Introduction to Marketing—Individual assignment
Grade weight: 15%
Case study: Majid Al Futtaim
Founded in 1992, Majid Al Futtaim is the leading retail and leisure pioneer across the Middle East and Africa. It has since grown into one of the United Arab Emirates’ most respected and successful businesses spanning 15 international markets (see Figure 1), employing more than 40,000 people.
Figure 1: Majid Al Futtaim’s activities span 15 countries in 2018.
Concerning retailing, Majid Al Futtaim owns and operates 21 shopping malls. The shopping malls portfolio includes Mall of the Emirates, City Centre malls, My City Centre neighborhood centers, and four community malls which are in joint venture with the Government of Sharjah. The company holds exclusive rights to the Carrefour franchise in 38 markets across Middle East and Africa, and operates a portfolio of more than 210 outlets in 15 countries. The company has become the retail partner for some of the world’s most desirable brands, with exclusive licensing rights across the region for names like Abercrombie & Fitch, Hollister, AllSaints, Lululemon athletica, Monsoon Accessorize and Sacoor Brothers. As of 2017, Majid Al Futtaim Fashion has moved into the Home Furnishings market through its franchise partnerships with Crate and Barrel and Maisons Du Monde.
Concerning leisure and entertainment, Majid Al Futtaim provide a wide range of activities. It owns 12 hotels and three mixed-use communities, with further developments underway in the region. It also operates 318 VOX Cinema screens and 32 Magic Planet family entertainment centers across the region, in addition to iconic leisure and entertainment facilities such as Ski Dubai, Orbi Dubai and Ski Egypt, among others.
A keystone of Majid Al Futtaim’s promise to the customers of all its business ventures relates to innovation. Although building shopping malls, hypermarkets, hotels, and entertainment centers requires heavy investments, especially in terms of real estate and equipment, Majid Al Futtaim is committed to imbue the myriad of its market offerings with new features, new products, and new experiences. Adapting to technological innovation and changes in people’s habits has for instance led to the company to develop Carrefour’s newest service “Carrefour Now” designed to enable customers to order groceries online with quick delivery.
Based on the information above and the press articles in the appendix, address the following questions. Alternative sources of information may be used but references must then be provided as a footnote where the argument is made.
- While the company’s current mission statement (“To create great moments for everyone, everyday”) is perfectly valid, perhaps it could be improved. Write another possible market-oriented mission statement for Majid Al Futtaim and explain your answer. (30 points)
- A) Let us pay closer attention to Vox. What key macroenvironmental factors do you think have affected and will affect Vox’s business? (30 points)
B) Provide a conclusion as to what are the opportunities and threats that lie ahead of Vox. (10 points)
- Written English (30 points)
Appendix
Article 1: Dubai's Majid Al Futtaim to run world's biggest ski slope in China 4
Article 2: Searing heat could make countries in North Africa and along the Persian Gulf unlivable 5
Article 3: How the UAE leads the world in high-speed broadband 7
Article 4: Despite Netflix, Movie Theaters Had Best Summer in Decades 8
Article 5: Lux Entertainment Granted The Fourth Cinema Operating License In Saudi Arabia 10
Dubai's Majid Al Futtaim to run world's biggest ski slope in China
Sepember 5, 2018
Dubai-headquartered retail giant Majid Al Futtaim will enter China after agreeing to operate the world's biggest indoor snow resort in the Asian country.
The firm will deliver design and development services for Wintastar Shanghai, a planned indoor ski slope that will be built by Singaporean real estate firm, KOP Properties.
Located in Lingang City, China, the 107,000m² indoor snow park will have three ski slopes, including one for Olympic training, multiple ski runs, and more than 25 Alpine-themed attractions for non-skiers.
Majid Al Futtaim said it would draw from its experience as the operator of Ski Dubai, the world's largest indoor ski park, to deliver the Chinese project, which marks the firm's debut in Asia.
Wintastar Shanghai will also build upon Majid Al Futtaim's burgeoning international footprint, which has so far seen it open a ski resort in Egypt, develop a snow park in Oman, and work on plans to operate another indoor ski resort in Abu Dhabi’s $1.2bn (AED4.4bn) Reem Mall.
A ground-breaking ceremony for Wintastar Shanghai was held on 3 September, 2018, and the project could be completed by 2021 in time for the Beijing Winter Olympics that will be held in February 2022.
Majid Al Futtaim's leisure and entertainment arm will operate the project.
When asked why the company was moving into China, a Majid Al Futtaim spokesperson said: "The Wintastar Shanghai project represents Majid Al Futtaim’s maiden investment in China and is a strategic partnership based on the group’s longstanding experience in designing, developing, and operating indoor snow resorts.
"It aligns with a growing demand for ski- and snow-based lifestyle activities in China that Majid Al Futtaim, through its Leisure & Entertainment business, is well positioned to capitalise on.
