New Opportunities for Brands in Africa

A PwC’s survey of Global CEOs found that despite 74 percent of respondents expecting to grow their operations in the next 12 months; only 13 percent currently have key operations in Africa. There is ample opportunity for brands to be pioneers in the market.

According to the World Bank, Sub-Saharan Africa’s GDP is estimated to reach 5.2 percent in 2014, while global growth is estimated to rise by 3.7 percent. The International Monetary Fund (IMF) reports that out of the 20 countries with the highest expected GDP growth in 2014, nine are from Sub-Saharan Africa, with Sierra Leon’s GDP projected to reach 13.04 percent by the end of the year.

Economic growth in the region is fueled by mobile tech: The Ericsson Consumer Lab forecasts that by the end of 2014, “there will be over 635 million [mobile] subscriptions in Sub-Saharan Africa. This is predicted to rise to around 930 million by the end of 2019.”

Africans are using mobile technology to optimize markets, to improve health care, and to voice their opinions. It is not surprising that Africa’s top two most valued brands are MTN, a South African telecom service company, and Vodacom, South Africa’s largest mobile operator by subscriber numbers. In fact, MTN is the only African brand to make it to the top 100 list of MillwardBrown’s BrandZ tracker.

Big tech brands (like Google, Nokia, Samsung, IBM, Microsoft and Intel) are not wasting time, bringing more products to market and building research facilities in Africa. In a recent post for the Stanford Social Innovation Review, Erik Hersman, co-founder of Ushahidi and founder of iHub -an Innovation hub and hacker space for the technology community in Nairobi-, explained that “big tech companies [are] viewing Africa as the last blue ocean of consumer demand for technology.”

African consumers are tired of being misrepresented and are using mobile technologies and social media to speak up about product performance, customer service, and advertising.

Take the example of Kenyans on Twitter (#KOT). During the 2013 attacks at Westgate Mall in Nairobi, #KOT denounced CNN with the hashtag #someoneTellCNN for reports showing Kenya as a nation in chaos while they were suffering a terrorist attack.

The Mo Ibrahim Foundation reports that in 2013, “Sixty-eight percent of Twitter users in Africa relied on the platform as a primary source of information on national news.”

Strategy

When developing a strategy for Africa, it’s important to consider that: 1) word of mouth (empowered by mobile) is the predominant way of communication, and 2) market research in the continent is very limited, making it extremely important to learn about the aspirations of local communities when designing your strategy.

Since many common products are new for local markets, word of mouth — both in person and through mobile platforms — will help brands provide customers with stories to tell about their products, and will give these brands the opportunity to educate consumers on how to use those products.

Gerhard Fritz, Divisional Manager for the Shoprite Group of companies, told PwC : “What works in other parts of the world may not work in Africa. People in Africa have a proud heritage; they don’t take kindly to others coming and telling them what to do. Our perspective is to think of every business as local.”

Building trust is especially important in an environment where shoppers maintain a strong brand consciousness. A 2012 McKinsey survey shows that 59 percent of African grocery shoppers are loyal to their favorite brands, compared to 38 percent who chose the cheapest offer.

Educating customers about the use of new products will make or break your brand. In Nakumatt stores, for example, shoppers tried to put black mascara on their lips because they didn’t know what it was for. Now, according to the Financial Times, the chain is setting up “free nail bars and makeovers to spread the word and tempt new customers for more expensive western brands entering the market, including Revlon and L’Oréal’s Maybelline.”

Understanding how locals are using products will give you clues on how to market to them. Think about the contrasts that are part of the daily life of your customers: from fetching water for their households, to actively using mobile phones to get livestock price updates.

Brands entering or repositioning in Africa will need to pioneer market research efforts in the continent; understand how Africans use mobile technologies and embrace these technologies as part of their strategy; and earn the trust of African customers.

Their strategies should be both global yet hyper-local, and consider partnerships with established brands which will share knowledge of distribution channels and influencers, and how to participate in informal economies.

BY GABRIELA TORRES PATIÑO

CMO insights from IBM’s Global C-suite Study

For more than a decade, IBM has built upon research to produce its C-suite Studies series, one of the largest collections of C-level executive insights. Its latest research Stepping Up to the Challenge: CMO Insights from the Global C-Suite Study focuses on how CMOs “are helping their enterprises become more ‘customer-activated.’”

