SA facing digital marketing revolution
Growth of smartphone use will see us catch up with global trend
● Absa’s “Africanacity” rebranding campaign last year, after its divorce from former parent company Barclays in the UK, left many wondering if the whole affair was actually worth it, but other companies are successfully navigating digital advertising that is set to overtake traditional advertising in SA.
Zibusiso Mkhwanazi, co-founder of Avatar (SA’s largest black-owned advertising agency) and CEO of M&N Brands, said advertising and branding were no longer a oneway affair in which brands sold a product or service, but rather a two-way communication in which consumers engaged brands about their offerings, facilitated by technology.
With the rise of social media and the use of smartphones, advertising channels have evolved to include the various screens that people engage with daily, alongside the traditional billboards, newspapers, magazines, radio and television.
PwC SA associate director Charles Stuart highlights a trend towards upgrading existing mediums. Billboards, for example, set for renewal or image change are increasingly being replaced by digital versions.
“Budgets are not as big as they used to be,” said Mkhwanazi, explaining that advertising budgets had remained stagnant over time, even declining in some industries.
However, more money was now being allocated to digital advertising. Whereas clients typically spent 10% of their marketing budgets on digital, they now allocated 30%40%, said Mkhwanazi.
Marketing tends to be one of the first items to be cut as businesses tighten the belt on spending. Contrary to this, advertisers think hard times are when businesses should invest more in marketing to protect their market share.
“Saving your way to greatness doesn’t make sense,” says Joey Khuvutlu, managing director of Hellocomputer Johannesburg — a digital agency that has worked with Toyota, Lexus and Investec. “Companies need to invest in their growth.”
PwC and IAB SA’s most recent research on the South African market, the “2016 Internet Advertising Revenue Report”, showed that total internet advertising across all devices and platforms was R3.95bn, an increase of 13% from the previous year.
Despite this increase, Khuvutlu admits that digital expenditure has a long way to go before catching up to television and radio because the majority of South Africans, who do not have access to smartphones, still rely on these channels for content.
SA was likely to reach a tipping point in 2022 when digital advertising expenditure would outweigh traditional advertising. This would be driven by mobile internet penetration set to reach 75% by that time. Globally, this tipping point was reached in 2016, Stuart said.
Whereas traditional platforms still offer mass reach, digital offers engagement. The surge in social media participation in recent years has given rise to a new crop of online
I have designers, … developers, copywriters, data analysts and data scientists coming soon
Joey Khuvutlu
MD of Hellocomputer Johannesburg
opinion leaders, called influencers, who are helping to drive this engagement and enabling brands to connect with their target markets.
Hair and beauty influencer Miriam Maulana said engagement was an “authentic interaction or discussion around a subject or topic”.
Having worked with a number of brands, including being a brand ambassador for Dark & Lovely, Maulana explains that “marketing through influencers guarantees you credibility and trust”.
The ability to receive real-time data and gain insights was a big advantage of digital over traditional advertising.
Influencers had become data scientists in their own right, constantly analysing their audiences to create the best content for social media, highlighting the shift in skills required by advertisers over time.
Khuvutlu agreed, adding that “in my office, I have designers, business analysts, developers, copywriters, data analysts and data scientists coming soon”.
Making use of consumer data sources, credit reports and social media reports, Mkhwanazi is a champion for data analytics and its ability to help advertisers understand customer needs by building accurate profiles to measure the impact of campaigns.
For example, data shows 60% of South Africans pick up their phones within 15 minutes of waking up. Normal waking-up time was 6am on average, with peak morning phone usage around 9am, according to Khuvutlu.
To ensure that messages are relevant, Faye Mfikwe, FNB chief marketing officer, said brands needed to start obsessing about “the segment of one”, or individual consumers, by taking advantage of data and where personalised communication can be delivered.
Agencies still had an essential role to play in the value chain of many businesses. They had become more proactive as they could offer insights for product development, unlike in the past when their scope was limited to simply marketing.
Agencies were becoming like management consultants, and traditional advisory firms had also now to become marketers.
“We were slow to transform,” Khuvutlu said, explaining that consultants realised data would become important and started putting together digital strategies for companies, going so far as to buy up existing advertising agencies to execute these plans. Consulting firms also had the advantage of dealing directly with CEOs and CFOs, which helped to increase corporate interest in digital marketing.
Recent rankings according to Agency Spotter, show that PwC, Deloitte and Accenture are in the top 10 of the biggest marketing agencies in the US, ranked by revenue.
Branding is different now because of social media, Mkhwanazi said.
Internationally, Kylie Jenner of Keeping Up with the Kardashians fame is set to take Facebook founder Mark Zuckerberg’s place as the youngest ever billionaire in the world as her makeup line — Kylie Cosmetics — grows in value, driven by social media marketing.
The biggest brands in the world now are Apple and Google, which do very little advertising. Their brand power comes from the innovation of their products, which are so good they are “evangelised” by ordinary people daily, Mkhwanazi said.
“People do the work on your behalf.”
FNB is regarded as an example of a local bank whose products and public sentiment have helped to create its brand.
Nike and Nando’s have been helped by “cause-based” marketing, in which business champions a particular issue that a target market identifies with, such as Caster Semenya’s struggle for professional legitimacy.
Social media engagement can open up companies to less than favourable sentiments, but Maulana explained that that could help to improve products and overall sales if feedback was taken constructively.
“Negative comments can be a good thing,” she said.