Ahmed Galal Ismail, chief executive officer of Majid Al Futtaim Ventures, said he looked forward to working on the ski resort and helping the business grow in the nascent snow entertainment market.
"This partnership underscores Majid Al Futtaim's extensive knowledge and experience in designing, developing, and operating indoor snow entertainment facilities," he added.
"We are confident this represents the beginning of an extensive international footprint when it comes to indoor snow entertainment facilities."
Ong Chih Ching, executive chairman and director of KOP Limited, the holding company for the Singaporean developer, said Majid Al Futtaim's "impeccable track record" would benefit the development.
Source: http://www.constructionweekonline.com/article-50179-dubais-majid-al-futtaim-to-run-worlds-biggest-ski-slope-in-china/
Searing heat could make countries in North Africa and along the Persian Gulf unlivable
August 12, 2018
In the fertile Nile Delta, rising sea levels and a rising water table are already cutting into Egypt’s precious 4 percent of arable farmland.
CAIRO — The heat feels relentless. Temperatures here in August regularly top 95 degrees Fahrenheit, and Sunday’s forecast projects thermometers will hit 100 F. In Ouargla, Algeria, the temperature spiked to 124.34 F on July 5 this year, the highest temperature reliably recorded on the continent of Africa. In 2016, Mitribah, Kuwait, reportedly reached 129.2 F, which could make it the highest temperature on record for the Eastern Hemisphere and Asia.
With blisteringly hot summers becoming a regular occurrence, climate change could soon push an environment that is uncomfortable into one that is unsustainable — particularly for countries along the Arab Gulf and in North Africa.
The past three years have been the hottest in Egypt since temperatures have been recorded, said Ashraf Zaki, representative of the Egyptian Meteorological Authority.
“All of the extreme weather events have really been increased, the number of heat waves have increased,” he said. “Humidity levels are increased. All these issues belong to the effect of climate change.”
In Egypt, statistics show that temperatures are increasing at a faster pace and Zaki calls the trend “highly significant.” He warns that if global warming continues on this trajectory, and countries don’t take efforts to remediate the problem through guidelines like those outlined in the Paris climate accord, it could all add up to “one of the biggest disasters on the globe.”AUG.10.201802:15
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In the muggy Arabian Gulf — which includes the United Arab Emirates, Qatar, Saudi Arabia, Bahrain, Iran, Iraq, Kuwait and Oman — the immediate risk of soaring heat and humidity overshadows the distant threat of rising sea levels. An MIT research team determined that future temperatures there and in southwest Asia will exceed the threshold for human survival if nations fail to reign in emissions.
According to an MIT video on the subject, “exposure to wet bulb temperatures above 35 C (95 F) is enough to cause the fittest to overheat and begin to fail.” Wet bulb temperature measures the combination of heat and humidity to determine how well the body can cool itself by sweating.
Elfatih Eltahir, MIT professor of Hydrology and Climate and co-author of the paper, explained that they were able to measure how reducing emissions would decrease the number and severity of heat waves.
In a nod to the gravity of the situation, the United Arab Emirates became the only Gulf country to establish a ministry dedicated to climate change that cuts across public and private sectors. The country launched a proactive plan guiding a transition to a green economy, cutting emissions, limiting risk and increasing adaptability to 2050.
By that year, the country intends to double the contribution of clean energy to half of the total amount, reduce the carbon footprint by 70 percent and save $700 billion. Rising sea levels could eventually threaten 90 percent of infrastructure on the coast line in that country, but the immediate risk is the heat.
“Here in the UAE we have already reached 104 F, we are almost touching 122 F…. We look at it as if we are on the front line compared to others,” said Fahed Alhammadi, assistant undersecretary in the Ministry of Climate Change and Environment. “We are now developing scenarios … where we need to start to review our own regulations and law … We need to start monitoring diseases associated with temperature increase in order to bring these figures down.”
In the UAE, all residences, no matter how remote, have access to a continuous energy supply for air conditioning. A green building code mandates energy efficiency, and district cooling systems that service areas rather than individual buildings has cut demand by half.
As temperatures spike, comfort and even survival will hinge on air conditioning.
Source: https://www.nbcnews.com/news/world/searing-heat-made-could-make-countries-north-africa-along-persian-n899921
How the UAE leads the world in high-speed broadband
August 22, 2017
The UAE now has the highest penetration of fibre-to-the-home connectivity in the world, according to Etisalat. This network supports access to high-speed internet for more than 93 per cent of homes, data from the FTTH Council Europe show.
This has come about through investment in infrastructure by Etisalat and du, supported by the regulator, the Telecommunications Regulatory Authority. Etisalat plans to spend more than Dh3 billion this year to develop and expand mobile and fibre-optic networks across the UAE. Investments in the past few years amount to more than Dh28bn. Du is also investing about Dh1.8bn in infrastructure every year. According to the World Bank, broadband internet is today seen as critical to the transition to knowledge-intensive economies across the world.
