Arcadia — SME Case Study (UAE)

Back in 2017, the Emirati perfume brand was born and the perfumes were officially available for customers on its website. The brand was inspired by the founder’s late mother who was very passionate about perfume and bakhoor making. The evoked memories fueled Amna’s passion for perfumery. Amna AlHabtoor’s main purpose of the brand is to push boundaries and bring back nostalgic moments with every scent. Furthermore, the brand also stands for people who love to experiment and live outside the gender and culture box. The brand targets men and women who are modern and progressive, considering that the brand offers women and unisex perfumes.

Arcadia by Amna started as a homegrown business and is now recognized in various countries. In 2017, the perfumes were only sold online but little by little, Arcadia by Amna the retail chain expanded and the perfumes became widely available in stores across Dubai. The perfumes were sold in The Zoo Concept store in City Walk as well as Robinsons in Festival City. Prior to the COVID-19 pandemic, AlHabtoor successfully signed agreements with New York, Vietnam, Saudi Arabia, Kuwait, Japan, London and Sweden to have her perfumes sold. In 2019, Arcadia successfully opened its flagship store located in Dar Alwasl, Dubai.

The mission and vision statements are very essential in every business and they set the path and future plans for businesses. The mission statement enables the firm to set common values and clear objectives to be utilized throughout the organization (Mullane, 2002). Arcadia’s mission is evoking memories through sustainable and high-quality scents that are cruelty, chemical and paraben-free.

Vision Statement A vision focuses on the long-term path and future position of the business (Cady et al., 2011). Amna AlHabtoor’s vision for the brand is to be widely recognized and available worldwide, while catering to tastes without being intimidating. Although they are widely available in different parts of the world, the perfumes continue to thrive and work towards worldwide recognition.

AlHabtoor said that she imagines her brand standing by famous perfume brands like Byredo and Diptyque. The founder also stated that one of their goals is not to say no to their customers and to cater to all their needs and requests.

Organizational Structure

Organizational structure is essential to providing clarity and a smooth flow of responsibilities and communication.

It draws a clear picture of the reporting system and functions that enable effective work (Jonathan, 2018).

There are various types of organizational structures ranging from horizontal to vertical structures depending on the size and direction of the top management.

Arcadia’s organizational structure was described as a fluid structure which ensures the team’s comfort and ease of communication. All employees and managers can easily communicate with the CEO personally or through a WhatsApp group. Meetings are held on a weekly basis and managers report back directly to the owner herself.

Leadership Amna AlHabtoor is the founder of Arcadia by Amna. She holds a bachelor’s degree in graphic design. AlHabtoor worked with her father, Sultan AlHabtoor, the president of AlHabtoor Motors, for 10 years. She has always been a fanatic of cars and was appointed as the marketing director. However, 10 years later, she decided to pursue her pure passion for perfumery. She took an intensive course in Cotswold Perfumery in Birmingham, United Kingdom, as well as other perfumery courses in New York, USA, as well as courses at the Grasse Institute of Perfumery. Working for the family business gave her the idea of running a large business, which played a great role in the success of her perfume brand.

Arcadia’s team consists of the brand manager, sales managers and the marketing manager, as well as employees who work at the store and the manufacturing team.

The founder always strives to maintain communication between all employees and enjoys personally keeping in touch with customers on social media as well as being approachable at the store.

Founder General Manager Employee Employee Marketing Manager Project Manager Creators Figure 46: Organizational Structure of Arcadia

The brand initially launched a first edition of 10 perfumes, which represented the finer things in life and the beautiful

nostalgic memories. The names in the first edition include

Candy Dust, Periwinkle, Hassaku High and Rose Pellets (Arcadia, 2021). The second edition included eight new unisex scents, titled “Dark Series.” The concept behind the Dark Series was that all the fine things in life come with hardships. It also emphasizes that everyone goes through tough days, pain and loses and that it’s human nature to come out stronger and survive the hardships.

The second edition was inspired by human emotions and featured names like Jinx, Enigma, Hysteria and Faded.

Also, with every collection, a new limited-edition scent is introduced.

Every scent is represented by a narrative and a story that describes the scent, enabling the customers to live the moment and feel the inspiration of the scent. The founder created different scents that represent her life.

For instance, she has a scent of her wedding day, her first baby boy and well as her daughter. However, the brand is not limited to perfumes only. During lockdown, the idea of creating a new line of candles and home diffusers was initiated, considering that people started spending a lot of time in their homes. Also, the service of customizing fragrances is available, as well as giveaways and catering big events like weddings.

