Prestige — SME Case Study (UAE)

The company selected for this case study analysis is Prestige. It specializes in the sale of Arabic sandals for both men and children. The company is based in the United Arab Emirates, founded in 1990 in Qatar under the ownership of Future Enterprises, which is the parent company, but incorporated in Dubai. The company has over the years recorded notable growth. It emerged as one of the small to mid-sized companies in the UAE in the domain of Arab sandals. Although it has not grown significantly in size, it has stayed afloat and competitive for more than 20 years since it has been in operation. This case study analysis reviews the company, identifies the firm’s products, business strategies, business challenges, possible solutions, lessons learned and recommendations for improvement of the firm.

Prestige

A mission statement is an essential component for a business, as it outlines the goals and purpose of its existence. It therefore helps give a sense of direction to the people in the organization, including managers and employees. For Prestige, its mission statement reads as follows: “To offer global quality products that are sure to meet customer expectations in all aspects” (Prestige, 2020). The mission highlights the enterprise’s focus on quality products that meet global standards, and satisfy the needs of customers. In this context, the company has been keen on creating and offering high quality products that are designed to reflect the needs of the customers that it targets. The mission statement is however not the best, given that it only mentions that it offers high quality products to meet customer specifications, without stipulating the role of other stakeholders, such as employees, and the way it leverages technology and other aspects while protecting the business interests and those of the other stakeholders, such as the customers and community members. It implies that the business may be able to improve its mission statement to reflect a more comprehensive focus and message to guide the actions of its managers and employees while appealing to targeted customers and the general public.

Vision Statement The vision of an organization refers to the overall futuristic aspiration for the company, detailing where the company seeks to be in the foreseeable future, and thereby underpinning the stated mission. Looking on the website of the company, it states that its vision is to stay adaptive and in line with evolving trends and customer preferences, “…with the ultimate goal of becoming ‘the most reputed name in the domain of our business areas.’” The vision statement outlines the long- term aspiration of the company, stating that it seeks to become the most reputed brand in the business through adopting an adaptive approach in its operations and customer value creation. Looking at the vision statement, it can be said that the message is clear, as it gives an idea that the company is looking and working towards becoming a superior brand in the market and increasing its competitiveness and performance (Prestige, 2020).

The fact that the vision statement gives insights as to how the vision could be realized, through an adaptive approach, in creating its products and delivering them to customers, further underscores its relevance and suitability to this extent within the UAE market.

Based on the vision and mission statements, it is evident that the company is focused on delivering high quality, luxury sandals that combine traditional designs with a touch of modernity and style. However, the company faces stiff competition and declining sales in the wake of the raging COVID-19 pandemic. To this extent, and given the prevailing challenging business environment, there is a need for the company to focus on its operational, management, and marketing strategies as part of the approach to optimize efficiency, competitiveness, and profitability. This case study analysis identifies the pertinent issues the company is facing and proposes possible solutions, based on the information accessed during the analysis.

Background of the Company Prestige falls in the category of small to mid-sized enterprises. As such, it faces multiple challenges, including a limited budget for expansion and marketing, lack of high value and experienced personnel, and inadequacies in technological adoption. As already mentioned, the company started off in 1990 in Doha, Qatar. It operated in Qatar, where it recorded and continues to record notable success. The firm is owned by parent company Future Enterprises. The popularity of its products, coupled with the notable success and growth, inspired the management to venture into the UAE. It is also noteworthy that in the UAE, the population is predominantly Arab and Muslims, which fits the definition of the primary target market for the company. As a result, the company was incorporated in the UAE in 2017. Since its inception in the UAE, which is the focus of this analysis, the company has seen notable success, continuing to attract new customers and grow its client base (Prestige, 2020). The firm’s track record in the past years was a major foundation for its establishment and significant positive growth in the UAE.

Organizational Structure

Presently, the company’s management is centralized, given its small size. Figure 68 illustrates the organizational structure. It shows that there are three levels of reporting in the management structure.

Chief Executive Officer Operations Manager Sales and Marketing Finance Human Resource Management Figure 68: The Organizational Structure of Prestige Luxury Redefined Currently, the founder is also the CEO of the firm. The CEO is the top most manager in the organization. He makes all the key decisions and provides leadership in the company. As the implementation person, he is responsible for developing strategies and actions for the company, and providing the necessary resources and systems to other people in the management chain to execute those strategies. The diagram above shows the reporting system, whereby there is an operations manager who is responsible for all the key functions of value creation in the business, including product design, materials sourcing, and product creation, and how they are delivered to the end market. The operations manager is a critical team player in the organization, as the department is responsible for turning all the inputs into valuable products that the customers will have.