Many countries in the Middle East and North Africa recognise that broadband is crucial to their efforts to reduce poverty and create job opportunities, especially for their young populations and for women.
For the UAE, developing the infrastructure for a knowledge economy is a critical plank of its Vision 2021 strategy to be among the best countries in the world as it continues towards diversification and to guarantee its future prosperity.
Source: https://www.thenational.ae/business/technology/how-the-uae-leads-the-world-in-high-speed-broadband-1.621718
Despite Netflix, Movie Theaters Had Best Summer in Decades
September 7, 2018
Movie theaters are having their best summer in two decades, reversing the losses from 2017’s disappointing season and showing resiliency in the Netflix era.
North American ticket sales will close out the summer season with a more than 14 percent increase, research firm ComScore Inc. estimated, fueled by the outsize performance of Walt Disney Co.’s “Incredibles 2” and “Avengers: Infinity War.” That’s the largest percentage gain since 1998. The season officially draws to a close with the Labor Day weekend in the U.S.
“The notion that streaming has led to a decline in cinema attendance is really over-exaggerated,” said Phil Contrino, a spokesman for the National Association of Theatre Owners.
Summer ticket revenue, always dependent on the studios’ big-budget pictures, can be volatile. Last year, sales plummeted a similar 14 percent when a few major releases came up short. Still, the spoils aren’t shared equally. Disney has almost doubled its sales from a year ago, according to Box Office Mojo, while Universal Pictures and Paramount are also up substantially. But other major studios are down.
One concern that may also may fade is the disruption caused by MoviePass, which shook the industry by offering unlimited moviegoing for under $10 a month. Constrained by losses, the service is now limiting customers to three movies a month, and major exhibitors including AMC Entertainment Holdings Inc. have come up with their own subscription plans.
With the summer bouncing sharply higher, analysts are raising their forecasts for the full year, crediting the Disney blockbusters and surprise hits like “Crazy Rich Asians” and “The Meg,” an action film about a giant shark. Leo Kulp, an analyst at RBC Capital Markets, predicts full-year growth of 5 percent, reaching a new record, after projecting a flat 2018 previously.
One caveat: Those forecasts include the effect of higher ticket prices, rather than just a stampede of filmgoers to the cinema. They also hinge on upcoming films performing well. That includes potential Oscar contenders like “A Star Is Born,” as well as more commercial fare like “Mary Poppins Returns.”
Source: https://www.bloomberg.com/news/articles/2018-09-06/asian-stocks-face-more-losses-treasuries-climb-markets-wrap
Lux Entertainment Granted The Fourth Cinema Operating License In Saudi Arabia
September 2, 2018
In a new boost for Saudi Arabia’s entertainment industry, Lux Entertainment, the alliance of Al-Hokair Group, Cinepolis Cinemas, and Al-Tayer Group, was granted the fourth cinema operating license from the General Commission for Audiovisual Media (GCAM).
The Kingdom had ended its 35-year ban on cinemas and opened its first new cinema last April in Riyadh.
The Development and Investment Entertainment Company, in partnership with the world’s largest provider and operator of movie theaters, AMC, was granted the first cinema operating license. The second license was awarded to U.A.E.-based Majid Al Futtaim’s Vox Cinemas, while the third one went to Al Rashed Empire Cinema Consortium.
Lux Entertainment has a plan to build 300 screens in 15 cities around the Kingdom to offer a multi-faceted cinema experience including luxury halls, infant cinema, and low cost operating movie theaters, in alignment with the rules and regulations of GCAM.
Alliance member Cinepolis is the fourth largest international cinema operator worldwide, with 652 movie theaters in 14 countries around the world, while Al Tayer Group is one of the leading companies in the field of retail operation in the UAE and the GCC.
Saudi Arabia plans to set up 350 cinemas with over 2,500 screens by 2030, boosting the movie-going industry to $1 billion in market value, as part of the Kingdom’s modernization drive that aims to wean its economy away from its reliance on petrochemicals.
Earlier this year, AMC Theatres partnered with Public Investment Fund (PIF) to open 30 to 40 cinemas in 15 cities over the next five years and 50 to 100 cinemas in total across 25 cities by 2030.
While Dubai-based VOX Cinemas too has agreed to invest over $540 million to open 600 screens in the next five years in Saudi Arabia, and South Korean media conglomerate CJ 4DPLEX inked a deal with Middle East-based cinema operator Cinemacity to open three 4DX cinema locations in Riyadh and other Saudi cities by the end of this year. Meanwhile, Al Rashed Empire Cinema Consortium has announced plans to open 30 new theaters in various cities across Saudi Arabia.
Source: https://www.forbesmiddleeast.com/en/lux-entertainment-granted-the-fourth-cinema-operating-license-in-saudi-arabia/