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Interviews

Identifying The Fault Lines

Dr Fahmida Khatun, Executive Director of the Centre for Policy Dialogue (CPD) shares her opinion about the state of our banking sector, perils of the high unemployment rate and the challenges that lie ahead for our economy.

As we step into the new decade, what is the biggest challenge that lies ahead for our economy?
Our domestic resource generation has become a major challenge, especially in view of high development expenditures. Despite the high growth of gross domestic product (GDP), the tax-GDP ratio in Bangladesh is the lowest in South Asia. This trend of the shortfall from the targets has started since FYI 2012. The short-fall of revenue –GDP ratio is now on an increasing trend. Our tax-GDP ratio is even lower than the average ratio in the Least Developed Countries (LDCs) where it was about 15 percent in 2017. We are about to complete the tenure of the Seventh Five Year Plan (7FYP). In the 7FYP the Revenue-GPD target is set at 16.1 percent revenue-GDP ratio and tax-GDP at 14.1 percent by FY 2019-2020. It is now unlikely that these targets of 7FYP will be fulfilled.

Efforts towards the generation of revenue through higher direct taxes should be the priority. We are gradually becoming dependent on indirect taxes which are inequitable and discriminating towards the lower-income groups. We have not seen an effective implementation of the new Value Added Tax (VAT) law. Initiatives are needed for the expansion of tax net and reduction of tax avoidance. The National Board of Revenue (NBR) should not only target the fixed income salaried people who are already in the tax net, but also the large tax evaders whose incomes are not always accounted for. The NBR has to be fully automated and human resource development should be an ongoing process.

Bangladesh’s ranking in the soundness of banks is the lowest among the South Asian countries, what are the factors that lead the sector to this state? How will the fallout affect the government?
The banking is in shambles at the moment. The amount of non-performing loans (NPLs) has been increasing continuously. On top of it, the practice of writing off and rescheduling of bad loans is also increasing. Several policies have been undertaken in 2019 which are not going to help improve the health of the banking sector, rather benefit the loan defaulters. Those are taking the banking sector backwards. All good practices are being scrapped one after another in the banking sector. The independence of the central bank has been undermined by external influence. All banking policies are being devised under the directives of the powerful and groups.

In June 2019, the total share of NPL was as high as 11.69 percent of total outstanding loans. On the other hand, the banking sector is facing a liquidity crisis. Domestic credit to the private sector has also been below the target of Bangladesh Bank. On the other hand, government borrowing from the banking system has been on the rise due to low revenue generation and underwriting the high expenditures of several mega projects. The cost of these megaprojects has escalated over time due to weak accountability and transparency. Therefore, on the one hand, low revenue generation and on the other hand, high bank borrowing by the government are going to have serious ramifications on the government’s fiscal management.

Currently, Bangladesh’s youth unemployment rate is 10.6 percent, more than two and a half times the national average. How can this issue be best addressed?
High economic growth has not been able to create enough jobs in the economy. Particularly, the youth have not been able to find suitable jobs despite university and college degrees. One of the features of our growth has been that, surprisingly, growth has been achieved despite low private investment. Indeed private investment has been stagnant at around 23 percent of GDP for the last couple of years. Hence without any private investment, the economy could not create adequate jobs.

More worrying, the higher the education level, the higher the unemployment level. The other feature is that though there are some demand for workforce in the economy, employers do not find our educated youth suitable for those jobs. This implies that there is a mismatch between the demand of the employers and the supply of graduates. This emphasizes the need for modernising our education system in line with the need of the market. On the other hand, our economy is not large enough to accommodate each and every job seeker. Therefore, opportunities for self- employment have to be created. Youths who want to be entrepreneurs should be provided with training and access to finance. Sadly, while thousands of crores are being siphoned off from the banks by loan defaulters, banks show little interest to provide loans to new small entrepreneurs.

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Interviews

A Promise of Protection

Having spent close to three decades in the sector, you are a veteran of the industry, when did you join Guardian, was that a new leaf in your career, did you want to do anything differently?
When I joined the insurance industry back in 1991, I had no notion of what I could do to contribute to it, and how long I would sustain here. Through the guidance of my mentors, I began to understand that this is a very vital industry for sustainable development of the economy, and also to bring social safety at large. To get a better understanding of the industry, I devoted myself to expanding my knowledge and focused on delivering service that customers expect from this industry. By the time I joined GLIL, I had accumulated two and a half decades of experience. My aspiration has always been to deliver the best customer service, which became a challenge at some point. Doing something outstanding and challenging the status quo is not easy and I was at a certain plateau of my career where I really wanted to dream big. When Guardian Life approached me, they gave me a good understanding of their vision with the company. It is a Company-sponsored by Apex, BRAC and Square Group, who have a very long track record of their commitment and ethical business practice in Bangladesh. They also conveyed that they aim to brand Guardian Life as one of the trusted life insurance company operated via ethical practice. I soon realized that this is the opportunity for me to materialize my dream, which was a major factor for consideration while joining Guardian Life.

Throughout your experience, how do you think the sector has evolved, and do you believe that our consumers match up to the idea of insurance?
 Looking back at how the insurance industry has evolved, it becomes clear that we have not been able to bring much change to people’s minds in terms of service. It was primarily due to misconceptions. By 1985, we had only one nationalized company and a severe lack of professionals in the industry. By the nineties, two or three more companies got approval who had the intention to create quality executives. Before they could realize that intention, 12 other companies came into the market in 2000 which resulted in further demand along with shortfall of talented people. However, 2000 was a turning point for this industry, business was good, although the potential market was much bigger. Insurance is a long term business, and the premium we collect is a liability. The money belongs to the people, not the company, so it must be used judicially to meet future commitments. Eventually, the money has to reach the policyholders.

A problem we face is peoples’ misconception of insurance companies not being managed well. I often hear complaints from customers that they are not getting their money back at maturity. At a bank, when the FDR gets matured, customers get the cashback on the same day or the following day. In the insurance industry too, the fund disbursement takes very less time for the reputed & weel-managed companies. However, for the rest, it usually takes much longer to get disbursed. It is mainly because the money was diverted in different units, and the cash flow was not appropriately maintained.
The other issue is the customers’ lack of knowledge about finances and the industry as a whole. Generally, people tend to compare insurance companies with banks, although philosophy is different between the two. We have to inform the customers of the difference, such as when investing money in insurance, they cannot withdraw from it whenever they want. Instead, it is a long term investment for their future; but usually, customers surrender their policy prematurely, resulting in them not getting their full money back. To change this practice, we are encouraging the government bodies to include a subject or paper on financial knowledge in the national curriculum. The aim is to create a way to educate people on various investment alternatives, not only in insurance companies but also in banks. The idea is to make people understand the importance of insurance and its role in securing one’s future.

Customer centricity is also of paramount importance for Guardian Life. We launched the first 24×7 call center in the industry back in 2018 and still now we are the only one in the whole industry. Our call center short code is 16622.

What do you believe is the most crucial challenge the insurance sector is facing?
Currently, the major channel of distributing insurance is via agents & agencies. Insurance is not a consumer good, it is a service that usually needs a bit of persuasion. We use our field force, agents who have been trained to recognize prospective customers. After making appointments, they convey the benefits of the product adequately, analyze all the information, and eventually sell the product. In recent times, due to time constraints, it isn’t straightforward to set up appointments with clients as they have become very busy. As a solution, we are advocating the government to permit corporate agents like banks and NGOs to sell insurance i.e. Bancassurance. Our current regulatory board, Insurance Development & Regulatory Authority Bangladesh (IDRA), along with Bangladesh Bank, are seriously considering it. We are expecting the channel to come up sometime within next year. We are also hoping for some policy changes by the government to promote insur-tech. There need to be some regulatory changes to make the process more efficient.

Currently, upon policy purchase, we need to send the documents back to the customer to get a wet signature, this process is very inefficient. We also have to affix BIMA stamp on the policy documents. The documents are available online, but the entire process is not 100% digital yet. Also, the KYC that has been issued by the central bank is very complicated, which discourages customers. Consequently, people usually get frustrated and give up. So, we are encouraging the government to introduce eKYC. The operation will have the same user-friendly feature as BKash, enabling people to buy a policy with the swipe of a finger.

We have already graduated from the list of LDCs. How crucial would be the role of financial inclusion for our country?
 Regarding financial inclusion, currently, around 45-50% of the population has got banking access. Insurance companies cover people both banked & unbanked. People outside the banking system show more interest in insurance products and want to open an account and make regular deposits. Most of them are micro-insurance or rural insurance, which is now the main focus of insurance companies. The unbanked population is the major focus area now. As a result, the bank and the insurance companies are complementing each other for financial inclusion.

