French luxury shoe brand Berluti opened the doors to its first store in Lebanon last month. Olga Berluti, creative director and lead designer for Berluti, said Lebanese clients shopping in Paris, whom she described as “always cheerful and courteous,” persuaded her to open a store in downtown Beirut.

Pierre Bouissou, general director of Berluti, told Executive that he too had his eye on Beirut since he joined the company in 2008. “For me it was strategy to develop in Beirut,” he said at the store’s opening on October 8. “In Paris, we have a lot of Arab clients, and Arab clients love watches and shoes.”

The Berluti’s Beirut establishment is the company’s second in the region, after Dubai, which opened in 2006. Berluti currently has 36 stores worldwide and according to Bouissou, will be concentrating on developing in the Middle East and China in the coming year. 

“For us it’s really important to be here because in Beirut we have local clientele and we need to have a relationship with the client,” said Bouissou. “In Dubai you have a lot of tourists. For us, it is more important to be in a city where we have local clientele because we need to have a relationship with the client to understand what he needs.”

Berluti’s top two markets continue to be France and the United Kingdom, with the third slot belonging to Japan, where Berluti already has 10 stores.

Bouissou said that although each store and each client base is different, the process of opening a new location stays the same.

“We need to understand the market before we open a store because Berluti is not a product, it is a philosophy and we need to help the client,” he explained. “We want to develop a Beirut market and we would want to maybe open stores in Kuwait and Qatar.”

Despite the high price tag, which ranges from $500 to $2,500 for a pair of shoes, Bouissou insisted that Berluti has not felt the effects of the economic slowdown.

“The crisis has not impacted [us] because when you buy the Berluti product it is not for one year, it is for your whole life,” he continued. “During a crisis, people want a quality product. With Berluti, they find that product.”

The numbers confirm the success of this philosophy according to the records of Berluti’s mothership, luxury brand giant Louis Vuitton Moet Hennessy (LVMH), which bought the bottier in 1993. LVMH posted $25.67 billion in revenue for 2008, which constitutes 7 percent organic growth compared to the previous year. The global conglomerate also reported a 7 percent loss of organic growth for the first half of 2009, but a 0.2 percent bump in revenue based on the same period last year, totaling $11.64 billion in revenue.

The fashion and leather goods sector of the group, which includes Berluti as well as Louis Vuitton, Marc Jacobs and Fendi, saw 10 percent organic revenue growth in 2008. That number dropped to 1 percent in the first half of 2009, with $4.46 million in revenue, making fashion and leather goods LVMH’s only sector showing growth in 2009.

Many luxury analysts credit this sector, and the Louis Vuitton brand specifically, for LVMH’s relatively smooth ride through the global economic downturn. 

Since Berluti shoes are not available anywhere other than Berluti stores, the brand did not feel the overall slowdown in department store sales. In fact, Bouissou claims that Berluti avoids the traditional behavior of what he calls “fashion brands.”

“We want to protect the philosophy of the brand, not create a fashion image,” Bouissou said.

For millennia, sailors have named their ships after the women of their hearts — mothers, sisters, sweethearts, wives — and cultivated bonds with those vessels so deep they could easily be called kinship. So if you find yourself behind the wheel of a Porsche Panamera, murmuring sweet nothings to the dashboard console, don’t be alarmed — you’re simply obeying an impulse that has existed for centuries between men and the vehicles they love. 

Most companies, competing to hold on to elusive consumer bases, strive to engineer products that exceed expectations. But when you have a chrome-plated reputation like Porsche’s, customers tend to expect nothing less than perfection. Executive was invited to travel to Dubai last month to test drive Porsche’s newest release.

The strongly contoured air intakes, wheel arches and sleek bonnet, the powerful shoulders over the rear wheels and the sweep of the roofline, quintessentially Porsche, leave little doubt as to the car’s manufacturer. And yet the size is striking to anyone familiar with previous models: The Panamera is a four door and is significantly wider (1,931 mm) than the 911. It is clear from the first glance that with this addition to its line, Porsche is cruising new ground.

Like a private jet on wheels

The Panamera represents a new phase in Porsche’s development, breaking with past precedents to incorporate a new four-seat interior. Some critics may question whether the sedan-like model can retain the sports car feel that the company has cultivated for decades, but from behind the wheel, the larger body makes little impression: it is evident that the Panamera is still geared 100 percent towards speed.

Seated in one of the two rear seats, one has total control of one’s environment — the Panamera’s interior is divided into four environments, each autonomously adjustable via a central console running through the vehicle’s interior — with all the luxuries of a private jet at one’s disposal. If a limousine could top out at 285 kilometers per hour (kmph), the passenger’s ride might feel a little like this.

