Journal of Strategic Marketing Newsletter – June 2020

29 June 2020

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Categories: Newsletters

Journal of Strategic Marketing Newsletter – June 2020

A NOTE ON MARKETING THE FUTURE

Five months into the coronavirus pandemic, with the attendant fallout in business and society, and we’re no closer to establishing a ‘new normal’, the term de jure across the globe we use to try and describe where we’re heading post-COVID-19. Whenever that will be…

Nevertheless, certain realities and trends are emerging, giving marketers some indication of where the discipline is heading and what they should be taking into account. That’s the road we’re taking in this edition of the Journal of Strategic Marketing.

A recent Nielsen survey points to a growth spurt in the ecommerce sector. Thirty-seven percent of South Africans indicated they are shopping more online, particularly for groceries. Previously, it was fashion, travel and entertainment that were the online front-runners. Only one to two percent of South Africans regularly bought food and groceries online. Managing director of Nielsen Africa, Bryan Sun, in his piece for this edition, says the African consumer has shown “incredible behaviour changes” over the past few months “with major increases in the use of social networking, online reading, listening to music and video streaming”.

Nielsen South Africa retailer lead Gareth Paterson said the rapid evolution in online made it clear that adoption in the current situation was paving the way for a sustained development of online shopping, in terms of infrastructure and consumer acceptance. Still, he warned retailers that communication with consumers was key, especially around issues such as being out of stock. The move from offline to online has to be seamless to keep the new consumers engaged.

Which is where supply chains come in, of course. IMM Graduate School lecturer in supply chain management, Marzia Storpioli, believes the ‘just in time’ model has been exposed during coronavirus as not being sustainable. She addresses this and more in her piece on reinventing supply chains.

The attitude of consumers too is changing. IMM Graduate School academic head, Angela Bruwer, writes in her look into where marketing is going as the pandemic continues, that consumers want to know the brands they’re supporting are ethical, that they’re authentic and that they’re not ripping them off. Actions, she warns, speak louder than words. The more compassionate and aware consumer also wants to know that packaging is sustainable and that brands are doing their bit in terms of corporate social investment, another biggie for marketers to note.

At the heart of managing businesses right now is creativity, as Brett Morris, CEO of Nahana Communications, points out. He emphasises that creativity is not just about producing a creative product, that it is a “process of critical thinking and problem solving”. The pandemic has forced all businesses to think creatively, about everything from how to manage staff working from home to how to restrategise around advertising, and he hopes that in future, they won’t take its power for granted. Hear hear.

With a bit of live sport back on SuperSport and news that Absa is no longer to sponsor the Premier Soccer League, sports marketing and sponsorship is top of mind. As it has been throughout the initial lockdown period. We’ve taken a global and a South African look at the sports arena, with WPP’s Misha Sher analysing the impact and opportunities globally, while BMi Sports Info’s David Sidenberg delves into the local situation. He believes the silver lining is “incredible learnings around sports fans and their media consumption habits” and the opportunities this knowledge will present.

So, there’s no real clarity on this ‘new normal’ but there are certainly new insights and patterns to explore as we continue to ride out whatever this crazy new world is throwing at us. And a wild ride it is too.

Glenda Nevill

Editor

Creativity is a process of critical thinking and problem solving

Creativity’s power in marketing and branding has been proven and documented over and over again for almost a century. When times are good, we’re more likely to take creativity for granted but now that we are in the midst of a global pandemic, we need to be more resourceful, writes BRETT MORRIS.

I’ve written many articles on creativity over the years. That’s probably because I’ve dedicated half my life to championing the cause of creativity as one of the most powerful tools any business has at its disposal. I’ve also been lucky enough to experience the power of creativity first-hand, working with brands and businesses that believe in the exponential advantage it offers.

Though I am more than happy to spend a good portion of my time and energy continually championing this cause, it has always amazed me that there is a need to do so. Creativity’s power in marketing and branding has been proven and documented over and over again for near almost a century.

Actions have spoken more loudly than words during the pandemic

Academic head of the IMM Graduate School, ANGELA BRUWER, discusses the impact, the fallout and the future of marketing in the wake of the devastating COVID-19 pandemic.

I don’t have a crystal ball. I don’t think any of us have got a crystal ball at this point. But I think we’re adapting because, with the many changes wrought by the coronavirus pandemic, we all have to become more agile, to think on our feet, to respond swiftly and authentically to the challenges the entire marketing sector is confronting right now.

At the IMM Graduate School, we’ve had to do just that. We’ve been the throes of exams and marking. To get to this point, in lockdown, we had to redo our whole learning platform, get the exams onto the system in time and for the first time, mark them online.

It’s been harrowing but is, perhaps, part of the ‘new normal’.

Sport’s blank page: COVID-19 crisis gives marketers and sponsors time to reflect, review and restructure

In a wide ranging interview with sports journalist, LUKE ALFRED, the CEO of BMi Sport and founding member and CEO of SS Network, David Sidenberg, talks about the impact of coronavirus on sport, rights holders, broadcasters and sponsorship. The silver lining, he says, is that sport has a blank page that could be filled with the ‘incredible learnings’ about sports fans and their media consumption habits.

The coronavirus pandemic has raised a variety of threats (and questions) in the sports industry. These relate to live sport, the broadcast of live sport and the relationship between rights holders and broadcasters. But they also relate to sponsorship, legal issues, public health issues and the role of government going forward.

How sponsors can navigate COVID-19

It’s safe to say that the sports marketing industry is living through unprecedented times. Never before has sport come to a complete halt across the world (with a few minor exceptions like Belarus), depriving billions of people of a much-loved emotional outlet and daily passion point.

Brands, which were predicted to spend £37.5 billion on sports sponsorship in 2020, are facing some tough choices. What do they do now that nearly every event has been postponed or suspended? How can they continue to engage passionate sports audiences?

A prime imperative: Reinventing supply chains

Current disruptions have brought to light the fragility of our supply chains, says MARZIA STORPIOLI. And the volatility is set to continue for quite some time. What to do?

There’s not doubt volatility, turbulence and uncertainty will continue, and probably increase in the decades ahead, and the ‘business as usual mentality’ will need to be replaced with business seeking stability in the face of disruption.

Current disruptions have brought to light the fragility of our supply chains. For the past 20 years, the focus has been on cutting costs along each link in the chain. Unfortunately, this has also expunged any flexibility or resilience (the ability to withstand shocks to the system) in supply chains.

The question now is, how do we retain cost efficiency but reintroduce flexibility and elasticity into supply chains?

COVID-19 creates deep shifts in consumer behaviour across Africa

BRYAN SUN, managing director of Nielsen Africa, gives insights into the new African consumer.

The COVID-19 pandemic has given rise to a new kind of African consumer who is already displaying fundamental shifts in consumption and purchase behaviour driven by factors such as heightened health awareness, a focus on quality and safety, a renewed desire to stay at home and a tight wallet squeeze.

A recent Nielsen industry webinar, Navigating the New Normal, discussed the realities and effects of this rapidly evolving outlook. Nielsen Africa outlined the consumer evolution since the onset of the pandemic and the fact that crisis-buying patterns have accelerated the adoption of permanent behaviour change.

Reebok and CrossFit no longer a couplet

Reebok has ended its association with CrossFit after the latter’s founder, Greg Glassman, tweeted a response to the Institute for Health Metrics and Evaluation’s comment that racism was a public health issue. Glassman replied, “It’s FLOYD-19” in reference to the coronavirus pandemic and the killing of George Floyd by police in Minneapolis. Reebok was unimpressed. “Recently, we have been in discussions regarding a new agreement, however, in light of recent events, we have made the decision to end our partnership with CrossFit HQ,” it said in a statement to The Morning Chalk Up.

Coca-Cola puts acquisitions on hold to invest in its business

Coca-Cola will be concentrating on ecommerce and innovation as part of its post-coronavirus response. The company’s chief financial officer, John Murphy, told the recent RBC Capital Markets global consumer and retail conference that emerging stronger and staying true to the company’s overall purpose were guiding some of its decisions. He said investing in the business was the number one priority, while the mergers and acquisitions side was now a “lower priority”. Coca-Cola, before the pandemic, was looking into diversifying its portfolio. Murphy said it was vital Coca-Cola’s brand “become as good in the online shelf as we are in the offline shelf”.

