Marketing Mix Magazine May June 08

MarketingMix M E A S U R A B L E

M A R K E T I N G

I N S I G H T S

I Vol 26 Issue No. 5/6 I 2008 I R25.00 incl. vat

[ contents ]

02 consulting editor and editor’s note consulting editor – Nici Stathacopoulos – a note from a direct marketer extraordinaire about, the direct marketing industry, and also a note from Fulvia Becatti

26 podcasting and content on demand Ryan Till takes a closer look at podcasting, and how to incorporate it into the marketing strategy

04 legislation update the DMASA brings us the facts and the major issues surrounding the introduction of the Consumer Protection Bill into Parliament

27 internal engagement Terri Brown and Grace Harding explain why internal marketing should be considered an important part of a company’s strategy

06 a message from the DMASA

28 CRM and data management Monique Smith tells direct why effective data management is becoming a crucial part of CRM

08 DMASA founder member profile Avis and Platinum eProducts discuss the benefits of being associated to the DMASA 10 direct mail Kathryn Price McKay explores some of the exciting new applications that marketers can use in their direct mail campaigns 12 CEM Bob Thompson tells direct why marketers should be focusing on managing their customer’s experiences more closely 14 variable data printing Loren Botha talks about the power of digital technology, and how variable data printing is helping marketers develop personalised campaigns 15 data Jonathan Manners wonders why companies are scared of data

29 loyalty Nici Stathacopoulos points out the difference between a rewards programme and true brand loyalty 30 custom publishing Martha Dimitrou tells direct why custom magazines give marketing campaigns a lift 31 awards in direct marketing direct zooms in on local and international direct marketing awards 35 research highlights A sneak peek at a few Forrester Research reports focusing on direct marketing case studies 36 budget/bulksms.com 37 look & listen/volkswagen citi 38 fnb/94.7

16 direct marketing and credit data Thamir Hassan explains how credit data could be used to create more targeted direct marketing campaigns

39 lexus/children’s hospital trust

18 innovative direct marketing solutions Melvin Chagonda shares some ideas around adopting a more innovative approach to direct marketing

41 pcmall/primaplus

20 search marketing Stafford Maisie tells you why search marketing is becoming a powerful tool 22 direct marketing in south africa Fraser Lamb expresses his views on where the direct marketing industry is at locally, with some interesting pointers on how agencies can go digital 23 mobile media in DM Rick Joubert explains why direct marketers need to focus on mobile media 24 direct marketing today Patrick Collister shares a new model of direct marketing, and tells direct why the lines is now vertical

40 mweb business/woolworths

42 seef properties/transunion 43 wiredloop/sasko flour 44 cell c/bmw 45 bmw/chabad house

46 sports sponsorship how to leverage sport and get the best from your sponsorship spend 52 central SA find out why the Central SA region is the country’s hidden gem visit www.marketingmix.co.za for more information about marketing mix news, events and expert opinions

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[ ed’s notes ]

a word from the top consulting editor’s note I am proud to be associated for the third year in row with direct, the direct marketing magazine published annually by Systems Publishers. It’s never an easy task to put together a magazine which requires the industry to contribute to the extent that we require from our colleagues. To this end I am amazed at just how enthusiastic everyone has been to ensure we yet again have a world-class magazine to bring to you. We are privileged to have international contributions again and are pleased to see that marketers are willing to share their case studies with each other. This publication carries similar topics to the previous two editions, but focuses on the here and now, future trends and, of course, as each year passes the ever-changing dynamics that the Web and digital present to us. These media can no longer be billed as ‘new’ or ‘flash in the pan’ – and the most important component of both is the reality that they have the potential to deliver to marketers the ability to truly harness customer knowledge to develop real CRM! There is also a fresh insight into creativity and awards as well as legislation and internal marketing. I am still astounded after so many years in the CRM industry how marketers believe that CRM is a reward (read points) programme and that budgets are not allocated on the true need to enhance the customer offering, but on the old traditional way of marketing – 80 per cent ‘ATL’ and the balance to everything else in the mix. Hopefully, the messages we continuously put out and the proof presented in case studies will start to shift this world view! Hopefully, in the not too distant future, marketers will realise that the customer is not a moron (as aptly said by David Ogilvy) and with the over-saturation of media and the prolific clutter in the marketplace, they will embrace the notion that speaking to customers in relevant, rewarding and regular ways will provide the springboard to loyalty and, in turn, increased brand presence and profitability. Enjoy this read – it’s worth keeping on hand as a reference! Nici Stathacopoulos is the managing partner of proximity#ttp, the maverick agency, that is well-equipped to handle new kinds of challenges. proximity#ttp fuses the core disciplines of strategic and creative thinking to develop ideas that bring brands closer to customers, creating customer action. nici stathacopoulos, managing partner, proximity#ttp

