That’s why Concrete decided to go ahead and open three more stores this year, including its new flagship shop on Lebanon street in Mohandiseen, despite the significant changes in consumer behavior that have Egyptians tightening their belts and penny pinching anywhere they can.

But it’s not all doom and gloom as the new year opens. Raouf is convinced shoppers are waiting for the right time to start spending again.

Q: What was 2011 like for Concrete?
Raouf: 2011 brought about challenges in many different aspects. We noticed that consumer behavior, the economy and morale had all changed. The most important factor is morale. Concrete targets several segments, from middle class to lower-upper class, and most of them have not been affected economically [for example, lost their jobs or had their salaries dramatically reduced].

But there has been a very negative effect on their morale. Shopping is about desire — we are not targeting the needs of customers. But to feel desire, you must be happy, willing to spend money and positive about the future. You can’t be afraid of what is going to happen to your money.

This is the biggest challenge: We have lost customers’ appetite and desire to pamper themselves. They are very practical in their shopping and this is the exact opposite mindset you need to buy fashion.

Q: How were sales affected?
Raouf: Overall we are down, but we are not afraid. We feel that we are on the right track and it’s just a matter of time before shoppers’ appetites come back. Consumer emotions are on a roller coaster of highs and lows. On a Friday [when people are in Tahrir Square] and there is fighting, they feel unsafe and scared.

But when we have a Friday without violence, people are willing to spend money to feel happy. We see the future and we are happy about our sales. Although we lost customers, we gained another segment — those who used to go abroad for their fashion nowadays are searching for the best in Egypt because they don’t travel as much. This is noticeable in our shops.

Q: Where did the idea of the Buy Egyptian weekend in December come from and why did Concrete choose to participate last year?
Raouf: The initiative came from Amr Adeeb on his TV program. The campaign created aggressive word-of-mouth advertising for the participating stores and everyone was talking about it in just a few days. We weren’t sure that consumers would be so quick to react.

[We participated] because we felt that we had an obligation to the economy and a responsibility towards consumers. For the first time ever, we offered a 20% discount on everything, including new items. This is particularly significant because we are not in a sale season since December is peak shopping time.

Q: How did the initiative go?
Raouf: The results were outstanding. We don’t have the exact sales figures for the three days [as of press time] but what we saw in the shops was amazing. We ran an advertisement in Al-Masry Al-Youm newspaper, our staff wore shirts with the initiative’s logo; we promoted it on our Facebook page. We hope to double our sales target achieved during the same weekend last year when we made LE 2 million across our 40 stores, and we are likely to reach that target.

Q: What do you think 2012 will bring for retailers and Concrete?
Raouf: There are things we can control and things we can’t. We cannot predict what the morale or spirit of the consumer will be. So we will try to restructure our organization from the inside, minimize our overhead costs and bargain and negotiate costs and prices everywhere. Although it’s tough to invest in new staff, we have an opportunity to gain good caliber people for senior positions this year. We have about 100 white-collar employees, around 500 in our stores and another 1,000 blue-collar workers.

This will be a big investment, so we can’t afford to see sales drop again. Customers need a reason to buy. Maybe we will try to achieve that through customer loyalty, or discounts, but our strategy is not set in stone. We are still thinking about creating that reason to buy. bt