Date—15th June, 2014 Volume 1, Issue 1

Saudi Arabian Consumer TELECOM SPENDS ON THE RISE!!

People in Saudi Arabia spend 30% of their income to pay their phone and internet services

bills, as mentioned by the Consumer Protection Association.

The average consumption is 30 per cent, but some individuals spend up to 50-70 per cent of

their income on communication services, local media quoted the head of CPA Nasir Al Tu-

waim as saying.

The figures show that consumers spend a considerable amount of time on phone calls and

internet services, despite the adverse economic and health consequences. The above reality

is evident in many different realities of Saudi Arabia—exponential growth in usership of

Social Media, growth in Broadband connectivity etc.

CONSUMER SENTIMENT IMPROVING!!

As per MasterCard, consumer sentiment index in Saudi Arabia stands at an impressive 93.3.

While there has been a marginal decrease on some elements, overall sentiment remains

particularly high.

When compared to the previous edition, consumers are slightly less optimistic about the

Economy (97.1 vs. 97.3), Employment (96.2 vs. 97.6), Regular Income (95.7 vs. 98.8), Stock

Market (89.6 vs. 93.5) and Quality of Life (87.9 vs. 88.9).

In the Middle East, Kuwait (96.8) overtakes Qatar (96.4) as the market with the highest

level of consumer confidence, followed by the UAE (94.7), Saudi Arabia (93.3), Oman (87.1),

Egypt (54.1) and Lebanon (26.9).

About the MasterCard Index™ of Consumer Confidence:

The MasterCard Index™ of Consumer Confidence survey has a 20-year track record of con-

sumer confidence indices collected from over 200,000 interviews, unequalled both in scope

and history across Asia/Pacific, Middle East and Africa.

INSIDE THIS ISSUE

Reading Habits ........................2

Growing Wealth .......................2

Social Media .............................3

Food Habits .............................4

Youth ........................................4

Mobile Internet .......................4

“The things that I want to know are in the books. My best friend is a man who can get me a book I have not read” - Abraham Lincoln

In the Middle East, 157 billionaires reside in the region, with a combined total net wealth

of $354bn. The region's richest community grew significantly from last year as a result of

strong equity and commodity markets, the report found.

Although the Middle East represents just seven percent of the total number of billion-

aires, they are the biggest consumers, which explains why the luxury industry puts a great

deal of emphasis on the market.

Within the Middle East, Saudi Arabia is the country with the largest number of billion-

aires (64), followed by UAE (37) and Kuwait (17).

The total wealth of Saudi billionaires comprised more than half of the combined net

worth of the billionaires in the Middle East. Two thirds of them derived their wealth from

inheritance and 95 percent of this wealth is held by men.

Billionaires of the UAE, on the other hand, have derived their fortunes through finance,

banking, investment and real estate and not oil and gas.

Top 10 billionaires in the region are

1. Prince Al Waleed Bin Talal Alsaud (KSA)

2. Mohammed Al Amoudi (KSA)

3. Nassef Sawiris (Egypt)

4. Abdulla Bin Ahmed Al Ghurair (UAE)

5. Majid Al Futtaim (UAE)

6. Murat Ulker (Turkey)

7. Prince Sultan Bin Mohammed bin Saud Al Kabeer (KSA)

8. Sarik Tara (Turkey)

9. Mohammed Mansour (Egypt)

10. Mohammed Al Issa (KSA)

READING HABITS IN UAE

GROWING WEALTH IN THE MIDDLE EAST

As per a survey conducted by UN a few

years ago, the average Arab citizen in the

Middle East reads approximately four pag-

es of literature a year — which corresponds

to learning five words a day.

In comparison, an average American reads

11 books a year and a Briton eight books.

This is affecting the Arab citizens in many

different ways, especially reading, compre-

hension and attentiveness related skills.

Especially in UAE, it is ironical because the

percentage of educated people exceeds

90%..

Amongst children, decline is of concern

because they are the seeds for future.

Many experts state reasons such as the lack

of the culture of reading at home, correla-

tion of reading with the mundane nature of

examinations and above all, limited availa-

bility of reading literature compared to

many other western countries.

How to encourage reading in children:

Be a model to your children

Set family reading time

Make it look like a shared enjoyable experience

Surround children with book

RICH AND FAMOUS

There are more billionaires in the

world at present than any time

before, with 2,170 wealthy individ-

uals worth a combined net worth of

over $6.5 trillion.

According to Wealth-X and UBS,

the average wealth of a billionaire

equals $3bn, but globally, there are

111 individuals who each have a net

worth above $10bn. Their collective

net worth is an impressive $1.9

trillion, which is greater than the

GDP of Canada.

TOP SOCIAL MEDIA TRENDS IN UAE

While Facebook is the biggest brand in social media, Google Plus seems to be slowly gain-

ing prominence. It currently has 343 million users globally and is constantly increasing in

number. Moreover, with a wide array of services available on Google, Google + will slowly

become the ‘one size fits all’ social media brand.

