Before Jonathan Labin rolls out of bed in the morning, he’s already on Facebook. “The first thing that I do, I check my mobile phone, I check Facebook, I check my feed,” he says. But, unlike the 83 million other people who check their Facebook pages in the Middle East, Labin doesn’t log onto the social network to catch up on news. Facebook is work.
Since the company opened its doors in Dubai four years ago—in the aftermath of uprisings, the number of its active monthly users has more than tripled to 136 million across the Middle East and North Africa. Labin ticks off some numbers: 127 million people, or 93%, access Facebook on mobile devices, and the region has the highest rate of video viewership per capita in the world.
“In a few years, that means we’ve become one of the biggest, if not the biggest, tech and communications platform in the region, particularly on mobile,” says the 38-year-old managing director of Middle East, North Africa and Pakistan.
Facebook’s popularity in the Middle East makes it a key market for the company. In September, it hosted at its headquarters in Menlo Park, California officials from Dubai’s tourism and travel sector, including Emirates, who rely on Facebook as a marketing tool. “We think we can learn a lot from the Middle East,” says Labin.
The company’s overall growth has been prodigious. Last year, it raked in $18 billion in revenue, a 44% increase from 2014, and posted a 26% jump in net income to $3.6 billion. From humble beginnings in Mark Zuckerberg’s dorm room at Harvard in 2003, it now boasts 1.7 billion monthly active members; 84.5% of its daily active users reside outside of North America.
Monetizing Facebook’s popularity wasn’t a quick affair in the Middle East. When Labin landed in Dubai in 2012, the company had 45 million active monthly users in the region. Nothing to sniff at, but online advertising was virtually non-existent—not great news for a company that relies on ads for revenue.
The Middle East and Africa accounted for less than 1% of digital ad spending globally, dead last in the world, according to market research company eMarketer. Labin estimates that companies spent between $200 million and $300 million per year on digital ads across the Middle East at the time. It was also primitive. “It was a pop-up here, a banner there,” says Labin.
Rising smartphone penetration and young people’s embrace of social media forced brands to respond to changes in consumer behavior, and engage with them on new platforms, such as Facebook, Twitter, and others. Labin estimates that spending on digital ads is now upwards of $1 billion per year.
To promote digital advertising, he introduced tailored products. Facebook compiles valuable data on consumer behavior for advertisers. Last year, for example, Labin worked with Etihad Airways to target the large Indian community in the U.A.E. Etihad promoted low fares between India and the U.A.E. on Facebook during the Hindu festival of Diwali, to reunite families.
The social media giant also provides self-service ad tools through its Ads Manager App, and tacks on additional features for tracking ad performance, and revising budgets and schedules. “Facebook was one of the first social media platforms that allowed self-managed advertising with improved targeting features,” says Mohamad Badr, chief operating officer and head of strategy at Brand Lounge, a Dubai-based brand consultant. “This opened a whole new world for established and startup brands.”
When Facebook dispatched Labin to Dubai, it was undergoing a shift in focus from desktop to mobile. Advertising was still desktop-based, but as smartphones took the lead in emerging markets, the company realized it needed a mobile strategy. “It went as far as Mark [Zuckerberg] saying, ‘I’m not going to take meetings anymore where people present solutions to me that are desktop-first,’” says Labin. “Everything needs to be mobile-first.”
The company made a series of big acquisitions to boost its mobile presence, including the purchase of Instagram in 2012 for $1 billion, and Whatsapp for $19 billion in 2014. With Whatsapp, it picked up a large user base in the Middle East, where the messaging app is wildly popular because of free texting.
Because the region varies tremendously in terms of wealth, so does bandwidth. In North Africa, in particular, smartphone penetration is lower and data plans are less common—meaning Facebook is not as accessible. “We needed to find solutions that worked for everyone in the region,” says Labin.
Last year, the company introduced Facebook Lite, an app designed to serve people on slow networks. It also teamed up with telecoms to offer Free Basics. In October, Labin partnered with Zain in Jordan to eliminate data charges for the telecom’s customers when they use Facebook on mobile devices. Free Basics is also available in Iraq, where Facebook has agreements with AsiaCell, Korek and Zain. (See sidebar).
Facebook introduced Slideshow for advertisers. Instead of relying on video ads, which might run slowly or not at all on outdated devices, companies can create ads with photo slides and text. “Our big bets long-term are connectivity, connecting the unconnected,” says Labin.
Luckily, when he arrived in Dubai, Labin was already familiar with the region.
Half German, half Venezuelan, he speaks three languages fluently. After studying at Universidad Pontificia Comillas in Spain, Labin got his start in 2001 at a consulting firm in Munich. Three years later, he moved to New York. He earned an MBA at Columbia Business School, and joined American media conglomerate Viacom.
That job took Labin to London, where he eventually worked in advertising on the emerging markets team for Central Europe, the Middle East and Africa. At one point, Viacom sent him to Dubai for a couple months.
“That’s when Facebook knocked on the door,” says Labin. It was 2011, and the company was looking for someone who had experience in the Middle East. Facebook was hot and getting ready to go public; he didn’t need convincing. “I didn’t have to think twice before joining the company,” says Labin, who was initially based in London.
With only two colleagues in Dubai Internet City, it was at first a threadbare operation. “We started very lean and very humble,” says Labin. When the printer ran out of paper, he was the one to run downstairs to buy more. The office has since grown to more than 40 employees, but the early ethos remains. “We think about this as a startup within a larger company,” he says.
Labin and his team organize programs to train businesses, large and small, to better deploy Facebook. For example, in September they hosted a conference in Dubai to teach developers how to build, integrate, and monetize mobile apps through the platform. They’re also rolling out an educational program that teaches businesses how to advertise through Facebook.
With Anghami, a Lebanese music streaming startup, Labin’s team helped the founders integrate Facebook’s login features into their platform, so that users can register for the service through the social network. With the help of targeted ads, Labin says that Anghami’s active monthly users grew by 37% last year.
To boost Careem’s business, he introduced the on-demand ride service to an algorithm that targets potential customers based on their Facebook profile.
On the big business end, Labin works with companies such as Nestlé. Last year, it ran a campaign for Nescafé in Egypt through Facebook that reached 12 million people, and increased brand awareness.
With nearly 400 million people in the Middle East and North Africa, Facebook has reached a third of the population. That leaves plenty of unconnected folks. “Our journey is 1% done,” says Labin.
No time to waste. “Before I go to bed in the evening, I do check Facebook,” he says.
SOCIALIZING IN THE ARAB WORLD
Here’s how social media platforms stack up based on a 2015 sample of 4,559 users in the U.A.E., Egypt, Lebanon, Qatar, Saudi Arabia, and Tunisia:
(Sources: Mideastmedia.org and Northwestern University in Qatar.)