How will this benefit the banked population?
Whenever a family loses a member who earns an income that goes towards supporting the family, it affects them negatively, insurance works as a safety net in this scenario. Likewise, if this member becomes unable to support the family due to disability, the insurance company steps up to provide the financial support instead. Insurance benefits ensure social safety. It is the most virtual strength of insurance, to bring social stability and enable smooth growth of the society.

To cater to this special segment, we have launched the first Life Insurance App of Bangladesh, namely EasyLife. Primarily, we started off with a term life insurance product and then introduced monthly savings plan with profit. We are the pioneers of Digital Life Insurance in Bangladesh.

How do you see digital application changing the insurance landscape in the coming years? How will consumers benefit from it, recently you have inaugurated an app for your consumers, could you share some information about that?
 When I joined Guardian Life, we looked into the opportunities and strengths that would take the company forward. We focus mostly on corporate business and microinsurance. Our sponsor BRAC has 4.5 million microcredit lenders. When the microcredit borrower dies, recovering the money becomes a challenge for the NGOs. It also becomes very difficult for the family of the deceased to continue with their livelihood. We formed a joint committee with BRAC to get a better understanding of their needs and to develop a plan. With Guardian-BRAC Bima Project, we have covered more than one crore lives, annually we are settling up to 22000 claims. It has been a massive achievement for Guardian Life, we are now the largest insurer in terms of lives covered and in terms of beneficiaries.

As for the younger generations, i.e. those who are 25-35 years old, ideally the digitally active population; we are conveying the insurance knowledge to them via online platforms. To cater to this special segment, we have launched the first Life Insurance App of Bangladesh, namely EasyLife. Primarily, we started off with a term life insurance product and then introduced a monthly savings plan with profit. We are the pioneers of Digital Life Insurance in Bangladesh. EasyLife is a suite of pull products aimed at sharing knowledge and inspiring customers to buy our products.

Globally, insur-tech is going to play a vital role in the next five years. We are preparing ourselves to cope up with what is happening on the other side of the world. If we don’t upgrade ourselves and keep us updated, then someone else will come and capture this market. So we are preparing ourselves, and via this digital platform, we are using our knowledge to take us forward.

We believe and follow our theme, “Insurance for all”. Earning reliability & trustworthiness is pivotal not only for Guardian Life but also for the industry as a whole, we aspire to be the flagbearer of that revolution.

What do you think about the future of health insurance for our country?
 We need health insurance. I am stating this from my professional and personal perspective. People do not necessarily anticipate and prepare for sudden medical needs. No budget is set aside to cope with such situations. In reality, according to statistics, 70% of treatment expenses are paid from out-of-pocket expense in Bangladesh. The other 30% comes from insurance facilities provided by multination companies or the government. So, there is a vast market for health insurance. We are a life insurance company, but we also offer health insurance as a supplementary product, selling it to corporates and individuals. Currently, around 300000 lives are covered by our health insurance. We settle about 32000 claims annually amounting to a sum of 24 crore taka.

Currently, we have over 300 hospitals enlisted with us, the people who are covered with us under health insurance, can get a wide array of services from these hospitals and avail exclusive discounts on medical bills.

Customer centricity is also of paramount importance for Guardian Life. We launched the first 24 X 7 call centre in the industry back in 2018 and still, now we are the only one in the whole industry. Our call centre shortcode is 16622. When the doctor advises a medical treatment, the policyholder can go to any of the enlisted hospitals and call our call centre for smooth admission and processing. With Guardian Life Health Card, the policyholders can get treatment up to the coverage limit without paying any cash, Guardian Life provides that guarantee of payment to hospitals on behalf of the policyholder.

What is your vision with Guardian?
 The vision of the Guardian is to be number 1. We believe and follow our theme, “Insurance for all”. Earning reliability & trustworthiness is pivotal not only for Guardian Life but also for the industry as a whole, we aspire to be the flagbearer of that revolution. We see a bright future where Guardian Life plays a lead role in bringing about changes to the insurance industry by generating a positive mindset and credibility regarding life insurance amidst the greater population.

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Interviews

Reshaping Real-Estate

Bay Developments introdcues innovation and new developments in industry

HARNESSING THE POWER OF R&D AND MARKETING
I was always fascinated with advertising and its impact on the consumers, which lead me to choose Marketing as my Major in University. So naturally when I entered the job market, Marketing became my field of expertise and it has served me quite well so far by giving me a very fulfilling career.

I learnt a lot during my initial Internship and subsequent stay at Singer Bangladesh where I had studied and prepared a report on the business prospect of Compact Fluorescent Lamps (CFL) better known as Energy Saving Bulbs in Bangladesh. Later on the product became very successful in the local market and made me realize the power of R&D and marketing. The passion was fueled further during my career at Bay, as I worked my way up from a trainee officer to my current position. There have been no shortcuts to my journey and I had the opportunity to learn during every crucial step of the way. It is all about filling the gaps in the market and communicating the values to the consumers through the right channels.

TRACKING THE MARKET EBB AND FLOW
There are many factors that influence the ebb and flow of the real estate market. Since the product takes many months to come to the market and years to deliver, it is affected by the macro-economic fundamentals and policies taken by the lawmakers.

In Bangladesh, things are no different but the problem here is that there are no baseline numbers or readily available market data to determine or equate a slump or surge in the real-estate sector. Even the strongest markets have pullbacks, dips and pauses as the consumer emotions go back and forth. In my opinion, the slower pullback days gives opportunities to the developer to reset and regroup their people & processes and the market can rest and stabilize as well.

We were the second fastest growing economy in South Asia in 2016, moving up a few notches. The capital grew by leaps and bounds and the whole city seemed like one big construction site.
We are set to graduate from LDC (least developed countries) to LMI (lower middle income). Recently, the Boston Consulting Group did a study where it showed that in 2015 there were only 10 key cities with more than 300,000 middle and affluent class (MAC) consumers each. Projections suggest that, in ten years, there will be 33 towns and cities with some having more than 2 million MAC consumers. The right product and placement can convert these populations into customers, and there seems to be immense potential outside Dhaka as well.

REGULATING THE REAL-ESTATE SECTOR
High registration cost is one of the barriers to sales in the real estate sector of Bangladesh.

As far as slashing of the registration fee by the government, the formal gazette hasn’t been published yet. However, when it does go through, it will be a welcoming change for both the government as well as the real estate sector.

The government has been missing out on a lot of revenue because of the customer delays and reluctance in registering their homes in a reasonable timeframe. These stockpiles of unregistered homes will come forward now because of this discount opportunity. Developers will benefit through a reasonable influx of price sensitive customers.

BAY INSPIRING INNOVATION AND DURABILITY
Our layout comes from functionality, the major characteristic of a Bay product. While buyers mention our distinct, clean aesthetics, I suggest that durability is the other main trait. In addition to the built quality, our buildings come with a maintenance contract from our highly trained Facilities Management team that keeps the building in top shape over many years after handover. This gives the investors a higher return over time through rental, capital gain as well as a much lower depreciation of asset than the industry average.

As we cater to a high-end niche we have to always stay ahead of the pack in terms of product innovations and green principles. Double glazed windows, synchronized generators, individual metering etc. were all incorporated to complement our practices in creating greener structures, while using energy & water more judiciously, and creative design of space.
We introduced fire stairs, community area, open green spaces and standby generators, among others, years before they were mandatory. Our early rooftop gardens, pools and clubhouses became role models for others. In fact, of the five dozen features and services we generally see today in high-end homes, were all introduced or inspired by Bay.

NO SHORT CUTS FOR VALUE CREATION
Goodwill or reputation, takes years to build and yes it is still one of the best tool for marketing of real estate in Bangladesh. I believe, it will not change anytime soon especially because there is a stigma attached to the real estate sector as a result of malpractices carried out by certain companies.

We need to continuously deliver a high value product, but also ensure that the value of the investment will endure over time. That notion that there are no short-cuts, be it in raw materials and the equipment that go into a building or compliance is very important. A holistic approach to the business is the key, supported by building a team of professionals with a commitment to the long term.

A BRIGHT FUTURE
PWC’s recent study shows that by 2030, Bangladesh will be the 28th largest economy. We estimate that at least $700b will be invested in the next 50 years just in housing alone. Dhaka is growing at 100,000 households a year, of which 25,000 homes are delivered by the formal sector. Of these, only 15,000 are delivered by Real Estate developers hence, the opportunities that lie ahead look very promising.

