Marketing in Iran is changing.
Businesses in Iran are now eagerly exploring ways to get access to a bigger part of the global market. There is much positivity – also amongst brands mainly operating in the domestic space in Iran.
Iranians are curious, open-minded and serious about learning and progress. During my last 3-city speaking tour to Shiraz, Tehran, and Esfahan, I got the impression that Iranian marketers are now very action-orientated. They want to make things happen. And are very specific about what they want to learn and how they can use that knowledge to accomplish their goals.
New, interesting initiatives are popping up here and there. One of which is the omnipresent “Iranian e-commerce consortium“. This organization is competently managed by Mr. Maleki. He is a key person in the (new) Iranian e-commerce industry and electronic payments industry.
Background: My first (speaking) trip to Iran took place in 2011. My most recent one was in September last year. And, it seems, much has changed in those five years.
Iranian marketers committed to change
My impression is that Iranian marketers are now committed to change. They embrace the ongoing changes affecting their marketing roles and see new opportunities. And that is a good thing.
The new international agreement will allow Iranian business to once again do business with (most of) the rest of the world. That is of significant importance to Iranian brands, to the export revenues of the country – and this will affect marketers. Because the environment in which they operate certainly will undergo significant changes in the coming years And that is what I sensed during my last visit.
Changes in consumer behavior in Iran
Brands selling to Iranian consumers market will have to deal with changes in consumer behavior and consumer preferences.
The change will happen gradually over the next few years. And it is likely that consumer behavior in the largest cities, namely Tehran, Mashhad and Isfahan – might differ from smaller cities such as Shiraz or Ahvaz. I am told that there are relatively large regional differences in Iran.
Many foreign (consumer) brands will undoubtedly enter the Iranian market in the next couple of years. After all, Iran is an attractive market. Iran gives access to nearly 80 million highly educated consumers. So the size of Egypt, but with better infrastructure and a generally better-educated population.
It is also a young (some 60% under 30 years old) and urbanized population (more than 70%). Marketing in Iran, then, is very much about understanding how to engage this very young population. At the moment social media and anything mobile is a good starting point.
For foreign brands entering the Iranian market, it won’t be a walk-in-the-park either. There is language, culture, local competition and consumer preferences to deal with. And trust.
For many brands, some customization and “innovation to fit the local flavor” will likely be required. You might like this Harvard Business Review article about doing business in Iran.
It is going to be an interesting few years ahead for local businesses in Iran – and for foreign businesses seeking to enter the Iranian market.
From a marketing point of view, my impression is that most Iranian marketers are geared towards traditional marketing. Marketing in Iran is not yet focused on engaging consumers through digital communication.
Judging from the conversations I’ve had in Iran, the good news is that Iranian marketers know they need to update their (digital marketing) skills.
From wasteful to meaningful communication
I think that modern brands entering Iran might have a competitive advantage. At least for a few years. Especially brands who excel at communicating in a personalized, relevant, timely and direct fashion. Brands such as __________ (<<< Fill in the blank).
Iranian brands seem to be quite mass-media centric. They do what they’ve always been doing in terms of TV, radio, print and out-of-home advertising. And a little bit of experimentation with digital channels. But that will change too.
The shift from traditional advertising to more direct and digital communication in Iran will be exciting to watch. Internet penetration is high. And so is mobile and mobile internet penetration. This offers interesting opportunities for marketers willing and able to engage the demanding Iranian consumer through these channels.
But. When it comes to digital communication, I expect that Iranian businesses will take their time to make the transition from “wasteful communication” to “meaningful communication”. Or should I say from mass communication to more targeted, digital communication.
And that’s not so different from what many other countries have experienced. Still, large international agencies are already making moves to position themselves to a role in the Iranian market. Read this interview with Sir Martin Sorrell
… and customer service + customer experience is an opportunity
Add to that the level of service.
While Iranians are very hospitable, friendly and easy to get along with, the service industry in Iran operates very differently. Oddly enough.
My experiences in four different 4/5 star hotels painted a clear picture; service was not a core competence.
In fact, to me, a reminiscent of my first visits to Russia back in the day.
So foreign brands who bring in a customer-centric approach with a relentless focus on providing a great service will likely have a competitive advantage too.
The trick will be to find the right personality type Iranian people to employ – and then subsequently train these folks to deliver great customer service consistently.
Marketing in Iran requires partnerships
If you are interested in marketing in Iran, I’ll be happy to guide you, connect you to relevant people or even help you enter the market.
Like everywhere else, it is important to network with the right people. There are certain rules and guidelines to follow when doing business in Iran. It pays to engage early on with people who have a first-hand experience with the Persian culture.
The language barrier is something else to consider. Although many Iranians are fluent in English, many are not comfortable speaking or negotiating in other languages than Farsi. My recommendation is to get a very good interpreter. I happen to know a couple. One of which you can experience in the video below.