Managing Director, Concept Brands Group
We were inspired by the outlet shopping culture in the US and Europe. The retail sector in the region and across the world is currently facing a slump. People want to purchase products, but at the same time they are price conscious. This created a unique opportunity to bring outlet shopping to the region. All the top brands are still producing new fashion designs, and the previous seasons are our opportunity as an outlet. A company giving a 40-60% discount on last season’s collections did not exist in this region, let alone the UAE. There are outlets here and there, but no organized outlet concepts. In 2018, we opened our first outlet in a mall. Soon after, we realized the potential of our idea and expanded. At present, we have eight outlets, with four more to come. We are also looking to expand outside of the UAE; in 1Q2020, we will have three new outlets in Saudi Arabia. People are starting to open outlets, so this concept will grow. Two to three years down the line, there will be more outlets than normal retail stores. We buy stock from different brands in bulk to offer the same discount to all customers. Our appetite is good, which is why some brands are open to doing special productions for us. As we expand our retail outlets, we will also grow our portfolio of brands. When we started, we had 15-20 brands, but today we are working with more than 300 brands. We are in discussions with around 10 new brands to do special lines for us.
The Gaggenau portfolio of home appliances includes ovens, refrigerators, surface inductions, wine coolers, and other prominent luxury kitchen products. The parent company, BSH, thanks to its brands, Gaggenau, Siemens, and Bosch, is able to cover the luxury, premium, and added-value categories all in one. This allows us to match our brands with consumers’ needs and gives us a competitive advantage. Gaggenau occupies the luxury segment, a niche part of the market. Meanwhile, our Siemens range is intended for consumers in the premium segment of the market, while the Bosch brand covers the added value segment. We cover the entire kitchen spectrum with this umbrella of brands, from small domestic appliances such as vacuum cleaners, food processors, and coffee machines to major household appliances such as ovens, hobs, hoods, refrigerators, and washing machines. Luxe is normally a niche market worldwide. In the UAE, this is a broader niche market, with a population that is ready and able to spend money. However, people will only pay a substantial amount of money if you provide something different. Fittingly, our motto is: “The difference is Gaggenau.” This difference between brands is fundamental to the consumer and justifies the money they pay. It is impossible to compare this brand with any other in-home appliances in the UAE market. Luxury means differentiation, exclusivity, materials, heritage, and quality; only Gaggenau can provide this in the UAE.
Business Executive Officer, Sergey Makarin
The Nespresso story started with a simple but revolutionary idea: enable everyone to create a cup of coffee just like a skilled barista. In MENA, we operate through appointed local agents. Currently, we are present in the GCC and select African markets with the Original Line, which is the traditional espresso and lungo coffees, and with the Professional line for HORECA and offices. In Saudi Arabia, the UAE, and Kuwait, we have launched Vertuo line in September 2019. From a coffee landscape point of view, the Middle East differs as it is established in its coffee consumption habits, with many traditions embedded in the different cultures. In addition, our retail approach varies heavily depending on the country and the retail landscape. Here, we are more present in retail, as people like to go shopping in malls. We experiment with different kinds of formats, including large boutiques, booths, or pop-up types of cashpoints. In addition to this, we are also developing our e-commerce presence. By enhancing this service and creating a habit of online ordering, we are also able to offer a service to return the used capsules for recycling with the courier. Finally, we differ in our operations; in our region we operate through an appointed distributor selected for their commercial expertise, local market knowledge, respect of our business principles, and understanding of our brand values.
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