© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Jan-Benedict E.M. SteenkampC. Knox Massey Distinguished Professor of

Marketing and Marketing Area Chair

BIFEX ConferenceBeirut, May 13, 2015

Leveraging the Lebanese Diaspora to Enter Foreign Markets

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Follow the Diaspora

• Enter foreign markets using the home market diaspora as a beachhead.

• In a world of unprecedented cross-border flows of people, there are millions of people living in other countries. Only a minority of these people will be fully assimilated into the new (host) culture. Many migrants will retain some old brand preferences and consumption patterns.

• Examples: ICICI, Reliance, Dabur (India), Pran (Bangladesh), Bimbo (Mexico), Jollibee Foods (Philippines), Islamic Bank of Malaysia, Nando’s (South Africa)

© Prof. N. Kumar & Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

The Lebanese diaspora

Famous businessmen of Lebanese descent include Carlos Slim Helú, Carlos Ghosn and Nicolas Hayek; names in entertainment like Salma Hayek, Shakira, Tony Shalhoub, and Paul Anka; politicians include Philip Habib, George J. Mitchell, Ralph Nader, Ray LaHood, Donna Shalala, John Sununu; lawyers like Amal Clooney.

Emigration 1975-2011: 1.6 million

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Segmenting diasporas: Lebanese abroad (Example: U.S.)

Low HighLo

wH

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Desire to Maintain Lebanese Cultural Identity and Characteristics

Aff

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© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Segmenting diasporas: Lebanese in the U.S.

Low HighLo

wH

igh

Desire to Maintain Lebanese Cultural Identity and Characteristics

Aff

ilia

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ith

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cult

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Marginals

• Lebanon vs. U.S. as country of origin does not matter;

• Products bough on functional performance and affordability

• Generally poor

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Segmenting diasporas: Lebanese in the U.S.

Marginals

• Lebanon vs. U.S. as country of origin does not matter;

• Products bough on functional performance and affordability

• Generally poor

Assimilators

• Market for U.S. products• Live in areas/cities with few

other Lebanese nationals• Disassociation of everything

that smacks of Lebanon

Low HighLo

wH

igh

Desire to Maintain Lebanese Cultural Identity and Characteristics

Aff

ilia

tio

n w

ith

an

d d

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soci

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© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Segmenting diasporas: Lebanese in the U.S.

Ethnic Affirmers

• Potential for sales of Lebanese products

• Less suitable as launching pad to mainstream Americans

• Live in areas/cities with high concentration of Lebanese nationals

Marginals

• Lebanon vs. U.S. as country of origin does not matter;

• Products bough on functional performance and affordability

• Generally poor

Assimilators

• Market for U.S. products• Live in areas/cities with few

other Lebanese nationals• Disassociation of everything

that smacks of Lebanon

Low HighLo

wH

igh

Desire to Maintain Lebanese Cultural Identity and Characteristics

Aff

ilia

tio

n w

ith

an

d d

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e to

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soci

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.S.

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ure

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Segmenting diasporas: Lebanese in the U.S.

Ethnic Affirmers

• Potential for sales of Lebanese products

• Less suitable as launching pad to mainstream Americans

• Live in areas/cities with high concentration of Lebanese nationals

Marginals

• Lebanon vs. U.S. as country of origin does not matter

• Products bough on functional performance and affordability

• Generally poor

Biculturals

• Potential for sales of Lebanese products

• Beachhead for diffusion of Lebanese products into mainstream U.S. population

• Above-average income• Socially integrated

Assimilators

• Market for U.S. products• Live in areas/cities with few

other Lebanese nationals• Disassociation of everything

that smacks of Lebanon

Low HighLo

wH

igh

Desire to Maintain Lebanese Cultural Identity and Characteristics

Aff

ilia

tio

n w

ith

an

d d

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© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Making the Lebanese diaspora work for your company

Key Success Factors Critical Questions to Ask

Is there a market? • What is the size of the diaspora relative to host country’s overall population?

• What are the sociodemographics of the diaspora within the host country?

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Some key characteristics of the Lebanese diaspora in the U.S.

Ethnic group Median household income

Hone ownership

Bachelor’s degree or higher

Post-graduate degree

Lebanese-American

$67,264 71.6%

Arab-Americans

$56,433 <65% 43% 18%

Overall U.S. population

$51,914 66.6% 28% 10%

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Making the Lebanese diaspora work for your company

Key Success Factors Critical Questions to Ask

Is there a market? • What is the size of the diaspora relative to host country’s overall population?