Important decisions such as supply chain choices, the design of the stores, the way products will be designed and delivered to the customers, the pricing and customer relationships management are all relevant to the work of the operations manager. In view of the success observed of the company since 1990, it may be stated that the operations office of the firm has played a vital role in this context. Nonetheless, as it will be discussed later in this paper, there is a room for improvement.

Below the operations manager are the sales, marketing, finance and HR departments, coordinating their respective functions and report to the operations manager. These personnel and officials are important for the organizational model, where they report to the operations manager, ensuring that all relevant processes and operations are properly coordinated and that the value chain runs as smoothly as possible.

In the context of the raging pandemic, the organizational structure has not changed. That means that the reporting system has remained the same as illustrated in Figure 72 above. It seems that it was necessary to retain the structure as part of ensuring that despite the pandemic, the crucial operations continued and the company was able to cope with the pandemic, despite notable declines in revenue and business flow. There are insufficient details from available sources as to whether the company experienced significant downsizing of its personnel in the lower cadres of operations, such as casual employees and digital personnel. What is evident, however, is that the firm has managed to remain operational and competitive amid the coronavirus pandemic.

Leadership Team and Founders The company was founded by Omar Bin Dhaher. Based on the leadership profile on the company’s official website, Bin Dhaher is a dynamic innovator and team leader with extensive experience as a business leader. He leads the rest of the management team in the company with insights and support from parent company, Future Enterprises.

The main products that the company offers are Arabic sandals. These are unique, Arabic-themed sandals cherished by Muslims. It is the core product of the company, with the products being of “premium quality,” according to information available on the firm’s official website. The company also offers customers other accessories, including leather goods such as belts, sun glasses and perfumes (Prestige, 2020). All the products are of high quality and come in a variety of sizes, designs, colors, fits, and reflect the diversity in individual customer tastes.

The business model of Prestige Luxury is making end products that are offered at friendly prices, despite being of high quality. As part of the firm’s business strategy, the products are made with a focus on user- influenced designs, combining modernity and traditional designs loved by Arabic men (City Walk, 2010). In this context, what the company does is it collects ideas and feedback from customers and integrates that information to design the shoes and determine what to include in product offering. The other critical element of the product strategy is making unique, Arab-themed sandals, which is the basis for the appeal of the products because they have a specific target market. On this note, the company targets Arab men and others who may have a taste and preference for Arab-themed sandals and related accessories. By having a specific market niche, the company is able to understand what customers want, and therefore deliver the value that meets those needs. By combining high-quality products, unique designs and specific target customers with defined needs, the company has been able to appeal to the needs of consumers, resulting in notable market success. Lastly, the fact that the company offers other accessories in addition to the primary product, sandals, help in expanding variety and create more value for the customers.

The operational strategies entail approaches which the company adopts to ensure that inputs such as labor, financial resources and other investments are turned into end products which are available to the end customer. The operational strategy includes sourcing finished, hand-made sandals, rather than making them in the UAE, which helps to cut operational costs and enhances efficiency to some extent. According to information available on the company’s official website, the sandals are made in Italy and delivered to the UAE markets (Prestige, 2020). What this implies is that the firm creates designs for the sandals, reflecting the Arabic culture and preferences, before giving the information to the manufacturers, who make the sandals and other Arab-themed accessories for men. In some instances, the company orders already-made products that meet specific features in line with the Arabic themes.

One benefit associated with this approach is that the company can concentrate on designing and creating customer relationships to bolster customer experience and value; while the manufacturers make the products to meet the predefined specifications. However, there could be a possible challenge where the company has limited control of the product making process, in terms of quantity and delivery. For example, given that the products are coming from a foreign country and the costs of shipping can be high, responding rapidly to changes of customer preferences may not be as efficient as it would be for the firm to optimize its operational efficiency.

