Aarong Receives AMEA for Marketing 3.0

Aarong Receives AMEA for Marketing 3.0

November 6, 2016

By Iftekharul Dastagir

Asia Marketing Federation (AMF), the foremost governing body of marketing in Asia, held the 2nd Asia Marketing Excellence Awards (AMEA) in parallel to the AMF Annual General Meeting and the MASOK International Conference on 23rd September, 2016 in Seoul, South Korea. The mega festival of innovative and responsible marketing was hosted by Marketers’ Society of Korea (MASOK). BRAC Aarong, the most popular lifestyle retail chain today in Bangladesh, has been awarded the Marketing 3.0 Award at the 2nd Asia Marketing Excellence Awards (AMEA) for being a socially responsive marketing company in mind, heart, and spirit. The winner of Marketing 3.0 category, one of the two most prestigious awards, was selected in two steps. After being selected by Marketing Society of Bangladesh (MSB), Aarong charmed the highly experienced jury board excelling over other nominated originations from 18 member countries. The feature covers tad-bits of MASOK International Conference and 2nd AMEA, and also focuses the on unique features of Aarong which got it recognized in international arena.

Start off at Seoul

MASOK International Conference (2016 Asia Marketing Conference) was held on 23rd September, 2016 following the AMF Annual General Meeting on 22nd September, 2016. The theme of the conference was, “New Marketing Opportunity in Asia”. The conference started off with opening speech from Mr. Kiwoong Kim, CEO, Korea Economic Daily, Korea. He officially welcomed the participants – representatives from AMF member countries and native marketing enthusiasts. Later on Mr. Takuya Goto, President, Japan Marketing Association (JMA) and immediate past President of AMF thanked the member countries for participating in the highly prestigious AMEA and congratulated the winners.  

Knowledge Beyond Borders

20160923_115844The introductory part of the day-long conference instigated towards the core focus of the endeavour, “New Marketing Opportunity in Asia”. The knowledge exchanging segments was initiated by the session of Mr. Boojong Kim, Professor, Dong-A University, Korea on “Understanding ASEAN: 10 Different Consumers in 10 Different Markets”. His session focused on avenues for marketers for exploring new opportunities in Asia, specially the ASEAN zone. A total of 10 sessions were conducted all day long by different experts.

A case on Aarong, titled “BRAC Aarong: The First Ever Social Business Model in the World” was also presented at the conference by Ashraf Bin Taj, Director, Marketing Society of Bangladesh (MSB); & Managing Director International Distribution Company Bangladesh (Pvt.) Ltd. The case focused on how Aarong has evolved as the first ever methodically developed successful social business changing the lives of millions. It also portrayed Aarong’s contribution in promoting and protecting our rich age old heritage and culture.

A panel discussion on “How Korean Companies Can Make a Success in ASEAN Markets?” concluded the conference.

Curtain Unveils

As the conference came to an end, the curtain of 2016 AMF-AMEA Awarding Ceremony unveiled for the esteemed guests, representative from different NMAs and others. The overall Chair of the endeavour, newly elected AMF President Ms. Gwen Albarracin from the Philippines Marketing Association, inaugurated the evening. She congratulated the winners in advance saying, “Your success today is an inspiration today for all Asian companies towards achieving marketing excellence by creating more global brands.” Dr. Syed Ferhat Anwar, President, MSB also shared his observation as the Jury Chair of 2016 AMF-AMEA Award. He mentioned, “Our focus has been on innovation, adaptation and, of course, giving back to humanity. Asia has a unique characteristics of being led by the purpose of serving humanity and through this catering sustainable and good business. I’m sure with this unique trait we will help in creation of a better world where our future generation can live in a better and peaceful way.”

Moment of Pride

Among the many awards on offer at the ceremony, the most notable will be the 18 ‘National Winners’ awards as well as the coveted ‘Marketing Company of the Year’ and ‘Marketing 3.0’ awards.

The Marketing Company of the Year Award is for outstanding and innovative efforts of companies’ Marketing Strategies, tactics and values and how this resulted in Sales growth, Market Share growth and Net income growth in the past 3 years.

The Marketing 3.0 Award is given to corporations with well-defined corporate culture as incorporated in its vision, mission and values and is reflected in its marketing strategies that specially consider the consumers’ need in mind, heart, and spirit. 

This year the Marketing Company of the Year Award is given to Century Pacific Food, Inc., which has risen from very humble beginnings as a toll manufacturer for other companies to being the largest canned food company in the Philippines. The company’s efforts in marketing the brands internationally are paying off as these are now sold in 58 countries.