Professionally, I have experienced an incredible transformation in the field of marketing where I saw companies slowly shift to the digital age, where it is much easier to measure the effectiveness of campaigns. Chief Marketing Officers (CMOs) all over the world are now spending a larger proportion of their budgets on technology than on internal staff. Marketing technology or MARTECH will continue to take up higher percentages of marketing budgets as more and more channels opens up in our country. Email marketing, online content management and digital analytics technology are the main things marketers are focused on at the moment. Some reports suggest that artificial intelligence could eventually be used to design marketing campaigns in future, rather than people. So there is plenty to learn and experiment with in the coming years and I’m surely excited about the future.

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Interviews

Invogue designs IT solutions

Tell us about your move to America, your schooling in Pennsylvania State University and your subsequent return to Bangladesh. Paint us a picture of your journey?
At a very young age, I was encouraged to experiment in the world of technology. It started from setting up PC’s to installing software in my father’s computer. It slowly became a second language. As I grew older, the love for technology became deeper. Whenever there was a new laptop coming out, I had to know about it. My friends at an early age started asking for my suggestions in regards to which hardware to go for.

After a very engaging 8 years of schooling at the International School of Dhaka, I decided to go to America to study. After going through all the steps I made the decision to go to The Pennsylvania State University, one of my top choices from the very beginning. The decision was surprisingly easy as I got into the program I aimed for and was also selected to be a part of the University Golf Team. It would be worthy to mention by the time I was in High School I became a very avid golfer, and attained a Zero Handicap status.

August 2010 started with an introductory course of Information Sciences and Technology focusing on Human Computer Interaction (HCI). After a long two hours class, I knew right away that this is what I was going to pursue for the next four years. Learning about UX was truly life changing. Understanding what Jony Ive (Ex Chief Design Officer of Apple) went through when designing the remarkable Apple products to Deep Dive method developed by IDEO, were the core foundation of my UX career. After a successful two years of University, it finally came to that point of applying for an internship.

As a kid, I was always attracted to New York and wanted to work in the Dream City. In Summer of 2012, that dream came true as I was accepted as a User Experience Intern for PulsePoint (a Leading Digital Media Company) in Manhattan, New York. After graduating in 2014 with a Bachelors of Science Degree in Information Sciences and Technology focusing on Human Computer InteractionI, I decided to go back to New York City, but this time to pursue a full time job. After working for about two years and gaining experience in my field, I decided that it was time for me to come back to Dhaka.

On the second day of my return I joined my father’s company, Invogue Software Limited. It’s been almost five years to date, that I slowly moved up the ladder from working part time, to managing our company.

How long have you been in the tech industry? What is your role in Invogue?
I have been in the Tech Industry for more than eight years now. I am currently the Director of Business Development.

Invogue started its maiden journey in 2000. Since then how has the company evolved and how much has changing global IT landscape influenced the evolution of the company?
Invogue was always a step forward in the Tech industry. We started as an IT company and a Media House, which focused on Software/Web Development and Developed Cartoon Animations for the local market. During the early years we also worked on font and logo creation which we still export to the U.S. Invogue was the first ever company in Bangladesh to develop a Bangla Job Site. We were, and still are a pioneer in many firsts in technology application; due to lack of our Marketing abilities we always fell short.

After my return in 2015, we as a Company decided to focus on our services and be more streamlined. During 2016, we finished restructuring our company and was solely focused on Designing and Developing Software/Web/Mobile Applications. As Invogue became stronger dealing with international clients, starting in 2019, we have decided to expand our services to countries in Cambodia, Germany and the USA.

What are some of the glaring differences between the IT sector in America and the IT sector here?
First is Business Requirement Document Formation. The knowledge it takes to form a well constructed Business Requirement Document (BRD) is something that the IT sector in Bangladesh has lacked for a long time. IT companies need to understand that listing out the requirements of a specific client is the number one step to successfully implementing a project. In the U.S., companies make sure to clarify every little detail when it comes to forming a BRD.

Secondly, Project Management A proper project management is the key ingredient to a successful IT project. Majority of the IT companies tend to follow a method and not really focus on the product. Their goal is to implement the project as quickly as possible and jump start the next one. This type of approach lead to unhappy clients in the long run.

And thirdly is Client Literacy. Client Literacy plays a major role in the Software Industry in Bangladesh. Most of the clients tend to have a difficult time in understanding the basic need of a software. We spend most of our time trying to not just pitch our products to a client, instead we highlight a problem within a company, to show how implementing a software can help solve the issue.

What are some of the challenges confronting the IT sector here? What needs to be improved in the IT sector in Bangladesh? Could you also highlight some of the positives?
There is wide aversion to do anything within the purview of law. Even after signing a well drafted contract, there is always a tendency by the clients to avoid legal compliance. Not getting payments on time from clients are a prime reason the IT companies in Bangladesh fail to flourish. In many cases total non payments have resulted in catastrophe for local companies. There is a definite requirement for a code of conduct, contract, payment, deployment and follow up for a rapid growth of the sector.

Also the knowledge on Cyber Security needs to be increased. I use the following metaphor when describing about Bangladesh’s current status on Cyber Security. “Most of the companies in Bangladesh are currently focusing on designing the nicest doors possible, one aspect they are forgetting is the need of implementing a strong lock for security.”Since implementing a software is already a big leap forward for most of the companies, they tend to forget a very important element – security. The lack of knowledge within the IT companies is a major setback in the industry, and knowledge implementation needs to begin immediately. I truly believe that every company should implement at least a basic layer of security when implementing a software.

Not all is gloom and doom. As a developing country, there are plenty of positives in the IT industry in Bangladesh. The young generations are quickly adapting to the latest technological trend which is very important to keep up with the world demand. The Government is investing heavily on tech hubs around the country which will help inject knowledge to the youth. Foreign Investors are slowly starting to invest which encourages young entrepreneurs with their startups.

What is UX? Can you detail the importance of UX? What is the most effective way to use UX to give companies a competitive edge in the market?
UX is what we call User Experience, which is how the user feels when using a specific software or hardware. When designing a software one of the most important aspects is to understand our users and what they are capable of. A user experience designer dissects the problem the client or the specific user is facing and then comes up with a design solution, which then is tested by the users and upon a positive result it is forwarded to the development team. Without the use of a proper UX, the relationship between the products and the user gets disrupted, which can cause a delay in the process, unsuccessful implementation, etc. We at InvogueSoft always keep our clients first. We make sure to understand the problem the client is facing and then move forward to finding a solution.

Where do you see Bangladesh’s IT sector in the next 10 years?
I see a very bright future in the IT sector of Bangladesh. The garment industry took advantage of the minimum wage and invested heavily in their infrastructure which then flourished in the following years, I see something very similar. In the next decade, we will see a lot of Tech Factories open up with lines of computers with software engineers working day in and night out to cater to both local and international clients. Outsourcing projects will exponentially increase, as our developers gather experience. For the local sector, new startups will come in the health, finance, agro, HR and manufacturing sector. Apps/e-Commerce similar to Pathao (Ridesharing), Daraz (General e-Commerce), Stridesco.com (Fashion e-Commerce) will gain traction as online payment will be generally approved by more people. Foreign funding will also play a major role in uplifting these startups.

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Interviews

THE ISPAHANI IDEAL

Omar Hannan, General Manager, Marketing of Ispahani Tea Ltd shares the secrets to his success

HITTING MILESTONES AT ISPAHANI
The journey began on 1st June 2000. I started my career with Ispahani and it still belongs to Ispahani. It’s been a great journey for me, because at the time of joining Ispahani I had just completed my MBA, and my two months orientation with Ispahani. When they offered me a full time position I was appointed as Brand Manager. During that period, Ispahani had launched Marshall Chips, marking their entry into the food business. I was in charge of the brand and sitting at our head office in Chittagong for 3 months to gather knowledge of the Bangladeshi market. I transferred from Chittagong to Khulna and stayed there for nine years from 2000 to 2009, and I was in charge of the whole North and South Bengal. It was a fantastic time, especially getting to know the market in depth, and also learning the FMCG sector. After 2009, I came back to the management part leaving the field for the head office. Following this, I became the Sales Manager, the National Sales Manager, Deputy General Manager, General Manager, Marketing and now I am the Department Head of Ispahani Tea Limited.

FEELING OUT THE FMCG SECTOR
Every marketer has some challenges, especially in Bangladesh, because here the FMCG sector is different from those of other countries. There you can find shops in every corner. So this is a very challenging area, in terms of distribution and awareness. The area is very big to cover. So this is very difficult in Bangladesh market, to understand what the brand is, what kind of benefits, if any, you could get from the brand. This is a challenge for not only Ispahani, but the FMCG sector as a whole.
As for reward, every marketer or salesperson thinks reward means growth, or how positively your sales are going up. But for me, the reward is actually consumer satisfaction, the service which we are giving, whether it is satisfying the end users or not. This is the main motto of Ispahani – not to run for sales growth, but to make quality products that satisfies us, which in turn will satisfy the consumers.