IBM Institute for Business Value found that employing a revenue-generating, customer-centric strategy can stem from digital marketing capabilities. But despite digital being a current area of focus for CMOs, it’s a world many still struggle with. Specifically, less than 20% of CMOs interviewed for the study “have integrated their company’s interactions with customers across different channels, installed analytical programs to mine customer data and created digitally enabled supply changes to respond rapidly to changes in customer demand….” Such CMOs are segmented as “Digital Pacesetters” in the report.

The issue isn’t that the other +80% are fire-walling technology, but rather they grapple with maneuvering through the explosion of data, and tethering digital media to bottom line numbers. As one CMO (anon.) in the study explains, “We know what we want to do. Our biggest challenge is creating the data infrastructure.”

This translates into potential missed opportunities. IBM Institute for Business Value reports, “There’s a close link between the degree of digital acumen CMOs display and the financial performance of the enterprises for which they work.” The research revealed that many CMOs have de-prioritized monetizing social media. They are “presumably finding it too difficult or see social mainly as a tool for building awareness and forging connections.”

While CMOs are becoming a stronger force when it comes to influencing CEOs on strategy, second only to CFOs, it’s the CMOs’ relationships with Chief Innovation Officers that generate results. IBM Institute for Business Value reports that businesses are 76% more likely to outperform in terms of revenues and profitability when CMOs and CIOs effectively work together.

According to the study, analytics are top priority for CIOs. IBM Institute for Business Value suggests partnering with CIOs to create an infrastructure for scalable cognitive analytics that produce actionable customer insights. It cautions not to be “all things to all people,” but rather concentrate analytics on those customer lifecycle phases that will be of utmost importance to your business in the next few years.

Digital Pacesetters, notes IBM Institute for Business Value, are “actively investing in the later phases of the customer lifecycle, where digital channels make the biggest difference.” While traditional phases end with the transaction, Pacesetters look at the bigger picture – focusing resources on long-term relationships and cross-channel experiences to turn customers into loyalists and collaborators and encouraging them to share these experiences. Such companies, per the study, “are 59 percent more likely to be outperformers.”

Download the complete study to learn more about IBM’s findings and strategizing digital.

BY ALLIE ABODEELY

#BoysGotGame

Lulu, the new app that allows women to anonymously rank their Facebook beaus, has quickly risen to smartphone fame. In a single year, it has attracted a user-base of well over one million with more than 200 million profile views and countless praise from esteemed media outlets like The New York Times, The Washington Journal, Business Insider and NPR. With backing from acclaimed financiers such as Yuri Milner, an early investor of Facebook, Lulu is poised to reign the dating app world.

Beyond just a simple ratings scale of 1 to 10, women can give detailed, yet pointed descriptions of their exes, flings, and male friends using hashtags (e.g. #SilverFox, #CheaperThanABigMac), hence easing the dating woes (or boosting desirability) for subsequent unsuspecting women.

Co-founder and CEO Alexandra Chong explains, “[W]e get references for jobs… or renting an apt…. Why not get references from women on the guys that they may end up in bed with.” After a six-hour brunch with her girlfriends chatting up everything from careers to guys, Chong saw opportunity to tap into “girl talk” by creating a private space where they can share past experiences to “empower girls to make smarter decisions….”

Initially, marketing was geared towards sororities. One in four college women have the app, and average about 8 visits per week. This sparked a blaze that’s spread like wildfire among women in their 20s. But what’s really excited Chong has been the dynamic contributions of Lulu’s members. “… fifty-two percent of users create content. As you know in the social space that’s often unheard of. Typically the rule is 9-10%,” she tells Bloomberg TV’s Cory Johnson.

More than just piquing interest, user-generated content gives Lulu (and prince charmings) a huge advantage—credibility. According to Nielsen, 92% of consumers worldwide rely on recommendations from friends and family, and 70% trust online reviews. Word-of-mouth is a tremendous driver for Lulu.

Lulu makes it easy for ladies to add their own two cents by inciting them to interact with the app through Cosmopolitan-style quizzes and content. Chong tells Johnson, “For our users, it doesn’t feel like they’re doing much to give information.” She likens Lulu to a Wiki for girls. “The idea for us is to move beyond relationships and into health and to beauty and to all the things women care about. That has endless opportunities.”

Surprisingly, men are responding, well… favorably. In an article last November, The New York Times reported that Lulu had received over half a million requests from dudes who welcomed (read: braved) #feedback. One poor soul who had received a 6.5 score was a good sport, tweeting, “I can only assume this is on a scale of 1 to 5.” Um, sure.

