamic banking offering, and provides specialist services such as banking for small businesses or for corporations at specific branches. It is one of the oldest names in banking in the Kingdom, founded in 1957 by four brothers from the wealthy Al-Rajhi family, and while its primary focus is Saudi Arabia, it also operates in Kuwait, Jordan and Malaysia. In 2015, the bank’s board appointed former Standard Chartered group executive director Steve Bertamini to the post of CEO as part of widescale restructuring. The bank is known for its work in the community, which in 2016 included sponsoring 15 orphans and 15 visually impaired people to undertake the Hajj pilgrimage. In mid-2016, Al Rajhi launched a financing scheme in conjunction with the Real Estate Development Fund to extend people’s access to finance; the bank provides free loans to consumers and the REDF pays fees to the bank on consumers’ behalf. The Al-Rajhi family owns the majority of the company; 45 percent of the company is traded on the Saudi Stock Exchange (Tadawul).

3

Company: Jabal Omar Development Company Total Brand Value: $4,887 million Headquarter City: Makkah (Mecca) Industry: Real Estate Year Formed: 2006

Jabal Omar is one of the largest real estate developers in the Middle East, and is best known for its vast development around the holy city of Makkah (Mecca), where it is focused on providing accommodation for pilgrims. Its flagship Jabal Omar Towers project is being developed in stages, and when completed will cover two million square meters and have the capacity to host 36,000 people year-round, and 100,000 during the annual Hajj pilgrimage. The development’s hotel towers will serve as a gateway to the city’s Grand Mosque. Part of the site is already operational; it will ultimately house international hotel brands including Hilton Suites, Hyatt Regency, Marriott and Conrad, along with residential towers, commercial space, car parking and one of the biggest shopping centers in the country. Jabal Omar in 2016 agreed to provide commercial space to Bin Dawood Group, the owner of the grocery retail brands Bin Dawood and Danube. Jabal Omar Development Company shares are traded on the Saudi Stock Exchange (Tadawul). The company’s founders are shareholders; other major investors include Makkah Construction and Development, and Hassana Investment Co.

4

Company: Almarai Company Total Brand Value: $3,964 million Headquarter City: Riyadh Industry: Food and Dairy Year Formed: 1977

Almarai is a popular brand of food and drinks, famous for its fruit juices, fresh and long-life milk products and its cheese and yoghurt range. The brand promotes itself as “Quality you can trust” and has become a household name since its launch in 1977. It is also one of Saudi Arabia’s best-known exports to other countries in the region; the majority of Almarai’s sales come from its home market, but the brand is available in the other GCC states as well as Jordan, Yemen, Lebanon and Egypt. The Almarai business, which includes bakery brands L’usine and 7DAYS, and the infant formula brand Nuralac, has been expanding despite the decline in oil prices that has dampened growth for many Saudi businesses. Almarai is well known for its Ramadan campaigns, which go beyond promoting the range to deliver a heartfelt message to those who are fasting. Community work includes a “Future Leaders” initiative to identify and promote talented graduates within the business, and sponsorship of the annual tourism event the Saudi Summer Festival. The company was founded by Prince Sultan Bin Mohammad bin Saud Al Kabeer in 1977 and is traded on the Saudi Stock Exchange, or Tadawul.

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Saudi Arabian Top 20  >  BRAND PROFILES

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND PROFILES 5

6 7

Company: The National Commercial Bank (NCB) Total Brand Value: $2,929 million Headquarter City: Riyadh Industry: Banks Year Formed: 1953

NCB, also known locally as Al Ahli Bank (or national bank), is one of the largest consumer and commercial banks in the Middle East, and was the first bank to be licensed to operate in Saudi Arabia. It is regarded as a pioneer in its sector in the region, particularly in its development of Islamic finance products and, more recently, in its application of technology to banking. In the past year, NCB has updated its web site and online banking app, promoting it as the fast, simple and modern way to bank. It has 350 branches and nearly 3,000 ATMs throughout the kingdom. NCB’s communications tend to focus on its residential and vehicle financing products. NCB rebranded in 2013 with a new, more modern-looking logo. In line with the government’s push to create jobs for local Saudis, NCB has this year achieved 94 percent Saudi national employees. Its CSR efforts include projects to provide orphans with educational support and medical insurance, and support for young entrepreneurs who want to start their own business. NCB held its initial public offering, of 25 percent of its shares, in 2014. The largest NCB shareholder is the Public Investment Fund, which holds a 44 percent stake in the business; the Public Pension Agency and Hassana Investment Co each hold 10 percent. Shares are traded on the Saudi Stock Exchange (Tadawul).

Company: Etihad Etisalat Co. (Mobily) Total Brand Value: $2,500 million Headquarter City: Riyadh Industry: Telecom Providers Year Formed: 2005

Mobily was not the first mobile and internet service provider in the country, but has positioned itself as the most modern, innovative and competitive on pricing. It is known in the market for its deals on packages and bundled services, and for being first to market with new services. Mobily was the first mobile provider to offer MMS messages when the technology was new, the first to give customers the opportunity to personalize their ringtones and, more recently, the first to offer unlimited data during international roaming. In its first 90 days of operations, Mobily signed up one million subscribers; it now has approximately 38 percent market share, the second-largest share in the Kingdom. The brand’s distinctive ringtone is well known across Saudi Arabia. Community work focuses on education. Mobily recently launched a program called “Qiyadi”, which aims to prepare the next generation of business leaders, and is installing high-speed internet in schools in the country’s east. Other new initiatives include the “Dorar” app for pilgrims, which gives guidance on the Hajj and Umrah rituals. Mobily was set up by UAE-based Etisalat; major shareholders include Emirates Telecommunication Corp, which has a 27 percent stake, and the General Organization for Social Insurance, with just under 12 percent. Shares are traded on the Saudi Stock Exchange (Tadawul).

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Company: Jarir Marketing Company Total Brand Value: $1,352 million Headquarter City: Riyadh Industry: Retail Year Formed: 1979

Jarir Bookstores is a major books and electronics retailer in Saudi Arabia and the region, with 45 branches across 14 Saudi cities and in Qatar, Kuwait and the United Arab Emirates. The brand promotes itself as “Jarir Bookstore... not just a bookstore”, and it carries a wide range of computers, mobile phones and other electronics, in addition to school supplies, art and craft items, reference books and fiction. It is a premium brand, and is known for its scale, customer service and warranties, and for being first to market in the Kingdom with new-release products. Since 2014, Jarir has had a sales and warranty licence agreement with Apple, and in summer 2016 offered exclusive pre-ordering online of HTC’s virtual reality headsets. Jarir is famous for its regular shopping catalogue, which includes not only products and prices but also news of upcoming product releases, and guidance on how to choose the right products in different categories. Parent company Jarir Marketing Company was founded in 1979 and listed on the Saudi Stock Exchange in 2003.

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Company: Bupa Arabia for Cooperative Insurance Company Total Brand Value: $1,309 million Headquarter City: Jeddah Industry: Insurance Year Formed: 1997

Bupa Arabia has the highest market share among health insurers in Saudi Arabia. It is part of the UK-based Bupa Group, which operates in 190 countries. The brand’s international associations make it appealing to multinational corporations operating in Saudi Arabia, which tend to choose it as their preferred health insurer for their staff. Bupa Arabia is a premium brand and offers unique services to members. These include the newly launched “Telemedicine” service, which provides long-distance consultations on complex cases with doctors from some of the United States’ most renowned institutions, including the Cleveland Clinic, Johns Hopkins Medicine and Harvard University. Bupa Arabia’s slogan is “With you for better health”, and in 2015, the company introduced a new service called Tebtom aimed at improving the health of its members through access to services such as elderly care, maternity and child care and chronic care. Also in 2015, Bupa Arabia changed its logo to more closely resemble the international Bupa logo. During Ramadan in 2016, Bupa Arabia worked with the transport app Careem to encourage members of the public to donate any unused clothing to people in need. Shares in Bupa Arabia are traded on the Saudi Stock Exchange (Tadawul).

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O B E S I T Y R AT E S A R E C A U S E F O R C O N C E R N . . .

. . . C O N S U M E R S A R E S E E K I N G H E A LT H Y A LT E R N AT I V E S

Saudi Arabian Top 20  >  BRAND PROFILES

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND PROFILES 9 10 Company: Samba Financial Group Total Brand Value: $1,142 million Headquarter City: Riyadh Industry: Banks Year Formed: 1980

Samba has grown into one of the region’s biggest banks and has become popular among young consumers with its slogan ‘Think Samba’ and youth-friendly online services. The bank has its roots in Citibank, which it traded as until a government program in 1980 forced all foreign banks to have at least 60 percent Saudi ownership. The bank rebranded as Samba in the same year. In 1999, Samba merged with United Saudi Bank, giving it much greater scale. The brand’s Citibank heritage has given Samba links with the United States; it is the bank used by many American companies and institutions, including the US consulate. Recent innovations include the Samba Financing Calculator, launched to help consumers manage their personal budgets. Campaigns to encourage credit card use include the chance for cardholders to win a trip to Australia, and a 0 percent interest offer on tickets with Saudi Airlines. Samba has international branches in the UK, Pakistan, Qatar and the UAE. Samba Financial Group is listed on the Saudi Stock Exchange (Tadawul).

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Company: Savola Group Total Brand Value: $1,082 million Headquarter City: Jeddah Industry: Retail Year Formed: 1978

Panda is the country’s biggest chain of supermarkets and hypermarkets by market share, operating about 400 stores across Saudi Arabia. It also has a presence the UAE and, since late 2015, Egypt, where it is opening 16 stores. It is known for the quality of its fresh produce, its wide assortment across a broad spectrum of product categories, and its competitive pricing. Panda is one of the few Saudi retailers to carry private label goods for value-seekers. Its advertising tagline is “Always fresh... Always for less”. Since 2013 Panda has been rolling out a new, smaller store format to offer convenience to urban consumers. The Pandati outlets resemble corner stores, featuring snack foods and household essentials; they currently number about 180. Recent marketing activity includes a 2016 “Golden Number” promotion, which used codes on receipts and on the website to give consumers the chance to win one of 28 cars if they logged their codes through the Panda site or app. Panda is part of the Savola Group, whose shares are traded on the Saudi Stock Exchange (Tadawul).

