Commodities to products

Medhat Stefanos explains why understanding the customer is key to sales success.

This is my first year working within a marketing department in a commodity industry. I find it extremely challenging to support our sales department with effective marketing; most of the tricks I know don't seem to be effective? What is the key to penetrating the minds of the Middle East consumer? Ostergard, Jordan

Medhat Stefanos says: The Middle East market today has grown to become one of the world's most appealing markets. Everyday new investment is injected in the Middle East to the slowly developing markets. Heavy industries are moving to developing regions as a result of labour and fuel costs, not to mention the normal growth in such regions.

In developing markets, a pre-perceived conception is dominant regarding products and their usages. Customers are used to basic products that serve their needs, not recognising the potential they have in advancing their usage and the associated products. That perception is based on the assumption of a better product is more expensive than a basic one. The users are often unable to realise the value added they receive that transcends beyond financial value and overlooks the savings they accomplish. Even with equally priced products, users resist change and drive the market to maintain the same basic product mix. That cannot be more evident than in the construction material sector, particularly cement. Cement is one of the products that are continuously used in the Middle East by many industries. The diversity of cement product development available in the world is significant, offering customers customised products for their exact needs. Nevertheless, the Middle East market tends to use Ordinary Portland Cement for all uses, when there are much better suited cement products.

To realise the investment's objectives, organisations need to reshape and develop their surroundings. This can be accomplished on a complete sector level rather than through individual efforts. Titan Cement Egypt has taken the steps to pioneer the market development to assure that customers are using the appropriate product and that the investment is at its full potential.

To accomplish such an objective, Titan Cement Egypt has spent extensive time understanding the true needs of the market and how it uses cement. Conducting extensive market research and segmenting the Egyptian market based on the usage and perception proved to be one of the most efficient investments made. Understanding our customer has provided us with the keys to developing the whole market. The Middle East customer has proved that different regions in the world operate differently and developing the market has to come from within and not be enforced by how more developed regions operate. Building our market understanding, Titan Cement Egypt has been able to utilise every aspect of marketing to share with the market the reward of a diversified product mix. We truly managed to change a generic commodity into a sophisticated product that customers demand.

Titan Cement Egypt selected from the world's best cement products and provided the Egyptian market with the ideal product mix. The product mix has been an extended success that managed to stimulate the consumer to explore a developed product versus the current market offering. One of the key success factors that contributed to Titan Cement Egypt is the close relation with the supply chain cycle. The extended reach to our customers' customers has opened a channel of communication that proved invaluable to all relevant parties. The relationship Titan Cement Egypt has developed with the key market influencers has been invaluable in shaping the industry.

Finally, the Middle East is a lucrative market, but definitely not an easy one to master. There is much work that needs to be done and more to be learned. Giving and taking from the market is to strongest key to success.

Architect Medhat Stefanos is currently residing as Group Commercial Director of Titan Cement Egypt. For 25 years, Stefanos has been of the founders and shapers of the construction industry in Egypt. Through his business and political career he has managed to enhance the performance of the industry and find a benchmark for the region.