At the controls of the Panamera Turbo, the 500 horsepower engine’s low rumble is like a dialogue between man and machine. Speed is an implicit promise: pushed to its limits, the Panamera can reach 100 kmph in a neck-snapping 4.2 seconds. But a vehicle of Porsche’s quality deserves to be coaxed before it’s unleashed. A touch of the foot to the gas pedal and the car glides forward, graceful as a panther — and nearly as quiet. The car responds like a well-tuned Stradivarius as it navigates through the streets of Dubai and slips onto the highway.

A car that can read minds

Driving a Porsche is, as it must be, a single-minded experience. There is no need to give thought to — or even mention — such extraneous details as stereo volume or climate control, both regulated automatically. One could expound at length on the top-of-the-line comfort features: the seven-inch, color-touch screen fitted with both CDR-31 audio system and Porsche Communication Management, including navigation module, the high-end Burmeister surround system… but these are ultimately cosmetic. It is the driving experience that makes a Porsche a Porsche, and the Panamera is no exception. With an eight-cylinder engine and bi-turbo technology, the Panamera Turbo has the muscle to burn almost any smaller two-door sports car audacious enough to issue a challenge.

On the highway, the car takes flight, with traffic cameras popping like swarms of paparazzi as it sails past at a top speed of 303 kmph. Out of the city and into the desert, the sun burning overhead, the separation between car and driver gradually vanishes. Both are learning to read the other, two personalities meshing into one as the road spins away behind; and on a level deeper than flesh or steel, they already share a basic DNA — a visceral, integral need for speed. It’s an impulse that predates man, stretching back to when rapid flight was a basic principle of survival. Then it was a necessity. With the Panamera, it’s a pleasure.  

Farid Chehab is the co-founder and current chairman of Leo Burnett in the Middle East and North Africa, as well as the firm’s chief coordinating officer for Central and Eastern Europe. With almost 40 years in the communications industry, Chehab is widely regarded as a creative guru. Last year, Leo Burnett Central and Eastern Europe became the most awarded agency at the Golden Drum advertising festival. Chehab recently sat down for a chat with Executive to offer up his in-depth knowledge of the industry and which way it is headed.

E  Your firm has won a lot of awards lately. What has your strategy been in order to achieve this?

We don’t have a consistent strategy. We always won awards in the past. What happened at one point is that some agencies adopted an award-winning strategy; agencies started creating ads specifically to win awards, scam ads. For two years this hurt us a lot. We were not willing to play this game and we used to enter without a strategy as we always do.

The way the others entered and diversified the ads between print and outdoor resulted in around two years where we were sheltered from the scene. I heard people say: “What is happening with Leo Burnett? They are not winning awards anymore.” Fortunately this joke stopped because recently there was a hoo-ha against scam [ads]. This is evident by the fact that most of our ads that won at Lynx [Dubai’s international advertising festival] won all over the world and positioned us as agency of the year in ‘new Europe’. We are just making ads… we do not make them to win, we just make good ads and good ads should win. I know that one agency spent $1 million to create scam ads to win. We never do that. We don’t have a budget to create scam [ads] because money is very scarce.

E  What is the reasoning behind creating scam ads at agencies then?

They think that when they want to pitch to a client, they claim that they were the number one agency at Lynx and so on. This can impress some clients and it does.

E  So it’s not a bad strategy per say?

It’s a very bad strategy because you cannot sustain it unless you want to cheat the client. If the strategy is about creating scam ads, going to the client, telling them that is what you deliver, working with the client, and not being able to deliver because you cannot sustain the effort it takes to create a scam all the time, is a very short-term strategy.

E  A year has passed since the beginning of the downturn. How has it affected your strategy, particularly on the creative side?

Honestly, in the beginning of the year it did affect us because we had a lot of real estate accounts that we lost. There were two ways to go. Either we could be defensive and scale down or look at things from a better angle and try to gain more business. This year was a year of fantastic opportunities. We didn’t want to fire anybody and we wanted to keep our teams intact because we have invested a lot in them and we didn’t want to lose them. We [pursued] a very thorough strategy of pitching and we won a lot of pitches. At the end of the day, we won more work than we lost and we are going to have a positive year in 2009.

E  So how did you differentiate your pitches in light of what had happened, knowing that clients had smaller budgets?

Prior to the crisis we had enough people to handle enough work and when we knew we were going to get more work we started bringing people in. In 2009, because we had some losses we had to free people. Some of the energy of the company was free to go into pitch ventures. We decided that there is no way that we could not use their time to try to get business. Anything that was pitchable, we pitched for it. We actually won 15 pitches and lost only one in 2009.

E  In the last five to seven years we have seen a lot of diversification in the business of communications, which is supposed to use economies of scale to deliver more integrated services to clients. What do you see happening now that the crisis has hit?

