Puma wrong-footed in National Day misunderstanding



Over 25 years in the field of media communications I have seen many initiatives, seemingly based on innovative ideas and professional marketing, come to nothing. In multinational companies' efforts to connect with local markets, it is often the cultural engagement that determines success.

While global business is about maximising profits in faraway lands, it also has to address the needs of the local market. Multinational corporations are not only selling products and services, but also diffusing an array of cultural values that need to marry with local traditions.

That point has been clear in the recent debate about limited-edition sport shoes released by the German company Puma. The trainers, displaying the colours of the UAE's flag in commemoration of National Day, were announced and then just as quickly withdrawn as the company realised its error.

Even before Puma apologised for the product launch of SpeedCat shoes, it was obvious that the company meant well by its efforts to honour National Day. Yet the incident provoked a question about how multinational corporations see their businesses. Do they see beyond selling products to passive consumers to socially conscious people who find fulfilment in their own national and cultural symbols?

For westerners who see shoes as no more than clothing, the uproar over Puma's trainers might have been perplexing. But the traditional view in Middle Eastern societies holds shoes in low esteem. Because of their physical contact with the ground and the unclean, shoes are seen as vessels of impurity.

Hence, Muslims are required to take off their shoes before they step into a mosque - in many cultures, etiquette dictates that guests remove their shoes before entering someone's house. In the Gulf, shoes are not as lofty as the ghotra or the iqal. In Arab traditions, ghotras and iqals are symbols of pride and honour, whereas shoes clearly are not.

Shoes carry an element of added threat in an argument as well. Most of us will remember instances when shoe attacks figure into moments of high political drama. In 2008, there was the shoe-throwing incident in Baghdad when the Iraqi journalist Muntadar Al Zaidi, a reporter with the Cairo-based network Al Baghdadia Television, hurled his shoes at the then-US president George W Bush during a press conference with Iraq's Prime Minister Nouri Al Maliki.

Al Zaidi could have used his notebook, mobile phone or even his pen to express his anger, but he chose to throw his shoes because he wanted to be as offensive as possible. The incident inspired similar subsequent attacks, but of course the Americans have not always been the target. In 2003, during the fall of Baghdad, Iraqis threw shoes at the statue of Saddam Hussein in Paradise Square.

While Puma may have strayed on to sensitive territory, it is not the first incident of a multinational company entangled in an intercultural controversy. Three years ago, the sportswear manufacturer Adidas withdrew its Muhammad Ali clothing line from stores in the UAE after complaints from some customers that the legendary boxer's brand appeared to use the Prophet Mohammed's name for commercial gain.

At that time, I wrote in The National that companies should show more sensitivity to local sentiment when they design and market products. It's surprising how much difference a small change could make: if Puma had put UAE colours on a T-shirt or a cap, it would have been feted rather than embarrassed.

In an increasingly globalised world, there are plenty of opportunities for misunderstandings. As global business operations put millions of dollars into developing products and marketing, they need to make a similar investment in cultural engagement.

Muhammad Ayish is a media researcher and commentator based in Canada

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

MATCH INFO

Manchester United 1 (Greenwood 77')

Everton 1 (Lindelof 36' og)

Scoreline:

Cardiff City 0

Liverpool 2

Wijnaldum 57', Milner 81' (pen)

The Matrix Resurrections

Director: Lana Wachowski

Stars: Keanu Reeves, Carrie-Anne Moss, Jessica Henwick 

Rating:****

TWISTERS

Director:+Lee+Isaac+Chung

Starring:+Glen+Powell,+Daisy+Edgar-Jones,+Anthony+Ramos

Rating:+2.5/5

Our legal columnist

Name: Yousef Al Bahar

Advocate at Al Bahar & Associate Advocates and Legal Consultants, established in 1994

Education: Mr Al Bahar was born in 1979 and graduated in 2008 from the Judicial Institute. He took after his father, who was one of the first Emirati lawyers

Kill

Director: Nikhil Nagesh Bhat

Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal

Rating: 4.5/5

'Gold'

Director:Anthony Hayes

Stars:Zaf Efron, Anthony Hayes

Rating:3/5

Confirmed bouts (more to be added)

Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
Mackenzie Dern v Loopy Godinez

Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.

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Investment required: $500,000

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Sun jukebox

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Roy Orbison, Ooby Dooby (1956)

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