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Company: The Company for Cooperative Insurance (Tawuniya) Total Brand Value: $969 million Headquarter City: Riyadh Industry: Insurance Year Formed: 1986

Tawuniya was the first insurance company licensed in Saudi Arabia, and its offering is one of the broadest among insurers in the Kingdom, spanning motor insurance, health, travel and home cover. It was originally known as The National Company for Cooperative Insurance (NCCI) until its rebranding in 2007. Tawuniya’s extensive network of partner hospitals, built up over many years, is the reason why many of its health insurance customers choose it. The insurance sector is on track to grow in the next few years as the government has begun to crack down on motorists who do not have appropriate insurance, and has been encouraging all workers to have health cover. Tawuniya insures many large companies; in 2016 it renewed its contract with Saudi Telecom, one of its biggest clients, and is now the insurer of every telecom provider in the Kingdom. Tawuniya runs year-round marketing campaigns, which in 2016 included a discount on its premium motor insurance during Ramadan. In 2016, Tawuniya launched a new website and began using the slogan: “Tawuniya: In your hands”. It also launched its Smart Insurance platform, which enables customers to access their accounts online and via mobile. Tawuniya shares are traded on the Saudi Stock Exchange (Tadawul).

12 Company: Riyad Bank Total Brand Value: $905 million Headquarter City: Riyadh Industry: Banks Year Formed: 1957

Riyad Bank is one of the oldest banks in Saudi Arabia, and as well as being a consumer bank, it is one of the leading financiers of syndicated loans in the oil and petrochemical sector and of major infrastructure projects. The bank positions itself as an innovator in the sector. It has announced plans to launch a banking app specifically for users of the Apple Watch, and in August 2016 launched a physical currency exchange machine that issues US dollars, pounds sterling, Euros, and Emirati Dirham. Riyad Bank offers a “Ladies Banking” service through women-only branches that are staffed by women. Riyad Bank has a branch in London and offices in Singapore and Houston, Texas. Major shareholders include the Public Investment Fund, which owns approximately 22 percent of shares, and Hassana Investment Co, which holds 17 percent. Shares are traded on the Saudi Stock Exchange (Tadawul).

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Saudi Arabian Top 20  >  BRAND PROFILES

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND PROFILES 13 Company: Saudi British Bank (SABB) Total Brand Value: $847 million Headquarter City: Riyadh Industry: Banks Year Formed: 1978

SABB is distinct among Saudi Arabia’s many banking brands because, through its relationship with HSBC, it offers consumers a global network of branches and focuses on international services. Its logo includes the message “With you worldwide”. The bank was originally the British Bank of the Middle East (BBME), acquired by HSBC in 1978. The global connection attracts many foreign entities doing business in Saudi Arabia, as it links them to a brand they already know and trust. SABB’s products are Shariah-compliant, which gives them appeal among local customers as well. The Hongkong and Shanghai Banking Corporation, Ltd (HSBC), holds 40 percent of shares in SABB, and shares are traded on the Saudi Stock Exchange (Tadawul). The largest local shareholder is Olayan Saudi Investment Company, with a stake of approximately 17 percent.

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16 Company: Dar Al-Arkan Real Estate Development Company Total Brand Value: $749 million Headquarter City: Riyadh Industry: Real Estate Year Formed: 1994

Dar Al-Arkan is a leading commercial and residential real estate developer in Saudi Arabia, and in its communications uses the tagline “Built for life” or, in Arabic, “A’amera”. Dar Al-Arkan is involved in what is considered to be one of the most ambitious development plans in the Kingdom; the Qasr Al Khozama project is designed to rejuvenate the city of Jeddah, and create a business hub in the heart of the city. Dar Al-Arkan has also been in recent talks with the government on plans for wide-scale housing construction in line with the national plan to boost private home ownership. Dar Al-Arkan is known for the quality of its designs and for strong project management. All of its projects have so far been within the Kingdom. Dar Al-Arkan began as a privately owned company; however in 2005 it became a joint stock company, and in 2007 listed on the Saudi Stock Exchange (Tadawul).

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Company: Saudia Dairy & Foodstuff Company (SADAFCO) Total Brand Value: $478 million Headquarter City: Jeddah Industry: Food and Dairy Year Formed: 1976

Saudia Dairy is one of the best-known dairy brands in Saudi Arabia, known mainly for its fresh and long-life milk products, but also for its range of flavored milks, butter, ice-cream and cheese. The brand promotes the quality and nutritional value of its products, and has recently been innovating to target health-conscious consumers, with the launch in 2016 of Saudia Soy, as well as Saudia Date Milk, the first milk product in the Kingdom to blend milk with dates. Saudia Dairy claims to be the market leader in long-life milk in Saudi Arabia and to hold the number two position in the total milk market. Its current tagline is “With you through life”, and the range includes products aimed at children as well as family packs of milk and individual portions. The brand celebrated its 40th anniversary with a 40-day promotion in which consumers could win daily prizes including iPhone 7s. Saudia Dairy & Foodstuff Company (SADAFCO) in 2016 launched a solar-powered distribution center in Riyadh as it works to become more environmentally sustainable. Shares in Saudia Dairy & Foodstuff Company are traded on the Tadawul exchange; Saudia Dairy products are also sold in Jordan, Bahrain, Kuwait and Qatar.

Company: Alinma Bank Total Brand Value: $473 million Headquarter City: Riyadh Industry: Banks Year Formed: 2006

Alinma is one of the Kingdom’s youngest banks, and has quickly worked to establish its name and reputation in a highly competitive sector. Alinma Bank uses its communications to position itself not as just another bank but as a trusted partner in life to holders of its personal and commercial accounts. Alinma markets itself as the partner who listens, makes your life easier, and understands your ambitions. It also focuses on specific banking products to distinguish itself from other banks. Alinma says it ‘redefines banking’. Two branches at prominent sites are open 24/7, and customers have access to online banking services. The brand seeks to be a leader in Shariah-compliant services designed to meet the needs of local Saudi people. Its major shareholders include the Public Pension Agency, the Public Investment Fund and Hassana Investment Co. Shares are traded on the Saudi Stock Exchange (Tadawul).

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Saudi Arabian Top 20  >  BRAND PROFILES

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

BRAND PROFILES 17 18

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Company: Abdullah AlOthaim Markets Company Total Brand Value: $449 million Headquarter City: Jeddah Industry: Retail Year Formed: 1980

Company: Alawwal Bank Total Brand Value: $372 million Headquarter City: Riyadh Industry: Banks Year Formed: 1926

Othaim Markets was one of the first chains of supermarkets to launch in Saudi Arabia, and its portfolio now extends to more than 140 supermarkets, hypermarkets and corner stores around the Kingdom, with a particular focus on the central region of the country. Othaim is still expanding, and new branches open regularly both in Saudi Arabia and in Egypt, where there are now five outlets. The brand’s promise to consumers is “Save more”, and its year-round price promotions are what distinguishes Othaim from other supermarket chains. Othaim also has a loyalty scheme, called Iktissab, which gives regular customers access to exclusive deals by collecting rewards points.

The bank formerly known as Saudi Hollandi Bank relaunched in late 2016 under a new name, Alawwal Bank, which means ‘The First’ in Arabic. The name reflects the bank’s heritage as the first bank to operate in Saudi Arabia. It was set up as a branch of the Netherlands Trading Society to cater to Hajj pilgrims from what was then the Dutch East Indies, now Indonesia. As the only bank in the Kingdom, it operated as a de facto central bank, holding the government’s gold reserves, and, in 1928, it issued the country’s newly minted currency, the Saudi Riyal. Now, it offers commercial and personal banking services through more than 250 branches and ATMs; services include international stock trading and investment portfolio management. In August 2016, the bank launched online banking services via the Apple Watch through a new app.

Shares in parent company Abdullah AlOthaim Markets Co, which also has interests in real estate, are traded on the Tadawul exchange.

The bank remains a branch of the Netherlands Trading Society, which is affiliated with ABN AMRO. The relaunch as Alawwal Bank was announced in November 2016 and was expected to roll out over several months. Shares are traded on the Tadawul exchange.

Company: Arab National Bank Total Brand Value: $344 million Headquarter City: Riyadh Industry: Banks Year Formed: 1979

The Arab National Bank specializes in commercial and investment banking services, financing for the leasing of equipment, and home financing. It has around 200 branches as well as nearly 100 remittance centers and sales centers, and more than 1,000 ATMs. Its brand promise is to be “A Friend Indeed”, and in 2016 ANB extended the hours of 32 branches from 5pm until 7pm on weekdays, with 20 branches also open on Saturdays, to make banking more convenient for customers. ANB offers retail banking services and has been offering international holidays and Cartier watches as prizes to encourage consumers to open personal accounts. The bank is best known, however, as a provider of finance to corporations working on major infrastructure projects and as a provider of banking solutions to government municipalities. The bank is 40 percent owned by the Jordanian-based Arab Bank, which is one of the largest financial institutions in the Middle East and has more than 600 branches on five continents. Remaining shares are traded on the Tadawul exchange. Credit ratings agency Moody’s in 2016 downgraded ANB’s rating from A1 to A2 when the government reduced its support for the bank.

Company: Almarai Company Total Brand Value: $339 million Headquarter City: Jeddah Industry: Food and Dairy Year Formed: 2007

L’Usine is a bread and baked-goods brand launched when the food business Almarai took over Jeddah-based Western Bakeries. It is known for the diversity of its range, which includes a variety of sliced bread, ready-to-eat croissants, cupcakes and other snacks. L’Usine is also famous for launching new products in the category, including singleportion puff pastry snacks, square breads and wraps. The brand is widely distributed throughout the Kingdom and is available in corner stores as well as bigger supermarkets. Sweet snacks are highly popular in Saudi Arabia and L’Usine has been able to expand; growth at Almarai in 2016 is largely attributed to rising L’Usine sales. The brand promotes itself to consumers as providing freshness, taste and nutrition to Saudi families. As a subsidiary of Almarai, which also has dairy and other food brands which it distributes around the region, L’Usine is available in all Gulf Cooperation Council states as well as Jordan, Yemen, Lebanon and Egypt. Shares in Almarai are traded on the Saudi Stock Exchange (Tadawul).