I think the post-crisis era is going to bring all those agencies back together. Today you cannot produce efficient communications if you are not using integration, specifically digital and PR, in the best possible way. The crisis created something very important, which was less money to be spent on media. You need to do more with less money but this is not enough. We are in a period which is human-centric and the individual has a say. His opinion can change the environment around him and he can ask for something that he needs.

Before we used to give him what he was supposed to take and he would accept it. What is important is to turn consumers into ambassadors and generate free media for brands. If you turn a consumer into your ambassador they will become your spokesperson through viral internet or conversational media. You cannot bombard individuals with media carpet bombing anymore. If you need a person to react to your communication and become your spokesperson, you need to respect their intelligence and give them the opportunity to react.

Today digital and PR are becoming essential because PR is becoming even more important than television. What you need to do today is to create new contact points. To become competitive, media needs to become creative. We are discovering that all the elements of the equation are coming back together. The markets are going to go back into a fusion mode.

E  How long will this take to become a reality?

This will not happen immediately, but at least during the planning stage. You will need one umbrella that covers all areas. Then you still have time to let the specialists handle each part of it independently. The big ideas don’t only come from the creative people anymore, they come from a consensus of experts that can understand how viral media functions and what is the best way to trigger a contagious viral effect.

E  What does that mean in monetary terms for the industry?

The way agencies are remunerated is going to change. Today we are remunerated on either media commissions, which are becoming very rare, or we are paid on fees based on time spent and this is going to disappear. In the future you are going to be judged on your propensity to create and trigger free media for your brand. If you are capable of creating a conversational media or a digital conversation for your brand, and you can evaluate the value that you are giving to the brand, you will be paid according to the value that you are creating. When you are paid on a fee basis you are in a comfort zone, it’s like you are a consultant. But this is not the norm today and it is a problem as well as an opportunity.

E  So things are going to shift rapidly into the digital arena now?

It is because of digital that you can trace the effect that you are having. In 2006, when we did a campaign for Bank Audi and Johnny Walker, we created a campaign that went viral. The tones of free media that we got were worth millions. But we were not remunerated for that and the client got it free of charge.

E  So how do you measure the value of free media then?

We don’t have standards yet. But what some of the clients are doing is they are paying a minimum to cover the cost base and then a bonus based on what sort of value you can create out of your campaign.

E  What will agencies have to do to achieve this level of service so they can be remunerated on that basis?

What happened in the not so distant past is that creativity was no longer the norm. The modus in communications was the media people and not the idea people. The decade where media ruled is over. Today we are back to the period where ideas will rule again. It brings to mind the power of the big idea.

With Arab and foreign visitors swarming Lebanon this summer, from the malls in Achrafieh, Dbayeh, Dora and Verdun to the clubs and restaurants in Gemmayze and downtown, and the mountain enclaves from Broumana to Bhamdoun, it is obvious to the naked eye that Lebanon is more than ever a prime vacation destination.

However, this summer season stood out for more than just the growing influx of tourists that graced Lebanese shores. This past season also saw an unprecedented amount of international publicity for Lebanon and its capital city, with articles in the New York Times and Paris Match praising all the city has to offer and CNN videos declaring Beirut “the party city.”  Add to that the push to vote Jeita Grotto one of the new “wonders of the world” and you would think that Lebanon was finally having its day in the sun.

Dubai’s shattered reputation

On the opposite side of the spectrum, another state was facing much more negative publicity. As Dubai felt the impact of the global financial crisis, the international media were more than eager to officially declare it bust, recounting in juicy detail how expats are leaving the Emirate in droves, some, according to one article, even sleeping in their luxury vehicles.

As Lebanon shone in the spotlight and Dubai faced a barrage of bad press, one had to wonder: did country branding play any role in building or harming the image of each?

If we examine what has been done in the region in terms of country branding, we might find that examples of solid and consistent country branding are few and far between. Several countries or states have tried to establish their own identity by creating a logo, such as in the case of Qatar, which has used its logo in its communication of events and initiatives taking place in the country. Others, such as Abu Dhabi, have even gone so far as to flesh out what their identity stands for and to communicate with their population and visitors through a website and a few cultural events. Bahrain even undertook a full-fledged campaign of regional and international press ads, TV commercials and online advertising with the slogan “Business Friendly Bahrain,” aiming to attract global companies and investors to the country. Dubai branded itself as a hub of tourism and business in the region and the place where everything is always bigger and better.

Yet the majority of these efforts cannot be considered as part of a holistic country-branding program. In Bahrain, for example, although the country’s campaign was clear, this business-oriented message was not complimented by messages targeting other stakeholders that could give the country a well-rounded identity. Instead, audiences were left only with a vague impression of Bahrain’s business environment. With other countries in the region, there was also a lack of consistency in communicating what each state stands for and how it differentiates itself or what added value it has to offer versus its neighbors.

