Social media comes into its own
12 Sep 2009
For a few hours on Wednesday afternoon, the term #dubaimetro became one of the most popular topics on Twitter, currently the world’s fastest-growing social networking and micro-blogging website. UAE users who “tweeted” – posted it on their Twitter pages to coincide with the inaugural day of the Dubai Metro – saw it as a moment of pride – and a sign the country’s burgeoning social networking community was coming into its own.
For media experts and observers, it illustrated the influence social media wields today and the minefield of opportunities it represents.
“It takes a relatively high volume of ‘tweets’ over a relatively short period of time [to get something to be a trending topic],” said Alexander McNabb, a Dubai-based PR director and active blogger. “To our advantage, the US was asleep. Because in reality you need a much bigger community and we are still very small. But I think it’s a clarion call and it demonstrates the potential of this form of communication.”
Globally, Twitter has seen a dramatic 1,382 per cent monthly global usage growth, according to Nielsen, far surpassing Facebook’s 228 per cent. While Facebook remains the most popular social networking site today, Twitter is quickly evolving into an important component of brand marketing, Nielsen said in a study.
“If you use it properly, there’s no doubt that you can gain a true competitive advantage,” said McNabb. “And there’s no time like now to do that, before everyone jumps onto the bandwagon, and be effective without having to spend enormous amounts of money on advertising.”
McNabb’s company, Spot On Public Relations, on Thursday released the first Middle East and North Africa Twitter Demographics and User Habits Survey. The study, conducted last month, saw the UAE surging ahead in Twitter usage in the region, at 40 per cent, followed by Egypt at 13 per cent and Saudi Arabia at 11 per cent.
While the region’s monthly user number growth stands at a humble 17 per cent, 2009 has been a big year for Twitter, it said, with the total user community increasing at a healthy 300 per cent in the first six months. Twitter was inaccessible in the UAE until August last year when the website was unblocked by authorities.
And marketers better take note – an increasing number of users are also changing their perception of brands as a result of using Twitter, the research revealed. While a massive 70 per cent of respondents admitted to having formed a positive perception of a brand or company, 52 per cent said they have formed a negative perception. “More people are using it as a research tool. They are interacting and engaging with brands and are no longer just satisfied with having messages being thrown at them,” said McNabb.
Carrington Malin, Managing Director of Spot On Public Relations, said the number of users was reason enough for marketers to get involved in the social media sphere. “In the UAE, there are more than 800,000 Facebook users, that’s more than any newspaper can claim in readership,” he said. “There are about 6,000 people on Twitter, that’s more than most trade or weekly magazine can claim in circulation numbers. Consumers are on these platforms talking about things and interacting. Sooner or later they will talk about your brand. So it makes sense to be listening and monitoring. By not doing so, you run the risk of people shaping other information about your brand. And you risk being left behind.”
Emirati entrepreneurs Mohamed Al Awadhi and Peyman Parham Al Awadhi are not going to let that happen to their venture, an upcoming quick-service restaurant serving “fusion shwarmas” called Wild Peeta. For the past two years, the brothers have steadily built their brand online and are now confident they have created enough pre-opening buzz to ensure a positive reception. “We had no advertising or marketing budget. Instead we decided to invest in web services to optimise our presence online and actively interact with potential customers,” said Mohamed Al Awadhi. “It’s paid off handsomely. Through our participation on social networking sites, we have been on the radio, been featured in many magazines and television shows. It’s always a case of somebody who knew somebody else. That’s the beauty of social networks and that’s a great way to build a brand.”
Despite social media’s seemingly huge potential for brand building, many companies in the UAE have yet to warm to the concept. The Spot On PR research shows fewer than 30 per cent of those surveyed use it to promote their companies. Alexander Rauser, CEO of Dubai-based Omnia Connect, an “interactive agency” that provides digital solutions, said larger companies were “still trying to figure out how to use it best. While it’s a great tool for small businesses and entrepreneurs, larger organisations are finding that is not an easy medium to use and adopt,” he said.
“It’s not like advertising where you send a pre-determined message to the consumer. Here, you need to interact with people and you need to appoint someone specifically for that. And that’s where the problem is usually. Because we have a corporate culture that is highly moderated, organisations are concerned about content that goes live. There is red tape and hierarchies through which the message has to pass. That delay is not suitable for social networking where a lot of communication is in real time.”
The best way to get started is to go at it privately, said Rauser. “Create a private profile and observe how people interact and find similar people and information. Get your marketing manager in as well and eventually build a corporate profile. If you don’t have the time, get a PR company to do it for you or hire a consultant to help you out,” he said.
As rising internet usage propels the growth of social media, companies and brands have to try harder to stay relevant and interesting, said Robert Singleton, Online Marketing Manager for the InterContinental Hotels Group properties at Dubai Festival City. “One day customers may make their choice not simply by the look of a website or the message of an advertisement, but by how a corporation communicates with its clients online, and through their tone of voice when dealing directly with the public,” he said.
