One can no longer ignore that market liberalisation is forcing executives and social activists to work together to develop new business models that will transform organisations and the lives of poor people everywhere. CK Prahalad's latest work suggests that many corporations have started to pay attention to customers at the bottom of the economic pyramid, and furthermore, companies and NGO's are trying to learn from and work with each other.
Township economies hit the brand radar screen
By Janice Spark
Township economies hit the brand radar screen
With three major shopping centres going up in Soweto and the emergence of a consumer hungry South African middle class, suddenly business people are eyeing the townships as sources of future business growth. Expect a litany of clumsy and misguided attempts to reach into these areas, accompanied by an array of taxi ads that mean little to anybody. Conversely, expect more and more entrepreneurial black business people to find real fiscal backing and leapfrog to the front of the new market.
We can also expect intermediary qualitative research agencies to take up an increasingly important role in this context - the era of simplistic vox pops is morphing into an age of valuable insights into new consumer mindsets.
Verlyn Klinkenborg, writing in the The New York Times Magazine, had this to say about the role brands are playing in modern life:
"... brands have taken on a more subliminal and emotional role in society. Brands have become our new myths and fantasies; cultural artifacts that define our hopes, dreams, aspirations, and fears. Like totems, brands represent personal and cultural identities, indicating where we have been and where we are going while they remind us of our humanity."
From marketing to distribution, it's the clever thinkers that will really make township money. These thinkers will demonstrate a localised understanding of Klinkenborg's increasingly valid insight.
We will undoubtedly see a racketing up of the pressure in the BEE sphere. Expect women's groups such as Whiphold and NAWA (National African Women Alliance) to secure even better deals thanks to their authentic, broad-based and representative status. BEE frontiers will truly start to sweat, and expect to see some great multi-racial, cross gender business partnerships developing.
Within the creative industry, the BEE spotlight is likely to shift away from the advertising sector (which has successfully pioneered the Marketing Advertising and Communications BEE charter) and firmly onto the marketing industry - which has lagged considerably in the transformation stakes. The opportunity will exist for the marketing sector to re-build from the bottom up, using the rubble provided by the deceased Marketing Federation of SA and focusing on catching up to the rest of an empowered South Africa. Whether the opportunity will be taken or not is anyone's guess.
The average South African is now truly bored with BEE. Even honestly broad-based, meaningful and effective BEE deals will need great communication strategies to gain recognition.
Die traditional media, die
Brands are being forced to become more creative and to make use of new channels to reach consumers. Digital marketing will take an increasingly prominent position in the communications arsenal. From the iPod series to DSTV's Personal Video Recorder (PVR), the digital revolution offers new worlds of possibilities to marketers in their attempts to reach a burgeoning market.
The TiVo will eventually have its 'ad fast forward' function unlocked, however, and as broadband becomes an everyday reality in South Africa an entirely new strategic mindset will be required to impact on consumers. South Africa will start to see content downloaded on demand and increasing numbers of consumers tailoring entertainment and news content to specific tastes.
Nonlinear media consumption (enjoying content on our schedule, not the broadcaster's) is our destiny. The revolution will not be televised, however, until the companies that funnel content into our homes figure out how to control it. The global music industry's failure to deal with radically altered content distribution channels offers an important lesson for all brands playing in the media space - ignoring the shift won't make the issue go away, or make the transition any easier. The time to act is now.
Digital irritation is hitting an all time high. Marketers without fresh ideas beware!.
Professional services realise the power of branding
Professional services firms have to battle against rivals for client attention and loyalty on increasingly competitive turf. Expect lessons learned over decades in FMCG (Fast Moving Consumer Goods) branding to be applied to South African professional services brands - from internal branding programmes to comprehensive client satisfaction management frameworks, in the 21st century most professionals services firms have no choice but to play the brand game.
Look out for new players and brands, backed by new business models and revenue streams. Anyone in this sector who thinks they have it all covered has one eye closed.
The age of participative journalism is taking shape. More and more corporate companies have signed up to the blogging phenomenon in an attempt to control to changing information distribution environment. Equally, the media environment is increasingly subject to seemingly contradictory forces: on the one hand, the consolidation of mainstream outlets and the rapid rise of aggregators such as Google; and on the other, a proliferation of alternative, user-driven content services such as web forums, blogs and wikis.
The upshot of all these movements is that PR has changed, fundamentally. Transparency, honesty and attempts at actual dialogue with stakeholders have replaced spin and blatantly dubious storytelling.
In South Africa, the force of participative journalism is dulled by a general lack of access to bandwidth and communication technologies. However, the rise of mobile broadband looks set to dramatically accelerate a still nascent trend. Local brands that haven't taken account of this rumbling shift in the media environment are in for an interesting time.
Corporations hiring their own bloggers and seeking to take control of participative journalism need to think laterally, and pay attention to the local context. Mimicking the activities of global players could end in dismal failure.
Outsourcing and the role of the specialist marketing company
Businesses are finding it increasingly difficult to integrate and manage the services of different (and often disparate) specialist marketing suppliers - thus the pendulum is swinging back to full-service agencies. This time, however, agencies need to be able to deliver expert services in specialised fields, matching the offerings from specialist consultancies. Thus expect an increase in media and marketing agency JV (Joint Venture) activity. Media players need to offer a full gamut of expertise, without straining resources in expanding their offerings.
The pendulum will continue to swing. Inevitably, as bigger agencies begin to make their presence felt, niches will be created once again for specialised marketing consultants able to offer personal attention as an antidote to the big agency experience.
The rise of non-traditional brands
A global realisation of the centrality of branding to business success means we will see even more left-of-centre, non traditional brands competing in the public space. From government departments to NGOs, sports teams, parks boards and bands, expect more and more weird and wonderful entities to be packaging themselves up in brand format to perfect image and drive business.
DIY branders will be quickly exposed by those who have spent real time, energy and money on the process. Business owners can provide the spark and the insight, but a pro is a must to finish off the job.
"It is going to be a very interesting year, with shifts in technology driving huge changes in the way business is conducted, and in the way members of the public perceive and interact with brands," says Idea Engineers' Spark.
"With the local economy booming we can expect compounding activity in terms of media spend. However, the efficacy of spend, especially when it comes to new media, remains uncertain. Major alterations are taking place in the fabric of the local economy - from township activity to a booming middle class and a morphing BEE landscape, so new opportunities for innovation and brand experimentation will continue to present themselves."
Janice Spark is Managing Director of Idea Engineers
In the last two years, INFUSION (formerly Culture Cruizing) has conducted continuous research in 7 townships in order to better understand lifestyle trends and social dynamics in the townships.
Have you heard of a Grameenphone? Superb idea in Bangladesh!
Townships are a marked South African phenomenon. People that reside in them are often seen as one indistinguishable mass with little consideration as to how lifestyles, areas, mindsets and perspectives differ.
South Africans love fast food and health supplements; cannot live without cell phones; enjoy community newspapers, and regularly stock up on food and groceries. These are just some of the insights gleaned from the Newspaper Advertising Bureau's (NAB's) latest ROOTS 007 research, independently conducted by Research Surveys.