Johnny Malek Technology for Marketing
NATALIE TURNER [00:00:13] Hello and welcome back to Technology for Marketing day two. I’m Natalie Turner with Disruptive Live and today I am joined by Johnny Malek. How are you today?
JOHNNY MALEK [00:00:22] I’m fine, thank you very much. What about you?
NATALIE TURNER [00:00:24] Yes I’m well. Thank you for asking. So you are the senior marketing consultant from Dubai e-commerce city.
JOHNNY MALEK [00:00:30] Commerce City.
NATALIE TURNER [00:00:32] Commerce City. That it just wanted to make sure I’m pronouncing that right. So, Johnny, tell us a little bit about you. Why are you here today and a little bit about Dubai Commerce City.
JOHNNY MALEK [00:00:43] OK, cool. So basically, this is our second year we’ve been here. We were here last year just to, you know, explore the waters a little bit and test the waters. It was quite successful. Last year, we basically sponsored the VIP lounge and we’re back on popular demand. And so this year, I mean, this is the second day and it’s been very, very good for us. Yesterday, I had a presentation, a keynote in the morning, 11:00. That was amazing because we’ve had a full house literally. And a lot of questions also happened there. And it’s a very interesting session. I must admit, a lot of interest, especially from the U.K.
NATALIE TURNER [00:01:25] OK.
JOHNNY MALEK [00:01:25] Given what’s going on here. They wanted to know more a little bit about what a free zone is the concept of a free zone, which is actually equal on European standards to an economic zone.
NATALIE TURNER [00:01:38] Right okay.
JOHNNY MALEK [00:01:38] So all of the benefits of a free zone, especially Dubai Commerce City, that is especially dedicated free zone for e-commerce.
NATALIE TURNER [00:01:49] Right okay.
JOHNNY MALEK [00:01:49] And so they they were quite interested. And today we’ve actually closed a few deals.
NATALIE TURNER [00:01:53] Oh fantastic
JOHNNY MALEK [00:01:54] I must say, yes, it was amazing.
NATALIE TURNER [00:01:56] You’ve got a big smile across your face.
JOHNNY MALEK [00:01:58] Well, it could be bigger, actually even by tomorrow.
NATALIE TURNER [00:01:59] Well I’m sure it will be. We’ve still got a few hours left of the day.
JOHNNY MALEK [00:02:04] Yes.
NATALIE TURNER [00:02:05] So if you could, some of our viewers may not have actually seen you at your speech. So could you give us some of the highlights of what happened yesterday and some of the key things that you’d like to get out for our audiences.
JOHNNY MALEK [00:02:16] Yes. So I’ve tried to make it short. Given the limited time we have. So basically, I’m here to promote Dubai Commerce City. I work for Dubai Airport Free Zone, which is a 21 year old free zone. We have about 17 hundred clients who operate out of the multinationals. You know, you name it, Boeing, Airbus, Red Bush, Chanel, Estee Lauder, Aldi. So Commerce City is a J.V. between Dubai Airport Free Zone and the landowners, lots of people. And we build and operate this free zone. So I was here to basically explain the concept of what this Dubai Commerce City is about and why did it come about, essentially. You know, it’s wanted to capitalize on the growing e-commerce market for a long time. And as part of our expansion strategies for DAFZA we wanted to go to go beyond our physical borders. So we decided e-commerce would be the sector that we want to capitalize on because we have to analyze a lot of sectors. And we discovered that basically e-commerce was witnessing the highest growth for the next five years. We’re talking about double digit numbers, 20 percent growth with the CAGR by 2022 and where you also have the Middle East contributing a large portion of that growth as well. So we said this is the sector that we want to be in. And so we decided that we should develop another other free zone called Dubai way Commerce City.
NATALIE TURNER [00:03:48] Fantastic. So when you were having your speech yesterday, was there any questions that people asked you that were quite key?