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Saudi Arabian Top 20  >  INSIGHTS

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

INSIGHTS MOVING ONLINE LUXURY OUT OF THE THREAT ZONE

Just three or four years ago, a SWOT analysis (Strengths, Weaknesses, Opportunites and Threats) of most luxury brands and retailers would have put e-commerce squarely in the Opportunity box. When I see a SWOT analysis now, e-commerce frequently appears in the Threat box.

Saudi Arabia has one of the highest smartphone penetrations of any country in the world, over 70 percent, and luxury shoppers are likely to be accessing global prices in real time whilst in a store. In an industry where products are typically sourced in Euros, US Dollars and Pounds, margins are highly susceptible to currency fluctuations. This makes competing on price and finding parity with other markets a constant challenge for retailers. Retailers and luxury brands must therefore focus on differentiating through experience rather than price. Providing in-store services, knowledge and regionally exclusive lines will become critical to ensuring that the physical store doesn’t become a mere “showroom” option for the shopper.

Global brands entering Saudi Arabia can sometimes struggle to make a meaningful connection with consumers, because many of the values and practices that have served them well in other markets simply don’t resonate here. The concept of beauty, for instance, is regarded quite differently in the Arab world than it is in the West.

But there are ways that global brands can make strong local connections. McDonald’s provides a local take on its global promise, with a McArabia burger in pita bread, special offers during the festivals of Ramadan and Eid, and separate seating areas for families and single men. Fanta has adapted its global take on the ‘play’ theme to take into account Saudi teens’ passion for gaming. And drinks brands Vimto and Tang have built a strong local connection by becoming a part of the family ritual during festivities in the month of Ramadan.

Andrew Mardon Director Of Consulting Kantar Retail [email protected]

GET HAPPY – HOW ‘OWNING’ EMOTIONS TAKES SERIOUS WORK

There are a handful of brands that make ‘owning’ an emotion look easy. Think about Coke and happiness, Oreo and the joy of dunking in milk, or Snickers: you’re not yourself when you’re hungry. Other marketers often have this kind of emotional connection in mind when they talk about the need to identify ‘a key category driver’ they can make their own, or ‘an emotional need-space’ that a campaign strategy can latch on to. The problem is that too many brands stake a claim to the same emotional space – success, happiness, freedom and the rest – without actually taking ownership. And when so many brands are talking about the same sentiments in the same way, the results are obviously limited. This is a particular problem among food and beverage brands.

HOW GLOBAL BRANDS CAN MAKE A LOCAL CONNECTION

Amol Ghate Country Manager - UAE Kantar Millward Brown [email protected]

The use of local talent rather than international celebrities helps a brand feel closer to Saudi consumers; successful global brands in this market use this as a starting point for localization, rather than the finish.

To truly ‘own’ an emotional platform requires serious work on three levels: 1. Rigorous insights work to unearth deep-seated emotions.

Prashant Kolleri Managing Director - Insights Kantar - Saudi Arabia & Pakistan [email protected]

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2. Immersion of key stakeholders in these insights, leading to bold communications concepts. 3. Careful selection of the strongest idea that clearly links the brand with the emotion in a highly memorable way – and in a way that couldn’t just as easily be applied to the competition.

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BRAND BUILDING BEST PRACTICES

Y O U N G P E O P L E A R E A H U G E M A R K E T. . .

. . . B U T T H E I R PA R E N T S H AV E T H E W E A LT H

SECTION 4 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

RECIPE FOR REGIONAL SUCCESS – FIVE WAYS LOCAL BRANDS CAN GROW THEIR VALUE

What do the following brands have in common: Alibaba, Almarai, Careem, Didi, Emaar, Flipkart, Huawei, Goody, Ulmart and Xiaomi? These are all local brands in primarily emerging / fast-growing markets, that have been able to succeed against strong multinational offers – and some of these have grown into regional and even global brands. Across markets and categories, these local and regional players are proving to be a stiff challenge for international brands.

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AMRB provides bespoke research solutions in the areas of consumer understanding, new product development, segmentation and pricing, shopper solutions, B2B and stakeholder loyalty research.

BETTER UNDERSTANDING OF CONSUMERS Being present on the ground and closer to consumers, local players tend to have a better understanding of their needs and thereby connect better with the consumer. Almarai, for instance, came up with the Tasbeera (meaning ‘snacks’ in Arabic) brand for their puffs and pastries.

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NIMBLE The fact that seven of the top 10 smartphone brands worldwide are from China is a strong reflection of the success of local brands. Similarly in India, brands such as Britannia foods, Dabur health products and Sunfeast snacks have been able to ward off competition from global competitors and grow. The Middle East is not far behind with regard to this phenomenon. Though it has largely been an import-driven market, there are quite a few Saudi brands, such as Almarai, Nadec and Goody, that have been able to grow in the food and beverage sector. Similarly, brands from the UAE such as Emaar, Jumeirah Group and Etisalat have been successful in the retail, hospitality and telecom sectors. So what exactly is the recipe for the success of these local players in a competitive environment?

Aurobindo Choudhury, Head of Customized Research, Kantar AMRB [email protected]

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Some of the key drivers seem to be:

Coupled with better consumer understanding, local brands are also able to respond faster to emerging consumer trends, while MNCs at times get bogged down with global platforms and diktats. Careem, the chauffeured car service, has become very popular with Saudi women, as it fulfills a key need gap – providing quick, safe and secure transportation for women, who are not allowed to drive.

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PRICE-VALUE EQUATION One of the key advantages of the local players is their ability to price their goods lower than multinationals due to their lower production and distribution costs. With improvement in product quality over the years, this enables them to provide superior value to consumers viz-a-viz international brands. Al Baik in Saudi Arabia, a fried chicken brand, is a classic example of a local brand that offers a better price-value equation as compared to its international competitors.

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INNOVATION AND RENOVATION The ability to innovate and renovate – taking a proven idea and then adding new features to make it more relevant to local needs - is another reason for the success of these offers. There are numerous examples of this principle in action: Careem in the United Arab Emirates started a book-delivery service, Patanjali in India has built on its herbal credentials to launch products such as toothpaste and hair oil, and Engro Foods in Pakistan launching specific products for adding to tea.

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REGIONAL EXPANSION Building on learnings from their home countries, local brands have also grown their footprint at a regional level. Their understanding of emerging-market consumers enables them to go beyond their boundaries into countries with similar needs. Local Saudi brands such as Goody and Almarai are expanding into other Gulf states and Egypt. Huawei targeted the Indian sub-continent on the back of their success in China, and Airtel entered Africa, leveraging its Indian experience. At times, favorable government regulations do benefit some local players, but that is not the norm. Although global players tend to have stronger marketing muscles than local brands, the local brands have been able to create a niche for themselves and will continue to grow and play a significant role in emerging markets, including the Middle East.

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Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

PIONEERING DISRUPTION – MAKING FRESH CONNECTIONS It’s no secret that Saudi Arabia has had a reputation for being the most traditional advertising market in the world – a nation known for its stereotypical conservatism and endless lists of dos and don’ts. If we look at the majority of communication today, people would be forgiven for thinking this was still the case – a generic showcase of ads that have safely checked all the boxes on the list – but as Saudi society and consumers evolve, the opportunity to disrupt is wide open and some brands are taking full advantage, engaging their audiences in a more meaningful exchange.

WHY CHANGE THE GAME? The conversation in the country is changing and it is all happening online as Saudis leverage social media to speak freely. With 60 percent of the population under 30, and almost eight in 10 young Saudis saying they own a smartphone, the rise in smartphones and easy internet access is clearly having an impact on the way youth consume media. Saudis also account for an astounding 190 million YouTube views each day— that’s a rough average of more than six views per citizen per day. With little relevant content available on traditional channels, YouTube offers Saudi Arabia’s young population entertainment choices not available on mainstream television, including locally produced content made by young Saudis who speak each other’s language. As a result, brands are largely being left out of the conversation as they produce safe, generic advertising that brings very little relevance to the evolving market and audience. So how can we bring brands into the conversation? The key lies in adopting culturally relevant ways to reach the youth in the Kingdom in their digital spaces – by bringing purpose, authenticity and entertainment.

BRING PURPOSE One way to connect with Saudi consumers is by making a difference to their world and giving the brand a more personal and emotional face.

Dana Alkutoubi, Strategic Planning Director, Saudi Arabia, J. Walter Thompson [email protected] 120

Al Arabia Contracting services did just that. Building on the insight that it has been hard for the general public to appreciate more modern forms of art, and that it hasn’t been easy for many artists in the Kingdom to present their work to the public, Al Arabia gave a platform to undiscovered artists in Saudi Arabia and brought their work to the people via outdoor sites. The campaign featured work from 900 artists displayed on 3,000 sites across the country and their website became Saudi’s directory for local art. In doing so, not only did Al Arabia create meaning for consumers, they also created differentiation for their brand and contributed to Saudi culture and its social fabric.

BE AUTHENTIC With the explosion of social media, consumers are no longer taking things at face value and are calling time on brands that aren’t authentic. Saudi consumers want brands that are empathetic and that aren’t afraid to tackle their weaknesses head on. Jarir Bookstore wanted to communicate its value proposition in electronics beyond price, so introduced a web series through the creation of two characters, Flan and Alan. Flan is a customer of Jarir while Alan is the one going after deals from various competitors. Each webisode was packaged in a lighthearted manner depicting several ‘real life’ scenarios where Alan tries to play it smart by getting his electronics from ‘apparent deals’ and later gets disappointed, while Flan relies on Jarir, which saves the day by giving true value. Each webisode focused on one of Jarir’s key differentiators in an authentic and fun way. Not only did Jarir’s electronics sales go up, but they triggered a conversation on social media, turning consumers into fans.