While the other prestigious award, Marketing 3.0 was accomplished by Aarong, the first ever social business model in the world. Mr. Mohammad Abdur Rouf, a Retail Expert in Bangladesh and Chief Operating Officer (COO) of BRAC-Aarong received the award. In his acceptance speech, he exclaimed, “This award will motivate us to connect more with the people. The award is actually for the 65000 artisans and millions of customers who has patronized our different initiatives throughout the last 38 years. The credit is also equally shared with the 3000 employees who have been working with us.”

BRAC-Aarong

Aarong is a leading fashion retailer in Bangladesh, specializing in ethnic apparels and handicrafts. It was initiated back in 1978 by BRAC in Bangladesh with the inclusiveness of rural women in the mainstream income generating activities. BRAC is the largest NGO in the world having its network in 12 different countries in Asia, Africa and the Carribeans. The mission for BRAC is to alleviate poverty by empowering the poor. Today the global reach of BRAC is 138 million people. BRAC focuses on women, who are the worst affected by poverty. BRAC acts as a catalyst, creating multitude of opportunities that allow the poor to realize their potential to transform their own lives. The following chart gives a complete picture about BRAC’s spread of activities.

From its humble beginning of one shop in the 1978s, today the chain boasts 16 stores spread across major metropolitan areas of the country and exports to over 35 countries. It has become an iconic lifestyle brand with over 100 product lines and a certified Fair Trade Organisation.  

Ingrained in the operations of Aarong is the Ayesha Abed Foundation (AAF) which has a two-pronged goal of acting as a production hub for the retailer while facilitating capacity development of the artisans. Through AAF, Aarong reaches out to nearly 35,000 artisans through 541 sub-centres in 16 districts resulting in a staggering number of direct and indirect beneficiaries. Additionally the enterprise engages over 800 independent producers who empower an additional 30,000 craftspersons.

Protecting What’s Important

The enriched cultural history of Bangladesh goes way back to thousand years. The handicrafts of Bangladesh were famous all over the world in Mughal era; most popular were handmade dresses (Muslin, Jamdani), Nakshi Kantha (embroidered quilt), Folk Arts and ornaments.

The Battle of Plassey in 1757 ushered British rule in Bengal. The Industrial Revolution in London was the transition to new manufacturing processes in the period from about 1760 to sometime between 1820 and 1840. Our age old crafts started to die due to Indigo cultivation and modernization. Indian sub-continent become independent from British rule in 1947, yet Bangladesh was a part of Pakistan (then). Till independence from Pakistan in 1971, left few other craft and cottage industry were also on the verge of extinction within this 24 years of exploitation. In such vulnerable time, BRAC took the initiative to protect our culture through empowering the rural artisans, specially women.

Unique Platform to Marginalized Artisans

True to its founding ethos, Aarong primarily acts as a link between the mainstream markets in Bangladesh and the rural artisans, who would otherwise have struggled to gain access to the formalized marketplaces. Small scale entrepreneurs, in spite of having the seed capital for initial investment, are often unlikely to either receive a fair price or a reliable income. The co-existence of Aarong and AAF means that such craftspersons are secured both on the front and the back end of the value chain; while AAF provides the necessary skills and raw materials for production, Aarong serves as a platform for rural artisans to market their craft. All finished products undergo a rigorous quality audit before being stocked in one of the Aarong outlets. The workers receive their wages on a piece-rate basis on a set-date every month.

Enabling Entrepreneurship

Another way that Aarong links craftspersons to markets is through independent producers who operate micro, small and medium enterprises. These entrepreneurs function as distributors, bringing the sample and raw materials to the home-workers’ locations or a production centre. They are responsible for ensuring accuracy and quality of the products as well as for the training of artisans who work with them.

Such indepenedent producers/entreprenuers of Aarong are required to abide by guidelines of fair-trade and ensure workers’ rights. Aarong pays the producers on the day of delivery of the products, a practice that is still rare among similar businesses in Bangladesh. Producers can also receive raw materials on credit to smoothen their up-front costs of investments during production. The design department maintains a close relation with such small entrepreneurs to help them enhance their work techniques, efficiency and quality.

Empowering Women

Aarong is empowering more than 50,000 women all over the country, under the lead of a woman, Tamara Hasan Abed, Head of BRAC Aarong. Among 3000 employees 47% are female – 40% are women at the head office (management), and 65% are women at the retail level. Among the 65,000 artisans, 85% are women who now have financial power and a say in family and social life.