Singleton’s company has, in the past, organised various promotional and online competitions on Facebook and Twitter which have garnered huge responses, he said. It has also enabled it to answer direct questions from new and regular customers. “Within the hotel industry, social networking is still in its infancy, however the potential has been unmasked,” he said.
Prashant K Gulati, CEO and Managing Director of Optimistix Ventures, said he hoped Twitter’s growing influence would help foster a strong community in the real world. “It’s been a great medium through which entrepreneurs can support themselves, network and share ideas. So many of us have come together because of Twitter. Our circles would have never crossed otherwise,” he said.
Gulati, along with a group of Twitter users, is also the force behind the first Dubai Twestival Local, one of the 200 Twestival Local events taking place in cities around the world. To be held tonight at The Jam Jar in Al Quoz, Dubai, the networking event will raise money and awareness for Dubai Autism Centre. Twitter users in Dubai also participated at the first Twestival Global in February to help raise money for global charity Water.
“Twitter has been used as a medium for everything from blood donation to tackling complex issues where consumers have found a voice,” Gulati said. “I see it forming a connected community and something that has the potential to build relationships outside of Twitter. I see it helping serious people getting serious returns. But if it becomes a frivolous medium where people take advantage of it to spam and advertise, it will die.”
This article originally appeared on Emirates 24/7.
Emiratis share ownership in 95% of firms
12 Sep 2010
UAE nationals share ownership in 108,035 companies or 94.9 per cent of the 113,832 registered in Dubai (outside the free zones), according to Dubai Chamber of Commerce and Industry. The total number of companies registered in Dubai exceeds 135,000, including offshore companies and those registered with free zones. However, in terms of sole ownership, Emiratis own only 22.31 per cent, or 25,400 companies.
Indian investors rank second with partnership in 20,038 companies while Iranian and Pakistani businessmen share ownership in 7,634 and 6,532 companies respectively. This is under a complex companies ownership law that restricts foreign shareholding in a company to 49 per cent.
British and American expatriates share stakes in 2,200 and 997 companies respectively while Egyptians and Iraqis share stakes in 1,200 and 1,065 businesses. Bangladeshis rank ninth with shares in 752 companies while Germans own stakes in 546 companies.
Sleeping partner
However, analysts said the numbers might not reflect the actual ownership. Prasant Gulati, secretary general of the Indian Business and Professional Council (IBPC) said: “In such a complex companies law, it would be difficult to gauge the real numbers as most companies under the UAE nationals are actually owned and run by the expatriates. “By any count, the largest investor group is Indians. This does not reflect,” he said.
However the Dubai Chamber of Commerce and Industry said most companies with more than one shareholder were run by foreigners, with the Emiratis remaining inactive as a “sleeping partner” for an annual fee starting from Dh3,000. The Emiratis relinquished management rights by issuing a power of attorney in favour of the expatriate partner, either designated as managing director, partner or general manager. The partnership was renewed with the fee every year. While the sleeping partner remained responsible for labour approvals, visa and immigration issues, the expatriate partner undertook risks, finances and losses and gains.
Despite these limitations, the number of companies was growing, regardless of the current economic slowdown. “In the first half of the year, 5,098 new members joined Dubai Chamber, which is an 18.9 per cent increase from 4,289 in the same period last year,” said Dubai Chamber of Commerce director general Hamad Bu Amim.
UAE nationals also took an active role in some companies where they shared the risks and profits along with their foreign partners. These companies include Limited Liability Companies (LLCs), Establishments, and Professional Establishments, and did not include those registered with the various free zones in the emirate. Bu Amim said raising the foreign investors’ ceiling could help change the equation. “We expect increasing the share of foreign ownership to improve the appetite of foreign investments to come to UAE markets.
However, we need to keep in mind that higher ownership is not the only element that guarantees more FDI, there are other issues such as investors’ protection, cost of doing business, laws of dispute resolutions, bankruptcy law, etc.,” he said. “We also think that such increase of foreigners’ ownership stake should be restricted to certain sectors that the country would like to grow, or know-how and technology we like to attract, and limited to flow of high capital in hundreds of millions of dirhams.”
Main business
Although the Department of Economic Development (DED) remains the main business licensing authority in Dubai, it remains mandatory for registered companies to join the Dubai Chamber. Foreigners are required to forge a partnership with UAE nationals in order to obtain business licences under various categories. Foreign investors can, however, enjoy 100 per cent ownership in companies registered with free zones.
More than 20,000 companies are registered with about 20 free zones in Dubai, where companies are largely owned by foreigners. Apart from that, there are 10,000 offshore companies licensed by three offshore licensing bodies.
Foreign investment in free zones is growing faster than those outside the free zones. Dubai Airport Freezone (DAFZ) reported 63 per cent growth in sales during the first half of this year, while 875 new companies registered with Ras Al Khaimah Free Trade Zone (RAKFTZ) during the same period.
“Interest in free zones among foreign investors remains high. However, they invest in non-free zone licences only when they are required to do business within the country,” investment adviser Jitendra Gyanchandrani, chairman of JCA business consultancy, told Gulf News.
This article originally appeared on Gulf News.