editorial staff publisher: Terry Murphy

editor’s note Direct marketing is certainly coming into its own, now, more than ever. And the reasons for this are obvious: getting your consumer to like you and support you is tougher than ever! I quite like the definition of DM posted on the Caples Awards website (www.caples.org): “the practice that statistically evaluates the present and future re-contact value of the data collected from those who respond to emotionbased ethical advertising requesting an immediate (interactive) response”. While exactly what separates good DM from not-so-hot DM is not always clear, to me this definition seems to get to the bottom of things. From this definition, I infer that DM needs to be measurable, it needs to focus on retaining customers by engaging their emotions and getting them to interact; and it needs to be ethical. SA’s direct marketers certainly give the international gurus and creatives something to talk about, and I think that as we get more exposure to international trends (and more opportunities in the mobile and online space), we will become an even greater force in the global DM arena. Some of the trends to watch out for: the green trend (think recyclable paper for your direct mailers) and, of course, the boom in search marketing. Google Maps is set to make a dent in the local market, and will create new opportunities for brands and companies. Then there’s the pressure that the current economic situation is putting on all of us. In this economic climate the winning brands will be those that develop really simple and cost-effective solutions that put the customer first. (I hear that Home Depot stores in the USA are developing a range of cheaper paints for cash-strapped home improvers as well as specials that allow whole homes to be re-carpeted for just US$200). Likewise, the winning DM agencies will be those that can give their clients solutions that really WOW the customer, without breaking the bank. Clients need to be more courageous, so do agencies, to allow everyone to think outside of the box. fulvia becatti, editor, direct

proprietor and publisher: Systems Publishers (Pty) Ltd. 1st floor, North Block, Bradenham Hall, Rivonia T e l : (011) 234 7008

consulting editor: Nici Stathacopoulos editor: Fulvia Becatti advertising sales: Robyn Andrews layout: Spencer van Graan

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© 2008 Systems Publishers. The opinions in this publication do not necessarily represent the views of the publisher Printed by: ContiPrint

[ legislation ]

consumer protection bill

update:

By Gary Simpson

The briefing by the Department of Trade and Industry to the National Council of Provinces (NCOP) and National Assembly (NA) committees tasked to deal with the Consumer Protection Bill took place on 6 and 7 May 2008. The Bill has only been introduced into the NCOP at this stage and will be introduced to the NA as soon as it has been dealt with by the NCOP. Parliament goes into recess again at the end of June 2008. Some very strong themes came through at the briefing and also in the questions asked by committee members. The DTI raised the following points and issues:  The Bill is not meant to duplicate existing laws, but to create a system of predictable rules for consumers; to codify rights that cannot be contracted out of; to create a system that is not reactive as regards consumer redress and to provide for enforcement mechanisms.  The need to balance consumer rights with business rights based on fairness.  The fact that the consumers have unequal bargaining power when entering into contracts; that there is the common law principle of ‘buyer beware’ was highlighted, and also that common law is judgemade law that is inaccessible to the consumer (and if the consumer goes to court, this is at a cost that most consumers cannot afford).  The insurance industry must be exempt from the Bill, but there was an ‘agreement’ reached with Cabinet that the relevant financial

the Bill is not meant to duplicate existing laws, but to create a system of predictable rules for consumers; to



codify rights that cannot be contracted out of; to create a system that is 

not reactive as regards consumer redress and to provide for enforcement mechanisms.