Marketing strategies are crucial for ensuring that a company connects with customers, making them aware of what is offered, and influencing their decisions to favor those products. This is typically done through targeted messaging, sales and promotions. In this regard, the company’s marketing strategy is anchored in digital systems, by investing heavily on its website, which is where it showcases products and creates an online presence. It does not invest in other traditional marketing methods such as electronic and press advertising or social media. This highlights a notable weakness for the SME firm. It seems to be missing out from the power of social media and other formats of integrated marketing communication (Prestige, 2020).

For example, existing case studies of companies in varied sectors show that social media advertising, alongside other digital approaches such as search engine marketing, search engine optimization and digital display advertising, are effective at marketing in a cost-effective manner, maintaining high visibility and customer engagement. Prestige’s dependence on its website and word-of-mouth advertising, while to some extent is beneficial, constitutes a lack of a strategic marketing methodology.

Looking at the Prestige case study, it is evident that the key issues apparent include ineffective marketing strategies, which result in limited visibility. Although it offers unique luxury sandals that are competitive in the market, the management has not invested in strategic marketing approaches. This issue may be linked to inherent challenges for SMEs, namely limited budgets for marketing and limited talent in the firm, which could explain the lack of creativity and leadership and the failure to influence vision and commitment among employees. In light of these shortcomings, it is essential to explore solutions to the main issues of the company.

After review of the business strategies and operations, as well as the existing website outlook and overall standing in view of the available information, it is possible to identify certain challenges the company faces. First, by being an SME, the firm faces challenges in terms of financial capacity. However, over the years, it has managed to grow its business portfolio. It has faced shortcomings related to marketing and growth given its small size and constraints. In the recent and present times, the arrival of the coronavirus has posed a major challenge, hindering operations, and affecting business flow. For instance, the halting of international flights meant the company could not bring in additional products from Italy for a while. Strategically speaking, the analysis of the company’s website and advertising presence reveals that it has a serious lack of a marketing strategy. As mentioned elsewhere in this report, the company does not have much of an online presence, aside from the official website and limited social media activity. Lastly, when looking at the organizational structure of the company, it may be noted that the company may benefit from hiring of a specialist in digital marketing and other relevant IT domains, as a way of having someone to spearhead the digital and technological departments. Presently, it seems that no such specialist exists, instead the CEO and other departments are shown in the organizational structure as the ones who handle IT issues.

Alternative Solutions In view of the information in the previous section, it may be noted that the key issue for the company is lack of a robust, comprehensive marketing strategy. The effect of the problem is that the company could be missing out on sale opportunities, as it is not visible in competitive markets. Four alternative solutions are proposed in this regard, as explained below.

First, it is recommended that the company develops a strategic, integrated marketing communication strategy to underpin its marketing efforts. The idea is to focus on digital media, including search engine optimization, search engine marketing, social media advertising and online marketing. The benefits of this suggestion are that it can be implemented with a limited budget, and has the potential to reach a large number of target customers given the popularity and convenience of digital advertising methods such as social media (Hurst, 2018). However, digital advertising may be limited by the lack of popularity among the older generation of possible customers in the UAE, and the need for creative and savvy people may be expensive.

A second alternative is to hire high value marketing professionals to lead the marketing initiatives in the company. In particular, if the company brings onboard professional marketing personnel, he or she could bring new ideas and insights that can be useful in turning around the marketing department in the firm. The approach is advantageous in that the company could benefit from the services of a marketing professional.

One downside of the alternative solution, however, is that it can be a costly undertaking, given the high value marketing professionals come at. The firm’s limited budget may be a hindrance to this extent.

Another possible solution is adopting the traditional approach of avoiding marketing costs and depending on word-of-mouth and other traditional marketing methods. For example, the company can invest in print and electronic media, which are still popular in the UAE.

The business can put advertisements in popular and mainstream newspapers, television and radio stations, as well as magazines and wall-branding. Although these methods can go a long way in increasing the visibility of the company brand, it can be a highly expensive project.

Given the limited financial capacity of the case SME, the alternative may be challenging to execute because of budgetary constraints.

Lastly, the adoption of modern and emerging technologies, namely big data analytics and customer relationship marketing, could be a viable solution to address the challenges identified (Hussain & Roy, 2016).

Here, the idea is for the company is to ensure it takes advantage of IT tools, such as consumer analytics to enhance decision making, data analytics also supporting operation and processes that can enhance business efficiency (Mei, 2016). In this case, engaging IT specialists in-house who help in the digital adoptions can be a suitable approach for the company. A specialist IT manager joining the team could also be instrumental in supporting the digital marketing efforts recommended earlier in this paper.