BE ENTERTAINING To earn the attention of today’s empowered consumer, communication needs to generate interest, and ultimately result in audiences clicking that ‘share’ button. Today, the young are increasingly seeking personalized content that speaks to their lives, their experiences and their perspectives. To communicate their broadband offering, STC created the region’s first online branded content hub which gave Saudi youth the freedom to “not let anything stop them” - inspiring the name of the platform, “LaYawgif”. To encourage the youth and further drive credibility, STC partnered with a group of influential Saudi comedians, Khambalah, to get the hub going. The hub hosted entertaining branded content featuring a combination of YouTube stars, YouTube creators and online stars in a sitcom series. The wide variety of shows created for the Hub allowed STC to host a number of competitions designed to cast more actors and hunt for new directors. In under a year, STC became the market leader in broadband and the world’s number one YouTube channel. Ultimately, STC demarcated themselves from the rest of the category, becoming a broadcaster.

WHAT LIES AHEAD Not surprisingly, local brands, given their closeness to Saudi consumers, have had the confidence to make the first move to meaningfully engage with audiences – however brands that don’t take advantage of the opportunity are in danger of missing out on connections and conversions. Clearly, Saudi consumers have evolved, they are demanding more and are now leading digital lives, even if their roots are entrenched in culture and tradition. It’s now time for brands to follow suit.

J. Walter Thompson Worldwide, the world’s best-known marketing communications brand, has been creating pioneering solutions that build enduring brands and business for more than 150 years. www.jwt.com/worldwide 121

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Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

HUNGRY FOR HEALTH – CATERING TO SAUDIS’ UNIQUE APPETITE FOR WELLNESS Around the world, consumers are increasingly talking about health and wellness, and there’s a clear shift in their expectations of brands in this regard. They expect brands to bring them health benefits. So, has this conversation reached Saudi Arabia? The answer is both yes and no.

Edwin Coutinho, AVP, Kantar AMRB, [email protected] 122

Kantar AMRB provides bespoke research solutions in the areas of consumer understanding, new product development, segmentation and pricing, shopper solutions, B2B and stakeholder loyalty research.

If we look at some of the most popular FMCG brands in Saudi, be it Almarai, Nestlé , Nadec, Anchor, or brands in the Unilever portfolio, it is difficult to miss the fact that almost every brand now has a health claim attached to it. There are claims about the nutrients, the ingredients, the sourcing of products and the calorific value of food and drinks. The organic aisle in retail stores is everexpanding, and growing numbers of FMCG brands are including organic ingredients. Additionally, changes in consumer behavior are also evident. Water is encroaching upon the dining table in a big way, impacting on consumption of juices and soft drinks. Fitness centers are springing up, driven by gym chains such as Fitness First, and many consumers are now taking regular morning and evening walks. Add to that the reams of government communication being distributed on the dangers of obesity and its risk to heart health, and you have a wonderfully health-conscious consumer landscape in Saudi Arabia. However, traditionally ‘unhealthy’ categories such as carbonated beverages and energy drinks are still growing in Saudi. Despite the hype, diet products have not seen significant take-up, and huge numbers of people have not moderated their unhealthy eating habits. While this picture may appear confusing, it is important to note that Saudi society is unique when it comes to attitudes towards health. Health is still seen as God-given, so people’s approach to it tends to be rather reactive, addressing problems when they arise rather than seeking to prevent them. Consumers are also unwilling to compromise on taste and the richness of their favorite foods for the sake of their health. For brands seeking to engage with Saudi consumers, therefore, it is

important to take into account the unique Saudi flavor of consumers’ rising healthconsciousness. We have identified five key ways to win with health in this market.

COMMUNICATING PAY-OFFS RATHER THAN CLAIMS Most brands tend to shout out laundry lists of claims without explaining the end benefit to consumers by way of pay-offs. Hence, claiming a food has been fortified with a nutrient, without letting consumers know what that means for their health, has little impact. However, some brands have done a good job of creating these. Nido milk, for instance, communicates the brain-development benefits of its formulation, and Belvita biscuits link fibre to ‘energy to keep you going’.

NOT OVERTLY COMPROMISING ON TASTE Health that compromises taste is something consumers in this region are not yet ready for. Consumers are looking for ‘great taste’ cues from food brands, so work with consumers to provide tasty AND healthy options. Knorr bouillon does this well by highlighting indulgence, with natural ingredients in the background to cue health.

POSITIVIZING CONSUMER EFFORT A shift in thinking and behavior towards healthy living requires large amounts of effort and trade-offs among consumers. Saudi society is still not attuned to lifestyle compromises and hence people tend to put off making changes to their

lives because of their health. Giving consumers a positive boost and nudging them in the direction of healthy living could be a good start. Currently, no brand seems to be tapping into this idea in a big way.

SHOCK AND AWE? Government communications on obesity and heart health has gained traction mainly because of the scary tone, which has created a sense of urgency. Could scare tactics be leveraged to drive the message? Brands need to play this card with caution, however, as an expressly negative narrative may cause the messaging to backfire on the brand. The women’s hygiene brand Always has shown how brands can use fear – in this case fear of social embarrassment – to guide consumers towards healthy choices.

FOCUS ON PACKAGING While brands primarily use advertising to educate and create disposition towards healthy options, packaging can also play an important role. Almarai juices achieved significant shifts in sales and consumer perceptions when they switched to a bottle that made overt health claims, included nature cues on the packaging, put drinks in chillers and reduced expiry dates to one month. Kantar studies show the brand is now strongly associated with freshness, and consumers feel strong engagement with it. Saudi consumers are unique when it comes to their disposition towards health and wellness, and at times display what appears to be contradictory behavior. A tailored approach to the health discussion can, however, bring success to brands, and better health to consumers.

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Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

MILLENNIALS UNCOVERED: THE PARADOXICAL GENERATION

Mariagrazia De Angelis, Head of Client Service, Landor [email protected] 124

In the new Arab world, millennials have become the most controversial generation. They constitute about 40 percent of the population and what’s interesting about them is not just that they’re there and that they’re young, but that they’re organizing the basis of being young, as Juan Cole, author of “The New Arabs: How the Millennial Generation is Changing the Middle East” puts it.

They are socially and culturally influential and are highly connected – organizing themselves to represent the interests of their generation. Any brand wanting to secure its place in the market knows it must capture the millennial mind set. But this is easier said than done; the group is widely misunderstood and press reports that attempt to define it are often contradictory, counterintuitive or downright confusing. Globally, each generation has a set of defining characteristics, and at Landor we recently conducted extensive research into how people of this age from around the world relate to brands. This data was then compared with secondary research and our BrandAsset Valuator. The project uncovered the following seven paradoxical attitudes held by millennials around the globe. We believe they resonate quite well with the worldly, well-travelled and educated millennial Saudis.

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THEY ARE SELFINDULGENT SHARERS Millennials have popularized the sharing economy. They love Airbnb, Zipcar and Uber. They are not defined by what they own and are careful with their money. Except, that is, when they aren’t. Many participants said ‘when I do go shopping I spend much more than I thought I would’. They actually shop as frequently and spend more per trip than the babyboomer generation (in the US, it was $54 per shopping basket compared with $46 for baby boomers in 2014) even though they have fewer resources. Brands that can help millennials live virtuously are welcome, but helping them let their hair down will be appreciated too.

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Although millennials are loyal and have better brand knowledge than other generations, they also display considerable antipathy towards the brands they know best. Five of their 20 most-loved brands also feature in their 20 most hated list – including Apple, Nike and Microsoft. Brands wanting to make use of this paradox need to cut the bull. Millennials will be aware of the negative side of a brand and marketers must acknowledge this too. One example from the UK of a brand that does honesty well is Sainsbury’s basic biological washing powder. The packaging says simply ‘it cleans’.

Millennials expect brands to function well online, but brands’ online credentials beyond that are of little interest. In fact, tech brands that play the pure innovation card are less successful in terms of differentiation, relevance and esteem than brands that connect with customers in a more human way. Brands should be careful not to hide behind technology and recognize it is an enabler rather than the main focus.

I LOVE YOU, I HATE YOU

TECH WITH BENEFITS

A global leader in brand consulting and design, Landor helps clients create agile brands that thrive in today’s dynamic, disruptive marketplace. www.landor.com 125

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DIGITAL ISN’T DIVINE

MILLENNIALS ARE CYNICAL OPTIMISTS

Millennials are digital natives, but they also crave old-fashioned, physical interaction. “Near me” searches on Google have doubled in the last year, and Amazon has just opened a real-life bookstore in Seattle. Offline is the new online and although millennials rely on digital, it’s offline experiences that get them talking.

Millennials tend to be impressed by companies like Innocent, which donates 10 percent of profits to organizations helping to reduce global hunger. That said, they are also fantastically cynical. The digital world is transparent and millennials are able to look behind every statement made by a brand. If you can’t make the world a better place then don’t say you will.

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DEMOCRATIZE AND PERSONALIZE Although millennials love democratic brands, they also want to feel special. Democratic brands include H&M, with its high-street access to fashion, and IKEA, which provides affordable style. But brands that combine this with something more personal truly stand out. Although Burberry tends to be expensive, its reasonably priced poncho monogrammed with a customer’s initials is both democratic and personalized, ideal for millennial fashionistas.

THAT’S NICE, BUT WHAT’S IN IT FOR ME? Millennials aren’t tripping over themselves to become fans or followers of brands online … unless there’s something in it for them. More than 50 percent said they would share information with a brand if they got something in return, such as vouchers or discounts. This is more than twice the proportion of any other generation. Brands need to be sure to demonstrate that they add value before asking for data.

While millennials are a hugely diverse group, there are three clear lessons here for brands:

Understand the unique drivers of consumer behavior and find interesting ways to make yourself more attractive and useful. Focus on communities of interest (such as bike lovers or foodies) and appeal specifically to these. Understand your brand’s situational equity and flex your brand to win across the variety of moments in which people interact with you. Only by grasping these challenges will brands be adaptable and versatile enough to meet the changing demands of this paradoxical generation.

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P E R S O N A L C O N N E C T I O N S M AT T E R G R E AT LY. . .