Time to look beyond the ‘cult of the CMO’

A new study from the World Federation of Advertisers (WFA) has revealed the role of chief marketing officer is still necessary, but that it ought to come with major changes. It said there was a need to “look beyond the cult of the CMO as the person with ultimate wisdom in all the complex areas that now affect the role”. Team capabilities, and the softer skills needed to effectively lead a team, are increasingly critical for CMOs, the report says. The CMO’s responsibilities range across nine distinct areas from marketing strategy (79%) through to data ethics (34%), business growth (58%) through to sustainability (37%).

Many of these areas are expected to become increasingly important during the next five years, with 80% of respondents citing sustainability, 77% the need to manage digital martech and platforms, and 74% the role of data ethics.

Travel Tractions saves 18 youth jobs by launching affordable marketing agency

A small South African business, Travel Tractions, has turned the stress of the struggling travel industry into an opportunity by launching an online marketing business, saving the jobs of up to 18 young people under the age of 30. Founder Matt Davison launched The Marketing Mill in response to COVID-19, ensuring that his staff of 18 keep their jobs during a very difficult time. The agency will market the affordability of South African work and the high level of quality that is produced.

IMM Graduate School now accredited skills development provider to CGISA

The IMM Graduate School is now an accredited skills development provider for the Chartered Governance Institute of Southern Africa (CGISA). As the only provider of online instruction and learning support for CGISA programmes, the IMM Graduate School offers students 13 weeks of tutorial sessions, once a week for two hours, with tutors who are experts in their field and who have a wealth of industry experience to share. They also help students keep pace with the learning content, which can often be a problem when facing work, home, and study responsibilities. During these online sessions, students will be able to collaborate with other students; bounce their understanding of concepts off each other, see varied perspectives on the module content, and learn from each other. To register and find out more, click here.

COVID-19 creates deep shifts in consumer behaviour across Africa

29 June 2020

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Categories: COVID-19 / Coronavirus / Lockdown, Newsletters

BRYAN SUN, managing director of Nielsen Africa, gives insights into the new African consumer.

As the prospect of looming lockdowns first hit, consumers realised they needed to stock up which saw a spike in store visits, stockpiling of shelf staples and growing basket sizes. However, as restricted living became more commonplace, there was a change in behaviour with consumers seeking out products without putting their health at risk.

We have therefore seen growth in online shopping, declining store visits and a rise in out of stocks. Supply chain challenges have also driven consumers to be less price sensitive on high demand packaged goods or those that guarantee hygiene standards.

The expectation is that once quarantines lift and consumers return to ‘business as usual’ they will continue to operate with a renewed consciousness about health, which will remain for a long time. There will also be shifts in the way consumers perceive products with the increased importance of safety and efficacy claims, and a willingness to spend more on hygiene needs and healthy foods.

Global perspective

Nielsen’s recent COVID-19 syndicated online survey, conducted in over 70 countries across the globe, produced interesting comparative data and insights for Sub-Saharan Africa (Kenya, Nigeria and South Africa) as compared to the rest of the world.

75% of SSA consumers are now more concerned about their families versus the global average of 48%. In addition,
83% said they were following information multiple times a day – significantly higher than the global average of 75%.
51% of SSA consumers said they were cooking more at home versus 39% globally, and significantly more said they worked more at home versus the global average.
46% SSA consumers said they are visiting malls less often versus the global average of 32%.

Despite perceptions that Africa lags behind in terms of online behaviour, it has in fact seen incredible behaviour changes with major increases in the use of social networking, online reading, listening to music and video streaming.

Future mindsets

As countries move from restricted living to precautionary living, Nielsen has also created an in-depth view of current and future SSA consumer mindset and purchase patterns based on learnings from other markets:

Heightened health awareness will drive consumers to be less price sensitive on high demand packaged goods or those that guarantee hygiene standards as food safety becomes paramount to consumers.
The renewed desire to stay at home and the preparation of home meals might require brand extensions and a need to address declining store visits, growth in online and proximity shopping.
As consumers are impacted by less income and smaller purchasing wallets, value for money offerings and more aggressive promotions – over that of just in-store promotions – are needed.
eCommerce growth has reached double digits in many countries with Italy at 82%, China 50%, and Korea 30% where older shoppers are trying eCommerce for the first time. Technology catalysts are driving behavioural change and will penetrate the market despite previous scepticism around this platform.

Looking to the future, the path to recovery means retailers must urgently look at factors such as pricing mechanisms and brand relationships in order to maintain and strengthen consumer trust in their brand.

Successful retail regeneration across the continent, following the impact of COVID-19 on the African consumer and retail landscape, will rely on an agile and innovative response that sets the groundwork for a future unlike any we have ever known.

BIO: Bryan Sun is managing director of Nielsen Africa. Nielsen Holdings is a global measurement and data analytics company that provides the most complete and trusted view available of consumers and markets worldwide. Our approach marries proprietary Nielsen data with other data sources to help clients around the world understand what’s happening now, what’s happening next, and how to best act on this knowledge.

A prime imperative: Reinventing supply chains

29 June 2020

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Categories: COVID-19 / Coronavirus / Lockdown, Newsletters

Current disruptions have brought to light the fragility of our supply chains, says MARZIA STORPIOLI. And the volatility is set to continue for quite some time. What to do?

The question now is, how do we retain cost efficiency but reintroduce flexibility and elasticity into supply chains?

Supply chain suppleness – revisited

Just In Time (JIT) has been seen as the model of supply chain superiority, but this is no longer the case. The disruption of supply chains by the coronavirus pandemic showed that this method of inventory control, which brings material into the production process, warehouse or customer just in time to be used, has its limitations.

Some elements of JIT are good and should be translated into the reshaping of the new models for supply chains, but many of the ‘credos’ of JIT will need to be redesigned and new thinking brought into supply chain management.

One of its weaknesses (and other similar methodologies) was that the environmental impact of JIT changes to supply chains was not considered or measured. This is no longer feasible. Consumers are no longer willing to accept ‘due to internal considerations….’ as an excuse for out-of-stock situations.

What will the supply chain of the future look like?

Firstly, the supplier base must be widened to include more suppliers for key/critical items. There should be reduced focus on cost reduction and a move to find a balance between acceptable costs and acceptable inventory levels. This should be done –with customer in mind, rather than the company’s bottom line only.

There should be greater visibility and sharing of information between and among supply chain members e.g. greater trust less ‘protectionism’.

We need to rethink strategies on essential goods and services. For example: chemicals used in sanitiser products – should they be imported because the supplier is cheaper, or should we manufacture the lion’s share in South Africa to reduce reliance on globalised sources?

More joint ventures are required to leverage off each other’s strengths. In other words, we need less outsourcing and more capacity sharing.

A move to on-shoring production of critical items (items critical to national security, health, economic prosperity) is needed.

For example, Sasol has always been able to produce chemicals – world class – why shouldn’t they be incentivised to develop their production to encompass chemicals currently being imported from China (due to some economic cooperation agreement between South Africa and China)?

The South African textile industry has a track record of producing high quality material. Why are we destroying that capacity by importing textile products from China?

Again, South Africa is capable of producing medical quality personal protection equipment. We shouldn’t need to import PPE from abroad.

A trend is developing where businesses collaborate with their competitors, leveraging each other’s unique strengths, buffering their weaknesses and moving closer to becoming ‘demand chains’. This means focusing on customers (outward looking) rather than focusing on internal business efficiencies (inward looking).

There must be a change in relationships with suppliers. It is no longer rational to keep adversarial relationships going, and more important to work on collaborative relationships – the ‘we are in this together’ mindset, as opposed to the traditional ‘beat suppliers down to the lowest price without a thought for their sustainability’.

And that’s just to start with…

BIO: Marzia Storpioli is Lecturer: Supply Chain Management and Programme manager: BCom International Supply Chain Management at the IMM Graduate School.

How sponsors can navigate COVID-19

29 June 2020

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Categories: COVID-19 / Coronavirus / Lockdown, Newsletters

There’s no doubt the 2020 sports calendar has been upset by the turbulence caused by the coronavirus pandemic. MISHA SHER has advice for brands on how to handle it.