Land of missed opportunities

Lebanon, however, presents a different case entirely. Despite its many political and security setbacks, this tiny state is a country branding dream, with all the best ingredients to make it a well-established and memorable brand, from its nature and vibrant social scene to the many thousand years of culture on offer, and its unique and varied population. Unfortunately, though, this winning formula has been little exploited throughout the post-civil war years. The lack of coordination and funds within the government has meant that although the Ministry of Tourism, along with other private partners, has been able to produce several TV commercials throughout the years, these efforts were not enough to entrench one clear identity and message about Lebanon that people across the globe can recognize and identify with.

During the first few years of Lebanon’s reconstruction after the civil war, there were attempts at country and city branding that began with the well-known and recognizable “Beirut” logo popularly used on storefronts and restaurants across Lebanon and the region ever since. The “Beirut” identity certainly held a great deal of potential, but the failure to build on this identity and communicate what it stood for, minimized its ability to cross-over to becoming a national symbol. Moreover, an important element has been missing from any branding efforts that have been undertaken. Although well-intentioned and infused with the spirit of putting Lebanon on the map, the nomination of Jeita to become one of the new wonders of the world and the branding of different areas of Lebanon, from Baalbek to Byblos as part of different cultural festivals, have not been part of a larger national communication strategy that can link all of these initiatives to a larger Lebanon brand.

Wanted: Brand Lebanon

Yet a solid communication strategy that will effectively position Lebanon in a way that Lebanese agree with and foreigners, investors or tourists, are inspired by must be based on a national consensus. This might seem like an overly ambitious and politicized task asking Lebanese in general to agree on their view of Lebanon, especially to those who believe Lebanon’s identity can be developed overnight as part of a quick talent or graphic design contest. But grasping the essence of Lebanon should be done through market research into different segments of the population to gather insights on the different elements that Lebanese admire about their country, beyond the cliché “you can ski and swim in one day.”

Research can even look into  foreign investors and visitors’ expectations, in order to identify the strongest prevailing misperceptions of Lebanon as well as what they would like to know about the country. These leasons should help develop a clear positioning for Lebanon that reflects its plurality and can be communicated to different stakeholders in a consistent way, providing the guidelines for developing a brand identity that is used everywhere from international TV commercials, to guidebooks, press ads in travel and business publications and even in the branding of cultural and touristic events.

Yet the branding of Lebanon should not be limited to the development of an identity. Effective country branding means holistic communication ranging from interviews with prominent Lebanese artists, businesspeople and musicians, sending delegations of talented Lebanese to perform abroad under the new brand’s umbrella, to airing short documentaries and ads about Lebanon on international satellite stations. As part of introducing the new Lebanon brand, activities can take place in Lebanon and in countries around the region introducing people to what Lebanon stands for through food, music, special videos and even interactive contests. The combination of these initiatives will help create a memorable brand for audiences that they look to when choosing where to vacation or invest.

The next question that comes to mind is “where will the government get the money for all of this communication?” The answer is that although the government must lead any national branding exercise, the private sector has an important role to play, as it has done throughout the years, in supporting any communication related to promoting Lebanon. Just as private corporations have sponsored arts and cultural festivals, helping make these successes, and Middle East Airlines has helped promote Lebanon through in-flight advertising, companies can help fund the development of a Lebanese brand identity and its accompanying communication. Public-private partnerships will help enrich the quality of communication about Lebanon, drawing on companies’ expertise in branding and promotion.

Additionally, many communication activities can have a big impact with a small budget, including the dissemination of viral videos. Initiatives that create a public relations buzz without breaking the bank range from getting the largest Lebanese tabbouleh dish into the Guinness Book to getting recognition for Lebanon’s historic or natural wonders.

Going viral

Individuals, like the private sector, can also be instrumental in spreading the word about a new brand and its   communication campaign. This was seen all across the worldwide web this summer with Lebanese posting videos and articles promoting Lebanon on social networks and emailing these to everyone they know.

Although Lebanese are currently launching initiatives to get their national cuisine and landmarks noticed, as well as sending information about Lebanon to their friends around the world, these efforts are missing the elements that could make a greater impact. These activities need to be tied into a larger brand and positioning for Lebanon to help audiences understand their purpose, rather than seeing them as ad hoc initiatives. Viral communication should inspire those people who can help spread the brand’s message to not only accept the new brand, but embrace it as their own and agree that what is being said in the communication is what they would have chosen to say if someone asked them about their country.

Such powerful country branding that strikes a chord with audiences is more than an aesthetically pleasing logo or an appealing campaign that invites us to visit a country for some sun and fun. When country branding is the result of a well-built strategy based on a national consensus, the identity that is created and the resulting communication takes on a life of its own, becoming a symbol of the country’s narrative in such a way that people no longer realize which was created first: the country or the brand.

Nohad Mouawad, Zeina Loutfi & Ramsay G. Najjar S2C