BY ALLIE ABODEELY

Kate Spade New York: Innovating the 360° Experience

The Kate Spade signature experience is as bold and colorful as its brand. Its 2013 strategy proved to be ahead of the curve, offering an amalgamation of consumer interactions across all touchpoints for a unified 360° experience.

Last summer, Kate Spade New York created a unique way to bridge digital with the brick and mortar world, transforming “window shopping” from a figurative expression into a literal action.

For one month in New York City, four of its Kate Spade Saturday store locations turned their window displays into a 24/7 interactive adventure. It enabled shoppers to purchase that “must-have” piece in the window, from the window, via touchscreens. And shoppers could schedule that item to be delivered within one hour anywhere in the City (e.g. a last minute present delivered to a party you have to miss, that anniversary gift you forgot to buy for your wife… again).

Mary Beech, Senior Vice President & Chief Marketing Officer, and upcoming BRITE ’14 speaker, refers to their decorative windows as “a little piece of theater.” “Our store windows are moments of whimsical storytelling that express our core values in every venue,” she explained at The Hub Live 2013 conference. “[T]here’s a sales goal related to these. But we have fun doing it.”

In true Kate Spade New York innovative style, the luxury retailer ran the first shoppable online video banner during the 2013 holiday season. See an item you like in the digital ad? Simply click and purchase. “The technology provided an immediate, seamless, shoppable element that enhanced the experience, rather than pulling you out of it,” Beech explains in an interview with Design Taxi.

Efforts are paying off. Kate Spade New York reported a 30% increase in comparable store sales for the 2013 fourth quarter, and a surge in last year’s stock price. Further, parent company Fifth & Pacific will be renamed to Kate Spade & Co. to focus singularly on the Kate Spade brand. The company recently trimmed 37 of its 40 brands and is soon to separate from Juicy Couture and Lucky Brand.

Beech notes that they’ve carefully identified complementary experiences to carry through different social media channels. Facebook is for customers seeking sales, product information, store openings, etc. Twitter offers the voice of the Kate Spade woman tweeting about local events and other delightful discoveries. Instagram paints a picture her story and NYC lifestyle through the use of images.

Kate Spade New York is fast becoming a trailblazer in the marketplace, developing unique ways to engage and even entertain its biggest and brightest fans by merging new technology with in-person interactions.

Join Beech at the BRITE ’14 conference (March 3-4, NYC) to learn more about the creative ways in which they’re keeping the brand both fashion and marketing-forward.

BY ALLIE ABODEELY

Building Your Action Plan for Social Media Marketing

As social media platforms went through their early exponential growth, marketers were compelled to dive blindly into the pool. Today they care about what kind of splash they will make. The pressure is on to create concrete strategies and deliver real value from any time spent on social media marketing activities. At the BRITE ’13 conference, Ric Dragon, author of Social Marketology, offers an action plan for marketers, of all sizes, to think smartly about how to best use these new tools and the 1-to-1 connection they offer.

While it should be obvious, Ric has found that many companies still don’t think about their desired outcomes – how will a social media marketing effort fit in with your company’s broader brand position and personality, and how does it align with all your marketing goals? He notes that the important thing is to consider and develop an understanding of these four major brand stakeholders:

• Us – be united internally on your company’s brand goals and personality
• Them – know what drives your consumers and how they perceive your brand
• Communities – uncover the larger, aggregated networks of your consumers
• Influencers – get to know who is influential in these communities

Throughout his talk, Ric provides insights on how to think about developing metrics for your social media campaigns, how to uncover micro-segments of active communities that will likely have an affinity for your brand or communications, and how to “professionally stalk” and excite the influencers of those communities.

These techniques would then be executed within five key approaches to social media:

• Brand maintenance – having a footprint, and listening to and occasionally interacting with your customers
• Reputation and crisis – creating and sharing content that shows your leadership on business and/or social issues
• Community building – creating an interactive presence with brand ambassadors
• Influence – targeting and connecting with key social media influencers in your category
• Big splash – creating attention through a unique campaign that will excite a huge reaction

“[Marketers] need to think about the healthy mix of these approaches,” Ric states, “and acknowledge that they may change over time.” Each brand must develop an action plan that weighs the level of attention it gives to the development of web properties, social connections, content creation, and stakeholder engagement, and how this balance should be altered each quarter.

Ric concludes, “When we integrate all this work with storytelling, it is extremely powerful, and I believe we all can grow our business through social media.”