Directing Traffik: Marcel Khairallah

Marcel Khairallah, founder and owner of below the line solutions company Traffik360, explains how he has adapted to a continually evolving business landscape, and how his business has become a global player
By Neil King
Tue 08 Apr 2014 04:00 PM

Advertising is everywhere you look. Open a magazine and it’s there in front of you; get into your car and you see huge billboards as you drive along road; turn on the TV and you’re hit with a never-ending stream of commercials.

Advertising is often unashamedly brash and in your face.

But there’s another type of advertising away from the television, print media, and internet which is somewhat less obvious, perhaps a little more sophisticated, and certainly more targeted: Below the line advertising (BTL).

Worth billions of dollars globally, BTL uses a series of methods to engage customers one-one-one, such as promotional gifts, brochures, email campaigns, and so one.

One company which has taken the regional BTL market by storm is Traffik360, launched by Lebanese entrepreneur Marcel Khairallah in 2002.

Focussing on promotional merchandising, point of sale material,advertising stands, print services, and - recently - brand activations and product launches, Traffik360 works with both local and multinational clients.

Offering a full ‘360 degree’ model, whereby the company creates, designs, and produces the materials for their clients, Traffik360 has become the leading BTL provider not only in the UAE, but perhaps the Middle East in general.

Khariallah arrived in Dubai in 1998 after graduating from university and a stint working in a  bank in Lebanon. He cut his teeth in the advertising industry for a year and a half before opportunity knocked.

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“There was a company in Beirut which wanted to start a similar business in Dubai,” he says. “They appointed me general manager to start up the company. I’d only been her just over a year, and I had to found the company, sort out lawyers, do registration, and everything else.

“It wasn’t easy!

“The company grew from two people to eleven when I left in 2001 to start up my own company. Traffik360 was launched in 2002, and we’re still going today.”

Starting out with just two people, and only selling promotional items, Khairallah strengthened contacts he had in China, and slowly but surely grew his new business.

“I acquired some clients who were working with me in the previous business, and they new I could offer them the personal touch,” he says.

“It was much easier to develop the business from there, and we started to establish a strong presence.”

‘Strong’ put it mildly. Clients including Diageo, L’Oreal and Unilever show just how big Traffik360 really is, and how highly regarded a businessman Khairallah must be.

His cause was undoubtedly helped in 2006 when Traffik360 became part of the International Advertising Gift Council (IGC) - a body which has 56 members in 52 countries around the world, and became a cooperative in 2011, allowing members to discuss best practices, support good suppliers over the bad, and share global clients.

“It’s a global agency - a club of similar companies,” Khairallah explains.

“None of us are competing geographically, so we have the freedom to help each other out, which is a huge benefit. Especially when it comes to sharing clients.

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“IGC can pitch for clients globally, so if the client is Pepsi Cola, and IGC gets the contract, it would get the business of Pepsi to be used by each of the member companies in each country.

“It works out well for the client - it’s better for them to club all their business with us in more than 50 countries. And it’s great for each of us members. It took us to a global platform.

Business may be good, but that doesn’t mean there aren’t continual challenges to face.

One such challenge is ensuring the quality and ethics not only of Traffik360s own operations, but also those of every supplier, logistics company, contact, or factory it is associated with.

Especially when dealing with multinationals.

“Clients like L’Oreal are very strong on CSR,” says Khairallah. “They want to know everything - what model we’re using, the HR of the factories we use - everything.”

Khairallah believes certification such as an ISO from Lloyds have helped the company “become more convincing and more trustworthy” - two qualities which carry a lot of weight when dealing with global brands.

“All the audits, the certification, the stringent checks, and everything else, are important to us. We need to be trusted if we’re going to do anything in this industry.”

While admitting Traffik360 is always learning as a company, Khairallah also points out that experience has taken them a long way, and helped guide them through the 2008 financial crisis.

He says: “Experience is very important. It’s partly about knowing how to sell between yourself and clients. If you approach only on the price point, they will take your for a ride. It’s difficult, but it’s true.

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“In this business a lot of people can do the same service for less if they want to. It’s not been so bad since the 2008 crisis because a lot of the bad competition didn’t survive, but some clients got used to very bad products because they were only looking at the price.

“When I go to somebody like Diageo, they are selling a premium product, so the extras have to be high quality as well. Otherwise it impacts them negatively.”

It’s clear Khairallah has an intimate understanding of his clients’s needs, allowing him to service them as well as possible, but he also exhibits good knowledge of the Chinese business landscape. With such close ties to China and its factories, it’s obvious that he needs to spend at least one eye on the market at all times.

“China affects the whole world,” he says.

“There has been fast appreciation of RMB [Renminbi, China’s official currency] in the past few years, which has changed things a lot - for everybody.

“There has also been an exodus to the villages lately. The average Chinese man sees his children twice per year. He leaves his village to work in the city and just sees them twice. The government created more jobs in the villages to help change this - gave them the opportunity to go and work with their families.

“A lot of the workers preferred to leave the factories in the cities and go back home. In some cases thousands left - there were drops of 30 percent in some factories’ workforce. So the factories had to increase wages to attract people back, and increase prices to cover the cost.

“Everything that happens in China makes a difference, and I don’t see any country replacing China any time soon. Their mentality in the workplace is unbelievable.”

With Dubai having grown beyond all recognition since Khairallah first stepped foot in the emirate, it’s no surprise to hear that the marketplace in the UAE has changed too.

The constant need for an established business to adapt and develop, plus the regular addition of competitors in the region, led Traffik 360 to look beyond its core offering and take steps to give its clients more.

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“Last year we saw a need to move away from just doing promotional items and POS (point of sale) materials,” says Khairallah. “So we diversified our services.

“We thought that we have some great clients, and a lot of experience, so we would cater for a bigger chunk of the business. Things like brand activations, product launches, and so on.

“Everything we do falls under the same umbrella - it’s all the same type of business. We said to clients ‘this is what we’ve done before, what do you say if you try doing these other things with us as well?’. We signed a few big names, which was amazing for our portfolio.”

But as with all things, balance became a key word. The extra services might have brought extra business, but that hasn’t necessarily meant Khairallah has been able to grow his company.

“I’m very cautious in terms of recruiting,” he says. “I don’t like over-recruiting - I like to use the people we have already.

“Don’t take that to mean that I want to slave-drive them - I don’t exploit people.

“But unless I see that business is really consistent, then it’s hard to commit. If the region is consistent, then we will grow.”

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Indeed there is an air of frustration about Khairallah when he discusses the current state of the market and of companies’ budgets.

He says: “We set targets and expectations, and we’re meeting them, but we’ve not been able to be as aggressive as we’d like.

“We have to be realistic. Budgets aren’t growing, and day to day life is hard for businesses, and for people generally. Clients haven’t always got a lot of money to spare, especially when a lot of their budgets have been redirected to Europe, where things are worse off.”

Given the change in Traffik 360s operations during the past year, and the size of Khairallah’s ambitions, it’s perhaps no surprise to hear his plans for the future.

“We’re going to continue developing our business line, adding more services, and making them perfect,” he says.

“We’re also thinking about possibilities outside the UAE, establishing branches in other countries, and looking for more opportunities there. There’s a lot more still to do.”

With so many achievements under its belt already, and so many big plans, one thing is for certain: Traffik 360 is far from pedestrian.

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