Questions have been raised about the merits of ‘hibernation’ style strategies – freezing all activity in order to protect budgets and wait out the storm. Such strategies offer a false sense of security and threaten to undermine brands’ hard-earned relationships with sports fans. Instead, a new playbook is required that offers brands alternative strategies for how to continue leveraging those relationships and sustain growth.

In what is undoubtedly a very challenging situation, it’s crucial that brands look at ways in which they can provide value to fans. Sponsorship is at its most powerful when it enhances the fan experience – and it’s more important than ever for brands to do that now.

Fully explore the potential of gaming

The biggest winner in the current situation has been the gaming industry. Even before the crisis, it was growing faster than any sport and now with everyone spending more time at home, it’s no surprise that live gaming is booming. A recent report by Captify shows that with mass live sports cancellations, consumers are looking for their sports fix elsewhere. Consumer interest for sports games saw a 1054% search uplift since 1 January 2020 with the top indexing audience being sports fans.

Clearly, there is an audience that craves sport and sees gaming as an alternative.

Brands already associated with competitions that are suspended are showing agility and hosting esports versions. And the numbers have not disappointed. Santander, the title sponsor of La Liga, headlined a FIFA 20 tournament comprising players from each club team. The Santander Challenge, livestreamed on Twitch, drew 1 million viewers and gave fans a more intimate and personal experience with their favourite players than they are used to. Nascar, NFL, NBA, F1 and others have started their own versions, in many cases featuring their current league sponsors. Admittedly, these virtual tournaments may not deliver the same scale of audience exposure brands are used to, but they allow sponsors to continue engaging with fans, staying top of mind and demonstrating a commitment to the sports that have helped them grow their businesses.

For others, there are opportunities to explore the possibilities created by in-game advertising offered programmatically by platforms such as Anzu.

Unlock the potential of sports talent and use it for good

In a crisis that has underlined the critical importance of interpersonal relationships to all of us, talent and influencer marketing is demonstrating its potential as a powerful media channel. There is an opportunity to leverage talent unlike ever before. Brands should be looking at ways in which they can authentically engage sports talent to provide fans with the access and entertainment that they crave.

A great example of this is Red Bull, which actively leverages extreme sports events to connect with their consumers. To continue engaging with their audience, Red Bull launched a new 10-part What Does It Take podcast series hosted by Matthias Dandois. The BMX star and eight-time Flatland World Champion interviews fellow Red Bull athletes and extreme sports stars from around the world, exploring not only what it takes to get to the top, but also how to stay there. Red Bull then uses a mix of its own and its talents’ social channels to distribute this content to fans.

As an Olympic Partner (TOP), Visa is taking a slightly different approach. The sponsor has quickly created a content series with its athletes called Do Your Part Like An Olympian showing them performing feats of sporting prowess, juxtaposed with easy COVID-19 safety measures like handwashing. It is engaging and informative, and contributes to vital communication efforts to encourage people to take the right steps to tackle the coronavirus crisis. Visa was one of the first major brands to confirm that it would stick with its Olympic partnership and stand by its athletes. Visa is now being seen as a socially responsible brand, utilising its sponsorship assets for the greater good. It will undoubtedly generate consumer goodwill.

Drive engagement by tapping fans’ creativity

If there is one thing we know about sports fans, it is that they want to be participants in the sports experience, not just spectators. For brands, it’s therefore key to engage people in a way that genuinely creates utility, rather than in an attempt to sell more product. GoPro have done just that by launching their #HomePro challenge. Knowing that people are likely to be suffering from cabin fever, the brand created a competition encouraging people to share whatever weird and wonderful activities they’re getting up to at home for a chance to win their latest performance camera. The beauty of the competition is accessibility. You don’t need to own a GoPro – footage can be recorded and shared from any device. The campaign effectively taps into emotions that people are likely to be feeling and offers them a creative outlet within the confines of critical social distancing measures.

Dick’s Sporting Goods have done something similar, launching the #LongLiveSport campaign across its social channels encouraging everyone to share how they’re playing their sport at home. The campaign is true to the brand and celebrates the creativity of sports fans and athletes.

Other brands can and should be asking themselves how they can harness the creative potential of their audiences in a way that helps build brand affinity.

Think ahead

Amid all the uncertainty, it is more important than ever to spend some time thinking about the future. Right now, sport seems like one of the most inconsequential things to worry about. But things will eventually return to normal – albeit perhaps a new normal – when the crisis has passed. Sport will return in a major way. When it does, the world will see a celebration of humanity and connection.

There is a chance that, at least initially, sport will resume in empty stadiums and arenas. If so, sponsors will have an opportunity to play a major part in the way people access and experience sports events. We’ve seen Heineken shrewdly demonstrate how to leverage such an opportunity when it paid for the rugby world cup final to be shown on South Africa’s state broadcaster so that people could watch on terrestrial TV rather than shielding it behind a paywall. It happened in what now feels like a different time, but nevertheless demonstrated how major event sponsors can transform the sports experience for millions of fans. Now is the time for brand sponsors to start thinking about the role they want to play when sport eventually resumes.

This is an unprecedented time, but brands must see this as a chance to play a bigger role in consumers’ lives, rather than a time to scale back. How they react to this crisis could dictate their relationship with consumers for years to come.

This story is published with the permission of WPP.

BIO: Misha Sher is Vice President of Sport And Entertainment at Mediacom. Mediacom Sport & Entertainment is part of The WPP Sports Practice, the global entry point to all of WPPs specialist sports marketing capabilities. Find out more about how The Practice brings together the best talent from across WPP to help brands, rights owners and events hosts.

Sport’s blank page: COVID-19 crisis gives marketers and sponsors time to reflect, review and restructure

29 June 2020

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Categories: COVID-19 / Coronavirus / Lockdown, Newsletters

But first…

Q: How will the news of ABSA pulling out of the Premier League sponsorship impact on the PSL and sport sponsorship?

A: While much has been made of ABSA’s announcement that they will not be exercising their contractual right to further extend the PSL partnership, for those in the know, this should however come as no surprise. In fact news of ABSA’s eminent departure pre-dates COVID-19 and was first publicly voiced towards the end of last year.

Similarly, any reports of the ‘death’ of the PSL – as once famously stated by Mark Twain – are greatly exaggerated.

In many ways, sport mirrors the broader economic climate and sponsorship by association is no exception. It’s of course true that traditional sport, like all business, is under more pressure than ever before. But whether we are speaking of the PSL specifically, or sport and the sponsorship market in general, it’s simply too early to pronounce on the long term impacts.

Yes, there will definitely be some casualties, a few market corrections and hopefully even some new brainchilds, but there is no doubt both the PSL and sport in general will bounce back. The underlying value is too great to simply be discarded.

For me, the more pressing question is, despite the challenges, how can we take advantage of this moment? I cannot remember a time in all my years in this industry where we have ever been able to push the pause button like now. So before we get going again and the opportunity is lost, now is our chance. We have a unique opportunity to review, rethink and where required, restructure everything – a period, if you like, of almost forced collaboration, where so much can be improved upon – so let’s not waste it.

Q: The sports industry in South Africa seems remarkably free of rancour so far during lockdown, i.e. no spats between rights holders and federations, no pushback from sponsors who aren’t seeing their product on television etc. Fair comment?

A: Yes, I believe this is currently a fairly accurate assessment. Ironically, our federations are for once in a more fortunate situation than many of their international counterparts because loss of match day revenue here is minimal. For most major sports bodies, leagues, teams, etc. they generally have four sources of revenue: Broadcast, Sponsorship, Match Day (ticketing and hospitality) and Merchandising and Licensing.

While broadcast and sponsorship are not surprisingly the biggest sources of revenue worldwide, the latter two can contribute up to say 30-40% in major markets. By comparison in South Africa, broadcast and sponsorship revenues (particularly for the big three) are often responsible for more than 85% of income.

Additionally, because there’s no play, there’s no travel, no accommodation, no opening up of stadiums, lights, security etc. and that can translate into short-term savings. Some federations (like SA Rugby) have reduced player salaries. Also, unlike Europe, for example, where Canal+, BeIN Sport and now others refused almost immediately to pay their final broadcast rights fee instalments to the associated leagues (LFP, etc.), our broadcaster(s) (SuperSport) has not yet blinked.