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services legislation and insurance legislation would have to be brought in line with the Bill within two years from the date of its promulgation (the way the Bill is drafted at present means that insurance products sold by intermediaries – those that do not give advice according to the FAIS Act – are still subject to the Bill. Submissions will have to emphasise this). Credit agreements (as regulated under the NCA) are meant to be exempt from the ambit of the Bill while assets sold (eg cars) under the agreement will be subject to the Bill (though the Bill is drafted at present so that these agreements will be subject to it). This will also have to be pointed out in submissions. Self-regulation does not always work; reference was made to the banking industry and its codes. The airline industry, the recent food price-fixing scandal, Fidentia (as regards abuse of innocent consumers), the banking industry, certain retailers, pyramid schemes, price errors on goods, cooling-off rights, imported goods problems, timeshare deals, SMS marketing

[ legislation ]

the regulations will only be drafted next year, which is very concerning as



























campaigns, branded goods (misleading adverts and goods that claim to be branded but are fake) and SMS competitions all fall under the spotlight, as do problems with returning goods or obtaining refunds, estate agents and lay-byes. Foods products (labelling, expiry dates, free foods and government feeding schemes) were also issues mentioned. There was broad concern for illiterate consumers and rural consumers. It was felt that even with better labelling of products, an illiterate consumer would still not be empowered. The previous draft contained a clause on official languages but due to a compromise with business it was removed. Also, the DTI had the dual role of encouraging businesses (by not increasing costs of doing business) and protecting consumers. The fact that the clause was deleted was not received favourably by the committee members who felt that the plain language requirement was not much use if it was in a language that the consumer did not understand; Many committee members relayed bad experiences they had had as consumers or that constituencies had had – some of which were with credit agreements, debt counselling matters (ie debt counselling was too late as consumers are already over indebted at the stage they approached a counsellor) and also insurance products (both of which are meant to fall outside the ambit of the Bill, according to the DTI). Committee members also expressed their dismay with free goods distributed to consumers that are expired or past their sell-by-dates. Questions were asked about the applicability of the Bill to the state – the DTI said that the intention was that where the state is the supplier of services or goods, consumers should be able to use the provisions of the Bill to act against the state (such as municipalities). The way the Bill is drafted at present, the definition of state has been omitted and the possibility of actually suing parastatals or state-owned entities is something that needs to be commented on. The need to educate consumers about their rights. The DTI said that this would be the role of the Commission until industry codes placed a ‘duty’ on its members to educate consumers. Misleading adverts were also discussed, especially for “health” products making untested claims. The aim of the Bill is also to encourage better service delivery instead of tying consumers into agreements to retain them; The argument that SA has many unsophisticated consumers, so the Bill might be considered inappropriate does not stand; SA operates in a sophisticated global and local market. All consumers, no matter their standing, have a right not to be ripped off. After discussion on the threshold clause, it appears that the Bill needs to elaborate on what a transaction is and how it will be determined to avoid misconceptions. When discussing the clause on strict liability, the DTI said it knew that this was a contentious clause. It was particularly important as concerns imported goods and consumers being able to have recourse against a local supplier. It is very well to have legislation in place to protect consumers but

many of the provisions of the Bill are dependant on the content of these regulations.









efficient enforcement and education of consumers about their rights is needed. The position of provinces was also discussed, as was the role of the Tribunal, courts and ADR mechanisms. The possibility of class actions was raised; comment is needed on this topic, since class actions pose a problem in SA where there are no rules for such actions. Though the DTI said that the Bill does not require small businesses to register, as with other laws, the business names provisions will require businesses to register their names, and there will be compliance costs (eg displaying prices and writing out sales records, etc). Generally, as regards the costs of implementing the Bill to business, the DTI said it had done a regulatory impact assessment (the memo attached to the Bill says that the Bill will cost the state R51.3 million in ‘financial implications’, but I do not know of a regulatory impact assessment/RIA having been done by the DTI, hence BUSA is undertaking a selective RIA using SBP). I think some of these abbreviations should be written out in full.