. . . B R A N D S M U S T B U I L D A N D M A I N TA I N T R U S T

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Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

LOOK OUT, BECAUSE NOW HERE COMES GENERATION Z

For years, marketers have been obsessed with dissecting the millennial mind-set. With global spending power of $2.45 trillion in 2015, this is hardly surprising. Debt-ridden, pragmatic and far more cost-conscious than they are given credit for, millennials have made marketers work hard for their attention and money. But what about Generation Z, the true digital natives arriving fast on millennials’ heels? Many marketers argue that millennials’ heyday is over; that it is time to shift gears and focus on this younger cohort. At nearly 70 million in size and growing, Gen Z – those born between the mid-1990s to the early 2000s - will soon outnumber their millennial predecessors, representing 40 percent of all consumers by 2020. What similarities do millennials and Gen Z share that marketers can tap into? We have arrived at five overarching commonalities:

Sheila Morrison, Strategy Director, Lambie-Nairn, [email protected] 130

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Both generations have low tolerance for anything unnecessarily complicated or inefficient. While millennials remember the days of dial-up internet and are slightly more forgiving than Gen Z, they will still walk away if a product or service is too much work. Gen Z, notorious for their eight-second attention spans, do not give brands any second chances. Its essential that all interactions with a brand are joined up, simple and intuitive. Brands must assume they have one chance to get on millennials’ and Gen Zs’ radar.

Millennials are assigning greater importance to meaningful experiences, especially travel. Gen Z seemingly cares even more about experiences, as it gives them something they can share. Gen Z’s favorite brands - Instagram, Snapchat and YouTube - are all highly visual mediums designed to let users share what they’re doing. Brands need to engage millennials and Gen Z with experiential content across their preferred channels. Even if they don’t buy something, they will form a stronger impression of your brand and share their experience with peers.

BOTH MILLENNIALS AND GEN Z EXPECT SEAMLESS EFFICIENCY

BOTH MILLENNIALS AND GEN Z VALUE EXPERIENCES OVER STUFF

WHO IS DOING IT WELL?

WHO IS DOING IT WELL?

Tech brands like Apple and Google are setting the bar here, integrating all their products to work seamlessly together.

Red Bull takes the cake for creating experiences, which range from entertaining fans with their Cliff Diving series, to their annual Soap Box races.

Lambie-Nairn has been creating dynamic brands for over 40 years—brands built for a multi-screen, digital world with the ability to coherently evolve in real time and reshape categories. www.lambie-nairn.com 131

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Neither millennials nor Gen Z want to be talked at by marketers. In fact, both are actively avoiding marketing campaigns, evidenced by the marked increase in ad-blocking software over the past 12 months. As content creators themselves, millennials and Gen Z are far more likely to engage with marketing when they are active participants and contributors.

Both millennials and Gen Z embrace a more entrepreneurial, pioneering spirit. Today, the majority of millennials around the world consider themselves entrepreneurs. Many academics argue that Gen Z is poised to be even more entrepreneurial. Ambitious and determined, both millennials and Gen Z value brands that provide information, thought-provoking content and insight that will help them get to where they want to go.

The world we live in today is tough for everyone, but millennials and Gen Z actually want to do something about it. For them, it’s about sustainability, transparency and giving back to the community. Brands need a purpose that goes beyond profit, and must demonstrate their value to society. The most important thing here is actually doing what you say, and acting with authenticity and transparency.

BOTH MILLENNIALS AND GEN Z WILL ENGAGE MORE IF THEY CO-CREATE

BOTH MILLENNIALS AND GEN Z WANT TO FEEL ENABLED AND EMPOWERED

BOTH MILLENNIALS AND GEN Z BUY BRANDS WITH SOCIAL VALUES

WHO IS DOING IT WELL?

WHO IS DOING IT WELL?

WHO IS DOING IT WELL?

Pandora’s recent campaign for its new Thumbprint Radio feature is a brilliant example of this. Collaborative, humorous and full of amazing dance moves, the campaign engaged youth audiences by asking them to capture their #nofilter reaction when their favorite jam comes on the radio.

In Saudi Arabia, STC’s InspireU business incubation and accelerator initiative is aimed at supporting digital start-ups. It supports young entrepreneurs with finance and marketing assistance, access to mentors and international partners, and use of STC’s networks and ICT infrastructure.

Careem, the chauffeur cab booking service, offers free rides to those affected by disaster, and runs promotions in support of social causes. For example, Careem recently partnered with detergent brand Omo to help customers donate clothes to the needy.

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OF COURSE, MILLENNIALS AND GEN Z ARE TWO DISTINCT GENERATIONS AND THERE ARE CLEAR DIFFERENCES BETWEEN THEM, BUT THAT IS ANOTHER TOPIC FOR ANOTHER DAY! IN THE MEANTIME, UNDERSTANDING THE THINGS THEY HAVE IN COMMON IS NO BAD THING, AND CAN HELP MARKETERS EFFECTIVELY APPEAL TO BOTH.

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Brand Building Best Practices

BRAND BUILDING BEST PRACTICES

BURNING IMPRESSIONS – MAKING EXPERIENCE COUNT FOR BRANDS

It is worth stepping back in time for a moment to consider the origins of the word ‘brand’ before we delve into what that means in the modern context. The word itself derives from the Old Norse word ‘brandr’, meaning ‘to burn’ and, traditionally, producers burnt their mark - or brand - onto their products: cattle, timber and even crockery. The brand was a means of identifying the people, groups and companies that physical products belonged to.

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and personal loans within a certain time of consumers lodging an application. During the first few months, the bank did not meet consumers’ raised expectations particularly well, and even though approval times were faster than they had been before, consumers were disappointed and the bank’s measures of customer experience dropped. The bank may have been better served by making sure that the new customer experience met its raised standards before it made a public promise and built consumer expectations.

Brands, therefore, need to create great experiences that become lasting memories. This is brand development through what we call ‘moments-led growth’. Consistency of experience across every one of those key moments is essential – otherwise how do you create a clear imprint of the brand in the consumer’s mind?

Consider also the case of a certain telecom provider, which had similar levels of consumer disappointment due to a disconnect between levels of service or customer care on which it has overpromised and under-delivered. This brand should, like the bank, fix its performance in problem areas rather than communicate on its service promises. The same telecom brand rates highly for its provision of mobile data, however, and could amplify this aspect of its offering in the meantime.

In the new age of digital and e-commerce, many argue that customer experience in the online space is really the only form of branding; many customers’ first experience of a brand is online, and sometimes the online experience is the only one. The late 1800s and early 1900s saw a shift towards the way we now think of brands, as manufacturers found they needed to advertise; many of these developments were pioneered by J. Walter Thompson and their work around trademark advertising. So, the meaning of ‘branding’ began to evolve from being a physical brand to an emotional link between a product and an individual, and has come to mean something more symbolic and deep-rooted for consumers. I would like to look at the impact of customer experience on branding. Every experience that a consumer has of a brand either reinforces the

Satish Dave Regional Head - Customer Experience, Dubai Kantar TNS [email protected]

intended brand positioning, or creates a dissonance. This is true across sectors, whether the brand is in consumer goods, banking, technology, telecoms or automotive. Research suggests that it is the memory of an experience, rather than the actual experience itself, that matters when it comes to building impressions of brands. So, consumers form positive, painful or other memories of their experiences with brands and, over time, these memories come to define in their mind what the brand stands for.

Online or offline, the brand and its promises need to be aligned with the customer experience – the time when a brand should actually deliver on its promises. How well brands do at this is something Kantar TNS measures on its ‘authenticity framework’. Brands that start off by first making sure they are delivering great customer experiences, and then communicate the brand promise, have a better chance of being considered authentic in consumers’ minds. A classic case of this going wrong is that of a banking brand we saw promising to provide credit cards

This principle is true for consumer brands that promise functional and emotional benefits, such as shampoo brands that promise to turn your hair to silk, or remove 99.9 percent of dandruff, and toothpastes that promise whiter teeth and fresher breath. The common emotional benefit these brand promises share is that you will look good in front of your peers and be attractive to the opposite sex. But if any of these brands fail to deliver on the functional benefits they promise, they automatically fail on their emotional promises, and lose all authenticity in the mind of the consumer. If you want to build great brands, consider the promises you can make, but ensure that you fulfill those promises with lasting, memorable customer experiences that are consistent and differentiated.

Kantar TNS is one of the largest research agencies worldwide. We provide actionable insights that help companies make impactful marketing decisions that drive growth. www.tnsglobal.com 135

Saudi Arabian Top 20  >  INSIGHTS

SECTION 3 BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017

INSIGHTS Pressures on household budgets due to a slowing Saudi economy are having a clear effect on consumer spending. Spending on FMCG grew by just 1.3 percent in 2015, its slowest rate for some years, and spending patterns have changed across all income levels and among both locals and expats. Beverages and home care brands are particularly affected, with food and personal care somewhat better insulated.

SEARCHING FOR VALUE – SHOPPERS PUT THE SQUEEZE ON FMCG BRANDS

Even within these broad categories, there is significant variation in Ranjitha Subash growth, and this tells us much Strategic Insights Director Kantar Worldpanel about the way consumers are Ranjitha.Subash@ thinking when they shop. Impulse Kantarworldpanel.com purchases such as chocolate, salty snacks and biscuits are down, while bread, yoghurt, labneh and cheese sales have stayed strong. Similarly, in beverages, water and plain milk have seen growth, while flavored milk and energy drinks have posted a decline.

Shoppers are looking for cheaper alternatives when buying staples such as cooking oil, and are looking for promotions on items that they consider to be less than essential. Value is what shoppers are seeking, and brands must prove they can provide it.

It is no great surprise that with few avenues for entertainment, low participation in exercise, and a penchant for rich, sugary and fatty foods, rates of obesity and other health problems in Saudi Arabia are high.

Arpit Singh Client Service Director - Dubai Kantar TNS [email protected]

A TASTY OPPORTUNITY – THE SEARCH FOR HEALTH AND SATISFACTION

As a result, young consumers are seeking healthier choices, and many food and drink manufacturers have responded with low-fat, lowcalorie and ‘natural’ ranges. Supermarket chains such as Panda, Othaim, Lulu and Danube are giving more shelf space to healthy and organic products. But even the most healthconscious Saudi consumers care, above all, about one thing: taste. And healthy foods aren’t usually considered tasty.