Most sponsors I have spoken with are looking for solutions and compromise – wait things out if you like, until there is more certainty – noting that by nature sponsorship is a long term partnership – so rash decisions to save a quick buck (no matter how necessary these budgets may soon become) could have significant strategic and public relations repercussions downstream.

Q: The lockdown happens when the sports industry in South Africa is already challenged?

A: Even prior to the COVID-19 crisis, we were asked by many of our clients to consider the impact on sponsorship media return on investment ROI arising from the lack of coverage this season/year by the SABC. Concerns had been further heightened by speculation that the ICASA Sports Broadcasting draft regulations will be pushed through in September – despite the significant challenges exposed during the hearings in early 2019.

The financial difficulties faced by the SABC are not new – but the impact this is beginning to have on sport and the sponsorship industry reached an unprecedented level when the 2019/2020 PSL season launched under a self-imposed blackout by the national broadcaster. Other major events of national importance including the 2019 ICC Cricket World Cup, Fifa Women’s World Cup, INF Netball World Cup, and IRB Rugby World Cup, which all featured South African teams received little or no coverage by the National Broadcaster.

And now – all bets – and arguably all live sport – are off for the time being

Q: Do you see the landscape plunging into complete crisis?

A: This really depends on whether or not SuperSport blinks – i.e. begins holding back on broadcast rights fees – and whether or not rights holders are prepared to find solutions for their sponsors and/or arrange for compromise payment structures. If, for example, SuperSport freezes all future payments to, say, the PSL until play resumes (an unlikely scenario), or, worse, pulls a Sky/BT sport and demand a refund, the house of cards could fall quickly.

Broadcasters have come up with different responses to the crisis of no live sport. For example: Sky allows customers to pause subscriptions during the pandemic; Canal+ makes premium channel free to view in response to Coronavirus; DStv has opened news channels for free, even to non-subscribers, and, in general, broadcasters are desperately trying to find ‘new’ archive content to fill the void left by the lack of live sport.

But broadcasters are faced with a two-sided coin: if they freeze subscriptions, the revenues required to buy or retain content dries up, but if they don’t, they risk retaining their premium subscribers who are receiving little extra benefit for the price. What’s really required is creative solutions and partnership with all stakeholders, especially with the fans in mind.

Q: Is there any upside to no live sport?

A: Despite the pessimism, there are upsides to the current moment. For example: The situation will create a buyer’s market for sponsorship rights. There will be huge value in the market for brands brave enough to commit budget rather than wait until a return to normality. Secondly, there is an opportunity for brands to support the sporting organisations/properties that will be most affected financially by prolonged disruption to the calendar. Thirdly, this is a unique opportunity for esport to shine – and reveal how powerful a platform this is to not only reach audiences previously difficult to find…but also how it can complement sport and sponsorship marketing efforts.

Finally, the period may allow time to connect with the most valuable asset for any rights-holder: the fan. It is time to build up a new view based on so-called ownership of data, engagement, and understanding the fan’s needs. As we near the end of the first phase relationship between sport and social media, largely based on huge over-claims of reach and relevance, we now need to take a closer look for evidence of deep fan engagement.

Q: How do you see the second half of the year sponsorship-wise?

A: There is evidence that suggests in times of trouble with reduced marketing spend from competitors, the opportunity to cut through the clutter is enhanced. These times require bold leadership and informed risk taking. To do nothing and wait for life to return to normal risks losing your opportunity to turn fan pain into engagement, appreciation and loyalty.

It’s equally important not to compromise long-term relationships or reputation by reacting negatively. In short, it’s a case of being practical and level-headed about managing the situation, but equally about being incredibly open towards finding the best fix to fill the void for all stakeholders involved. On the plus side – the crisis may lead to a better understanding of the interdependence of interests within the sports industry. We’re going to find out not just how resilient that ecosystem is, but how collaborative it needs to be for everyone to get through this.

If there is a silver lining, I believe we will come out of this period with incredible learnings around sports fans and their media consumption habits.

So maybe all of this, right now, is sport’s blank page.

BIO: David Sidenberg is one of the sponsorship industry’s most influential thought leaders and alongside his company BMI Sport Info, are credited for the lead role they have played in quantifying the impact sports marketing budgets contribute to their clients bottom line results.

Actions have spoken more loudly than words during the pandemic

29 June 2020

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Categories: Newsletters

Academic head of the IMM Graduate School, ANGELA BRUWER, discusses the impact, the fallout and the future of marketing in the wake of the devastating COVID-19 pandemic.

I don’t have a crystal ball. During 2020, I have, however, felt that I am holding a rugby ball, listening to the referee’s instructions before a rugby scrum: “Touch, PAUSE, Engage”.

Pre-COVID outbreak we were in touch, post COVID-19 outbreak we were paused, and now we are slowly starting to engage. However, our engaging is in a state of flux. The many changes brought about by the COVID-19 pandemic and lockdown have forced us to be even more agile, to think on our feet (maintaining social distancing), to respond swiftly and courageously to the challenges confronting the entire marketing sector right now.

At the IMM Graduate School, we’ve had to do just that. We’ve been in the throes of exams and marking. To get to this point, in lockdown, we had to re-engineer our whole learning platform, get the final assessments onto the system in time and for the first time, mark them all online. Our online engagement with students has gone from being ‘an additional option’ to being core and instrumental to the success of our institution and ultimately our students.

It’s been harrowing but is, perhaps, part of the ‘new normal’.

Everyone is talking about the ‘new normal’. One piece I read resonated with the me; the writer said the ‘new normal’ is a bit like New Year’s resolutions; People will go back to their old ways anyway.

Perhaps so. Nevertheless, there are real challenges for industries such as travel and tourism, the restaurant business…never mind just finding a new way of doing things, their entire business models are going to completely change.

So from a marketer’s point of view, I think brand agility is going to be absolutely key.

Talking brands

The isolation caused by COVID-19 has given people a lot of time to reflect and, I think, almost go back to family values and compassion. Brands have functional attributes and emotional attributes too. The third component is self-expressive benefits. People will support brands that are seen to be supporting other people, and if I support these brands, it makes a statement about me. This is because people develop strong relationships with brands similar to those relationships we forge with people

This is a real challenge for marketers because you don’t want to be seen to be doing these things just as a marketing ploy. You are doing it because it’s the right thing to do. This will require using different channels, influencers, brand ambassadors, and people who can speak on your behalf. It won’t just be about someone endorsing your product. It will be people endorsing what you stand for. We will see more of this in future.

Some brands have stepped up to the plate, others not so much. Shoprite has been quite a socially responsible brand. They know who their target market is and that their stores are where a lot of vulnerable people would traditionally shop. They’ve absolutely gone out of their way with clear markings outside the store. They only let so many people in. The staff all wore masks, all the whole way through – before it became law. In a similar vein Pick n Pay introduced an early morning window for vulnerable pensioners to shop.

You could argue that they were following government instructions, but a lot of the other retailers weren’t. They were letting in people and the use of masks and signage was iffy. To me, that says something about the brand. It is the actions of brands that speak louder than their words during this time.

Talking CSI and PR power

There’s going to be a bigger strain on marketers to try and make their money work harder for them, which has always been a marketing challenge. PR keeps people informed and creates brand awareness without necessarily punting products. It is critical as it builds trust in brands.

Social responsibility will play more of a role in marketing. In South Africa, we’ve always had a very strong CSI component, and this will be even more pronounced. There will be an even greater demand on corporates and big organisations to be seen to be even more socially responsible and socially aware. Whether in education or in news delivery, the social divide in our country has never been more prominently on display. South Africans have responded by getting involved and by helping where they can.

This will extend to the communities in which they operate, nationally and spill over into Africa as well. We’re going to have to assist neighbouring countries as CSI won’t be ring-fenced here. This, too, will fall on marketers who have products being sold in Africa, or retailers that have operations in those areas.