The committee members in general felt that the Bill was long overdue and they looked forward to it being passed. The head of the NA Committee on Trade and Industry said that the role of Parliament was to pass laws for all its citizens and that its role did not end once the law had been passed. It urged members to be involved in the implementation of the laws it passed. He also said that they must look for unintended consequences in the laws they deal with and ask (after the implementation of the law): ’have we achieved what we sought to do?’ The Bill was officially introduced to the NCOP on 14 May 2008. Submissions will be called for by the NCOP and were to be submitted by 23 May 2008. The aim is to have the Bill introduced into both houses of Parliament by the end of June 2008, with the Bill finalised and made law by November 2008, but with a year to implement. The regulations will only be drafted next year, which is very concerning as many of the provisions of the Bill are dependant on the content of these regulations. Although the NA is likely to also call for submissions, it is imperative that submissions are made to the NCOP as well. Gary Simpson, DMA legislative portfolio head [email protected]

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[ dmasa ] ??????? professionalising a multibillion rand industry –

DMASA calls for accountability, integrity and delivery from members The direct marketing industry has changed – dramatically! In the face of implementation of laws that potentially could have crippled the industry, the Direct Marketing Association of South Africa (DMASA) mobilised its members and industry to lobby government and engage in a spirit of co-operation and goodwill. The result has been the development of bills and acts that will protect the privacy of individuals and juristic persons yet still allow direct marketing to continue without any drastic limitations. In fact, the result has been the professionalising of an industry that has come together to ensure direct marketing takes its rightful place as an omnipotent marketing and communications tool that deserves the attention of all brand owners and consumers of products and services. “There has been an incredible amount of work done by our legislative sub-committee and the result has been the fostering of a spirit of cooperation between the SA Law Commission, the Department of Trade and Industry and the direct industry,” says Brian Mdluli, CEO

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direct marketing tool

amount spent in 2007

description

AMS

R100 000.00

Audio messaging service.

SMS

R3 330 000 000.00

Short message service, including service messages that have advertising linked to them.

MMS

R393 515 625.00

Multi media messaging from machine to individual. This figure does not include individual-to-individual messages.

DIRECT MAIL

R160 000 000.00

This figure represents direct mail that has a response platform and the figure includes creative and production costs.

CATALOGUE

R1 500 000 000.00

Catalogue mailings – creative, production and mailing costs included in this figure.

CALL CENTRE

R1 200 000 000.00

Cost of outbound contact centres, excluding customer services contact centres.

DIRECT TO HOME

R500 000 000.00

INTERNET ADVERTISING

R254 000 000.00

ESTIMATED EXPENDITURE

R7 337 615 625.00

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Website advertising that has a response platform.

[ dmasa ]

of the DMASA. “In fact, government’s action in an industry that failed to self-regulate is probably the single precursor that forced an alarmingly unprofessional industry to reconstitute itself into a healthy, active industry that conforms to the highest standards and ethics, delivering a marketing practice that is explicitly designed to talk to consumers in dialogue that is tailored to their needs. Today, the spotlight remains on the real value of direct and brand owners have sat up and taken notice!” This is hardly surprising when you consider that the DMASA’s first initial research has shown the local industry to be worth at least R7.3 billion based on research data received from a poll of some of its members as well as key industry players and associations. However, the figure is highly conservative and the DMASA believes it will be significantly greater once the research study covers its full scope. “This study forms part of our ongoing research into the direct spend for 2007 and the figures quoted are averages that have been gathered from the sources listed, including the SA Post Office, 5th Dimension Marketing, AC Nielsen, Marketing Web, Direct Marketing Association of SA, Multimedia, Primedia@Home, Computer Facilities, Vibrant Direct, BPeSA and Waspa,” explains Mdluli. The DMASA will continue to monitor the figures on a monthly basis and is also calling on all industry players to submit their figures to [email protected] – all figures received will be kept confidential by the DMASA and only overall figures per category will be divulged for public consumption.