FOUR REASONS WHY THE TIME FOR CHALLENGER BRANDS IS NOW

The market leaders in many product categories have at least double the market share of the next-biggest player, and this has made it incredibly difficult for challenger brands to break through in Saudi Arabia. STC is by far the biggest mobile phone network; in automotive, Toyota is way out in front, Landmark Group dominates clothing retail, there’s Almarai in dairy and Al Rajhi Bank and NCB in banking.

But now, the conditions are right for smaller brands to be able to challenge these dominant players, and we’re seeing smart challenger brands making bold moves. The big opportunities are:

YOUTH - With almost half of the population under the age of 25, to win with the young is to win significant share. Rabea tea has shown how innovating with the young in mind can pay off, with its extra-caffeine product that challenges coffee brands. CONVENIENCE - The growing number of women in the workforce means products and solutions that help consumers save time are in demand. Nadec launched Ayran, a ready-salted laban (milk drink) for drinking on the go. E-COMMERCE - More than a quarter of urban consumers are buying online, so it’s possible to build a strong brand without a big physical footprint.

SCREENS - Average time spent on screens and social media is high, which levels the media playing field for small and large brands and allows brands to make a big impact with a cleverly invested but relatively small budget. Virgin Mobile did just that using Facebook. Prashant Kolleri Managing Director - Insights Kantar - Saudi Arabia & Pakistan [email protected]

Brands that can come up with healthy AND tasty products stand to grow in this market. But success is unlikely to come from communications about what’s missing from food – less sugar, fewer calories, and so on. Connect with consumers’ emotional need for a healthy lifestyle – and their insistence on great-tasting food.

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BRANDZ™ METHODOLOGY

BRANDZ™ BRAND VALUATION METHODOLOGY

INTRODUCTION The brands that appear in this report are the most valuable in Saudi Arabia. They were selected for inclusion in the BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017 based on the unique and objective BrandZ™ brand valuation methodology that combines extensive and ongoing consumer insights with rigorous financial analysis. The BrandZ™ valuation methodology can be uniquely distinguished from its competitors by the way we use consumer viewpoints to assess brand equity, as we strongly believe that how consumers perceive and feel about a brand determines its success and failure. We conduct worldwide, on-going, in-depth quantitative consumer research, and build up a global picture of brands on a category-bycategory and market-by-market basis. Globally, our research covers 3.2 million

consumers and more than 100,000 different brands in over 50 markets. This intensive, in-market consumer research differentiates the BrandZ™ methodology from competitors that rely only on a panel of “experts”, or purely on financial and market desktop research. Before reviewing the details of this methodology, consider these three fundamental questions: why is brand important; why is brand valuation important; and what makes BrandZ™ the definitive brand valuation tool?

THE VALUATION PROCESS Meaningful In any category, Meaningful brands appeal more, generate greater “love” and meet the individual’s expectations and needs.

Different Different brands are unique in a positive way and “set the trends”, staying ahead of the curve for the benefit of the consumer.

Salient Salient brands come spontaneously to mind as the brand of choice for key needs.

IMPORTANCE OF BRAND

IMPORTANCE OF BRAND VALUATION

Brands embody a core promise of values and benefits consistently delivered. Brands provide clarity and guidance for choices made by companies, consumers, investors and other stakeholders. Brands provide the signposts we need to navigate the consumer and B2B landscapes.

Brand valuation is a metric that quantifies the worth of these powerful but intangible corporate assets. It enables brand owners, the investment community, and others to evaluate and compare brands and make faster and better-informed decisions.

At the heart of a brand’s value is its ability to appeal to relevant customers and potential customers. BrandZ™ uniquely measures this appeal and validates it against actual sales performance. Brands that succeed in creating the greatest attraction power are those that are:

Brand valuation also enables marketing professionals to quantify their achievements in driving business growth with brands, and to celebrate these achievements in the boardroom.

DISTINCTION OF BRANDZ™ BrandZ™ is the only brand valuation tool that peels away all of the financial and other components of brand value and gets to the core – how much brand alone contributes to corporate value. This core, which we call Brand Contribution, differentiates BrandZ™.

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STEP 1: CALCULATING FINANCIAL VALUE Part A We start with the corporation. In some cases, a corporation owns only one brand. All Corporate Earnings come from that brand. In other cases, a corporation owns many brands, and we need to apportion the earnings of the corporation across a portfolio of brands. To make sure we attribute the correct portion of Corporate Earnings to each brand, we analyze financial information from annual reports and other sources, such as Kantar Retail. This analysis yields a metric we call the Attribution Rate. We multiply Corporate Earnings by the Attribution Rate to arrive at Branded Earnings, the amount of Corporate Earnings attributed to a particular brand. If the Attribution Rate of a brand is 50 percent, for example, then half the Corporate Earnings are identified as coming from that brand.

Part B What happened in the past – or even what’s happening today – is less important than prospects for future earnings. Predicting future earnings requires adding another component to our BrandZ™ formula. This component assesses future earnings prospects as a multiple of current earnings. We call this component the Brand Multiple.

It’s similar to the calculation used by financial analysts to determine the market value of stocks (Example: 6X earnings or 12X earnings). Information supplied by Bloomberg data helps us calculate a Brand Multiple. We take the Branded Earnings and multiply that number by the Brand Multiple to arrive at what we call Financial Value.

STEP 2: CALCULATING BRAND CONTRIBUTION So now we have got from the total value of the corporation to the part that is the branded value of the business. But this branded business value is still not quite the core that we are after. To arrive at Brand Value, we need to peel away a few more layers, such as the in-market and logistical factors that influence the value of the branded business, for example: price, availability, and distribution. What we are after is the value of the intangible asset of the brand itself, which exists in the minds of consumers.  That means we have to assess the ability of brand associations in consumers’ minds to deliver sales by predisposing consumers to choose the brand or pay more for it. We focus on the three aspects of brands that we know make people buy more and pay more for brands: being Meaningful (a combination of emotional and rational affinity), being Different (or at least feeling

that way to consumers), and being Salient (coming to mind quickly and easily as the answer when people are making category purchases). We identify the purchase volume and any extra price premium delivered by these brand associations.  We call this unique role played by brand, Brand Contribution. Here’s what makes BrandZ™ so unique and important. BrandZ™ is the only brand valuation methodology that obtains the customer viewpoint by conducting worldwide on-going, in-depth quantitative consumer research, online and face-toface, building up a global picture of brands on a category-by-category and market-bymarket basis. Our research now covers 3.2 million consumers and more than 100,000 different brands in over 50 markets.

STEP 3: CALCULATING BRAND VALUE Now we take the Financial Value and multiply it by Brand Contribution, which is expressed as a percentage of Financial Value. The result is Brand Value. Brand Value is the dollar amount a brand contributes to the overall value of a corporation. Isolating and measuring this intangible asset reveals an additional source of shareholder value that otherwise would not exist.

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BRANDZ™ REPORTS, APPS AND IPAD MAGAZINES

WHY BRANDZ™ IS THE DEFINITIVE BRAND VALUATION METHODOLOGY

GOING GLOBAL?

All brand valuation methodologies are similar – up to a point. All methodologies use financial research and sophisticated mathematical formulas to calculate current and future earnings that can be attributed directly to a brand rather than to the corporation. This exercise produces an important but incomplete picture. What’s missing? The picture of the brand at this point lacks input from the people whose opinions are most important – the consumers. This is where the BrandZ™ methodology and the methodologies of our competitors part company.

HOW DOES THE COMPETITION DETERMINE THE CONSUMER VIEW? Interbrand derives the consumer point of view from panels of experts who contribute their opinions. The Brand Finance methodology employs a complicated accounting method called Royalty Relief Valuation.

WHY IS THE BRANDZ™ METHODOLOGY SUPERIOR? BrandZ™ goes much further and is more relevant. Once we have the important, but incomplete, financial picture of the brand, we communicate with consumers, people who are actually paying for brands every day, constantly. Our ongoing, in-depth quantitative research includes 3.2 million consumers and more than 100,000 brands in over 50 markets worldwide.

WHAT’S THE BRANDZ™ BENEFIT? The BrandZ™ methodology produces important benefits for two broad audiences. • Members of the financial community, including analysts, shareholders, investors and C-suite, depend on BrandZ™ for the most reliable and accurate brand value information available. • Brand owners turn to BrandZ™ to more deeply understand the causal links between brand strength, sales, and profits, and to translate those insights into strategies for building brand equity and fuelling business growth.

We wrote the book BRANDZ™ COUNTRY REPORTS: ESSENTIAL TRAVEL GUIDES FOR GLOBAL BRAND BUILDING

BRANDZ™ PUBLICATIONS

BRANDZ™ TOP 100 MOST VALUABLE GLOBAL BRANDS 2016 This is the definitive global brand valuation study, analyzing key trends driving the world’s largest brands, exclusive industry insights, thought leadership, B2B trends and a look at the Future of Brands.

BRANDZ™ TOP 100 MOST VALUABLE CHINESE BRANDS 2017 The report profiles Chinese brands, outlines major trends driving brand growth and includes commentary on the growing influence of Chinese brands at home and abroad.

BRANDZ™ TOP 50 MOST VALUABLE INDIAN BRANDS 2016 This in-depth study analyzes the success of powerful and emerging Indian brands, explores Indian consumers’ shopping habits, and offers insights for building valuable brands.

BRANDZ™ TOP 50 MOST VALUABLE INDONESIAN BRANDS 2016 Now in its second year, this study analyzes the success of Indonesian brands, examining the dynamics shaping this fast-emerging market and offering insights for building valuable brands.

SPOTLIGHT ON MYANMAR The story of Myanmar is one of huge potential, as a new era of openness signals a strong growth opportunity. Now is the time for brands to make an impression in this emergent economy.

SPOTLIGHT ON MONGOLIA Mongolia’s GDP has grown at rates as high as 17 percent in recent years, encouraging a growing number of international brands to gravitate toward this fast-growth market and make a beeline for one of Asia’s hidden gems.

Our BrandZ™ country reports contain unparalleled market knowledge, insights, and thought leadership about the world’s most exciting markets. You’ll find, in one place, the wisdom of WPP brand building experts from all regions, plus the unique consumer insights derived from our proprietary BrandZ™ database. If you’re planning to expand internationally, BrandZ™ country reports are as essential as a passport.