Talking innovation

WPP’s chief brand officer, Mark Read, recently said the coronavirus pandemic had brought forward innovation by a decade or more, that it had hastened digital thinking. I would have to agree. If you look at the whole notion of online learning, which is our space, people are suddenly doing courses through Harvard, Oxford and the IMM. Or they’re doing decorating course and learning to make sourdough bread. Children are doing virtual tours of museums, for example, which have been available for some time but not embraced.

In marketing terms, this is Roger’s diffusion of innovations (which explains how, why, and at what rate new ideas and technology spread). The early adopters have been doing these things for a few years. Then there’s the normal bell curve and the laggards. But during this time, the lag period has shortened. Zoom, Google Hangouts and Microsoft Teams are the new way oranisations are conducting their meetings. One could argue that pre-COVID-19 you could Skype and use Google Meet, but most people opted to travel. The way of working has changed, so the need to travel internationally for meetings or even conferences is fast becoming obsolete.

School is being taught on platforms like Google classroom and playdates are being organised on Zoom. Even grandparents are using Google Meet or Face Time to see with their newly born grandchildren. As Plato said “necessity is the mother of invention” (innovation).

Talking consumers, ecommerce and mobile advertising

My overarching sense is that consumer behaviour is changing. People who were completely risk averse to online buying pre-COVID-19 have been buying online for the last few months and are enjoying the convenience and efficiency. I don’t think people will spend time in shops browsing or window-shopping until we have a greater sense of health safety, and this will impact on buying behaviour. Online buying is being enabled by the “door to door delivery” aspect of ecommerce, which is fast becoming so well-oiled now and out of pure necessity not convenience, far better than it was.

E-marketing will therefore continue gaining ground. As a marketer, what’s interesting to me is the separation of mobile advertising from digital advertising when one considers global research tracking ad spend. South Africa has not been overly aggressive in the mobile advertising space. I don’t think marketers have used it as opportunistically as they could have, seeing it as an invasive irritation. We need to get smarter in terms of the mobile side of advertising.

Talking ad spend

According to the WARC DATA Global Ad Trends, May 2020, there was a decline in South African ad spend in 2019 (-7.6%) and then pre-COVID 2020 it had gone up somewhat by 6.4%; however post-outbreak a drop of -19.6% versus the global post-outbreak drop of -8.1%. The picture in terms of marketing budgets, staffing and trading conditions have seen huge declines since February 2020. Researchers don’t predict an increase or positive growth in ad spend happening in the traditional channels, (TV, radio, press, OOH, mobile and digital (excluding mobile).

The closure of Caxton Magazines and Associated Media Publishing tells you a lot about what’s happening in the marketing environment right now. Those publishers relied heavily on ad spend. And, within a month of us being in lockdown, they shut shop. Of course there must have been historic factors at play too, but Covid-19 was the final straw that broke the camel’s back.

Talking social media

Social media still a tricky space for marketers and they have to be more intentional in how they use it as a marketing tool. With all the technology available, you can be quite targeted in the social media that you use and who you’re targeting specifically.

But I think there is a point of saturation. Marketers need to be very, very careful. During this crisis, people have been on social media so much that I do believe an element of fatigue is creeping in. So from a marketing point of view, one needs to be intentional and targeted and tailor-make the message. Too often, marketers fall into the trap of ‘one size fits all’.

Talking shopper marketing

From a marketing perspective, shopper marketing is going to get interesting. The face of mall shopping is certainly going to change. Shopping malls will go through tough times because in the past they relied on their anchor tenants, but some of these retailers are sinking. The hairdressing and beauty salons, the small shops, the restaurants, the coffee shops…have been hit hard. I would be surprised if a lot of them didn’t open again in the shopping centres and will start working differently, possibly even trading from lower rent properties because they’ve taken such a knock.

It’ll be interesting to see what happens to the hotel industry and tourism because people aren’t going to be too happy to travel, feeling safer in their own countries. Many will also find themselves in financial difficulty as a result of either not getting paid during the lockdown or having to close their businesses temporarily or even permanently. So local tourism is where I would focus my time and energy. Marketers in that space need to think very cleverly on how they can promote South Africa to South Africans, to generate a rebirth of local is “lekker” tourism. This will be critical. We need to revive the Proudly South African spirit and buy local, support local.

Social media threads and memes have made all earth’s citizens aware of how nature has bounced back during the pandemic. From a consumption point of view, consumers are going to be looking for more earth-friendly packaging, for example. People are going to be less tolerant of wastage and will spurn the corporates and brands that don’t toe the line. The pandemic has highlighted just how vulnerable we are and the fragility of our planet. This is at forefront of people’s minds now, that they’re not just socially responsible citizens caring for their communities, but have to care for the earth too.

Talking employee branding

From an employee branding point of view, organisations will encourage their employees, and care for them. Good marketers will embrace that, and build brand loyalty and even brand advocacy with employees. This virus is having an emotional impact. People are interacting with each other wearing masks. We’re going back to work, but everything is different. In a way, we are grieving for that loss. Grieving for future loss, the things we were looking forward to that aren’t going to happen now.

Marketers should and will be looking at this more and more during this time. It is essential to have a positive workforce who are positively impacting on the country at this time. As organisations across various industries try and regain their commercial foothold, they will want to count on the contribution of every employee. The immediate past and the present moment, called for unparalleled feelings and acts of community by organisations towards their employees: a new bond has been forged and it could be to the advantage of both parties.

Angela Bruwer is the academic head at the IMM Graduate School. She has 27 years of professional experience and has held several executive management positions at major companies in the financial services, consulting and education sectors. Her areas of expertise include brand management, marketing and communications. She has started and managed three successful consulting agencies, and still consults to clients. Her work experience is in marketing strategy, all facets of branding, communication strategy, media planning, consumer insights, account management, corporate communication, public relations, stakeholder management, sponsorship marketing, marketing research, advertising, and classical marketing. Currently the Executive Academic Head of the IMM Graduate School and Chairman of the Academic Board and Executive Committee Member, Bruwer is a sought after speaker and a contributor to the textbook Introduction to Marketing: A Southern Africa Perspective (2018) published by Van Schaiks.

Creativity is a process of critical thinking and problem solving

29 June 2020

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Categories: Newsletters

We continually hold up examples in boardroom discussions (now video calls) of iconic companies or brands that have benefitted from the power of creativity. They say, “We need to approach this like Apple would” or “This needs a real Nike attitude”. And yet when it comes to implementing the theory, it’s much more difficult in practice.

That’s probably a good segue to talk about why there is such a spotlight on creativity in the current context. When times are good, we’re more likely to take creativity for granted but now that we are in the midst of a global pandemic, we need to be more resourceful.

We are faced with more challenges on a daily basis, there are more problems to solve and businesses are more cash-strapped, which means we are inclined to make more effort. That’s because it takes effort to push boundaries, to have a point of view or to be evocative. So given the choice, if we are not forced to make the effort, most people will choose not to.

Being creative takes a lot of hard work

This is not an indictment in any way, it’s just human nature and what people don’t realise, is that being creative takes a lot of hard work. This is not the view that most people have of creativity, they tend to think it’s something that ‘comes naturally’ but that is not the case at all. It is really nothing more than a disciplined process of critical thinking and methodical problem solving. And that’s probably why there has been an increased interest in creativity more recently.

The lockdown has obviously had a devastating impact on the economy and on people’s lives in ways we could never have imagined and that should not be minimised in any way whatsoever. But it has also made us all a lot more conscious of the things we normally take for granted.

I’ve spoken with many leaders who have remarked on how much more empathetic this crisis has made them. How they’ve been more purposeful in their communication and in their actions because they know how much more it counts. Many have also commented on how they hope that these behaviours continue beyond the pandemic as they make us better people. And the same can be said of creativity.

I hope that, as many businesses turn to creativity because they need to do more with less or do things in ways they’ve not done before, they don’t take its power for granted in the future.

I think it’s worth re-emphasising the point that creativity is not just about producing a ‘creative product’. Creativity adds value in whatever spheres it’s applied. To repeat: creativity is a process of critical thinking and problem solving and many of the most creative people I know are not actually in ‘creative fields’. I’ve reflected many times over the past months on how many businesses went to remote or distributed working on such notice in a short space of time.

