Interviews

Zumtobel Group exec on the lighting market’s bright future

Veit Mueller, SVP of Zumtobel Group – MEIA, discusses his firm’s multi-brand segment approach to clients and what the acquisition of acdc means for the group

Founded in Austria in 1928 by Dr Walter Zumtobel, the Zumtobel Group has since grown into a global lighting solutions powerhouse. The company now has sales offices and partners in approximately 90 countries and employs a global workforce of over 6,500. The group’s production network is also global, with 13 plants on four continents, and in its nearly 90-year history it has acquired companies including Thorn, Tridonic and, most recently, acdc.

In the Middle East, the group’s various companies have provided lighting solutions on several prestigious projects including the Emirates Palace and Yas Marina hotels in Abu Dhabi, as well as Dubai’s Burj Khalifa and the Al Maktoum International Airport.

In the last 12 months, the Zumtobel Group has concentrated its efforts on two areas, in an effort to better address the regional market with its brands. “Zumtobel Group has been working hard on two key topics. Firstly, introducing the multi-brand segment approach to our clients. We now have additional brands and new divisions in our business, which really allow us to deliver complete solutions to our clients across a broad range of segments,” explains Veit Mueller, SVP of Zumtobel Group – MEIA.

“By using products from across our lighting brands, we can offer clients the best quality solution for the entire space at a budget that suits them. The lighting market in the Middle East is transitioning to LED very quickly, which means – in addition to the advanced technology lighting products – promotion of our controls and systems division is becoming important to really get the most of every lighting installation.”

The group has also carved out an advisory role for itself in the region, and based on feedback from partners and customers, it has also placed importance on educating market stakeholders. “Education has also been a key topic for us recently. There are so many competitors in the LED lighting market that people have been asking us to help them understand how they can specify good quality LED products, and what are the key factors to look out for. We have conducted several seminars across the region to improve the level of knowledge in the market, and are hard at work to continue internal and external knowledge increase,” says Mueller.

Zumtobel has maintained an office in Dubai for 10 years, and earlier this year it unveiled its new facility. “Globally, the office environment is changing rapidly. It’s no longer just a place where people sit down and carry out basic tasks built around a nine-to-five working day. Offices are much more dynamic now, and technology is changing the face of the environment. Millennials working in today’s office expect much more than just a place of work; it is more about collaboration and working in teams to solve complex problems. The environment needs to provide creative breakout spaces, places to relax and have less formal discussions.”

Mueller says his company is setting the standard for office lighting, and believes the revamp helps employees work better while also serving as a space to demonstrate its various solutions. “Our new space includes areas for meetings, discussions, networking and training. We offer a complete digitally connected experience to all our staff and visitors. Our latest and innovative products such as the Mellowlight Infinity and our Litecom control system allow us to display products at the forefront of technology. In the 750sqm premises, visitors will be able to see the application of luminaires in offices, retail, art, industry and outdoor.”

Business Synergy
In 2015, the Zumtobel Group announced that it was acquiring UK global LED lighting specialist acdc. With the acquisition now complete, Mueller is even more confident of opportunities on the horizon.

“Architectural façade and hospitality lighting are precisely the areas where we see major growth opportunities. We also see a great deal of potential in the run-up to Expo 2020, and acdc will be a key part of our success. Furthermore, the acdc team has a highly developed innovation culture which enables them to provide fast and dynamic responses to market requirements. It is our aim to retain their culture and their excellent customer relationships.”

“Huge growth potential exists for the acdc brand, particularly with regard to marketing the acdc product portfolio through the Zumtobel Group’s worldwide sales organisation. Together we will continue to dynamically drive forward the acdc brand and strengthen its position in the global lighting market.”

With several companies offering complementary solutions and hundreds of projects to its credit, the Zumtobel Group is well positioned to take advantage of current and future opportunities. Mueller is particularly optimistic about what the coming years will bring, driven mainly by regional mega projects.

“Demand for the latest in lighting technology in the region continues to be high, as upcoming mega events such as the Dubai Expo 2020 provide a catalyst for regional growth. The GCC LED market is expected to continue with significant annual growth in the next few years, and at this rate the penetration will be significant by 2020, giving the Zumtobel Group ample opportunities with our eco-friendly and smart lighting systems.”

Mueller is particularly positive about the hospitality sector from the standpoint of new developments and upgrades.

“Hospitality is an area that is growing and will continue to grow in the run-up to 2020. Not only are there opportunities for new build, but we are now seeing many of the hotels go through their first major refurbishments. We also see the mid-tier hotel market as an opportunity for the future, as places like Dubai look to attract an even broader audience. I think we will see an increase in refurbishment business in the near future, as more and more people look to make the switch to LED.”

Going forward, Mueller also expects the lighting design profession in the region to grow, and exert more influence on market tastes. He believes this will give project owners a nudge to invest in lighting that is both high-quality and sustainable. In fact, the group is already working towards this goal.

“It’s definitely something we try to propagate here in the region and globally, because of our heritage. There are some projects where people think about this now; it’s more widespread when consultants are involved on the project from an early stage.”

A Question of Budget
Although Mueller is confident about future business prospects, he points that there are challenges that need to be taken into account. Reduced liquidity and political uncertainty are in some cases pushing clients and project owners to focus on reducing their initial investment, rather than considering the long-term benefits of quality solutions that have higher up-front costs.

“Low-cost, and often low-quality, competition from Asia remains a challenge. That is why we will continue to educate our customers on the wider benefits of good quality lighting, and dealing with a group that has decades of experience in the field. One of the key advantages of LED is its extended lifetime, but we are still seeing many inexpensive, poor quality LED products being sold that are failing in very short time periods. To really appreciate the technology advantage, one should always go to a reputable manufacturer – in the long term it is the much more economical choice, even if first costs reflect the higher quality.”

One trend that crops up from time to time is cost-cutting under the pretence of value engineering. This can be a challenge when a project owner’s engagement with the project is limited, according to Mueller.

“When the owners are involved or the consultants are very strong from the beginning, cost isn’t the primary concern and long-term considerations remain. But if the owner is less involved and budget is limited, costs become a first consideration.”

Mueller is quick to point out, however, that there are plenty of contractors who are more than capable of executing value engineering in the true sense. He also notes that the Zumtobel Group has reacted to cost challenges by optimising its products to fit project and client requirements accordingly.

“From the Zumtobel side, we reacted to this to a certain extent and de-specified some of the products. What this means is you don’t get all the bells and whistles in the lower cost products, but it’ll still create the same good quality light. With these products you may not be able to dim them or perform colour changes, etc. So there are fewer options, but this means contractors have both high-end options and cost-effective options to choose between.”

Addressing Light Pollution
Concerns about light pollution have been increasing in the last few years, as growing evidence has linked it to negative effects on human health, the disruption of ecosystems and wildlife, and increased energy consumption.

Mueller notes that his company is well aware of the issue and actively working to drive changes and adhere to legislation.

“As far as general dark skies are concerned, there are many areas around the world where dark sky rules are very prevalent and obviously we work in those areas quite successfully. We are also part of a push of introducing more and more controls into spaces, which means that when lights are not needed they are turned off, so you don’t have the negative results.”

Mueller says his firm is committed to increasing awareness of solutions that are green and don’t have a negative impact on the environment. He notes that while legislation generally comes from associations and consultants, his firm is keen to push environmentally friendly technologies.

“Guidelines and specifications typically come from associations where you have consultants, manufacturers and a couple of other concerned parties working together. Generally, it always appears to start from the consulting side. From our standpoint, we are definitely interested in increasing awareness about environmentally friendly technologies, and we are already reacting to requests from the market.”

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