Proposed Solution Alternative #1, which entails the execution of a digital marketing campaign, is proposed as the solution of choice. It is realistic and viable in light of the firm’s financial limitations and given the prevailing business environment where customers are increasingly searching the Internet for products they want (Morris, 2009). Both alternatives #2 and #3 are more cost-intensive and have limited success prospects in terms of marketing efficiency for the business.

Digital marketing is a cost-effective advertising strategy where the management can deploy digital tools and social media to design and implement a robust marketing campaign to increase the brand visibility of the company (Mohamed, 2017). Existing research and case studies have demonstrated that digital marketing initiatives can be effective and are suitable for low budget firms such as SMEs (Hurst, 2018). For Prestige, the management can adopt a collaborative leadership approach in introducing the digital marketing model, where employees are inspired and provided a sense of direction and shared vision to work cooperatively in implementing the digital marketing campaign, as recommended by Zenge and Folkman (2016). Since the proposed solution comprises a chance, good and strategic leadership that embraces open communication, employee engagement, teamwork, a clear vision and goals would be necessary to successfully execute the suggested approach in marketing.

My experience has also shown that the use of digital and social media platforms such as browsing websites and networks like Facebook and Twitter are increasing. If I want to purchase a pair of sandals, I search online and check my social media feedback. This shows that if done appropriately, the digital marketing approach may help to enhance Prestige’s brand awareness and bolster its competitiveness and sales. To this end, it is essential that the company considers adopting this route as part of increasing its prospects in the market.

The suggested solution can be implemented by tasking the sales and marketing department with the role of designing and executing the digital marketing strategy.

It involves creating interesting marketing messages that are to be shared on platforms to ensure consistency (Mohamed, 2017). Multimedia content including images, interactive clips, text and audio are recommended. The marketing team then identifies the most appropriate digital platforms, including social media channels such as Twitter, Facebook and Instagram, and enlists SEO and SEM consultants to provide online and in-app ad services.

Another action is revamping the official e-commerce website to become more responsive and user-friendly, including making it more colorful and including appealing product displays. The website will form part of the online marketing, where it will be included in the SEM and SEO content, and be included in all digital advertisements.

When someone clicks the link to go to the website, they will find it friendly and interactive and want to browse or purchase the products, or return to the site in the future.

Lastly, the marketing team will post interesting content on all social media platforms and engage customers regularly to keep conversation going (Morris, 2009). A campaign can be run for a period of six months, with periodic reviews and improvements, and be measured against specific goals to gauge success. The costs the company saves from the marketing budget can be invested in adopting other additional technological solutions, such as customer relationship management (CRM) tools to better understand customers, provide a superior customer experience and boost sales.

When a company identifies a niche market and makes products that are responding to the identified need, it has high prospects of succeeding in the particular market.

It is important to have a clearly-stated, detailed and relevant mission statement as it helps to put forward a summary message of why the business exists, and the value it creates for shareholders, customers, employees and the general public.

The operational strategies are essential for a company as it determines the approaches it uses to deliver end products, create value to the customer and how it generates value for the owners in the process.

No matter the uniqueness of the products and how good they are, if a business fails to adopt a suitable marketing strategy that engages customers and increases brand visibility, it would not generate as much business value and profits as it would not be desirable. This highlights the importance of marketing for a business.

The leadership in a business is a major, determinant factor for the success or failure of a company, as evidenced in this case study, where the leader in the UAE had been a major driving force for the firm’s success, despite evident challenges such as the absence of a comprehensive marketing effort.

Recognition of problems and challenges in a business is important as a first step to developing suitable solutions.

The case study analysis approach can help in identifying certain problems and provide appropriate solution approaches.

Prestige offers unique products. However, its lack of a vibrant marketing strategy limits its sales and competitive potential. Given the financial constraints characteristic of SMEs, it is suggested that the company implements a robust digital marketing campaign to enhance its brand visibility. The approach is cost- effective and can potentially enhance the firm’s brand reach, sales and competitiveness. It is also suggested that the company adopts modern technologies, such as customer relationship management and big data analytics, as part of increasing its decision making to be data-driven, thereby being able to respond more effectively to changes in the market, while avoiding errors in the decision-making and business operations processes. These suggestions may enable Prestige Luxury to increase its competitiveness, brand visibility and overall market performance and growth prospects.