A world beyond COVID-19

I have to confess that if you had asked me in January how long it would take to move our entire organisation to remote working, I probably would have given a typical corporate answer. Something like, “By the end of the year” for no good reason other than we place arbitrary emphasis on the end of the year as an inflection point. We would have had to run trials, report back, and deal with the inevitable delays as well as our day jobs getting in the way. And ultimately, we would have been lucky to be have made a decision by the end of the year.

And yet in the context of the current crisis, we were able to do this in two or three weeks. That comes down to the fact that we had some very creative people, applying their critical thinking and solving problems in a time frame that we would never have thought possible.

There’s no doubt that we’re going to be feeling the impact of this for a long time to come. And nobody could ever have imagined how COVID-19 would impact us in the way that it did. But what we most certainly can imagine is a world beyond COVID-19. We can imagine that we will get through this challenge and overcome it together. And we can imagine that it will actually make us more empathetic, more connected and more creative than ever before.

BIO: Brett Morris is Group CEO of Nahana Communications. After eight years in the ad business, he was first appointed Executive Creative Director of FCB Johannesburg. Under his leadership the agency won more awards than ever before in its 90-year history. He has been recognised numerous times at major award shows including Cannes, One Show, D&AD and Clios. In 2014 Morris was appointed Group Chief Executive and has since been voted by his peers as most admired agency leader in Johannesburg for five years in a row and three times across South Africa.

‘The lotus thrives in muddy and unpleasant conditions, we are being presented the opportunity to plant and grow lotuses.’

Creativity has taken centre stage even more now during this pandemic. COVID-19 has changed how we view the world and how it works and, change always fuels creativity. We have all had to re-imagine life, apply creative thinking and imagine new possibilities on how to execute creative solutions for our clients and the public under such dire circumstances.

True creativity has been awakened in creatives. The equation we’ve adopted is Isolation = (Imagination + Creativity-Noise). It has been a time for everyone to rethink, reflect, dig deep and that has allowed great content creation and a plethora of ideas. We’ve had to think up new ideas of engaging the consumer, keeping abreast of the shifts happening around us and create opportunities for our brands to stay relevant.

Done correctly, this time could be the preparation we all need so that we’re fully loaded for the new wave and possibly a new type of consumer. We will have to create new narratives for new realities. There is a stillness that is fertile ground for new strategies and creativity.

Co-creation that is made up of authentic brand/consumer collaboration is the future and storytelling still reigns supreme, even though it may look a bit different. We are more connected than ever even though we are apart and this is a huge opportunity for innovation – how to be apart but together.

That shrinks the world even more and at an even faster rate than what our reality offered us just a few short weeks ago.

One day this era will be part of history. The lotus thrives in muddy and unpleasant conditions, we are being presented the opportunity to plant and grow lotuses. ~ Zama Nkosi-Mabuye and Cuma Pantshwa, founders of Ashante Blush.

‘The best things that have come from this pandemic have all been driven by creativity.’

For me, I think it’s about doing what we can to uplift and inspire others around us. There’s so much negativity out there. The scale of this epidemic is unlike anything we’ve experienced in our lifetime, and people are suddenly faced with the realisation that we all lead a very fragile existence. We’re only human, so let’s bring some of that humanity into everything we do. The brands and agencies that do that will be the ones we’ll all want to partner with when we come out the other side.

There have been some amazing pieces produced locally and internationally. The Dove ‘Courage is Beautiful’ commercial by Ogilvy Canada was my favourite. Others that were notable included Nike ‘Play for the World’ and Facebook ‘Never Lost’. They all captured the right sentiment and spirit of hope. But that doesn’t mean every standout ad needs to have an epic feel to it. In fact, the one local commercial that helped us smile in this time was the Chicken Licken ‘Easy Bucks Meals’ commercial which they redid the voice-over to and released on Day 7 of lockdown. ‘Everybody’s talking about it, even during lockdown’ was the simple message. Pure genius.

Everything always impacts on advertising and creativity. That’s the nature of creativity. Adaptability isn’t scary for creatives because we hate monotony. You get the sense that most people concerned about how ‘everything has changed’ and how we will ‘adapt our thinking’ are not the ones who are used to staring at a blank piece of paper every morning.

Creativity will always shine through. But let’s not fall into the trap of thinking that data = creativity. You need data to have better insights to come up with creative solutions. But data in itself is not the answer. If that were the case every brand would be saying exactly the same thing in exactly the same place. The best things that have come from this pandemic have all been driven by creativity.

Humans are physical beings driven by emotion. That’s why we fear pandemics, even though the data tells us we can control it. Why we cry during movies, even though the data tells us it’s just a movie. That’s why even the Data Scientists read their kids bedtime stories – because we’re all human, not robots. ~ Brandon Govender is Executive Creative Director of FCB Durban.

Journal of Strategic Marketing Newsletter – April 2020

29 April 2020

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Categories: Newsletters

Journal of Strategic Marketing Newsletter – April 2020

A NOTE ON MARKETING THE FUTURE

Well, who knew when we started 2020 with such oomph and optimism, shedding the trials of 2019 like a snake’s skin, that just two and a half months into the new decade, we would be confronting a global monster that has changed lives and business forever.

Marketers, faced with the unprecedented crisis coronavirus has wrought across the globe, have had to throw out existing marketing plans and respond with agility and authenticity, on multiple fronts, to the wants and needs of consumers.

And those wants and needs have changed literally overnight with one third of the world’s population living in lockdown conditions. What, then is a brand’s purpose in these times? According to data from Global Web Index, “brand purpose is everyone’s concern”.

As Chris Beer, author of ‘Coronavirus: how brands should respond to the crisis’, says, “Right now, purpose isn’t about brand health – it’s about public health.” And marketers and brands that respond appropriately “will emerge as leaders after the crisis”. Luxury brand LVMH, for example, started making hand sanitiser, a massive move away from its usual exclusive messaging.

For all the big picture thinking, the nuts and bolts matter too. One of the first major impacts of the virus was on global supply chains. Everyone is aware of the ‘pandemic pantry’, of the panicked run on hand sanitisers and loo paper and tinned foods and even alcohol as South Africans followed global behaviour patterns ahead of lockdown.

Supply chain management and procurement professional, Marzia Storpioli (MCIPS), who is a Lecturer: Supply Chain Management and Programme manager: BCom International Supply Chain Management at the IMM Graduate School, has taken a hard look at the impact in her piece, underpinned by Nielsen’s global research, ‘Supply chains have been changed, possibly forever’. Supply chains, once a concept, are now a “life-saving essential service”.

The global hunt for a vaccine or cure for the coronavirus is dependent on the collaboration or the concept of ‘open innovation’ betwen scientists and doctors around the world. The father of open innovation, Henry Chesbrough, has written a follow up to his 2003 book that looks at the challenges and successes of open innovation over the past 17 years. Our story ‘Don’t be distracted by the ‘shiny new objects’ arising from the advance of technology’ takes a look at this.

Twenty four million South Africans belong to loyalty card or rewards schemes. Justin Brown has explored loyalty marketing in his piece ‘The ins and outs of a successful rewards and loyalty programme’.

We’ve unpacked a case study on how Ads24’s groundbreaking and award-winning Food for Thought series was conceptualised and rolled out. ‘Food for thought on how to create a provocative experiential activation’ details the plan from concept and the AI-inspired invitation to implementation and drones delivering desserts. Truly amazing.

Finally, we’ve rounded up a few Strategic Snippets making waves at home and abroad.

Stay home and #staysafe.

Glenda Nevill

Editor

Supply chains have been changed, possibly forever

The competition is no longer between brands or even between companies; it is between supply chains (networks). Supply chains in the time of coronavirus have changed, possibly forever. MARZIA STORPIOLI reports.

Supply chain management has been likened to a philosophy, a concept rather than an essential service.

Historically, companies relied on strong brands and good products to win over the consumer. Competitive advantage was gained by the organisation based on the strength of its brands and its reputation for quality products.

But as the COVID-19 pandemic continues its inexorable march across the globe, supply chain management is no longer being considered merely a concept, but rather a life-saving essential service used for the cohesion of all supply chains so that they may work in concert with one another in order to satiate the needs and wants of people and businesses at all times, including times of crises.