professional status for direct marketers The DMASA together with the Services Seta has developed a process for professional registration of direct marketers that allows them to apply for an assessment of competence once they reach 2 500 qualification points and, which if passed successfully, will provide the candidate with a registration number. From there the direct marketer can progress towards ‘practitioner’ status through to the ultimate qualification of a Chartered Direct Marketer based on successful completion of various continued professional development (CPD) programmes as well as years of experience. For more information go to www.register.dmasa.org “Essentially, this process of professional registration for direct marketers takes direct marketing out of the realm of being perceived simply as an activity within the marketing field, and positions it as a profession,” explains Mdluli. “Considering the tremendous changes afoot in the direct industry both from a technology and legislative point of view, it is high time that direct marketing achieves professional status. Chartered accreditation is the professional registration awarded to direct marketing practitioners who possess the qualities that characterise a true professional and is the highest level that can be achieved within the industry based on academic qualifications and experience. It measures the depth of a marketer’s knowledge and experience as a basis for the ultimate professional recognition within the direct industry,” adds Mdluli. Assessment and training will be provided by some of the most accomplished professionals in the field of direct marketing, hand picked by the Services Seta and the DMASA to mentor upcoming direct professionals. “This process also provides prospective employers with a means to truly benchmark a direct marketer’s skills and level of qualification on a formalised basis, something which has been relatively lacking in the industry,” concludes Mdluli.

“according to proposed law, any company embarking on a direct marketing campaign will be required to run their list against the Opt-Out Register and ensure that any names on the register are deleted from their database.”

direct marketing association’s opt-out register gets multiplatform functionality The DMASA has launched multiplatform functionality for its Opt-Out Register via SMS, Internet and a call centre which allows consumers to remove their details from mailing lists used by the association’s members. To add your details to the ’Don’t Contact Me‘ list – previously known as the Mail Preference Service (MPS):  SMS DMA followed by your ID number (this is crucial) to 34385.  Phone the call centre on 0861 DMA or DMA (362 362)  Visit www.dmasa.org to access the DMA’s Opt-Out Register Since the launch of the DMASA’s Opt-Out register in March 2007, 75 000 consumers have registered. Registration via any one of these methods serves the sole purpose of removing consumers’ names and addresses from all prospect mailing lists used by members of the association. “According to proposed law, any company embarking on a direct marketing campaign will be required to run their list against the Opt-Out Register and ensure that any names on the register are deleted from their database. Although consumers will see a reduction in the unsolicited direct mail they receive, not all commercial mail will stop. For example, they may continue to receive mail from companies with which the do business – for example, a banking institution – where they have provided consent for them to market to them. In addition, they may continue to receive mail addressed to the ‘resident’ since the mail is not personalised,” explains Mdluli. The Opt-Out Register has been developed by the DMASA in response to required government legislation to professionalise the industry and curb unsolicited marketing messages via mail, SMS, e-mail, telephone and post to unsuspecting consumers. When consumers register with the DMASA’s Opt-Out Register, their name, home address, telephone and email contact details are placed in a ‘do-not-contact’ file. DMA members are required to run their list of prospective customers against the file and remove individuals who registered so that they do not send their mailings to these individuals. There is no cost to DMASA members for this service; however, non-members will have to pay a fee to the DMASA for the list. The Opt-Out Register is updated monthly. for more information contact the DMASA on (011) 781 8032 or visit www.dmasa.org.

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[ dma founder members ]

DMA

founder members

The DMA founder members are ABSA, Avis, Computer Facilities, FNB, Home Choice, MTN, Nedbank, Platinum eProducts, the RCS Group and the SA Post Office. “The companies comprising the set of Founders provided seed capital to facilitate the appointment of an Executive Director, and the establishment of a DMA office,” says Colin Hudson, Founder Member liaison. “They see the DMA as playing a critical role in supporting the industry and providing services to collectively represent the industry in a variety of forums. They also take marketing seriously and are themselves leaders in different aspects of direct marketing. The DMA appreciates the participation of Founder member companies in additionally sharing expertise to assist others with personal development, thereby raising overall standards and professionalism in the direct marketing industry”. The direct marketing industry is undergoing change thanks to the amendments that are being made to marketing legislation. The DMA’s founder members are positive about these changes and the role of the DMA in facilitating them. Thulani Nzima, sales and marketing director, Avis, says: “The DM industry has always had a strong legislative presence in its daily operations. Like all aspects of marketing, we are glad for that involvement; however, with the Consumer Protection Bill being promulgated soon, a deeper understanding of the change is

