Samu Makhathini, Marketing Services Manager at NAB (the Newspaper Advertising Bureau), using data and insights from ROOTS 2013, dispels certain myths about marketing to township residents.
The ROOTS research has come a long way in tracking retail consumer behaviour, says Samu. In fact the survey has been in existence in various forms since 1981. Thats more than 30 years of retail consumer intelligence, and the learnings are clearer than ever. These include that one size-fits-all marketing approaches do not work, ever; advertisers need to be mentally and physically available locally and no one suburb is the same as the next.
ROOTS 2013 had 7 500 interviews in townships, and 11 000 in the LSM 4-7 category. In total, the research conducted 28 500 interviews across 115 suburbs and towns, engaging with 3.5 million households and more than 6 million PDMs (purchase decision makers).
We all know that were experiencing a tough economy but one of the reasons why marketers should place emphasis on this market is that its one of the fastest growth areas in the country. ROOTS has shown that there has been a 80% movement out of LSM 1-5, and an increase of people progressing to LSM 6,7 and 8, says Samu.
This market cannot be boxed into merely being an LSM 4-7. For example, 93% of PDMs in Orlando fall into the LSM 6-8 category and 4% into the LSM 9-10 bracket Umlazi shows a similar picture with 89% of PDMs in LSM 6-8 and 12% in LSM 8-10. In the Tsakane and Kwa Thema suburbs the figures are 84% and 14% respectively.
Township households are getting wealthier too. In 2007, the average household earned R5107. In 2013 that figured rose to R7 718, a whopping increase of 32%. Overall, ROOTS 2013 showed that average HH incomes went from R12 629 in 2007 to R16 718 in 3013 - an increase of 41%.
But averages give the big picture, not the real picture, she says. For instance, in Soweto the average HH income is R7182 per month; making the overall value per month of this community at R2.5 billion! Each suburb is remarkably different from its neighbour though. In terms of household income growth since 2007, Pimville has grown 86%, Chiawelo 40% and Jabavu 20%. Orlando has grown 50%, Dobsonville 29% and Diepkloof 31%.
Another myth in this market is that township PDMs will travel far and wide searching for shopping deals. Before the plethora of shopping malls opened in Soweto and other township areas, there was some truth in this statement but today thats no longer the case, says Samu.
Before malls were in place in Soweto, residents shopped at Westgate, Southgate or the Jhb CBD. Today their options include the Dobsonville Mall, Jabulani Mall, Maponya Mall, Bara Mall, Protea Gardens Mall and Westgate, Southgate and the Jhb CBD.
ROOTS 2013 shows that PDMs are no longer willing, or feel the need, to travel further than their local shopping centre to complete their monthly and weekly shopping trips. In Gugulethu for instance PDMs will travel a maximum of 30 minutes for access to their food and grocery shopping, for a good restaurant or for shoes and clothes.The exceptions are that 52% of PDMs surveyed in this area would only be willing to travel more than 30 minutes when looking at DIY or home related goods, or when looking for a new home (68%).
Its also incorrect to assume that this market, or any other for that matter, is loyal to brands. ROOTS data shows that over a 30 day period, 85% of PDMs have been to Shoprite, 55% to Pick n Pay and 41% to Spaza shops. Similarly in the fast food category, and over 30 days, of all PDMs who visit KFC, 29% also visit McDonalds and 23% also visit Nandos and Debonairs. The picture is very similar with retailers too.
As with any category, the picture changes by area, she says. In Mamelodi, 24.5% prefer McDonalds but 30.7% of PDMs surveyed in Newcastle want Chicken Licken and 22.4% of PDMs in Gugulethu want Debonairs.
The banking world is no different for township PDMs of all Soweto PDMs, 37.1% bank with ABSA but area by area these figures differ: 26.7% of Gugulethu PDMs surveyed prefer Capitec, and 31.6% of Umlazi residents bank with Standard Bank. I honestly cannot see how the traditional shotgun approach to marketing works in todays multisumer universe.
Our overall takeouts is that there is massive growth potential for marketers targeting townships, says Samu, but be cognisant that your consumers are not brand loyal and will not respond to a one-sized fits all marketing approach. But if your service or product is in their geographic catchment area and youre advertising weekly, success is more assured.
For more information, contact NAB at 011 889 0600 or follow them on Twitter at www.twitter.com/NAB_SA or look for NAB on Facebook.
Issued on behalf of:
Gill Randall / John Bowles
Joint Managing Directors
T: + 27 11 889 0600
Chirene Campbell - Managing Director
Tel: +27 11 234 2882