THE LIVING LEGACY
Ispahani has a big history. After one year, in 2020, we are going to celebrate 200 years of business in Bangladesh of Ispahani. We established our business in 1820. So this is not a year or a decade journey, it is a 200 years’ journey. No business organization can sustain for 200 years, if the consumers and customers had not been loyal, or given love or faith to them. We always measure our happiness with that of our customers. So we believe, Best Brand, gave us recognition from our end consumers. They made us the top brand of Bangladesh. Whatever we did for marketing, others do much more, but the recognition we got, is from our end consumers.

MARKETING FOR COMMUNICATION
In terms of marketing strategy, we have a very clear concept. We don’t want to make any kind of controversial steps, which would hamper the products of their brands. We are very simple; we want to build awareness for our brand. The very clear strategy is that we are very innovative in the tea market. You can see that from the beginning of the tea industry in Bangladesh, 30 years back, nobody believed they could find tea in a 10-gram packet. Then Ispahani starts thinking from 1983, that tea should come in a branded packet, in a proper way. At that time, tea was found in the market in paper packets. So from 1983 t0 2019, whatever innovation that was introduced in the tea industry, was all from Ispahani. Ispahani introduced tea in a jar, in single and double-chambered tea bags. We introduced it, and others learned. We successfully communicated our concepts with our consumers. This is our strategy, very simple but clearly understandable

A DIGITAL FUTURE
The next thing is digital marketing, but my belief is that after 10-15 years, digital marketing will be the only thing in Bangladesh. People want convenience now, and mobile phones provide it for them. The good thing about digital marketing is that you can target a specific group and reach them with your specific communication. We believe that all other companies, including Ispahani is increasing their spending on digital. In terms of cost, it is more effective than other traditional communication systems. Digital marketing comes with both the good and the bad – such as, sometimes people are intentionally giving negative comments, which creates negative impact about the brand and hampers it. You don’t know which comment, good or bad, will end up becoming viral. Apart from this, we believe that digital marketing is the only way to reach the customer in the right time. In Bangladesh, Facebook is much more popular than other platforms. Even an illiterate person now has a Facebook account, whether he knows how to make use of it or not. All marketers should be very careful before posting anything. This is a big challenge for us and everybody.

A BALANCE OF OLD & NEW
At present time, it’s a combination of all these things. In a media survey, last published, still 84% reach is through TV, but digital increased from 7% to 28%, but still the highest reach is TV. So it’s a combination of both, but you have to plan in a smart way about where you will go to. If it is a mass communication, then we definitely have to go through TV. Basic content remains the same, but some messages are different. The only challenge is the negative marketing, or the negative impact on consumer. It is very harmful. It can actually collapse a brand. Marketer has to be very careful before they upload anything, after considering any and all possibility of negative impact on the brand or company. If you talk about our main brand, Mirzapur, which got the Best Brand, and which I believe is a mass people brand, therefore, we try to keep our content the same, so people can relate to it better. For different brands, with different products, for different customers, digital is the best route to reach targeted consumers. We always keep the challenges of digital marketing in our minds.

FIRST LEARN – THEN DO
This applies for everybody – first, spend the time to learn, don’t be too ambitious. Learn the Bangladesh market. What I learned in my education life is different from the knowledge of real life. Whenever someone is aspiring to start a career as a marketer they should first take the time to learn the market, how it grows, how people are thinking. Second, take the input from the consumers, then go and create something for them. One thing I advise everybody, is to not change their career too much, by that I mean the company. If you’re working for a good company, if you feel that you have a future there, then spend time learning there. At present time, the workforce of Bangladesh is very ambitious. They want to achieve everything in a very short time. This is a bad thing. Without knowing all the facts, if you want to do something, it could have a negative impact on your career. If you think you have the ability to do something, first learn then do. Invest in patience.

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Interviews

Weaving wonders in the textile industry

Samit Hassan, Director of Silver Line Group talks to Ice Business Times about his family company and shares his aspirations.

Please tell us about your company, how it started and how was the journey of Silver Line Group?
Silver Line Group started before I was born. I became the director of the company when I turned 18. We started our spinning in 2002. Our spinning was for knitting, but then in 2014, our plan was to do a composite, so we ended up doing a woven composite instead of a knitting composite. My dad Mr. MAH Salim found out that knitting was done by a lot of people in Bangladesh, but woven was done by only a few people. That’s when he thought instead of going into the path of knitting, let’s go for the woven path. Normally, in woven industries, the yarn dyeing, solid dyeing, weaving and finishing are all in different sectors because they involve different processes. When we decided to start our own textile factory, we brought separate components under the same compound. Our textile, garment, and spinning are under one boundary.

We bought this land a long time ago. Before deciding on a spinning factory, we went through a couple different ideas. My dad is not fond of changing business rapidly, he likes to see the market and the trend to see where it’s moving. And gradually with quality work, we became one of the most successful in this industry.

When I was a teen, I used to go to the factory with my brother, who used to visit the industry 6 days a week. It took us 2 years to build the factory, and started running it around 2014. When I used to go with my brother, my dad would urge me to accompany him. This was aimed at encouraging me to know what’s happening, so that I would appreciate the business. It’s a family business, so he always wanted his sons to be involved with it.

The recent trade war between the U.S. and China has been a boon for our garments industry. If China and USA settles everything between them, will this advantage go away for us?
If China and the U.S. settle everything, the advantage will be to us. In Bangladesh, when something hits, it becomes a trend and everyone goes after it. Like right now, woven is something, I can tell from the top of my head, there are thousands of factories that are coming to this field. The market is shifting. China is already coming into Bangladesh and trying to buy off factories, and also trying to capture the factories that are already there right now. It’s beneficial right now for Bangladesh, because we are moving to the next level, since there is a trade war going on between the U.S. and China. There will be no more people shifting to China because of the rate at which the technology is shifting. South Korea used to be a textile industry; they went from fabric and moved on. Then China captured the textile field, and is now shifting it to Bangladesh. Bangladesh has the opportunity to capture the market, but there are ups and down. China will come into Bangladesh but I’m not too keen on that, I’d prefer Bangladesh doing it.

In the RMG sector, our greatest strength has been low wages of workers. Do you think that this advantage is sustainable in the long run?
No, I can’t say it is, because our workers are getting skilled on the same level as workers in Vietnam, Laos, India and Ethiopia. Their skill is increasing, obviously they’ll want more. For example, for you and me, as every year goes by, I want an increment. I don’t want the same thing, I want more. Bengalis are hungry for more. The garments industry has to consider raising wages, because garment has more heads, more workers. The textile industry relies on automation; we have become more dependent on the results from machines. For example, in garments, per line would have 20 something machine, and there is a lot of people per line of production. For us, in textile we deal with and are dependent on machines. Human beings can make mistakes, but that’s highly unlikely with machines. You input the right specs, it’ll follow. It’s the same pattern over and over, with repetition. In garment sector, it’s all about sewing, thus human beings eventually get tired. So, sustainability of the wages, is beneficial for us, but it won’t last.

What should the stakeholders do to protect our position in the global market?
As I see, you want the person who’s working for you to be loyal. When you begin working for someone, they train you. If I start training my people and if I am able to earn their sympathy and loyalty, and inspire them to realize that they are not just working for me, but they also have a home here and are being taken care of – I think these things matter a lot for the success of the company. It’s not always about the big things, or about showing people what they want to see. It’s about actually going there, talking to them and understanding them. Talking helps, and even small talks with them, it makes them smile. I’ve seen it. It’s the relationship that you build between you and the workers that matters on the final product. When workers are treated well, they will try to give their best in performance. Treating employees right will make them stay with you. The rapport with employees will help you to produce best quality product which will help you to be confident and make your position in the global market strong.

Since the Rana Plaza tragedy, our RMG sector has come a long way with complying with international safety standards, where does Silver Line group stand when it comes to compliance?
Silver Line Group is 100% compliant. We have the certification to prove that. So, we are 100% complaint by the Accord and Alliance for our garments. After the Rana Plaza tragedy, there was a distinct shift in industry practices. When workers know that the factory is certified by Accord and Alliance, they feel a sense of security, because the compliances are met. If there was a fire or a drill, I would know how to get down, how to get out. Something good came out of the tragedy, but I am still sympathetic towards what happened. The tragedy forced our industries to take stock of glaring mistakes and work towards bettering the conditions. The drafting of Accord and Alliance also secured the reputation of our country.