Robots vs Humans: A compelling story of a powerful and impactful experience

Ads24 won a bronze in the 2019 Assegai Integrated Marketing Awards for its Food for Thought experiential media campaign. In its third year, the 2019 event was themed Robots vs Humans. This is the case study on how the award-winning activation was conceptualised and rolled out.

To cut through the plethora of activations and events aimed at media agencies and advertisers, Ads24 required a single-minded reason for its existence. It was out of this that Food for Thought was conceptualised, packaged and promoted to inspire and inform targeted individuals about cutting edge developments impacting on their careers and their lives.

In Food for Thought, Ads24 created a brand and a vehicle for giving back in an impactful and memorable way, with a healthy return on effort and investment.

Don’t be distracted by the ‘shiny new objects’ arising from the advance of technology

The ‘father of open innovation’, Henry Chesbrough, has just published a follow-up to his ground-breaking first book. He believes business must extend beyond the creation of new technologies, to also include their broad dissemination and deep absorption, in order to prosper from new technologies. GLENDA NEVILL reports.

‘Open innovation is a term used to promote an information age mind-set toward innovation that runs counter to the secrecy and silo mentality of traditional corporate research labs.’ ~ Wikipedia

Right now, think tanks and scientists and researchers across the globe are collaborating in the search for a coronavirus vaccine (or cure).

This is a timeous reminder, says Irving Wladawsky-Berger, Research Affiliate at MIT’s Sloan School of Management and Fellow of the Initiative on the Digital Economy and of the MIT Connection Science initiative, that the open innovation model is “the perfect vehicle for today’s fast-moving environment, which includes the current race for a coronavirus vaccine”.

The ins and outs of successful rewards and loyalty programmes

Research has shown middle-income South Africans are members of at least nine loyalty plans, while membership is set to grow as smartphones penetrate more of the market. JUSTIN BROWN finds out more about what makes a rewards programme successful, and where opportunities lie.

Over 24 million South Africans are members of rewards and loyalty programmes, of which there are more than 100 in existence.

The most popular schemes are those offered by grocery, health and beauty retailers.

Steve Burnstone, CEO of Eighty20, a Cape Town-based consultancy, says his company’s research found that middle-income South Africans were members of, on average, nine loyalty plans.

Burnstone believes rewards plan memberships will rise significantly as smartphone penetration increases in South Africa.

A key consideration in South Africa is how to provide loyalty offerings to low-income consumers, he says. If a customer does not spend much, then it is hard to reward them, but Burnstone believes it is possible to reward all types of customers.

Instagram’s shoppable posts

One third of the most viewed Stories on Instagram are from businesses, and 130 million Instagram users tap on its shoppable posts. So it’s not surprising that 72% of Instagram users have bought a product off the app and that it is a popular platform for luxury shoppers. Scrolling through Instagram’s vast feed, one often sees a sponsored post with a highlighted offer to ‘learn more’ or ‘shop now’. Popular company Zaful uses this tool, as does Get Smarter in its efforts to sell online courses and modules. Then there’s the data retailers source to help them refine their social commerce strategies, so it’s no wonder shoppable posts are set to become the norm in 2020.

A fashionable response to COVID-19

Fitness brand UnderArmour is making 100 000 masks a week, nicknamed the ‘origami mask’ in response to the coronavirus pandemic. It has created an innovative surgical mask out of a single piece of fabric, turning its innovation lab in Baltimore into a factory. Gucci is making masks and medical overalls, which French luxury house LVMH is producing hydroalcoholic gel, which it will distribute free of charge to health authorities in France, from it perfume factory. Bulgari is making hand sanitiser containers rather than its beautiful perfume bottles. Jaguar Land Rover Automotive PLC, the two automotive brands are deploying more than 160 vehicles to organisations helping curtail the spread of coronavirus. They include the British Red Cross and the Red Cross Societies in Australia, Spain, South Africa and France.

Brands had best spurn quick bucks

Brands that raised their prices significantly during the panic-buying stage of the coronavirus pandemic will be punished by consumers later. That’s the word from Richard Shotton & Will Hanmer-Lloyd writing in Marketing Week. “Many brands are in a position to capitalise on public panic but doing so would be foolhardy. People are acutely sensitive to unfair behaviour and they’ll punish perpetrators.” Their advice? “Spurn the opportunity for a quick buck and take a long-term view.”

All about content marketing

There’s so much more to content marketing than, well, just content marketing. The AddThis Academy has listed key trends marketers should keep top of mind in 2020:

– Visual Content Marketing tells provocative stories, vital in graphics or infographics. Colours are important, with 2020 having a more muted palette; design wise,2019 was more ‘Van Gogh’ while 2020 is ‘Picasso’. Bring on the abstract.

– Interactive Content Marketing will embrace augmented reality and virtual reality. But it has to go beyond the social sphere, as consumers expect interactive experience in website design as well as live content and advertising.

– Live Content videos have become far more popular in content marketing circles than produced video content. Plus they are cheaper and easier to produce.

Marijuana dispensaries an ‘essential service’

Ten years ago marjuana growers and sellers would be prosecuted and thrown into jail. Now they are vital members of society. Multiple states in the US, including California, Illinois, Oregon, and Washington State have declared that cannabis dispensaries are essential and must stay open during the COVID-19 pandemic. Cannabis sales have tripled over the past few months as people stocked up on the holy herb ahead of the new reality of lockdowns and quarantines. While dispensaries will stay open, home delivery is advised.

Creative digital interns given a Front Row seat

South Africa’s Interactive Advertising Bureau (IAB SA) has launched a new initiative to create opportunities for young creative digital interns and students. Front Row will give black students, entrepreneurs and agency interns between the ages of 18 – 28 the opportunity to attend IAB events and workshops, as well as access to South Africa’s brilliant digital media and marketing minds. “Front Row aims to further increase our engagement with the future leaders of our industry while bringing in a fresh, and different, perspective to the IAB SA as a whole,” said CEO, Paula Hulley. She said the initiative aimed create valuable collaborative spaces and the opportunity to “sit at the table” with “seasoned industry leaders at the highest level”.

Supply chains have been changed, possibly forever

20 April 2020

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Categories: COVID-19 / Coronavirus / Lockdown, Newsletters

Supply chain management has been likened to a philosophy, a concept rather than an essential service.

It’s useful to remember wars have been won and lost by the implementation and control of either effective and efficient supply chain management, or the lack of using it to its full potential, as was experienced during the Napoleonic Wars and World War ll. There is little doubt that the post-COVID-19 world will be decidedly different to life as we knew it prior to this scourge befalling us.

There’s no doubt most nations were caught unprepared by its rapid advance. In South Africa, consumers – like those across the globe – adapted their buying behaviour to “cope with this rapidly evolving situation”, as Nielsen researchers put it.

Retail outlets – supermarkets, pharmacies and wholesalers – were unable to satisfy consumer demand for sanitiser products, demonstrating the inability of supply chains within South Africa, and globally, to respond to a meteoric increase in demand for hand washes and sanitiser products, household and industrial bleaches and surface cleaning solutions driven by the global crisis.

Just-in-time (JIT) and lean manufacturing, once seen as the pinnacle of achievement in supply chain performance, may no longer be effective. They were implemented across most global supply chains in the face of mounting pressure to reduce supply chain costs – the aim being to continually strive for increasing levels of efficiency while reducing costs overall.

Efficient, but not robust

These supply chains are operating on razor-thin margins, so much so that they are no longer robust and unable to respond to ‘shocks’ in the system, and have limited capacity to respond to disruption in their supply chains. They are efficient, but they are not robust.

If the disruption continues, eventually these supply chains will stall – manufacturing will stop due to a lack of raw materials or spare parts.

Today, companies that achieve a sustained competitive advantage (Zara, 3M and Dell) are those who have invested significantly in developing responsive logistics capabilities. They are demand-driven and designed from the customer backwards (rather than from operational capability forward – forecast driven). Their supply chains are agile and responsive to changes in consumer behaviour.

Talking of consumer behaviour, self-preservation reigned ahead of South Africa’s national lockdown as the ‘haves’ stockpiled goods at the expense of the poor, the needy, the aged and the sick.

