29 January 2008
"How long before we have too many malls" and "don't we have enough shops and brands already" are often the kind of things that I hear from friends, colleagues and clients. Yet in such a wildly diverse and rapidly emerging market, these questions often require lengthy and detailed explanation.
The US is a market that we typically try to benchmark ourselves against. However, it is also this market that is showing signs of stagnation when looking at some of the most well-known and well-branded products of our time.
Never have there been two more symbolic images of modern-day consumerism than the Starbucks disposable coffee cup and the two white in-ear buds of Apple's iPod. However, despite their marketing drives and ability to infiltrate our lives so easily, they now find themselves battling against a wave of products and companies all desperate to get a slice of the pie.
Consequently, this new price point from Starbucks undercuts all of the current competition's prices.
Apple's answer to this is much like that of Starbucks, i.e. product diversification. Consequently, they view the iPod not simply as a music player, but much more so as a multimedia device. As a result, the iPod is now as much about video, photos and lifestyle as it is about music, resulting in a broader addressable market and a more diverse product range.
Lessons
There are key lessons to be learnt here, especially for emerging markets, such as those in the Middle East. In the main, what these two examples show is that, although the road to maturity can be both challenging and quick (Apple released its first generation iPod only in 2001), the underlying problem is that without constant re-invention and product diversification, the outlook can quickly become stale.
This message can be easily transferred into the current strategy of mall development in this region, whereby a long-term strategy that allows for brand and product mix diversification will almost certainly witness increased market longevity than other less aware malls and brands.
- The writer is Head of GRMC Retail Services, Dubai.
By Neil Tunbridge
Gulf News 2008. All rights reserved.