“like all aspects of marketing, we are glad for that involvement; however, with the Consumer Protection Bill being promulgated soon, a deeper understanding of the change is necessary.”

necessary. The DMA has made understanding of this bill much easier. The DMA’s bi-monthly legislative forums for the industry provide us with a great opportunity to seek clarity, and register our views in a systematic manner.” Bob Lafite, CEO, Platinum eProducts, says that the impact of the legislative changes (such as the development of the National Credit

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the mass consumer market in SA is economically vulnerable, and so the challenge to the direct marketing industry is to strike a balance between protecting the vulnerable on the one hand and promoting their participation in a vibrant market economy on the other.

Act) will go a long way to eliminating unhealthy practices and opening the communication channels to clients through proper disclosure and documentation. “If as an industry we can demonstrate our ability to comply with the new Act and, importantly, its objective as far as protecting our clients are concerned, the positive spin-off in terms of market credibility and better consumer relations will far outweigh any negative aspects of new legislation,” he says. The founder members agree that the DMA’s role within the industry as an information provider is vital. “It is important to keep abreast of industry developments such as proposed legislation. The DMA, as the industry representative, communicates its concerns and queries to government before bills are enacted into law. It also enables us to benefit from the learnings of other association members,” says Nzima, adding that the regular forums encourage interaction and networking. Lafite believes that the mass consumer market in SA is economically vulnerable, and so the challenge to the direct marketing industry is to strike a balance between protecting the vulnerable on the one hand and promoting their participation in a vibrant market economy on the other. “In this regard, an organisation such as the DMA has a vital role to play in defining and articulating the industry’s interests at a national level,” he says. Direct marketers are working hard to get a firm grasp on current and future trends, including trends in digital media and mobile, for example. “Last month we attended a conference held by our advertising agency. One important learning from the conference is the growing power of the Internet. As a result, we are looking at increasing our spending in the digital arena and increasing our focus on e-commerce and website marketing,” says Nzima.

[ direct mail ]

what’s new in

direct mail? by Kathryn Price McKay

That’s a tough question. Especially since selling through the mail has been around pretty much for centuries. Even before the post office or stamps, for that matter, were around there was direct mail: circulars sent by travelling salesmen via Pony Express, scrolls carried on foot by messengers telling wealthy men (and their wives!) that a merchant ship had arrived laden with expensive goodies from far off climes. You get the picture. The point is, over the years, DM’s raison d’etre has remained pretty much unchanged – send a message to get someone to buy something, or at the very least show some sort of interest in buying something. That takes care of the why – but the how and the what – those have really changed. In fact, they are still changing and will change some more ad infinitum because change in direct mail is the key to its survival. Let’s face it. The average consumer has the attention span of a gnat – and today there’s huge competition for a share of that abbreviated attention span. To get in, to get read, to get opened at all, to get actioned specifically, a direct mail piece has to be either 100 percent relevant or really, really irresistible. For example: You’re the consumer and you’ve really been wanting to buy the latest Acme Cookbook. In that moment – or pretty close to it –

well, how about an envelope that smells like gravy, boeuf bourguignon or hot dogs (you may be a little peckish after all). Or a brochure that doesn’t just show you mouth-watering food pictures coupled with easy-toprepare recipes, it talks to you about them.