How has local spinning mill contributed in the RMG sector in terms of supply chain and cost?
Spinning mill has contributed greatly to the reduction of cost and supply chain of the industry. However, people still import. India makes cheaper yarn, at times better quality, because they grow their own cotton. Also right now in the industry of spinning, the yarn’s prices aren’t going up, but cotton prices are going up. There are only a handful of people who manufacture cotton, they set the prices giving them the upper hand. In July-December period of the current fiscal year, export earnings from the readymade garment sector went up by 15.65% to US$17.08 billion, which was US$14.77 billion in the same period last year, according to Export Promotion Bureau (EPB) data released.

I’m increasing few thousand spindles; we’re getting in 70000’s in a couple of months. And then I’ll make sure that my entire spinning is supporting my textile. It will reduce the time and I can maintain the quality of the thread. Like right now, I’m importing from India and getting it from my own factory too. I’m taking some from the local as well, but in the local market the yarn price is more expensive than what we get from India. Buying yarn in the country has a huge advantage, because if the quality isn’t right I can send it back. Whereas when importing from India, even if the specs are incorrect, I don’t have the permission to send it back.

Silver Line works with some of the biggest clients in Bangladesh textile sector. Is it challenging to maintain such a demanding client base?
Silver Line Group is willing to take on the demand and challenges of our clients. Give us any type of yarn, if my machine can run it, I promise you I will run it. Even if it’s at the development stage, I will run it. I will not say no to my buyers if I know that I have the opportunity to do it. Bangladesh used to be that country for textile in woven sector. We were the ones who brought 100% viscose, 100% modal, Cotton spandex, 100% yarn dyed tensile, Silk, Hemp, Coolmax with cotton spandex and mixed it up. Some of our competitors are unhappy with us, because we are not opening buyers’ eyes, we are opening market opportunity for Bangladesh in these kinds of variety. So it’s not only about 100% cotton but also other activities that improve our services to customers. We are mixing it up and we like it. For example, if a buyer thinks Bangladesh is only 100% cotton, only certain people will come. Where’s the point in that? I am making different types of fabric too. But it’s hard to maintain, because maintaining the balance of each and every fabric is different. Bangladesh is used to 100% cotton which is why we decided to create textiles in an experimental basis and then go for the full production. There was this unique yarn that my CMO showed me, he developed it. For me, developing things like this is fun, I actually like it. It became a passion throughout the years.

Now that you guys are doing woven, is there other lines of textile you guys are bringing in right now?
No, actually woven right now, is pretty huge in Bangladesh. Because as you can see woven is shutting down in China and coming into Bangladesh. We already captured it in 2014. There are a lot more that were before us and they did a good job but they did not have the diversity that we have shown. When we came into the market, we showed them. With 4 different colors of yarn, and made it into 7 types of shades. We played around. I thank my team. I learned from them, they teach me, because I have 0 textile background. Even when I used to go to the factory, I didn’t have an office, and now when I’m 25, I still don’t have my own office in my factory. I sit in the weaving floor, with my R&D, planning, managers, I sit with them in the conference room and I can see what everyone is doing. At the back, I have the machines crackling, I can hear the sound of every machine, every stage that they go through, like every swab that’s coming out. Learning has no measures. We are learning all the time.

As part of the Silver Line Group’s CSR, you provide childcare and medicare, tell us a bit more about these initiatives?
Medicare, we have one in our garments unit and we have one in our textile unit. Spinning unit is in between both of them, so we give them Medicare from those two centers. The doctors stay on the premises, we have provided residence for them. We encourage workers to visit our doctors. In Bangladesh factories, there is a divide between workers and the head officials. We’re trying to mend the gap between factory workers and head office as a company. Whenever there’s a communication gap, there will be big problems. A lot of things could go wrong, production may not be finished on time, or things may get delayed, buyers might be complaining because head office team is not working with factory team. This is why we encourage our people to go to our factory. Take the time and go to the factory. We even sent some of our planning people from our factory to go see the buyers, explain why things are not coming on time, why they are having problems. We don’t separate factory and head office workers, everyone’s an employee and at the end of the day we have to work for the company. We have to work for the company, so that people can have their jobs. We have 6000 employees, overall; for my dad it’s a lot. Because he has to take care of 6000 people. So we have to ensure everything runs smoothly. We also have childcare. Garments people have children, so while they are working, they can’t take care of them, so we watch over the kids for them. The present export growth is better compared to the previous year. But there is more space to grow in terms of export earnings.

We also have learning centers as in training centers. We train them and based on their performance, they are employed. CSR for my dad extends beyond the company. We have universities and colleges in our hometown, and it’s free of cost by the company. It’s under my paternal grandparents’ names. It’s run by us and the government. We built it for the community.

You guys are pretty big on green technology? What sort of water conservation system does Silver Line have?
We do zero disperse, like ETP (Effluent Treatment Plant). 100% of our wastewater is treated through Biological Treatment Plant and recycled to reuse and cost minimization. This significantly contributes to our GREEN environment initiatives, waste control. A part of our Corporate Social Responsibility (CSR) to protect the environment and society. We also have WTP (Water Treatment Plant) and CRP, caustic recovery plant. This is a step towards zero effluent discharge. Through this we get 90% recovery of caustic soda from weak lye, recovery of water from vapor condensate, reduction of TDS, COD of effluent and so on.

We also don’t have any black exhaust, no black air, so only white air, which is cleaner. We have recognition of ‘CONFIDENCE IN TEXTILES’ from Oeko-Tex-Standard 100 and GOTS. Silver Line also has OE 100 Standard certification. We have organic certification from Global Organic Textile Standard. And we are not doing any diesel generators, we are doing natural gas for zero black air. We have solar panel system in a few areas. Green is coming into play, we are doing sustainable yarns, which is reusable. Silk is also reusable. We also developed hemp, that’s 100% sustainable. We are the first ones to do it, nobody in Bangladesh has done it.

There’s a lot of automation in textile, and soon the garment industry will see rapid automation. It stands to be seen how the picture of the garment industry will be. Rapid automation may not be as promising, since it is a machine that follows specs. Think about bespoke designs which are handmade. When something is handmade, an extra level of care and effort goes into the making.

Do you have anything else say to the readers?
I want to say that I am glad to be a part of the Silver Line Group. It pushed me at the age of 18 to learn. Now I’m 25, and I think I’m pretty well experienced, but I am happy that my dad pushed through this route, to mix with people and to understand them, and how much they will respect us in return. I saw that and I like it.

I want to finish with my favorite quote. The quote states, “Nothing is going to work out unless you step up and make it happen.” – Aulic Ice. This is the quote that always motivates me to work hard like there is no tomorrow. This quote encourages my fellow youths to work hard to achieve their goals. There is nothing which comes in easily; one must work for it. If your wish is to make it in life before the age of thirty years, then you should start working now to make it come true. Hard work will always result in better outcomes. Just continue working to ensure you fulfill your dreams. Everything is possible.

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Interviews

Positioning Priority

Nestle’s Manager of Consumer, e-commerece and Digital talks about tapping the right channel with the right content

THE PROPER PLACEMENT
When it comes to digital marketing we are still scratching the surface. We have a long way to go. We have explored various digital channels, and are mainly present in Facebook and Youtube, both in terms of content and promotion. Instagram is becoming very popular among Bangladeshi Consumers along with channels like Whatsapp and Viber. We are exploring these channels as well. Very recently, with the launch of NESCAFE’s new thematic song, we have opened Instagram Channel for NESCAFE in Bangladesh. The main reason of exploring with different Digital channels are nothing but the shift in consumer choice and their media behavior. We want to move with a brand through a channel where the target consumers are situated.

NESTLÉ’S EMERGING E-COMMERCE
E-commerce is the next big field in Bangladesh. We as a country are at a nascent stage, but it is growing very rapidly. We were accustomed to buying electronics and cosmetics from e-commerce, but buying grocery through e-commerce is still fairly a new idea. We definitely want to strengthen our footprint in e-commerce. We have been present in e-commerce since 2015, and we are growing. By partnering with e-commerce vendors we intend on strengthening our position and foothold. Nowadays you will see e-commerce vendors are promoting products using social media platforms and other digital platforms. We have already partnered with Chaldal and Daraz. We do have a Joint Business Plan (JBP) with one or two such vendors where we collaboratively work towards finding the best deal for our consumers. Recently, we have started designing e-commerce specific deals, to provide an exclusive experience through this channel. People are in e-commerce for the convenience, for the difference, so it is important we give them the right experience.