• What are the sociodemographics of the diaspora within the host country?

Can we reach the market? • Do members of the Lebanese diaspora live in close proximity to each other and to points of distribution?

• In which cities or regions of the host country?• Can we leverage word of mouth in these communities?

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Leveraging the geographical distribution of the Lebanese diaspora in the host country

Lebanon Host Country

Beachhead

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Geographic spread of Lebanese in U.S.

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Making the Lebanese diaspora work for your company

Key Success Factors Critical Questions to Ask

Is there a market? • What is the size of the diaspora relative to host country’s overall population?

• What are the sociodemographics of the diaspora within the host country?

Can we reach the market? • Do members of the Lebanese diaspora live in close proximity to each other and to points of distribution?

• In which cities or regions of the host country?• Can we leverage word of mouth in these communities?

Is the target segment attracted to Lebanese products?

• What is the estimated size of ethnic affirmers and biculturals segments?

• Does the brand have heritage, appeals to unique needs, revive childhood experiences?

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Targeting unique needs

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Halal cosmetics

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A role for the Lebanese government?• Dubai is working on establishing a national certification

standard as part of plans to regulate and develop the halal food industry in the UAE.

• Dubai is working with the Emirates Standardisation and Metrology Authority (ESMA) to set the requirements for granting the Halal National Mark to food producers in the country.

• The UAE Scheme for Halal Products is the first of its kind at an Arab and Gulf level and supports the initiative launched by Sheikh Mohammed bin Rashid Al Maktoum, ruler of Dubai, to make Dubai the global capital of the Islamic economy.

• Dubai's Economic Zones World (EZW) will develop two Halal Zones, specifically designed to cater to the regional and international Halal Product markets.

• EZW said it has allocated infrastructure-ready plots of land for Halal Zones in Jafza and TechnoPark.

• EZW will also engage in a global marketing campaign for the Halal Zones.

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Making the Lebanese diaspora work for your company

Key Success Factors Critical Questions to Ask

Does the brand have appeal outside of the diaspora?

• To what extent do migrants associate with people outside the diaspora who share their socioeconomic status?

• Can the brand employ universal appeals to attract the mainstream population?

० Superior product performance? ० Compelling value?

० Global niche?० Positive Lebanon-as-country-of-origin effects?

Is there a market? • What is the size of the diaspora relative to host country’s overall population?

• What are the sociodemographics of the diaspora within the host country?

Can we reach the market? • Do members of the Lebanese diaspora live in close proximity to each other and to points of distribution?

• In which cities or regions of the host country?• Can we leverage word of mouth in these communities?

Is the target segment attracted to Lebanese products?

• What is the estimated size of ethnic affirmers and biculturals segments?

• Does the brand have heritage, appeal to unique needs, childhood experiences?

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Global niche?

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Positive COO effects?

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Semsom in NYC

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Putting the ideas in practice - I

First, managers should gather and evaluate data in these four dimensions to determine whether their brand will benefit from the Diaspora strategy.

• Critical mass of the diaspora in host country. What is the size of the Lebanese diaspora relative to the host country’s overall population? Where is the percentage highest? What are the sociodemographics of the diaspora within a country, and does a substantial number of these migrants fall into our target audience?

• Geographical distribution of the Lebanese diaspora in host country. Do members of the diaspora live in close proximity to each other and to points of distribution? In which cities or regions of the host country? Can we leverage word of mouth in these communities?

• Socioeconomic profile of the dispersed diaspora. To what extent do migrants associate with people outside the diaspora who share their socio-economic status?

• Brand appeal. Will our brand’s product characteristics and imagery appeal to the mainstream population?

© Prof. J-B.E.M. SteenkampNot to be used or reproduced without permission

Putting the ideas in practice - II

Second, implementing a diaspora-driven strategy works best when firms:• Segment the diaspora into four types--assimilators,

marginalized, ethnic affirmers, and biculturals.• Target the ethnic affirmers as an attractive market and the

biculturals as a beachhead, and ignore the other two segments.

• Study tourism patterns and demographics at home to determine whether the number of tourists from a foreign country is substantial enough to leverage a reverse diaspora effect.

“Made in Lebanon” associations may complicate moving from the Lebanese/Arab diaspora to mainstream population.

Stereotypes can be overcome through smart marketing, by leveraging unique Lebanese/Arab strengths.