Business strategies are vital to help set a business stand apart from competitors through setting and outlining goals that will be achieved, and to gain a competitive edge over rivals (Hossain et al., 2019). Arcadia by Amna’s strategy is product differentiation, considering that the brand also thrives to set the trends and keep customers engaged. Furthermore, there are no Emirati stand-alone perfume brands that offer perfumes with the same concept with the ability to lead the market.

Also, the brand focuses on continuously improving customer service as a strategy to attract customers to walk in the store and to guarantee a pleasant experience.

Another strategy followed by the brand is an affordable pricing strategy, compared to other local homegrown brands. Last but not least, being a socially responsible corporation is another strategy implemented by Arcadia.

All products are paraben and chemical-free as well as cruelty-free, which greatly attracts customers who value these things.

The methods and tactics that help an organization reach its objectives are all underlined in the business’s operational strategies, as they guide the way to achieving a vision and mission (Crane, 2017). The main aim of the brand is to create fragrances that fall out of gender and cultural boxes and create a community of progressive and modern customers. One of the operational strategies implemented by the brand is quality assurance and continuous offering of products. The highest selling perfumes are always restocked to ensure customers’ needs are met. Another strategy that was implemented was a cost cutting strategy. In 2019, Arcadia realized that the brand required some changes where packaging and bottles changed to a more sustainable approach.

Implementing the right marketing strategies enables a business to stay ahead of competitors through positioning the brand strategically (Li & Leonidou, 2020). Arcadia relies heavily on social media and spends a lot of effort towards growing the business through e-commerce.

The 4 P’s Price The pricing of the perfumes starting from 350 AED for the perfumes in all collections to 600 AED for the limited-edition perfumes. The price is considered highly competitive in comparison to other brands that do not have the same customer base as Arcadia. Discounts and offers are occasionally available throughout the year to celebrate special moments with people and increase the customer base.

Place The perfumes are available at Dar Alwasl in Dubai, which is a very strategic location considering that it is very close to major attractions in Dubai. The store is five minutes away from Jumeirah and 10 minutes away from the largest attraction, Burj Khalifa and downtown. The products are also available on the Internet to ensure that customers can order in the comfort of their home, as well as placing orders directly through direct messages on its Instagram page.

Product One of the goals of the brand is to create a product and packaging that is not intimidating. The packaging is very modern and sophisticated as it caters to both men and women through the simple design. The product was previously packaged in a paper box that was beautifully designed, but was then replaced by sustainable pouches that support the brand’s image.

Promotion Promotion methods and marketing tactics are one of Arcadia’s main focuses. The brand is known for being innovative and creative by always stepping out of the box. The first edition was launched in INKED, located in Al Serkal Avenue in Dubai, where the warehouse was rented and transformed into different rooms with actors that acted out the story behind every scent. The first edition was extremely successful, and customers were always excited for upcoming events. The second edition called “Dark Series” was also a big hit that touched people’s emotional side. Famous designers and public figures like designer Arwa Albanawi, Laila Qureshi, Mohammed Alhabtoor and Tarjas White, along with other recognized figures, were part of the campaign. This consisted of short interviews that ask deep questions about pain and hardships of life. “Amna Warehouse” pop-up events also marked great success, where people got to know the brand better and were able to relate to the concept.

Arcadia’s Marketing The product packaging is simply sophisticated and sustainable High focus on social media plateform and creating excitement and curiosity through pop-ups and interactive event Arcadia by Amna is located at Dar AlWasl, in the heart of Dubai Affordable pricing range from AED350 to AED650 and AED1000 for limited edition Figure 45: Promotional Strategies of Arcadia by Amna

Successful brands are bound to face various challenges throughout its growth. The owner’s main challenge was her name, and all the perceptions judgement that came with it. Considering the background of the family and their position in Dubai’s business world, Arcadia grew the hard way and earned its current position. The challenges faced were with suppliers and municipalities. One of the main challenges was discrimination and overpricing with the assumption that AlHabtoor’s daughter would not negotiate prices. Another major challenge were little things in initiating the business. For instance, the process of labor cards, visas and most importantly, getting the perfumes approved and everything came with its price.

Another major issue was finding the most suitable spot to grow the business further as it took two years to finally settle. The rent prices go up to a million and the leasing process is very complicated. Last but not least, the costs of production were very high considering the design and packaging of the product.

COVID-19 Challenges The pandemic has affected the progress of the store and employees. Luckily, no employees were fired, but no one was able to work during the pandemic. One of the managers was not able to exit their home country, which put more on other employees and the founder herself.