CHANNEL APPROPRIATE CONTENT
Digital marketing is part of a bigger picture; it is not separate from the whole Marketing Value chain. I think one has to take a 360 approach and ponder on questions like – Where is my consumer? What product am I selling? What benefits am I offering? Most importantly what media behavior is my target consumer exhibiting? We need to first identify these aspects, and then decide which is the most effective way of reaching out to them – be it digital channels, Radio, Television, Billboard or any other Traditional Marketing channels. There are no set rules, but one thing we should keep in mind – that is, the digital space is constantly evolving which in turn changes how consumers behave in digital platforms. If you want to do it right, then you really need to prioritize Content, because while the channel is important, it is crucial to come out with content that speaks to consumers in their own language. It is what your consumer wants to hear and not what you have to say! No matter how cliché it sounds, content is still the King. Therefore, if I have to summarize the secret recipe, it would be creating the right balance of Content and selection of Channels!

THE CUSTOMER JOURNEY
There is no fail-safe method to marketing. In Marketing everything is customized and tailor-made according to the consumer base, which can be comprised of all sets of people from having different kinds of Demographic and Psychographic profile. Starting from their food habits to how they spend their leisure time, all has to be considered since consumers has a journey. We as marketers, have to first identify the kind of product we are marketing then design the Customer Journey Framework, and then we decide the right touch point of interaction in the journey. These touch points differ from consumer to consumer. If you want to create a structure, then make one relevant to the consumer journey which helps customers decide that they will take a journey with a brand for a certain period of time. And this changes from brand to brand, from time to time.

CREDIBLE CUSTOMER CARE
In terms of communication, being transparent is always better to adopt. Yes, for the beautification of our communication we take different routes, but if we can ensure that we are being transparent about the products and services we are selling, that should help us in creating a sense of security and place of trust. There are different mechanisms, like being transparent where my product is sourced from, where it is made. Give them the opportunity to visit your office or your factory premises. If you have an open dialogue with your consumer or if you have the option to make the consumer reach you, it will help them to get answers anytime and every time. In Nestlé we have a call center, which is the first ever Toll Free call center in the country with a unique number. The whole idea was to listen to our consumers, their experiences, their queries which is open 24/7. We encourage our consumers to call us by promoting the service every now and then, which is a bit rare, when it comes to Call Center Service. These are small but effective steps that helps a brand establish trust and credibility.

“FROM OUR KITCHEN TO YOURS”
Maggi as a product has been here for the last 22 years now. It is the brand that incepted the idea of instant noodles. Many of us grew up with Maggi. This is why when we were confronted with the crisis, which originated in a different country in 2015, we knew immediately that we have to take a hands-on approach. The crisis started with digital, and to battle that we did not just consider digital as a channel, we took a more combined approach. People who believed and trusted the brand also got shaken and that is why we were getting calls in our call center, queries on our social media. We tried to utilize all media channels as much as possible. However, since the commotion began in digital, we tried to answer each and every query very meticulously through our customer service support on social media. We were taking constant updates, and the entire management was very involved with what people were asking and how we were responding to the queries.

This year we have done a campaign with three celebrities – Dilara Zaman, Shehtaz and Mithila. We took them as our ambassadors. They first got to know our brand and understand how Maggi is produced in Bangladesh factory. It wasn’t done on TV; we did an OVC which we published. They first took a deep dive into how Maggi is produced, and only when they were convinced, they decided to be part of the campaign. We did three different online videos featuring these three celebrities talking about the overall aspect of the brand. Mithila spoke about how quality is maintained during production, Shehtaz talked about from where we are sourcing the raw materials and how spices are being sourced and what kind of quality we are maintaining, and Dilara Zaman focused on overall trust on the brand. We were proud to have them as ambassadors, and we promoted the content in all sorts of digital channel. Digital is a place where people can readily share their opinion. We addressed the issue in the channel where it started with different kinds of content. We designed a specific campaign to address what was going on in people’s mind.

From this campaign we decided why don’t we invite people to visit our factory. On 30th June we closed the registrations and these celebrities will take them to our factories. Visitors will have a whole day to go through our factory. It will happen in August, and it will be for both children and adults. We have had a great response. The idea is to take them to our factory in Gazipur where Maggi is produced and give them a tour of our entire operation. This is one kind of activation companies can do to build trust, so that customers feel invited. We are saying this campaign is “From our kitchen to yours”. Kitchen is a very intimate space in a house, so when you invite guests to your kitchen it gives them warmth and creates a personal bond. We are doing this from a brand perspective. People might say it is a marketing gimmick, but we really want our consumer to come and visit us and believe and see for themselves. A campaign that started in digital is ending offline.

TRENDS OF THE TRADE
The overall media behavior of people is changing, so this is something a marketer has to lookout for. It is very crucial. The media vehicles are increasing, it is no longer limited to media and press, we have digital now and within digital there are separate channels, and people are shifting and moving all the time. I think this entire shift and the various media vehicles is something that as any marketer we should be looking out for. Marketers need to factor in consumer behavior because of the shift that happens in consumer minds.

The millennial consumer base has a different mindset, a different attitude towards life. This affects the way we are doing marketing. The two factors marketers have to keep in mind are changing consumer behavior and changing media vehicles.

Being present in the right channel with the right content, I think that is something we have to look out for. Most importantly, we have to factor in consumer insights so keep a tab on what consumers are saying, what they are thinking about your brand. Because if you are not listening, someone else is, so consumer insight is important, and so is research and listening to your consumer. Everything starts with consumer insights. If I am making a service or a product, I have to first listen to what they want, not what I want to sell. We sometimes take an inside-out approach, rather than an outside-in approach. We need to really understand what consumers are saying about our brand, what they need, how they are going to consume it. These are the two things that I feel as marketers we need to be on top, and then last but not the least, as we are becoming more and more a technology driven society, we should always be aware of the technological changes taking place in consumers’ life, in their media consumption and overall media vehicles. Being on top off that is very important.

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Interviews

Passion of Perseverance

Igloo’s Head of Marketing credits success to never saying no to an opportunity

The Metamorphosis of a Marketer from Research Officer and Puppeteer
If I look back to my student life in DU and NSU and early professional days, I can see, I was guided by the right leaders all through. My passion to pursue, curiosity to learn and going the extra mile also helped me to attract the attention of the right leaders, and the bottom line was together- we – the prodigy and legacy have been achieving more since then.

When I was a student, apart from academic activities I was also involved in many extracurricular activities which helped me to build my career, sharpen my interpersonal and communication skills, and develop my idea iteration skills as well. I am always very comfortable to go way beyond my comfort zone to challenge my limit even in cross functional assignments.
I was also a puppet artist with Mustafa Monwar from my student days.

There was a show on BTV called Moner Kotha where I portrayed the character Parul.I joined this organization for an initial training workshop. Sir associated me to different meetings; when he would work on a project, particularly a national-level project, such as UNICEF and the likes, where the issues were focused on impact creation. Such issues were communicated via education through the puppet show. When such national-level projects or issues were being discussed, though I was the youngest one in the group, but sir always used to include me.

The Corporate journey began under the supervision of a very visionary person and of the living marketing legend, Ashraf Bin Taj, he was my recruiting boss. It is said, your first boss has the best impact on your career, for my life, it is correct indeed. Coming from a different academic background, my marketing know how was zero, apart from my inherited curiosity, problem solving ability and creativity. He nurtured me, guided me every day with new assignments and coached to improve my ability. We also learned teamwork at Nestle and tried to help each other, in return I actually acquired new skills and competencies.

My career turning point was in 2006, when Nestle Global decided to transform from the global number 1 food and beverage company to Most preferred Nutrition, Health and Wellness Company. In Bangladesh, it was me who was working in marketing with a combination of marketing and nutrition know how. And in South Asia Region (SAR), it was me , who identified the move and wanted to implement in market level. My Boss, that time was Shammi Rubayet Karim, he appreciated my interest and gave me full support to lead the show.
Further, my department was reassigned, and Mr. Ziaul Hafiz became my boss, he helped me to see the big picture, and I started taking strategic decisions with his guidance, it helped me to have better aspiration for business and for personal growth.

After that,I joined BRAC with a vision because they are the number one NGO internationally. I took over Marketing Lead role for 12 social enterprises, except Aarong. I was fortunate to share the same stage with Sir Abed here and learned new leadership skills from Mr Taufiqur Rahman- the former CEO of BDFP. I also experienced a short span of time for a new business inception in Bangladesh. Looking into my track record and seeing my passion for work, the Corporate Coach and Group CEO of Igloo GM Kamrul Hassan chose me to lead Igloo Marketing Function – The most trusted & loved Ice-cream Brand in Bangladesh.