ELIGIBILITY CRITERIA The brands included in the BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017 report meet two eligibility criteria: • The brand is originally created by a Saudi Arabian enterprise and is owned by an enterprise listed on a credible stock exchange or Tadawul. • For banks, a minimum of 25% of its operating income should be generated by its retail segment.

BRANDZ™ TOP 50 MOST VALUABLE LATIN AMERICAN BRANDS 2017 The report profiles the most valuable brands of Argentina, Brazil, Chile, Colombia, Mexico and Peru and explores the socioeconomic context for brand growth in the region. For the iPad magazine, search BrandZ Latin America on iTunes.

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SPOTLIGHT ON CUBA Cuba is a market unparalleled both in the Caribbean region and the world. Brand awareness among Cubans is high, but gaining access to them uniquely challenging. Now is the time to plan your Cuba strategy.

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THE BRANDZ™ CHINA INSIGHTS REPORTS

BRANDZ™ BRAND BUILDING TOOLS

In-depth brand-building intelligence about today’s China The opportunity to build brands in China is greater than ever. But so are the challenges. The fastest growth is happening deep in the country, in less well-known cities and towns. Consumers are more sophisticated and expect brands to deliver high-quality products and services that show real understanding of local market needs. WPP has been in China for over 40 years. We know the Chinese market in all its diversity and complexity. This experience has gone into our series of BrandZ™ China reports. They will help you avoid mistakes and benefit from the examples of successful brand builders.

BRANDZ™ TOP 30 CHINESE GLOBAL BRAND BUILDERS 2017 This groundbreaking study aims its radar at the edge of the Chinese brand universe, exploring developed-country markets where only a few Chinese brands have dared to go – so far.

UNMASKING THE INDIVIDUAL CHINESE INVESTOR This exclusive new report provides the first detailed examination of Chinese investors, what they think about risk, reward and the brands they buy and sell. This will help brand owners worldwide understand market dynamics and build sustainable value.

THE POWER AND POTENTIAL OF THE CHINESE DREAM “The Power and Potential of the Chinese Dream” is rich with knowledge and insight, and forms part of a growing library of WPP reports about China. It explores the meaning and significance of the “Chinese Dream” for Chinese consumers as well as its potential impact on brands.

THE CHINESE GOLDEN WEEKS IN FAST-GROWTH CITIES Using research and case studies, the report examines the shopping attitudes and habits of China’s rising middle class and explores opportunities for brands in many categories.

THE CHINESE NEW YEAR IN NEXT GROWTH CITIES The report explores how Chinese families celebrate this ancient festival and describes how the holiday unlocks year-round opportunities for brands and retailers, especially in China’s lower-tier cities.

TRUSTR ENGAGING CONSUMERS IN THE POST-RECESSION WORLD Trust is no longer enough. Strong brands inspire both Trust (belief in the brand’s promise developed over time) and Recommendation (current confirmation of that promise). This combination of Trust plus Recommendation results in a new metric called TrustR.

REPZ MAXIMIZING BRAND AND CORPORATE INTEGRITY Major brands are especially vulnerable to unforeseen events that can quickly threaten the equity cultivated over a long period of time. But those brands with a better reputation are much more resilient. Four key factors drive Reputation: Success, Fairness, Responsibility and Trust. Find out how your brand performs.

CHARACTERZ BRAND PERSONALITY ANALYSIS DEEPENS BRAND UNDERSTANDING Need an interesting and stimulating way to engage with your clients? Want to impress them with your understanding of their brand? A new and improved CharacterZ can help! It is a fun visual analysis tool, underpinned by the power of BrandZ™, which allows detailed understanding of your brand’s personality.

SocialZ is the new social media data visualization product from BrandZ™ that enables you to easily track, visualize and present a data-driven approach using the real-time view of the social landscape surrounding any brand.

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BRANDZ™ REPORTS, APPS AND IPAD MAGAZINES

THE BRANDZ™ INDUSTRY INSIGHTS REPORTS

LEADERS IN THE HOT SEAT BEHIND THE BRANDS THAT SHAPE LIVES AND BUILD VALUE Interviews with chief marketing officers from some of the world’s most valuable global brands reveal the ingredients of brand strength, value and longevity.

BRANDZ™ TOP 25 MOST VALUABLE GLOBAL RETAIL BRANDS 2016/2017 Shifting shopper habits and evolving priorities are transforming the retail sector – and the balance of power among retail brands. Insights, analysis, key trends and retailer profiles support this exclusive WPP report.

BRANDZTM ON THE MOVE Get this new report - BrandZ™ Top 20 Saudi Arabian Brands 2017 - on your smartphone or tablet. Download mobile apps for other important BrandZ™ reports, including: Top 100 Most Valuable Global Brands 2016, Top 100 Most Valuable Chinese Brands 2016, Brandz™ Top 30 Chinese Global Brand Builders 2017, Top 50 Most Valuable Indian Brands 2016, Top 50 Most Valuable Indonesian Brands 2016, and Top 50 Most Valuable Latin American Brands 2017, along with Spotlight on Myanmar, Spotlight on Cuba and Spotlight on Mongolia. To download the mobile apps for these and other BrandZ™ reports go to www.BrandZ.com/mobile (for iPhone and Android). BrandZ™ is the world’s largest and most reliable customer-focused source of brand equity knowledge and insight. To learn more about BrandZ™ data or studies, or view one of our industry insight videos, please visit www.BrandZ.com, or contact any WPP company.

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WPP COMPANY CONTRIBUTORS

WPP COMPANY CONTRIBUTORS J. WALTER THOMPSON

KANTAR  

KANTAR AMRB 

J. Walter Thompson Worldwide, the world’s best-known marketing communications brand, has been creating pioneering solutions that build enduring brands and businesses for more than 150 years. Headquartered in New York, J. Walter Thompson is a true global network with more than 200 offices in over 90 countries, employing nearly 10,000 marketing professionals. The agency consistently ranks among the top networks in the world and continues a dominant presence in the industry by staying on the leading edge—from hiring the industry’s first female copywriter to developing award-winning branded content today. For more information, follow us @ JWT_Worldwide

Kantar is one of the world’s leading data, insight and consultancy companies. Working together across the whole spectrum of research and consulting disciplines, its specialist brands, employing 30,000 people, provide inspirational insights and business strategies for clients in 100 countries. Kantar is part of WPP and its services are employed by over half of the Fortune Top 500 companies.

AMRB, part of the IMRB group of companies, was established in 1999 and has grown to become a respected market research solutions provider to clients across the Middle East & North Africa region. AMRB helps both multinational and regional clients with their marketing questions, via innovative and bespoke solutions. AMRB specializes in areas such as consumer understanding, new product development, segmentation and pricing, shopper solutions and also has expertise in B2B and Stakeholder Loyalty research. AMRB operates across the MENA region through offices in UAE, Saudi Arabia, Egypt, Algeria and Morocco. AMRB and IMRB are part of Kantar, the data investment management division of WPP, which operates with over 30,000 employees across 90+ markets.

www.jwt.com/worldwide

www.kantar.com

www.amrb-mena.com

Camille Haddad CEO Saudi Arabia [email protected]

Prashant Kolleri Managing Director - Insights, Saudi Arabia & Pakistan [email protected]

Aurobindo Choudhury Vice President [email protected]

GEOMETRY 

KANTAR MILLWARD BROWN  

KANTAR RETAIL  

KANTAR TNS  

Geometry Global, the world’s largest and most international brand activation agency, drives conversion, action and purchase through award-winning programs that change behavior and inspire people to buy well. With teams in 56 markets, Geometry Global has expertise in shopper, digital, experiential, relationship, promotional and trade marketing. Geometry Global is a WPP company.

Kantar Millward Brown is a leading global research agency specializing in advertising effectiveness, strategic communication, media and brand equity research. Kantar Millward Brown helps clients grow great brands through comprehensive research-based qualitative and quantitative solutions, embracing the latest technologies and leveraging them to develop new products and services to help marketers compete and win today and in the future. Part of Kantar, WPP’s data investment management division, Kantar Millward Brown operates in more than 55 countries.

Kantar Retail is the world’s leading retail and shopper insights and consulting business and is part of Kantar, the data investment management division of WPP. The company works with leading branded manufacturers and retailers to transform the purchase behavior of consumers and shoppers through the use of retail and shopper insights, purchase data analytics, consulting, organizational development and retail virtual reality services. Kantar Retail tracks and forecasts over 1,200 retailers globally, has purchase data on over 200 million shoppers and among its market leading reports are the annual PoweRanking survey (USA and China), and Industry Shopper Study Across Retailers. Kantar Retail works with over 400 clients and has 20 offices in 15 markets around the globe.

Kantar TNS advises clients on specific growth strategies around new market entry, innovation, brand switching and customer strategies, based on long-established expertise and market-leading solutions. With a presence in over 80 countries, Kantar TNS has more conversations with the world’s consumers than anyone else and understands individual human behaviors and attitudes across every cultural, economic and political region of the world. It is part of Kantar, the data investment management division of WPP and one of the world’s largest insight, information and consultancy groups.

THESE COMPANIES CONTRIBUTED KNOWLEDGE, EXPERTISE AND PERSPECTIVE TO THE REPORT BRAND UNION Brand Union is a leading global brand agency with deep expertise in brand strategy, design, interaction, brand management and employee engagement. With 500 people in 25 offices, Brand Union serves every major market with clients including Vodafone, Bank of America, GSK, Jaguar Land Rover, CBRE, Pernod Ricard, IHG, LeGroup, Shazam and Tencent. From the most significant of launches to the smallest of online interactions, Brand Union defines, creates, and curates the total brand experience, ensuring it’s both brilliantly designed and beautifully connected.

