There are about 44.4 million black people in South Africa, 6 million of whom are middle class (a figure that has tripled in the last 12 years). Black high-net-worth individuals (HNWIs) have also increased by 179% since 2007, while white HNWIs have declined by 42%.
Why is this relevant? Because black consumers are more influential than ever. Their collective buying power is staggering compared to other racial groups. And it’s growing.
But, despite this, there is a persistent lack of insight and investment into the melting pot of South African consumers by marketers – particularly through the use of foreign-owned advertising agencies and production companies that don’t understand the market.
Impact on local industry
Considering that our industry has the power to impact millions of lives, it pays to be mindful of the needs of those lives. And not just financially. As the Association for Communication and Advertising says, advertising “is an intrusive form of communication to which over 40m South Africans are subjected every day. For a relatively small industry, its influence is disproportionate to its size, [so] making it a truly South African industry is imperative.”
In other words: there’s a good chance that we owe it to the people to whom we’re exposing our content to make their lives better. And we can only do that if we’re invested in their interests. After all, how can locals be expected to pay for the products we’re selling them, if the economy can’t provide them with the reliable income required to buy those products?
Choosing an international agency or production house rather than a local one can:
- Cripple transformation: SA agencies can’t get a foot in the door because clients are more impressed by big-name agencies and their scorecards.
- Crush entrepreneurial spirt: Who wants to open a start-up when they’re competing with huge organisations with unlimited resources?
- Inhibit the supply chain: International companies are often large enough to manipulate market forces.
- Promote mass production: This lowers industry standards across the board.
Where the problems lie
The issue is possibly exacerbated by a general lack of understanding among clients, who may not ask questions about who owns an agency or why it matters. (Plus, some global groups own as many as 13 agencies in SA, so even clients who have some understanding may assume SA ownership.)
Local agencies and production houses may also be to blame, as it’s possible that not enough is being done to inform the local market of the benefits of keeping projects local. Nor do we do enough work to grow and develop home-grown South African players.
The biggest advantage to commissioning local business is that the industry is kept healthy and functioning optimally. This means that local companies can offer:
- better value,
- more creativity,
- more innovative solutions, and
- contributions to the local economy.
But transforming the industry has to be a collective effort that goes beyond BEE points. This is because, based on the stats we’ve seen, local home-grown marketing and advertising don’t just make economic sense – they make business sense.
Making local (more) leaker
In an ideal world, clients would ask if an agency is locally owned before engaging it further. But changing consumer behaviour is easier said than done. A more constructive approach would be to look at ourselves. Specifically, I believe that we should:
- Work together
Locally owned agencies and production companies should consider collectively launching a campaign that educates clients on the importance of supporting local business.
- Reward local business
Together, we should find a way to recognise and reward clients who go local.
- Employ & grow local talent
Who knows the consumer better than the consumers themselves? We should employ and develop talent that has insight into the people we’re marketing to.
- Partner with smaller agencies
This is one way to make a smaller voice heard – by making it louder. We should join forces with other smaller agencies wherever possible.
- Drive transformation
Think, speak, and behave in a way that positively drives local investment and empowerment.
- Grow local influencers
Find the South African voices that are already being heard and give them a loudspeaker. The more they’re heard, and the more local companies are celebrated, the more recognition the South African industry will get.
A healthy, thriving advertising and production industry enables greater advancement, creativity and growth… not just for ourselves, but for other industries too. As it happens, local really is lekker. For everyone.