Tapping into global taste buds
We look into the global trend before we decide on a flavor. Ice cream is something that is very impulse-based. We focus on what the trend is, at the same time we also focus on local taste preference. Combining both we create our own, unique flavors. Although we have a very strong R&D team we still go for numerous consumers tests. Every year you will find an ample number of new products in DITF. Icefest is also a place where we get immediate feedback about new products and improvement needs from the real consumers. Besides that we also do several consumer studies , getting the input from consumers, combining quantitative and qualitative data, we analyze our products improvement needs ,and as the products are designed by adopting consumers feedback you will see, this is the most preferred Ice-cream brand by consumers too, actually, it is the most loved Ice-cream brand in Bangladesh.

Consistency is crucial for loyal consumer base
We tend to confuse marketing and propaganda – both are different and serve separate purposes. A real marketer never claims or makes unattainable promises. The job starts when the designing of a product begins. When the product or branding communication is initiated, an effective marketer’s job is to communicate that to consumers. Consumers are really smart, it’s not like they don’t understand that from a 1TK worth product, it is not possible to get a 1.5TK benefit. So, from the beginning, what I can provide, is what I should communicate. Therefore, the chances of these issues arising decreases. You know, if you don’t over promise, there is no chance of heartbreak. So instead of over promising, it’s better to be real, relevant and reliable- and all can be delivered with a quality product & service. It helps to build a loyal base who trust on the brand and brand promises.

Trust is formed alongside a long-term relationship. So we need to serve, engage our consumers and need to walk the extra mile for them. As the most loving Bangladeshi Ice Cream brand, we have a loyal base, who are our safe gourd and brand advocates. If anyone intentionally wants to create any controversy about us, they start talking on our behalf, because the consistent quality delivery earned their trust for years. However, there are some occurrences or external stimulus for which the brand itself is not liable, but became a victim in those cases I think the media should be a bit more conscientious. They should check all their facts, before stating the information they’ve collected to the public.

At the government level, the role of the gatekeeper should be amplified. By that I mean, who is responsible for what, what can be done, and what can’t be done. What the standard is, and based on what are the questions being asked. The reason I am saying this is because, for a very long duration, the brands I have worked for, and those I am still working for, all of them were tested and trusted brand. Even then, I have witnessed 3 big incidents, once in 2008, then in 2014, and again this year, for 3 different brands. Each time, it was due to external reasons, and the brand was not involved. Something transpired in a different country, or the study that was conducted was faulty. Later on, when according to the standard, it was tested outside or abroad, the result revealed that the entire study was erroneous. Therefore, if the government were to handle such issues, just a bit more strictly, then the fraudulent industrialists will develop a sense of fear and start assuming more responsibility. On the other hand, if the brand is good, they can continue to serve with right products to the consumers. even if the consumers are confused, they would approach the brand, because they have faith. Then via one on one communication, the confusion can be resolved, since they do have faith in you. It’s not necessary to tell everyone, but it is essential to stay connected with your loyal base. So an issue may arise, but if I stay within the promise I made, then it’s possible to overcome the issue in a short span. Because consumers have faith and it’s being tested. We don’t compromise on product quality, which is the main reason people trust us. We maintain consistency and this is how we ensure the confidence of our loyal consumer base.

Catering to the convenience of consumers
Despite the proliferation of social media and digital marketing, the distribution network is still the same, naturally. But the fact is, as people are more convenience seeker, we have evolved our delivery services i.e. home delivery. You can call 16556, and you can get your favorite flavor of ice cream at home. That is how our reach to our audience is being changed. Similarly, our communication approach has also changed. The channels we are focusing on are mostly digital because that is more convenient and you can actually communicate with you consumers directly. You can actually target the consumer you are seeking for. Accordingly, the work is involved with the products, as well as engagement. Because a particular study about Facebook says that, ice cream is more about impulse, and the biggest consumer demography is the youth and millennials, and generation i, and millennials are not actually loyal. They prefer and love brands who can offer them an experience, engagement and excitement. We get this opportunity more via digital, so we are more focused on digital channels now. Accordingly, we are trying to communicate with our consumers, besides that. This brand has a legacy, has been in the market for a very long time. People of different ages like ice cream, hence for some we communicate in conventional media like television, and for some, particularly the new ones we have to be involved in BTL, for activation. We also work on the consumer end. However, we select the touchpoints, those which are fun and entertaining, we work on those points. Naturally, Facebook comes first but we also have a focus on YouTube, Instagram, and LinkedIn etc

Journey will define the success
When I think about career and success; I find them as the journey, or you can call it the life road. The journey will take you to a path, it’s a long journey and still I need to go miles away, hence I can’t see the destination yet. However, to make the journey a memorable and significant one, I will try to give my best one, and I am sure I will get some reward in return. Thanks to Ice Business Times for featuring me. A success story of someone from the crowd may help others to encourage. Thanks for the initiative but I will request you to raise your voice more about violence against children and women and violation of consumer rights. Before doing business we have a society to uphold.

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Interviews

DOORS TO THE FUTURE

Partex is reshaping the benchmark of living

Designing a Standard
There is no doubt that the demand for furniture is escalating due to an increase in disposable income. But we can’t overlook another salient reason behind the increasing demand for furniture- the improvement in the standard of Bangladeshi people’s lifestyle. The key reason behind the upgrade in lifestyle is the growing use of Satellite TV and Digital media especially, Facebook and YouTube. Therefore, furniture is no longer a mere necessity- it is now a product that defines people’s standard of living. Here, we are basically focusing on differentiating Partex Furniture from its competitors. Most of the furniture brands in Bangladesh are focusing on a single kind of lifestyle, i.e., either contemporary or traditional. But taking the customers’ preferences into consideration, we are producing and retailing, contemporary, fusion & urbanology furniture, in addition to traditional furniture. New design is another factor that we are considering for making our brand distinct, as it is one of the key purchase drivers in the furniture industry. We have a dedicated product development team led by a foreign designer. They are working constantly to generate new design ideas and present newly designed furniture to the customers. Partex Furniture has introduced more than 60 new furniture in the market in 2019 alone.

Customizing to Customer Taste
Most of the furniture we sale are ready-made furniture. There are a few customers who want to customize their furniture, especially the upholstery of sofas and chair. We have placed an album of fabric swatches at our retail outlets so that a customer can buy furniture with their preferred upholstery.

I should inform you that Partex Furniture also provides total interior decoration solution for both corporate and Individual HouseHold (IHH). We have a dedicated team for that. Basically, we offer customized furniture when we provide total interior decoration solution.

Fire Safety through Partex Fire Doors
Partex Fire Door is the only UL (Underwriters Laboratories) certified fire door that is being manufactured in Bangladesh. UL certified Fire Door means that all of its components are UL certified. Therefore, it is obvious that the quality and fire resistance properties of Partex Fire Door are far better than any non-UL certified brand, and at least on a par with any imported UL certified fire door brand. But the additional benefits that a customer gets for buying Partex Fire Door are that we ensure on-time delivery and a quality after-sales service. Thus, we have got an excellent response from the market.

The price of any fire-proof product is much higher compared to any ordinary product due to high production cost. Therefore, it would be unrealistic to regularize the use of fire-proof furniture in offices, since it will increase overhead cost and is unfeasible at times. Rather, government authorities should impose a regulation of using required fire safety measures (especially fire exits, fire extinguishers, and fire doors) at all offices, factories and high-rise buildings.

The Rise of Partex Fire Doors
Till date the demand for Fire Door is highest in the Garments Manufacturing sector, because the use of Fire Door has been made obligatory by the buyers. Due to some fire-related incidents that have occurred recently, the demand for Fire Door is also rising in the textile sector, industrial sector, housing sector and offices. Personal selling plays a primary role in marketing the Fire Door to the institutional sector. In addition to this, advertisements in business segment of daily newspapers, business magazines, direct mail, and trade fairs are effective platforms for traditional marketing. Advent of digital media has made it easier to reach specific target groups. The use of SMS, Viber and LinkedIn is playing a very effective role in case of digital media.

Prompt and prepared
Proliferation of TV Channels, Radio Station and Newspapers has fragmented viewers, listeners and readers. Therefore, reaching target groups using traditional media has become costlier. On the contrary, reaching a specific target group using social media becomes simple and cost effective. Because, in the case of social media, audiences can be filtered according to their demography, geography, psychography and occupation.

