Dubai Holding trims marketing and advertising budgets

Dubai Holding will cut its marketing and advertising spending by 25 per cent this year.

Dubai Holding, the government-owned group whose subsidiaries stretch from the property to the media sectors, will cut its marketing and advertising spending by 25 per cent this year in response to the economic slowdown. The cut comes as marketing budgets across all sectors are tightened, particularly property, which has been hardest hit by the credit crunch.
"In the current economic climate, there is increased pressure on marketing and advertising budgets as business strategies and objectives change," said Khalid al Shafar, the marketing director of group marketing for Dubai Holding. "As a result, it has been decided to reduce the group's total marketing and advertising spend by 25 per cent in 2009, compared to 2008." Dubai Holding encompasses seven main companies: Jumeirah Group, TECOM Investments, Dubai Group, Dubai Properties, Tatweer, Sama Dubai and Dubai International Capital. Of these, the property-related companies would be pulling back spending the most, Mr al Shafar said.
"Real estate will be the most affected, while in other industries some budgets will be maintained or increased," he said. TECOM, the media-related arm of the group that oversees companies such as Dubai Media City and Dubai Internet City, will also experience some changes. JiWin, the public relations agency launched in 2006 by the Dubai Press Club, a TECOM initiative, has laid off five staff, according to sources within the industry. JiWin's clients include Dubai Holding and many of its subsidiary brands, as well as outside companies such as Coca-Cola. JiWin officials declined to comment.
In 2007, JiWin and Dubai Press Club became members of a new umbrella company, Media Services Group. Another member of Media Services Group, A'Sidrah Public Affairs, a specialist consultancy dedicated to government-related communications, is planning a restructuring in coming weeks, according to Naamat Barahdy, the managing director of A'Sidrah. "There are changes [coming], but nothing has been defined," she said.
Dubai Holding is a major player in advertising in the Emirates, with Dubai Investment, a subsidiary of Dubai Group, ranking among the top dozen television advertising spenders in the first three quarters of last year, according to the Pan Arab Research Center. Mr al Shafar said the group would be seeking more cost-efficient channels of communications, shifting away from more traditional outlets. "In 2009, we will take a more integrated approach using innovative channels such as digital - which is an emerging media in this market and a cost-effective communication medium - rather than traditional media," he said. "We will also be increasing the use of trackable advertising in our media mix."
But the group is sticking with its media agency, OMD Ellipse, which is part of the Dubai Media City-based Omnicom Group (OMD). "Dubai Holding, in line with other companies, regularly reviews its advertising plans, especially in light of the downturn in the global economy," Mr al Shafar said. "Since its launch in 2004, Dubai Holding has commissioned Omnicom Group (OMD) to exclusively manage its media planning and buying through a dedicated team, OMD Ellipse. Dubai Holding renewed the contract recently as OMD has delivered strongly against the performance objectives set by Dubai Holding."
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