ASDA’A BURSONMARSTELLER  Established in 2000, ASDA’A BursonMarsteller is the region’s leading public relations consultancy, with 11 fully owned offices and seven affiliates across the Middle East and North Africa. A WPP company within the global Burson-Marsteller network, ASDA’A Burson-Marsteller is a member of the MENACOM Group. The agency provides services to governments, multinational businesses and regional corporate clients through its specialist practices: Technology, Finance, Healthcare, Brand Communications, Corporate Communications and Public Affairs. The firm’s services include reputation management, digital communications, media relations, media monitoring & analysis, design services and event management.

www.brandunion.com

asdaabm.com | burson-marsteller.com

www.geometry.com

www.millwardbrown.com

www.kantarretail.com

www.tnsglobal.com

Majdoleen Till  Managing Director, Middle East [email protected]

Sunil John Chief Executive Officer & Founder [email protected] 

Nick Walsh  General Manager [email protected]

Piotr Chodakowski Country Manager [email protected]

Lindsay Wakefield Regional Director [email protected]

Arpit Singh Client Service Director [email protected]

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WPP COMPANY CONTRIBUTORS

WPP COMPANY CONTRIBUTORS

KANTAR WORLDPANEL

LAMBIE-NAIRN 

LANDOR 

Kantar Worldpanel is the global expert in shoppers’ behavior. Through continuous monitoring, advanced analytics and tailored solutions, Kantar Worldpanel inspires successful decisions by brand owners, retailers, market analysts and government organizations globally.

Lambie-Nairn has been creating dynamic brands for over 40 years—brands built for a multi-screen, digital world with the ability to coherently evolve in real time and reshape categories.

Landor creates some of the world’s strongest and most agile brands—brands that thrive on change. As new audiences and new technology generate new demands, disruption has become the norm and the pace of change is accelerating every day. Agile brands seize these opportunities to sharpen their strategies and transform their markets. Walter Landor wrote the book on branding, and he did it from the deck of a ferryboat named the Klamath. Like our clients, he found opportunity where others saw adversity. From Barclays to BMW and Tide to Taj, Landor helps brands stand out and stand for something—while never standing still.

With over 60 years’ experience, a team of 3,500, and services covering 60 countries directly or through partners, Kantar Worldpanel turns purchase behavior into competitive advantage in markets as diverse as FMCG, impulse products, fashion, baby, telecommunications and entertainment, among many others. Kantar Worldpanel is part of Kantar, one of the world’s largest insight, information and consultancy networks, and the data investment management division of WPP.

Historically well-known for our pioneering work in broadcast identity, Lambie-Nairn’s experience extends across both business-toconsumer and business-to-business brands in multiple sectors. It’s in our DNA to look at brands holistically, building them from the inside out, providing the expertise and tools to allow them to flex and grow in today’s ever-evolving world. Our unique approach to brand building extends to our industry leading brand management program known as Brand Optimisation™.

MINDSHARE

XAXIS  

Y&R 

Mindshare is a global media agency network with billings in excess of US$34.5 billion (source: RECMA). The network consists of more than 7,000 employees, in 116 offices across 86 countries spread throughout North America, Latin America, Europe, Middle East, Africa and Asia Pacific. Each office is dedicated to forging competitive marketing advantage for businesses and their brands based on the values of speed, teamwork and provocation. Mindshare is part of GroupM, which oversees the media investment management sector for WPP, the world’s leading communications services group.

Xaxis is the world’s largest audience buying company that programmatically connects advertisers to audiences across all addressable channels. Through the expert use of proprietary data and advertising technology along with unparalleled media relationships, Xaxis delivers results for over 2,800 clients in 45 markets across North America, Europe, Asia Pacific, Latin America and the Middle East. Advertisers working with Xaxis achieve exceptionally high return on advertising spend through the company’s proprietary media products, as well as through its specialist companies, Light Reaction, plista, Bannerconnect, and ActionX. Xaxis is a GroupM company that is part of WPP.

Y&R is one of the leading global marketing communications companies, comprising the iconic Y&R Advertising agency; VML, one of the world’s most highly regarded digital agencies; premier mobile marketing company iconmobile; shopper marketing and retail network Labstore; and Bravo, our integrated solutions agency for multicultural marketplaces.

www.mindshareworld.com

www.xaxis.com

www.yr.com

Rabih Khouri Managing Director [email protected]

Marcus Siddons Managing Director, MENA [email protected]

Georges Barsoum CEO Gulf [email protected]

Y&R Advertising has 189 offices in 93 countries around the world, with clients that include Campbell’s Soup Company, Colgate-Palmolive, Danone, Dell, Xerox, GAP, Land Rover, Lloyds and Telefónica, among many others.

As part of WPP we serve clients across the globe and manage 9 offices in Europe, the Middle East and Latin America.

www.kantarworldpanel.com

www.lambie-nairn.com

www.landor.com

Alan Roy Business Unit Director [email protected]

Andy Hayes MD Northern Europe & Middle East [email protected]

Ramel Kabbani Executive Director [email protected]

WPP is the world’s largest communications services group with billings of US $74 billion and revenues of US$19 billion. Through its operating companies, the Group provides a comprehensive range of advertising and marketing services including advertising & media investment management; data investment management; public relations & public affairs; branding & identity; healthcare communications; direct, digital, promotion & relationship marketing and specialist communications. The company employs over 205,000 people (including associates and investments) in over 3,000 offices across 112 countries. For more information, visit www.wpp.com. WPP was named Holding Company of the Year at the 2016 Cannes Lions International Festival of Creativity for the sixth year running. WPP was also named, for the fifth consecutive year, the World’s Most Effective Holding Company in the 2016 Effie Effectiveness Index, which recognizes the effectiveness of marketing communications. In 2016 WPP was recognised by Warc 100 as the World’s Top Holding Company (second year running).

www.wpp.com Roy Haddad Director WPP MENA [email protected]

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WPP & BRANDZ™ CONTACTS

WPP & BRANDZ™ CONTACTS

IN SAUDI ARABIA WE HELP BUILD VALUABLE BRANDS 

Our WPP companies have been engaged in Saudi Arabia for over 35 years. Today over 400 people including associates work in 11 companies and 20 offices in Riyadh, Jeddah and other cities. They provide the advertising, marketing, insight, media, digital, retail, shopper marketing, PR, knowledge, insight, and implementation necessary to understand Saudi Arabia and build and sustain brand value. To learn more about how to apply this expertise to benefit your brand, please contact any of the WPP companies that contributed to this report or contact: Roy Haddad Director, WPP MENA [email protected] Philippa Clayre Executive Director - Government & Public Sector Practice, WPP MENA [email protected]

BRANDZ™ BRAND VALUATION CONTACT DETAILS

The brand valuations in the BrandZ™ Top 20 Most Valuable Saudi Arabian Brands 2017 are produced by Kantar Millward Brown using market data from Bloomberg. The consumer viewpoint is derived from the BrandZ™ database. Established in 1998 and constantly updated, this database of brand analytics and equity is the world’s largest, containing over 3.2 million consumer interviews about more than 100,000 different brands in over 50 markets. For further information about BrandZ™ contact any WPP Group company or: Doreen Wang Global Head of BrandZ™ Kantar Millward Brown +1 212 548 7231 [email protected] Elspeth Cheung BrandZ™ Valuation Director Kantar Millward Brown +44 (0) 207 126 5174 [email protected] Martin Guerrieria Global BrandZ™ Research Director Kantar Millward Brown +44 (0) 207 126 5073 [email protected]

www.brandz.com

For further information about WPP companies worldwide, please visit: www.wpp.com/wpp/companies or contact: David Roth CEO, The Store, WPP EMEA and Asia [email protected]

Bloomberg The Bloomberg Professional service is the source of real-time and historical financial news and information for central banks, investment institutions, commercial banks, government offices and agencies, law firms, corporations and news organizations in over 150 countries. For more information, please visit www.bloomberg.com

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BRANDZ™ SAUDI ARABIAN TOP 20 TEAM

BRANDZ™ SAUDI ARABIAN TOP 20 TEAM THESE INDIVIDUALS CREATED THE REPORT, PROVIDING VALUATIONS, RESEARCH, ANALYSIS AND INSIGHT, EDITORIAL, PHOTOGRAPHY, COMMUNICATIONS AND PROJECT MANAGEMENT

Abdulaziz Al-Abdulwahed

Nikhil Banga

Jo Bowman

Prashant Kolleri

David Roth

Raam Tarat

Abdulaziz is a Junior Research Executive at Kantar Millward Brown in Saudi Arabia and is involved in the data collection and brand insights for BrandZ™ in KSA.

Nikhil Banga is a BrandZ™ Valuation Manager for Kantar Millward Brown. He manages the brand valuation projects for various countries for BrandZ™.

A journalist for 20 years, Jo Bowman worked for newspapers in Australia before moving to Hong Kong to specialise in business writing with a focus on Asian branding and marketing. She has since worked in Italy and the UK, as a writer and editorial consultant.

Prashant Kolleri is the Managing Director of Insights at Kantar Millward Brown in Saudi Arabia and Pakistan. He is engaged in regional support and coordination between WPP companies.

David Roth is the CEO of The Store WPP for Europe, the Middle East, Africa and Asia, and leads the BrandZ™ worldwide project. Prior to joining WPP, David was main Board Director of the international retailer B&Q.

Raam Tarat is the Global Project Manager for BrandZ™ at Kantar Millward Brown. He project manages the production of BrandZ™ global and country reports, as well as marketing communications for other projects.

Elspeth Cheung

Piotr Chodakowski

Lucy Edgar

Igor Tolkachev

Doreen Wang

With special thanks and appreciation to:

Elspeth Cheung is the Global BrandZ™ Valuation Director for Kantar Millward Brown. She is responsible for valuation, analysis, client management and external communications for the BrandZ™ rankings and other ad hoc brand valuation projects.

Piotr Chodakowski is the Country Manager of Kantar Millward Brown in Saudi Arabia. He is involved in local analysis and leads overall execution and marketing of BrandZ™ in KSA.

Lucy Edgar is the Global Marketing Manager at Kantar Millward Brown, where she is responsible for the PR, marketing and communications on the BrandZ™ projects.

Igor Tolkachev is a part of The Store WPP's EMEA and Asia team and coordinates BrandZ™ worldwide projects and partnerships.

Doreen Wang is the Global Head of BrandZ™, and a seasoned executive with 17 years' experience in providing outstanding market research and strategic consulting for senior executives in Fortune 500 companies in both the US and China.

BA Photography, Richard Ballard, Tuhin Dasgupta, Jay Makwana, Anthony Marris, Ben Marshall, Gaurav Mittal, Cecilie Østergren, Adam Smith and Peter Walshe

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