In Bangladesh, people who have smartphones/ TV/ notepads/ laptops/ desktops and internet connection like to spend most of their spare time using social networks (especially Facebook, YouTube, Instagram, LinkedIn and Twitter) rather than watching TV, listening to the radio and reading newspapers/magazines. So, the opportunity to see (OTS) of any ad is high on social media.
Social networking sites allow us to interact and deal with our customers on a personal level, which eases the process of providing and receiving feedback. We are observing that the customers prefer relaying their complaints and queries through direct messages on Facebook pages over calling directly. This is helping us provide prompt service and connect with prospective buyers. When our brand gets involved in conversations on social networking sites, customers view it as welcoming, responsive and accessible. This type of exposure positively influences how we are perceived and makes customers more receptive to the information that we share.

Globally, as well as in Bangladesh, Marcomm expenditure on social media is increasing gradually. Likewise, we are gradually shifting our focus to social media for marketing communications. But it is also realistic that we cannot ignore traditional media totally. Because there are still plenty of people who do not use social media, and it is much harder to get someone’s attention with a Facebook post then it is to get someone’s attention with a newspaper ad. So, in case of selecting media mix for any marketing channel, we should take into consideration the nature of the product and profile of target customers and their media habits.

Digitalization is the Future
Bangladesh has made a lot of progress in digitalization, but we still have a long way to go. I personally see plenty of changes in consumer behavior due to digitalization. One of the key changes is the method of payment. Customers now prefer to pay cashless using e-wallet. Another change in customers’ behaviour is that now customers seek information from different sources, particularly website and social media prior to buying any product (specially household durable). Customers also prefer to buy online, although lack of trust is the prime hindrance in growth of e-commerce industry in Bangladesh. But I believe digitalization is the future of Bangladesh.

Be Determined, Dedicated and Devoted
The market is very competitive and it is not that easy to differentiate oneself from the others. So, I would suggest that the young marketers gather in-depth knowledge about the products, competitors and customers’ insight. This will facilitate them to differentiate their brands, which is persuasive, relevant and credible to consumers. In addition to this, for young marketing professionals’ future in career and career growth, I would like to advise them to be determined, dedicated and devoted toward their responsibilities.

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Interviews

 

Steering in the Right Direction

Vendor Development and Foreign Partnership spell long term Success

How much has the advent of the ride-sharing industry propelled the growth of the motorcycle sector?
The ride-sharing industry is mostly concentrated in Dhaka, which is why I would say that the industry has had an impact in Dhaka city. Whereas, the rest of the country has yet to catch up. If I had to quote whether it resulted in increased sales, Dhaka city, yes, but for the country, no.
If you look at the plans of the ride-sharing companies, they aspire to service the entirety of Bangladesh, but then they also look at demand. Depending on demand, I am sure they will expand into other cities. If you look at Dhaka as a market, it’s maybe only 25% of the business of Bangladesh, so I would say that it is the rural areas, where the road connectivity is not smooth, is probably where you’ll see more of a demand for motorcycles.

What are you doing to ensure better road safety? Are there any CSR activities from the manufacturer’s side as a whole?
We are trying to work out something with BRTA, and trying to see if we can develop policies and training programs to ensure road safety. We are having dialogues with BRTA regarding two initiatives – one is road safety, the other one is training. BRTA needs to come out with a better policy on ride-sharing and how it should be performed. We as manufacturers can help them.

We are involved in CSR activities like in the past we had some training programs in terms of female training courses. We are also planning to also teach women how to drive bikes. Shohoz helmets have a TVS brand on them, so we are basically the suppliers for their helmets.

After the government cut supplementary duty (SD) on import of the two-wheeler’s components, the duty on import of completely knocked down units of motorcycle was slashed by 25 percentage points to 20 percent in 2016-17 to encourage local assembly and subsequent manufacturing. How much did the price of motorcycles go down because of this?
When you import things as a CKD (Completely Knocked Down), you pay a certain amount of duty. When the government changed the policy and gave more advantages in terms of duty benefit, they have a separate SRO called SRO155 which has three criteria – manufacturing, parts and components, CKD step. Depending on which criteria you fulfill you get better benefit. They issued a policy which said if manufacturers meet requirements like importing certain machines, and localizing some of the components so that we can fabricate the frame here in Bangladesh. We have automated machines/robots to do the welding, we are doing the painting with the paint booth, certain metal parts are being produced in Bangladesh – then you can enjoy the benefit of a reduced duty. A lot of the manufacturers are enjoying the benefit and they are passed on to the consumers in terms of reduced prices.

Can you expound on the kind of retail finance support the motorcycle sector needs from the banking sector to reach its full potential?
If you look at India, one of the huge explosions had come after the retail financing scheme started. In Bangladesh, the banks are still not able to process this, maybe because we don’t have a proper credit reporting system, so understanding the credit worthiness, or actually recovering bad debt, or loan amounts is a little bit difficult for them right now. Having said that, I think, banks can, of course, look into it because it is a huge market. A first mover can actually take advantage of this and it will probably be very lucrative, so I think if they are associated with the industry then the industry can actually grow 30, 40, 50% more if this kind of retail scheme is available.

How are price cuts, increasing purchasing capacity and thrust for faster mobility compound to the predicted 6 lakh units by the end of 2019?
There is always an organic growth in the market and it is already growing. In the last three years, we have seen that normally industries are growing 10-15%. Last year we had around 500,000 vehicles, and this year the projection is around 600,000. In addition to that what we see as the SRO benefits, if the price comes down even more, definitely then you are creating a newer market, so some people who are not able to buy before will be able to buy now, and that would probably add another 10-15% to the market. But the other ones in terms of mobility, and affordability, I think that goes hand in hand with the price. As the price goes down, people who couldn’t afford it can afford it now.

How are challenges like lack of vendor development for manufacturing required components and supply of those to manufacturers being tackled by the industry?
When we first worked with the government to develop these kinds of industries, one of our questions was the same – how are they going to help us. Initially, they wanted us to invest in all the back end things, for example, if you go to India or some other countries, most of the parts are made by vendors, and the motorcycle industry is doing the final assembly because it is very expensive and not feasible for me to make all the parts. A vendor can make parts for many companies, so their scale is much bigger than mine, that’s why we encourage the government to have some kind of vendor policy. It’s not that you should do everything in-house, but also pass it along to vendors so that vendors can develop and give us the parts that we need to assemble and manufacture the product. Maybe one vendor specializes in seats, another in metal parts, another in plastic parts, or another in aluminum casting for the engine.

The government can go to India and invite some of the Indian companies to come to Bangladesh and research and see if it is viable for these companies to develop their factories here and give them some incentive so maybe they can export back to India or some other countries. The first thing these companies will see when they set up a company is to see if it is viable or not, so their return investment is the first priority. Then secondly if they can see axillary profitability or if business comes from other revenue streams, then maybe they can be exported to a third party or countries.

What policy support does the motorcycle manufacturing industry seek from the government?
I think the government has already done a very good job of implementing a policy that is already in place. But of course, the most important thing is that a lot of times the government can change the policy. Like one year the budget is like this, then another year the budget is another way. Luckily for us working closely with the government, we’ve been able to work with the government to ensure that the long term strategy of the government doesn’t change, and that is the most important thing for us. Let’s say Honda or TVS were going to invest 200 or 300 crores in one project, if you have government policies changing every few years then it is hard for us to think long term because I am thinking I am investing 200 crores, how am I going to get it back? The most important thing for me is that the government has a long term plan, and sees it through.

For me, the motorcycle industry is a very prospective industry in Bangladesh, and we feel that Bangladesh has a huge scope to mend the infrastructure gaps in the transportation system. Definitely, this industry has a huge potential, at the same time, I think the government is doing a very a good job in helping us get there so that we can ensure better jobs, building more factories, developing vendors. So, that on itself is creating GDP output, creating more jobs. The training aspect, I think us as an industry can work hand in hand with the government.

Indian brands are a real threat for local manufacturers because Indian brands hold lion’s’ share of the market. How are local manufacturers tackling the competition?
For any business, if you want to develop anything in the automotive sector like designing a motorcycle, that can cost 100 million dollars. I am not sure the local manufacturers have the capacity to get back that sort of investment of R&D cost. The local players are struggling because they don’t have the budget, whereas India is thinking of exporting to 90 different countries, and Bangladesh is thinking about their own. I think the scale is very important so if any kind of automotive industry does not have the scale then you can’t make the money. Usually, the revenue is invested in more research and development.

Right now they are struggling, but for them to come out of it they need a foreign partner. In the 60’s India had joint ventures with all the Japanese manufactures, and now the Indian companies are independent and doing it on their own. For example, Hero was with Honda for forty years, therefore, Hero Honda then they split, Kawasaki was with Bajaj, TVS was with Suzuki. All these guys had years and years of technological supervision from Japan. Any local player looking to develop should do a joint venture with a foreign company, learn from them, and decide in a future point and time that they are ready to be independent and they can do it on their own.

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