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Territory in focus — Middle East

Pink Lady Development in the Middle East

With a vision to build new markets and advance Pink Lady® into a global brand, Pink Lady Development Limited (PLD) was formed in 2013 as a joint venture between Apple and Pear Australia Ltd (APAL) and its European licensee, Star Fruits. Funded from a portion of royalties collected in established markets, funds are directed to target markets across Southeast Asia, the Middle East and South America.

In the Middle East, the focus has been on the Gulf states of the United Arab Emirates (UAE) – Saudi Arabia, Oman, Qatar, Kuwait and Bahrain. These markets have wealthy consumers and often a large proportion of expats. Combined with locals who have travelled to Europe and the United Kingdom, shoppers are often familiar with the Pink Lady® brand so bring knowledge and expectations to their shopping habits in the Middle East. Targeted marketing and a strong brand, with a consistent visual appearance supported by reliable quality, can build successful markets here leveraging the strength of the brand around the world.

Pink Lady apples on display at Lulu Village Mall Dubai display. Credit: pinkladyapplesuae on Instagram.

The Gulf region

In 2015 APAL partnered with locally based agribusiness experts LucaZara to develop the Pink Lady® brand in the Gulf. Based in Dubai, the LucaZara team is led by Australian owner David O’Brien, with Jubin James managing quality and the UAE territory. Sue Ellen Hilgemann heads up marketing and Marilou A. Deramas looking after general affairs. Together PLD and LucaZara are implementing a market development strategy maintaining an optimal number of licensed importers, increasing marketing and promotional activity, active trademark defense, continuous quality monitoring and the provision of targeted retailer training.

Constrained supply volumes, particularly from the Northern Hemisphere, remains a primary limiting factor for growth of the Pink Lady® brand in the region. Building momentum through marketing and promotional activity becomes challenging without twelve-month supply. Fortunately, committed importers, encouraged by exclusive licenses within their countries have been able to continue sourcing fruit.

After consultation with retailers across the region, it was found that waxed apples are poorly received in the Middle East and are not seen as premium. Since July 2018, waxed fruit is no longer accepted into the Middle East market, bringing the territory into line with the European market highlighting Pink Lady® as a premium brand.

United Arab Emirates

The UAE is the most established market for the Pink Lady® brand in the Gulf. A population of 8.1 million, the majority of whom are expats and living in either of the two truly global cities, Abu Dhabi and Dubai, the UAE has proven an ideal launching pad for the Pink Lady® brand.

Pink Lady® has 51 per cent brand awareness in the UAE, but is ranked sixth for market share. Converting customers from knowing about our brand to becoming regular purchasers is our challenge. Customers have shared that the number one reason they have not purchased Pink Lady® branded apples is because they are either not available, or not easy to find where they shop. Constrained supply volume has been the limiting factor in growth of the Pink Lady® brand in the UAE over the last two years, principally during the Northern Hemisphere season. With increasing supply this year and commitments from importers to 12-month availability, the situation looks to be improving quickly.

Spinney, Carrefour, Lulu, Panda, Danube, and Al Meera now offer Pink Lady® branded apples that is supported by a range of marketing activity. In store sampling remains the pillar of the retail marketing, giving consumers an opportunity to be reminded of the superior flavor of the apple and make a break from their habitual apple purchase.

A busy promotional calendar that includes free gift with purchase; free shopper bags based on the popular European designs; buy one get one free; and attractive, seasonal in-store displays encourage shoppers to purchase Pink Lady® branded apples. This season will see the return of the free Pink Lady® with every bag of Granny Smith apple promotion. This is a simple and effective way of encouraging consumers to compare the flavor and appearance of their regular apple purchase against a Pink Lady® branded apple. Valentine’s day is celebrated in the UAE and is targeted as an opportunity to showcase the brand with competitions and in-store promotions. Underlining all this activity and increasing engagement with consumers is an active social media presence, including a fully localised website pinkladyapples.ae.

Shoppers receive a free Pink Lady® apple with every bag of Granny Smith apples they buy so they can compare the flavour and appearance. Credit: pinkladyapplesuae on Instagram.

Research conducted in the UAE in 2017 highlighted the importance of the reliability of eating quality with crispness, sweetness and juiciness highlighted as key attributes leading to repeat purchase. Unfortunately, without close attention to quality, the market had become a home for lower colour fruit. Since early 2016 quality control inspection has been conducted on containers arriving into the UAE by an independent quality inspector. Today, quality control inspection is undertaken on 80 per cent of containers arriving. As a result of increased focus and attention, the quality on arrival and on shelf has been improving steadily over the last two years. Regular monitoring of shelf quality and working collaboratively with retailers will ensure colour standards and eating quality remain consistent.

As with other developing Pink Lady® markets, APAL and PLD are active in providing handling and product knowledge training services to supply chain stakeholders in the UAE. APAL will continue to roll out training in the UAE and across the Gulf to help build human capacity and general knowledge of apples; support retailers and supply chain participants; promote the Pink Lady® brand; protect the apples from poor handling; and instill a sense of ownership in the brand.

In July 2018 the services of local UAE trademark lawyers were secured. This will bring increased focus protecting the trademark from unapproved use, protect the brand reputation from inferior quality product and support local licensees in their efforts to grow the brand in the UAE.

Saudi Arabia, Bahrain, Qatar, Oman and Kuwait

A large, heavily urbanised population (33 million people, 85 per cent urban), high disposable incomes and modern retail channels looking for premium produce, all highlight that Saudi Arabia represents significant opportunity for the Pink Lady® brand. Sales have been strong during the current southern season, with significant year-on-year growth in volumes.

Importer Sharbatly Fruit is licensed to import Pink Lady® branded apples into Saudi Arabia and Bahrain. With modern cool chain facilities across Saudi Arabia and Bahrain including large scale facilities in Jeddah, Riyadh and Dammam, Sharbatly is well placed to grow the brand. The continued roll-out of independent quality control across the Gulf will be focused on Saudi Arabia over the coming year.

Along with the UAE, Qatar has been identified as a priority market for brand development and increased trademark protection activity. Legal representation was engaged in July 2018 and is now active in addressing trademark breaches.

The Qatar diplomatic crisis beginning in June 2017 has altered fresh produce supply chains, with produce once sourced from neighboring Saudi Arabia and the UAE no longer accessible. Significant changes in sourcing has seen opportunities for importers to move to more direct supply from producing countries and this has occurred with Pink Lady® branded apples also.

Importer Al Shahabi is licensed to import Pink Lady® branded apples into Qatar; Al Jebali is licensed to import Pink Lady® branded apples into Oman; and the Fresh Fruits Company is licensed to import Pink Lady® branded apples into UAE and Kuwait.

Andrew Mandemaker

About the Author:

Head of Global Quality & Innovation, Apple and Pear Australia Limited

amandemaker@apal.org.au