JOHNNY MALEK [00:03:55] Yes. I mean, their main question was, where’s Dubai? No, I’m joking. I think a lot of people actually knew where Dubai was. But they said the essential question was, what is the value proposition for Commerce City and what’s it different from other free zones and versus even the joint venture freezone, which is DAFZA. So typically your free zones are, you know, where companies come and set up that operation to be able to trade in the region. And the relationship typically would be one of landlord and a tenant. So we provide leases. They come and lease an office or a warehouse. And we basically give them a licence and visas. And then they they go. They start operating. Commerce City was a value proposition is quite unique in that we actually get involved in helping our customers grow. And so we develop free zones. But also this free zone comes with an entire ecosystem all around e-commerce. So, for instance, an e-commerce company, whether they are global or regional manufacturers coming from US, think Nike, for example, they want to come onshore to be close to that demand. Typically, the business model would have been, you know, Nike appointing a distributor in Dubai and then distributors selling to the customer. Today, these big manufacturer brands, the parent brands, have realized that they need for their e-commerce business to come onshore to sell directly. So we said, you know, they understood the tax benefits, but not. Not only that, but they would be saving great margins by removing the intermediaries and their distributors. Right. Whether they pass it on to their bottom line or pass it onto the customers. That’s entirely up to them. But they did say that they would come to be able to be close to their customer and sell them. And they had to be in a free zone, tax free environment for that, because Dubai Commerce City is essentially great for product e-commerce where excluding, you know, service e-commerce, the likes of AirBnB or, you know, any travel retail as such, because they don’t need to be in a free zone environment. So the value proposition is that we are offering software as a service. What does that mean? Any customer that comes into Dubai. And they don’t have the set up like any retailer would have. We are providing the software platform, which is the Magento e-commerce platform that has pre-payment gateways that has that can develop websites for them. They can Arabise it. And in the local indigenous language, whether it’s in Dubai or in Africa or whatever, whichever language. And also, we have done a deal with three PL. So we have three clusters. We have a business cluster where we have 12 buildings with G plus six. And then we have a logistic clusters where we have about a hundred and five warehouses, two of which are manned and managed by three PL. That tight end with the last mile delivery operator, the first one being Hellman and then DHL Express doing that last night delivery. So we are we did a deal with this three PL and we contacted them and we slapped him with sort of KPI’s to be able to provide logistics and transportation services exclusively to the Dubai Commerce City clients, which means that you don’t have to reinvent the wheel as a client or be able to go out to the market and get quotations here and there. We’ve split the Middle East into 10 zones and every zone has a cost, which is on average 30 to 40 percent cheaper than the market. If they were to go out to the market and get to a certain quotations also from an SLA perspective, the timing was much, much better and much tighter because as you can understand in e-commerce, it’s all about cost and timing. The cost has to be minimal because your margins are a little bit tighter. And then the timing we’re talking about same day delivery. I mean, some some customers managed to do two hours delivery if orders are placed before 2:00. So Dubai Commerce City’s value proposition, which is what I told them yesterday. And they were like, wow, what are you talking about, Johnny? It’s like we’re providing software as a service platform with Magento. We’re providing logistics as a service with this dedicated three PL that’s managing the inbound logistics and the outbound logistics on behalf of customers, including clearing customs and everything else. So that basically it’s an end to end kind of value proposition for those who are interested. Now, some of the global clients that already have their deals with, you know, their logistics firms and then they come onshore to to Dubai Commerce City would expect that if they want our services, we can provide them. But what we are doing is we’re providing a choice. We go beyond that. We also our ecosystem is providing, you know, like you want to develop web, web developer. We’re provide it for you. You want to call centre. We’re provide it for you marketing agencies to develop the SEO’s for you, essentially essential for your brand to be able to be visible in order to kickstart your e-commerce business. We can also provide this for you. So when you come in, you actually come in to plug and play system and an environment that basically makes it easier for you as a customer to do it. No other free zone in the world does that.
NATALIE TURNER [00:09:03] That’s amazing
JOHNNY MALEK [00:09:04] Yeah it is.
NATALIE TURNER [00:09:05] So there’s nothing you guys can’t do really is there?
JOHNNY MALEK [00:09:07] We can’t we can’t dance karoake. That’s one thing we don’t do.
NATALIE TURNER [00:09:13] Or sell donuts. So you’ve seen massive growth you’re obviously going in the right direction. The future is looking bright. But what can we expect in the next year or two years? I mean, what’s the what’s the goal for the company?
JOHNNY MALEK [00:09:24] So basically Dubai Commerce City is being built as we speak. The ground breaking ceremony happened with Dubai dignitaries about eight months ago. It should be ready up and running by Q4 2020. Okay. But we have done we have begun our pre-leasing lead generation activities, hence why we are here. And I must say, you know, we have we have shortlisted quite a lot of clients that are you know, they wanted even to sign that we had this one this afternoon signing. So we’re actually going around the world marketing the brand and securing a lot of pre appeal, these sort of wishlist. Right. All right. So we have about 400 of those because we started about a year and a half ago. So we go to Asia-Pacific. So we’ve been to Tokyo. We’ve been to Seoul. We’ve been to Hong Kong. And, you know, and the you know, our story has been receiving a lot of traction east and west equally.
NATALIE TURNER [00:10:26] Well that’s incredicle.
JOHNNY MALEK [00:10:26] Yeah.
NATALIE TURNER [00:10:27] Thank you so much Johnny.
JOHNNY MALEK [00:10:27] Thank you.
NATALIE TURNER [00:10:28] I’m afraid we have actually run out of time.
JOHNNY MALEK [00:10:30] Have we? Oh, my God.
NATALIE TURNER [00:10:31] That was really informative. And I’m sure the audience were happy to hear more about you.
JOHNNY MALEK [00:10:34] Thank you. Thank you for having me. Thank you. And I’ll see you next year, same time.
NATALIE TURNER [00:10:39] No, absolutely. As I have said, unfortunately, that is all we have time for. But please don’t go away. We will be back after a very short break. We’ll see you in a bit.