Kuwait

uwait’s economy has been hard hit by the low oil prices of recent years. It holds about 10 per cent of the world’s oil supplies, and hydrocarbons make up about 95 per cent of its exports.

This wealth means Kuwaitis have grown accustomed to comfortable living, supported by state employment. One commentator in Forbes at the start of the year quoted former liberal MP Abdullah al-Nibari as saying: “Kuwait’s people used to be very hard-working. Unfortunately, with the influx of oil wealth this trait has been gradually reduced. Now they all look for a government job where they work only three hours a day or don’t work at all.”

Times are changing, though, and in 2016, Kuwait ran its first budget deficit for 17 years. This tightened economy means that the good old days of state support are over for citizens and businesses alike. As oil prices stay low, advertising clients are asking for more for less.

So says Dana Alhanbali, creative partner at local agency Beattie + Dane. Production budgets are down and freelancers are coming out of the woodwork to cater to an increased need for digital content.

This is playing to the advantage of smaller agencies, who are often better adapted to working on a per-project basis, while internationals tend to stay on retainers for content creation.

In December, Kuwait’s Emir opened parliament with a warning that “sacrifices” were coming. “I am confident that the Assembly and all citizens are aware that cutting public spending has become inevitable through well-studied measures,” he said.

This means reducing subsidies. The government has begun to stop underwriting the costs of water and electricity, at least for expatriates, raised the price of kerosene and diesel and, last October, began increasing the price of petrol at the pumps. It has promised to eliminate subsidies altogether by 2020.

The government is supporting those Kuwaitis who do wish to move out of public sector jobs, and Alhabali says this is fostering a new vein of entrepreneurialism. “When it comes to niche brands, Kuwait is a very entrepreneurial market. So we have hundreds of businesses that open up every week in the food and beverage and the caféstyle concept sectors,” she says. “The way they attract audiences and promote themselves is quite interesting, because they completely switch things around. They become content generators on their own.”

This means more content is being produced – by these entrepreneurs and for them. And startups are also altering the media landscape in another, unexpected way, as those new cafes and small businesses drive traffic – and therefore outdoor spend and activations – into edgy hipster warehouse areas and away from the centre of Kuwait City.

Social media personalities too are becoming more popular. GCC platform Influencers. ae lists 321 Instagrammers with more than 20,000 followers in Kuwait, beaten only by the UAE with 620 and Saudi Arabia with 524.

“Influencers are quite popular here in Kuwait, especially when it comes to small businesses,” says Alhanbali. “It replaces putting your ad in the newspaper. What putting your ad in the newspaper used to be some years ago, you generate those views within one day of using an influencer. So it’s a brilliant return on investment.”

Some of these social networkers are making a real name for themselves, including Ascia al-Faraj, a fashionista followed by 2.1 million on Instagram. Others, however, are now becoming less reputable, says Alhabali, having cashed in too quickly on too much. “They’ve done a very good job in terms of generating strong, reputable platforms,” she says. “But some of them are losing credibility because they haven’t defined what they stand for as an influencer; they are working with a mix of brands that don’t make sense.”

Whether or not influencers are taking money away from print, Zenith reports that advertising spend on newspapers fell from $61m in 2015 to $43m last year, and predict that spend will drop to $33m in 2017.

However some still read the dailies, and Alhanbali’s agency found print was still an essential part of its media plan when it produced its campaign for Al Munaes Tea, inventing a fake parliamentary candidate. “Who is Bu Salem” won a gold at the Dubai Lynx.

Ramadan is a busy time for Kuwait’s boutique agencies. Alhanbali knows of one production house in the run up to the holy month with 17 projects on the go. “That as a number, with the size of the production house is ridiculous,” she says. “We are not a UAE, we are not a Saudi. That’s a ridiculous number for one team to manage.”

Alhanbali’s theory is that clients look for local insights from local agencies, although smaller shops are also likely to be more affordable, and ready to take on single-contract work.

She says: “A lot of the bigger brands here, such as telcos and banks, have retainers with multinational agencies. What these retainers do is they do the day-to-day executional work, whether it is content for social media or specific promotional tactical ads. When it comes to the major communications that these big brands do, they go out on a limb and work on projects with different types of agencies that do different things. The multinationals have become the execution drivers.”

This shift has been happening more noticeably in the past two years or so.

“Last year in Ramadan, 48 TVC films, came out during Ramadan for 48 different brands,” says Alhanbali. “I don’t even think two of them came from multinational agencies. They were all from local boutiques.”

Brands look for local insight, which might be diluted by foreign talent and culture at the network agencies, she says.

“A lot of these companies are looking for a really direct hit-and-run style of marketing, when it comes to these big bangs. It has to hit the nail on the head the first time.”