The sales were very hard to predict during 2020 and some campaigns were held back due to the restrictions imposed.

The following are challenges faced by Arcadia by Amna

¡ Finding the proper spot in the heart of Dubai ¡ High costs for startups, considering the resources ¡ Price discrimination due to the founder’s family reputation and background ¡ Constantly shifting customers needs and expectations ¡ Employee wages were paid without practicing the job due to COVID-19 Overcoming Business Challenges Challenges were overcome by constantly trying to find solutions and alternatives. For instance, the costs of production and packaging were greatly reduced by following a more sustainable approach and being innovative with a new design. Arcadia’s management replaced all paper packaging with a more sustainable package that required no use of paper. The new design also requires less labor work, which has relatively reduced the costs. As for the constantly shifting preferences, Arcadia has increased interaction with consumers through engaging them on social media platforms to better understand their needs. The other challenges were solved by patience and being proactive.

The Best Successful Practices and Failed Practices Arcadia highly values its customers and believes in first impressions, hence why the founder established strategies to attract customers and ensure their satisfaction, as well as ensuring motivation of employees. The store follows a no-phone rule, where employees are not allowed to use their phones unless there’s an emergency or during their break times. This rule attracts people walking by the store to enter and interact with the salesperson. Another best practice is rewarding efforts and by a commission-based program. Employees are always rewarded for their hard efforts and recognized for ideas. Targets are set for all employees and commissions are given accordingly. This program motivates employees to stay focused and help the business grow. Last but not least, regular meetings are one of the best practices that ensure transparency and involvement of all employees.

The Best Practices Deployed by Arcadia are

¡ Having a high focus on employee motivation to ensure a healthy work environment and increase sales ¡ Having the founder always be approachable and open for conversation with staff and customers ¡ Having regular meetings with managers and employees ¡ Using an informal WhatsApp group to enhance communication On the other hand, failed practices are bound to happen, but business owners learn from their mistakes to better tackle future challenges (Meyer & Meyer, 2017). One of the failed practices that took place were small campaigns on small occasions like Valentine’s Day and Mother’s Day.

Another failed practice was paying a large sum of money to social media influencers that have a large audience but very little influence on social media. The money was wasted where it was possibly better to put the money back into the business. These practices were replaced by focusing on influencers with 10k followers and have a stronger impact on people, relying on word-of-mouth and regular walk-in customers.

The brand has been through its ups and downs, but transforming a passion and dream into reality has become a success. In the beginning, everything was done the hard way and from scratch without clear instructions.

Simultaneously, working with different suppliers and learning the know-how of perfumery defined the success of Arcadia. The journey has been like a roller coaster but the hard work paid off. The founder expanded her knowledge of perfumery through intensive courses from reputable institutes. Broadening the horizons of the founder’s knowledge led the brand to success and creativity. The dream of having Arcadia in different parts of the world became real, with many more countries yet to come. Future plans include reaching out to more countries to have the products available and to expand the brand line. Today, Arcadia by Amna is a unique brand that doesn’t fail to impress and attract.

It is recommended that Arcadia implements the

following

¡ To provide product extension to existing products, like introducing hair perfumes, essential oils, etc. to reach a bigger customer base.

¡ To make Arcadia available in Emirates aside from Dubai through placing the perfumes in different reputable retail stores in Abu Dhabi and Sharjah.

¡ To consider that customers value hands-on workshops by holding workshops that are available for groups that have a passion for perfumery as well as those who love new experiences.

¡ To create a clear organizational structure to ensure smooth flow of responsibilities and communication.

Arcadia has left a great mark and worked as an inspiration

with the following lessons learned

¡ Do things with passion that leave beautiful results, hence why people will always follow their dreams and take risks.

¡ Keep employees motivated and involved. It is very essential and plays a vital role in the success of the business.

¡ Handle hardships with an open mind and remain optimistic.

¡ Be proactive and have a proper crisis management plan.

Arcadia by Amna’s concept was planned in 2015, and the business has been successfully operating since 2017.

The founder, Amna AlHabtoor, has a strong passion for perfumery and has gained real-life business experience by working for her father’s automotive business as a marketing director. AlHabtoor believed in her passion and pursued her dream through experimenting and taking extensive perfumery courses in reputable global institutes. The brand’s goal is to provide fragrances that are against gender, social and cultural boxes, while maintaining sustainability through design and production. COVID-19 put Arcadia through a tough time, but ensuring the safety of employees and their families was well worth it. The founder’s well-planned business strategies helped her achieve her goals and stay ahead of competition. Also, the marketing strategies are very up-to-date and suite the diverse society.