Revival of Jamdani and Muslin

Jamdani was a traditional dress on the verge of extinction. But thanks to the activities of BRAC Aarong and patronization of the artisans, Jamdani is now back on mainstream. The situation changed due to the following measures by Aarong:

  • Jamdani Exhibition  Bangladesh Shilpakala Academy – 1980
  • Started promoting Benarisi Palli in 1982 through collection of pit
    loom weaving card.
  • Collected all possible motifs of Jamdani between 1984-1986.
  • Aarong Jamdani Exhibition (Story of pride) at Shilpakala Academy – 2010
  • UNESCO Jamdani Product Exhibition (Shilpakala Academy) – 2014

Muslin, the most elegant handcrafted textile, was also extinct. Different museums became the place for this heritage. Aarong, along with other partners, took the initiative to revive the heritage so that Muslin can make a comeback as a trendy and popular designer’s choice once again.

Aarong has received many national and international awards for the contribution in protecting, sustaining, and promoting age old heritage in modern era. Seal of Excellence Award for Handicrafts in 2006 from UNESCO, Award of Excellence for Handicrafts 2012 from UNESCO and Award for Safeguarding and Supporting Jamdani Weavers 2015 from Intangible Cultural Heritage of Bangladesh are the most notable ones.

Social Safety Nets & Well-Being

Aarong, along with AAF, has put in place an extensive support system for the artisans and independent producers around the country. The support system not only ensures financial security, but also addresses different issues like – health, education, emergency loan, training and skill development related to the artisans.

  • Ayesha Abed Foundation: Within the bigger production centres of AAF, there are childcare facilities, with full-time caregivers, and allow working mothers to tend to their babies during work. Artisans have access to a welfare fund, to which they may apply in times of hardship. Through Aarong’s gratuity pay system, artisans are paid gratuity at retirement based on the duration of their attachment with AAF.

More than 30,000 artisans receive piece-rate work (15,000 active artisans working at any given time).  As of July 2016, about BDT 256 million has been paid out to artisans as gratuity pay as of July 2016 and BDT 5 million has been dispersed from the welfare fund for artisans’ use when in need.

  • Artisan Development Initiative: Since 2012, Aarong partnered with six of BRAC’s core development programs, such as microfinance and health, to launch the Artisan Development Initiative (ADI). The primary goal of ADI is to meet the social needs of the artisans and provide them with an integrated support to break out of the cycle of poverty.  More than 30000 artisans have been benefitted through different features of the initiative.
  • Health Security Scheme (HSS): In order to help artisans pay for catastrophic health expenditures, Aarong has established the Health Security Scheme (HSS), a co-contributory healthcare-access and financing program. The program now covers 13,036 people, including artisans and their family members. Till June 2016 the program has served 559 beneficiaries and BDT 1.6 million dispersed as benefits to the artisans.

Giving Back

As of 2014, the net capitalization of Aarong was USD 47.16 million with a total asset value of USD 54.09 million ensuring decent growth in sales and profit year on year. In 2014, Aarong registered a profit of USD 10.04 million which was 14.79% of its sales revenue. Aarong fulfils its social enterprise mission by not only enabling rural women to have decent livelihoods but also by redistributing 50% of its profits to BRAC’s development programs such as health, education and human rights. Self-sustainability is a key to any social business and Aarong ensures this objective by ploughing back the remainder of its profits to for its expansion and other BRAC social enterprises.

Bangaliana at Mind, Heart and Spirit

Aarong is the most closely related when it comes to the concept of Markting 3.0.  In mind, Aarong offers trendy lifestyle products to its customers. Revolutionising the retail industry with high standards of quality and artistry, this iconic brand blends the traditional with the contemporary style in ways that never cease to win consumer appeal both at home and abroad. At the heart, Aarong deeply cares about handicrafts from marginalized artisans and patronizing them. And in the spirit, Aarong is Protecting and promoting ethnic and cultural heritage. All these core features won Aarong the AMEA for Marketing 3.0.

Towards the Future

The contribution of Aarong has already brought about significant changes among people on how they perceive our culture and heritage, embodying the core essence of own culture into modern lifestyle and creating a unique platform for the artisans. The recognition from AMF is an inspiration to do more for the heritage, culture and people of Bangladesh. According to the honorary fellow of AMF, Takuya Goto, “AMEA is an award of Asia, by Asia and for Asia.” Aarong will continue to work toward even greater excellence with people to trespass the boundary of Asia and emerge as a true global brand built on Bangladeshi culture and heritage by the Bangladeshi people.

Author

Iftekharul Islam Dastagir

Brand Executive

Bangladesh Brand Forum

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