Imagine if the world did not have an effective and efficiently run supply chain to constantly channel food, fuel and other essentials to replace those that have been exhausted because of this ‘feeding frenzy’. There would be further chaos, indescribable misery, an uncontrolled mortality rate and above all, a world economic recession that would surpass the 1929 financial crash!

With the pandemic spreading to South Africa a few months after the initial outbreak in China, Nielsen was able to research global markets, delivering insights into how retailers are dealing with challenges brought about by coronavirus.

Turning a crisis into an opportunity

The research shows that retailers are facing three primary challenges: insufficient inventory of some categories, difficulty in logistics and distribution, and inadequate staff to deliver orders.

Those able to organise resources and respond actively to the epidemic and launch measures to “help turn crisis into opportunity” will thrive. These, Nielsen reported, included “flexible co-ordination of participants in the supply chain, ensuring the efficiency of product supply, showing care and concern for employees, rationally deploying staff, adjusting the store’s operating hours, expanding businesses through online channels and in community and strengthening corporate brand marketing to enhance consumers’ trust and creating a favourable impression”.

Nielsen has identified six key consumer behaviour threshold levels that tie directly to “concerns around the novel coronavirus outbreak. These thresholds offer signals of spending patterns, particularly for emergency pantry items and health supplies with these patterns being mirrored across multiple markets”.

As African countries such as South Africa and Kenya announced their country-specific responses to the outbreak, Nielsen found that global consumers were adapting their purchase behaviour to cope with the rapidly evolving situation.

“As patterns begin to emerge in response to news events of this nature, it will be imperative for companies to learn from these scenarios so they can sustain growth even in times where COVID-19 is deeply impacting people’s lives. These patterns will help provide leading and trailing indicators to those trying to understand how people will respond as developments continue to play out at different times in different countries,” said Scott McKenzie, Nielsen’s global intelligence leader, adding that this would be critical to understand as stores worked to maintain supply levels of in-demand items.

South Africans entered threshold #5 ‘Restricted Living’ on Friday 27 March 2020. Consumer behaviour at this stage was characterised by severely restricted shopping and constraints due to supply shortages, delivery fulfilment challenges and caps on product quantities, Nielsen reported.

The lessons learned

Of the retailers surveyed by Nielsen on their attitudes towards business for the rest of the year, 67% said they would make efforts to expand online channels and accelerate home-based business / retail warehouse layout.

“Fifty-three [percent] said they would change their product mix according to the shopping habits of consumers and increase the inventory and on-shelf number of health, disinfectant and protection products,” Nielsen reported. “Forty-three percent of the retailers say that they would work on their supply chains, especially those for fresh food, strengthen the ties with various brands and enhance communication efficiency.”

Robots vs Humans: A compelling story of a powerful and impactful experience

20 April 2020

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Categories: Newsletters

In Food for Thought, Ads24 created a brand and a vehicle for giving back in an impactful and memorable way, with a healthy return on effort and investment.

Campaign context

In an industry consistently exposed to trends, strategies and knowledge about its field of expertise i.e. media and advertising, Ads24 wanted to create a campaign in which it could influence business and leadership thinking as well as refocus attention to the critical role media owners, brand owners and advertisers play in bridging the gap in the minds of consumers between the now and the future.

The objective of the campaign was to position Ads24 as tribe leaders and critical business influencers within the communication space. It should strengthen business relationships and encourage collaboration through a powerful and impactful experience while reminding key industry advertising leaders about the influential nature of media. Ultimately, the company wanted to grow high-level involvement with top decision makers at media agencies and direct advertiser clients.

The strategy was to ensure Food for Thought stood out from industry clutter via a media industry event that encouraged progressive learning as well as debate around the economic, political, environmental and technological forces shaping the future of business in South Africa. Ads24 had to ensure that the event challenged everyone’s thinking and drove curiosity in an impactful way.

Enormous attention was paid to creating details that provided a full sensory experience. Tactics used to achieve this was through a hyper-personalised and carefully planned invitation process; creating a thought-provoking experience and journey on the day for all attendees; developing an integrated PR plan during and post-event, and maximising social media during and post-event

The big idea and its implementation

The world and its economies are experiencing unprecedented times. In every aspect of life, humans face a complex array of sensitive challenges that call for extraordinary responses and creative leadership. There is a massive shift in consumer mentality and media organisations need to proactively adapt to lead this dynamic environment.

Ads24 created an event positioned between a world dominated by artificial intelligence and technology, and one desperate for human connection.

The invitation was issued in the form of a book written by one of the speakers called We Are Still Human, by Brad Shorkend and Andy Golding. The book led to a hidden message in one of its pages, creating engagement and appealing to the natural human inquisitiveness. It also led to another very important feature: the RSVP

For this, Ads24 used hyper-personalisation by using real time data and leveraging of artificial intelligence to deliver a more relevant and surprising experience for the audience. This was done through creating an algorithm as part of the RSVP which predicted a personal surprise for guests to take home, further illustrating the impact of personal consumer centered communication.

The event

This event was designed from start to finish to engage every sense and challenge thinking. Every aspect was created to juxtapose the human touch with robotic interpretations. The starting point was a taste bud hack. Each person was invited to take a pill made from the ‘miracle berry’, synsepalum dulcificum. A glass of freshly squeezed lemon juice was then offered. The pill had the ability to mask taste and instead of eye-watering, tart lemon, each person experienced a sweet orange juice flavour.

This served as a metaphor on how we consume news and how easily we are fooled to digest fake news – the very opposite of what we pride ourselves in – the facts, the news and the search for truth.

Each food experience contrasted artisanal, handmade delights with a robotic version of the same. Fresh flapjacks topped with creamy mascarpone cheese and rich berry jam was paired with 3D-printed mascarpone cheese on spirulina-infused flapjacks with pipettes of berry compote. The delicious aroma of fresh-pressed coffee was served side-by-side with coffee cubes.

Each table setting was also designed to represent robots or humans and each attendee was assigned one or the other version of the main meal. Although the outcome of the meal was the same, each component was created by hand or by machine. This created an exciting atmosphere of curiousity and experimentation, culminating in desserts delivered by drones.

Content and speakers

Ads24 focused on different aspects of the future by looking at the incredible pace of AI and technology and how it’s reshaping our existence in an increasingly automated economy. With so many areas in which the media and communication is changing, from how we consume news to social media, fake news, hyper-personalisation and programmatic buying, if we don’t keep pace and remain agile to these changes, we face professional extinction.

The line-up included public speaker, entrepreneur and author of the best-selling business book, Legacide, Richard Mulholland, Brad Shorkend, one of the authors of We Are Still Human, and computer scientist, Rapelang Rabana.

Each shared their views on how to stay ahead of the game in a world where the word, ‘phigital’ (physical and digital), is the new normal. Comedian, author and speaker, Don Packett, refereed the debate by posing the questions: Where are we today in the fight between humans and robots? Where will our businesses be by 2030? And, how do we prepare for the journey? We explored the dangers of legacy thinking, how AI can be a tool to advance civilisation and how to be a good human in a technologically shifting world. They raised a few eyebrows, challenged the way we see our industry and our world, and opened the door to a spirited conversation around the future of media in 2030.

PR and social media

A series of thought leadership pieces were created based on each of the topics discussed at the event. Every week, for four weeks, a piece was circulated to media. Included in the pieces was a short 30-second video taken at the event relating back to the specific speaker/topic. This insured that when the article was published, readers would have full context to what was discussed/debated at the event.

Key messages were taken and posted on social media with either images or short 30-second videos from the event.

Return on investment

Ads24 Food for Thought 2019 provided insight into a world where human connection and artificial intelligence create new opportunities and challenges for the media industry and our world. The event solidified Ads24 as a thought leader among influential media partners and as a competitive media owner in a dynamic and constantly evolving industry.

73 % of those invited attended the event
- 80% gave us a perfect score for relevant content
Organic Social media engagement on the day of the event increased to 6.2% compared to the average rate for May of 1.8%.
Content series allowed for further organic reach:
- Post reach increased by 107%
- Post engagement increased by 300%
Page likes increased by 23%
Page views increased by 78%
Page followers increased by 14%
Average time spent on integrated content: 3 minutes

We achieved an overall PR value average of R6.8 million

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