Mobile is THE platform of choice here in the Middle East, The MENA region has the sec-

ond highest rate of smartphone shipments out of Asia, so the region is growing like crazy.

Brands that purposefully place mobile at the heart of their experience, telling stories

through the apps that embody the brands character will be the winners in 2014.

Digital commerce will also grow considerably in the days to come. By 2017, the region’s

digital buyer audience is expected to reach 94.0 million people, or 10.3% of its popula-

tion. Understanding the social, digital and mobile shopper will become increasingly im-

portant for retailers wanting to drive engagement, customer loyalty and footfall to malls.

The next generation of advertising and content creation will have its roots in visual story-

telling. Platforms like YouTube, Pinterest and Instagram that can showcase ephemeral

content will assume more prominence in the days to come. If brands want to experiment

with bespoke, target communications to a young audience, then social media is the way to

go.

The success of major shows such as Arab Idol on social media will drive greater interest in

social media & events integration. Sporting, social media and music events will therefore

have to strengthen their presence online for maximizing viewer interest.

Above all, social media will become a tool to mobilize public opinion and build percep-

tions. If used positively, it can bring a lot of benefits to the society. This is exactly the area

wherein authorities need to focus their energies, especially because social media has very

often ventured into directions that have had negative impacts on individuals and society

at large.

SOCIAL MEDIA AND THE SOCIETY

Social media has forever changed

the way society works, whether it’s

the sharing of an idea, the commu-

nication of news, or the availability

of a product or service.

Society today is on the verge of a

new way of existing that it’s never

experienced before. No longer will

people from one side of the world

be really able to say that they will

never see a person or communicate

with someone from the other side

of the world ever in their life.

No longer will people not be able to

share an idea, if they really want to

share it (no matter how radical it

may be or no matter how many

people may disagree with it).

No longer will the spreading of

information or the expressing of an

opinion be able to be completely

silenced.

As long as there is a person who

wishes to express their opinion,

share their music or art, or simply

say hello to another human being

in another country or culture, so-

cial media will allow them to do so.

Growing interconnection with the outside world

3

Traditional Middle East Recipe

FOOD IN THE MIDDLE EAST

Eating is one of the grand passions

of Middle Eastern life. For all the

religious, political and social issues

that divide the region, an emphatic

and overriding belief in the im-

portance of good food is a strong

binding factor.

Middle Eastern food primarily

derives its excitement from the

large and astonishing variety at all

its feasts, wide array of colours and

complementary tastes.

Middle Easterners see eating as a

way of life, an event to be shared

with family and friends and to mark

the most important events in life. It

is also a pastime worth spending

hours over, ranging from procuring

the choicest materials to the most

elaborate cooking process.

FOOD HABITS AND SHIFTS IN SAUDI ARABIA

According to Alpen Capital’s recent 2013 GCC

Food Industry report, KSA has become the

largest food consumer by volume in the GCC

region and by 2017, will account for 59 per

cent of the food consumption in the region at

29 million tonnes.

While there is a growing awareness and drive

about healthy living, obesity rates are high

and diabetes is a top health concern within

the Kingdom. As a consequence, demand for

health food which is high on energy and nu-

trition is expected to gain traction. This is

likely to be a fast growing segment in Saudi

Arabia.

Eating out is becoming increasingly popular

in Saudi Arabia, which is increasing demand

for fast-food in the Kingdom. A host of casual

dining and fast-food restaurants have sprung

up over the past decade as richer consumers

and a strong eat-out culture drives growth.

Packaged food makers might have the most to

gain from Saudi Arabia’s current growth

boom. According to a report from Research

and Markets, the country’s packaged food

market will grow at a CAGR of 8.95 per cent

over the period 2012-2016. One of the key

factors contributing to this market growth is

the rising population of the country and, in

particular, its youth bulge.

SEAFOOD IN THE MIDDLE EAST

With global seafood consumption forecast to

rise to 150-160 million tonnes per annum, or

between 19-20 kg per person by 2030 accord-

ing to the World Health Organization, the

international seafood industry is looking to

the fast-growing Middle East markets for new

business opportunities. Given the region’s

growing population, rising financial prosperi-

ty and strong tourism sector, seafood con-

sumption per capita is growing at a substan-

tial rate compared to other regions.

Seafood enjoys considerable popularity in the

region, due to its strong cultural linkages and

above all, its status as a source of low cost

protein. Further, the availability of a wide

variety of fish, both locally cultured and im-

ported gives a wide variety of options for the

consumer to choose from.

Importantly, the popularity of seafood is not

restricted to fish alone. It extends to other

foods such as shrimp, crabs and oysters.

Especially in UAE, with a wide variety of

restaurants from across the region, seafood

enjoys omnipresence across most cuisines.

“We cannot always build the future for youth, but we can always build our youth for the future” - Franklin Roosevelt

The Middle East, is experiencing an unprecedented "youth bulge." With over 30 percent

of its population between the ages of 15 and 29, representing over 100 million youth, this

is the highest proportion of youth to adults in the region’s history.

The demographic window of opportunity is defined as having a large working-age popula-

tion and low dependency ratio. The dependency ratio is the ratio of the economically

dependent population (0 -14 and over 65) to those who are productive (15-64). With a

large pool of young workers, the Middle East enjoys a low dependency ratio which can

enable the region to bolster savings and investments. However, the Middle East has a

narrow window of opportunity to capitalize on its large youthful workforce before it starts

to age. By implementing sound economic and social policies, countries can take ad-

vantage of the youth bulge and translate it into a dividend that promises better economic

and social outcomes.

Over the last 15 years the Middle East has witnessed key technology-led shifts that have

transformed the way its countries govern, shop, and do business. The region’s extremely

young demographic (44% of the regional population are under 20 years old) is undoubt-

edly a key driving factor for the increasing levels of digital engagement, with over 150

million people online and over 60 million actively using social media networks.

As digital engagement levels and internet penetration rates increase, levels of mobile

device use rise correspondingly. Saudi Arabia currently leads the Middle East by

smartphone penetration level, achieving a level of almost 63%, and is closely followed by

the UAE with 61% – meaning over half the total population of these two countries are

connected to a smartphone device. Throughout other Middle East countries, research

shows that Kuwait has a 49% smartphone penetration level, followed by Lebanon with

36%, Jordan with 19%, and Egypt with 5%.

There is a clear difference in results between the GCC (Gulf Cooperation Council) coun-

tries and the rest of the region, as the latter currently tends to be less smartphone-

centric. This suggests a need for different marketing approaches tailored to each of these

regions.

According to recent research from Google at the Arabian Travel Market, 50% of travelers

surveyed in the GCC use mobile devices to make key travel decisions. As smartphone

ownership and internet penetration rates are constantly increasing in the region, this

trend is not particularly surprising. Among travelers who plan their trips online, 48%

have used a smartphone during the last year to carry out travel-related activities, a figure

that rises to 69% if tablets are included. Saudi Arabian travelers came out top in mobile

online usage, with 50% using smartphones to access online services, closely followed by

the UAE with 35%

YOUTH IN THE MIDDLE EAST

MOBILE INTERNET USE IN THE MIDDLE EAST

Introduction FeedBack Market Research is a full service market research agency headquartered in UAE, with offices in Egypt and Saudi Arabia. Through our own offic-es and that of our associates, we currently conduct research in more than 20 countries across the Middle East, North Africa and Levant regions. We help our clients in doing business better by providing a richer understanding of customers and cultures within the region. We are therefore a partner of choice for clients looking for a differentiated understanding of customers through cultural analysis and expertise. FeedBack is therefore well positioned to be a partner in your progress by virtue of its determination, intellect and transparent approach to client relation-

ships.

Our Services & Specialties While we offer the bouquet of traditional research services like focus groups, in-depth and structured interviews, we have our core areas of differentiation as well: IN-HOUSE RESOURCES At FeedBack, we do not outsource fieldwork. We also do not outsource moderation in qualitative, as we believe that in-house resources give us greater control on quality. DATA COLLECTION TECHNOLOGIES We have invested significantly in improving our data collection efficien-cies and competencies. We have a state of the art CATI system that offers 100% recording, remote listening, predictive dialing, call barge-ins & discreet interviewer commu-nication facilities. We also have invested significantly in using internet enabled tablet computers for data collection work in face to face inter-views DASHBOARD FACILITY We offer customized dashboard facility as well. This can be integrated with our online data collection software, so as to provide near real time access to research information. ARABIC RESOURCES We believe that culture is best understood by people who are a part of it. Hence, we have consciously invested in developing Arab talent from with-in the region. This has helped us in better understanding and analyzing cultures. Further, all our Arabic resources are reasonably fluent in English and this makes communication with clients easier and effective.

INDEPENDENT QUALITY CONTROL The quality control team is an independent and empowered team. They accept or reject interviews, accompany interviewers or take any other action that may be necessary for ensuring delivery of high quality data.

SECTORAL EXPERTISE While we conduct research for a number of businesses, we specialize in Government, FMCG, Healthcare, Retail and Fashion & Luxury FOCUS GROUP STUDIOS We have our in-house focus group viewing studios in Sharjah, Dubai, Jeddah and Cairo. Facilities on offer include: 1. Focus Vision Facilities 2. Flat Screen Televisions 3. Hi-Speed Internet Access 4. One Way Mirror

CONTACT—UAE

Murli Mohan, Regional Director

mmrao@feedbackme.ae

Amit Sahni, Director, Client Services

amit.sahni@feedbackme.ae

CONTACT-KSA Ahmed Fouad, Research Manager ahmed.fouad@feedbackme.com.sa

CONTACT-EGYPT Dr. Amr Mansour, Country Manager amr.mansour@feedbackme.com

Perihan Atia, Head, Qualitative

perihan.atia@feedbackme.com