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a mail piece neatly drops through the door, advertising said cookbook, with a handy number to call Acme AND easy payment terms. Amazingly, you happen to have a few minutes to spare, and no other pressing mail to attend to, so you open it immediately, and call the toll-free number, which is staffed until late at night for your ordering convenience. What could be better? In fact, you buy three copies – one for your mum and another for your best girlfriend! This scenario is the fairytale ending, the happily ever after with which direct marketers keep themselves warm at night... the right offer to the right person at the right time. But here’s another more likely scenario. You’re just an average Joe (or Josephine) getting home from work later than you should, picking up the mail, before traipsing indoors, weary from another day with your nose to the grindstone. You don’t even want to think about dinner – let alone owning a cookbook that you may use once a year. What’s going to make you open that mail pack? What’s going to make it irresistible? Well, how about an envelope that smells like gravy, boeuf bourguignon or hot dogs (you may be a little peckish after all). Or a brochure that doesn’t just show you mouth-watering food pictures coupled with easy-to-prepare recipes, it talks to you about them. Or what about an offer that’s strategically linked to a national take-away chain, so that if you call and order now, your dinner will be delivered to you along with your copy of the cookbook. If that sounds like science fiction to you – and you’ve just been mailing the same old stuff over and over, well it may be time to wake up and smell the rose-scented paper. Because, we can now print scents on continuous stationery, which makes it viable for large mail quantities and not just small niche mailings. Sound-chip technology is now happening in South Africa in pretty much record time – no need to pay exorbitant prices or go through the East. Strategic partnerships are big news in every other advertising format – why shouldn’t they play a part in direct mail? And then there’s a whole plethora of other advances that direct mail-

[ direct mail ]

ers can add to their arsenal... You can print magnets onto the back of ordinary bond paper (and pop the magnet out from inside the body of a letter, brochure or leaflet). Even better, the text on these magnets can be personalised! There are sparkly glitter inks, and even a new spot UV printing process that prints UV varnish as a 5th colour – no need for a separate print process, no drying time and much lower costs. That’ll get your outer envelope (OE) looking spiffy. And what about variable printing? It allows you to literally write your consumers’ names in the stars... or in leaves, flowers or (back to our recipe book example) even spaghetti. Even more exciting, did you know that you can now print pretty much anything onto fruit and veg? Imagine an avo handed to you at the traffic lights on your way home that says: there are 10 ways to turn this into a delicious meal in under 10 min – call 0860 DINNER now for Acme’s Latest Cookbook... There are also some older techniques that have been around for a little longer, but either hasn’t infiltrated mainstream direct mail in South Africa the way that they have internationally or simply aren’t being used creatively enough. For instance, we happily die-cut letters and brochures – but how about a die-cut outer envelope? Imagine our Acme Cookbook mailer arriving in a tomato-shaped OE? And then there are thermo-inks, which intriguingly reveal a message when heated or cooled: really interactive and great as a competition entry device... but hardly used. Holograms have also been around for a while, but it seems they too have yet to grab direct marketers’ attention. That’s just in South Africa. Internationally, advances in printing that aren’t quite here yet – or aren’t quite cost-effective enough – are being used in mainstream direct mail. Ultraviolet printing, which enables a piece of paper that might appear blank indoors to reveal a message when taken outside could, be really funky on your OE. And I hear

isn’t it time you tried something new to attract their attention? And if your suppliers aren’t telling you about all the new, funky things they can do with DM, perhaps you need to start shopping around...

there’s a new die-cutting machine (in Switzerland, the US and now Australia) that can produce shape-cut and saddle-stitched multi-page books and folded brochures quickly and a whole lot more costeffectively per unit than traditional methods. Overseas, paper engineers are becoming more and more a part of a print company’s offering with pop-outs, fold-outs, and flip-over-and-overs more and more in demand as marketers struggle to make their direct mail communication stand out from the crowd. Ricky Uys, sales manager at Lithotech Afric Mai says: “We can do things in printing today that clients can’t imagine – we keep innovating because that’s what the market demands. And while some innovations might come at a price, others are really a whole lot more affordable than you think. In terms of ROI, most of our clients are pretty pleased with the results.” So, if you haven’t tried – or even heard of – some of these new techniques, it might be time to do some research – and then some testing. Or are you willing to let the ever-declining response rates continue to fall? Today’s savvy consumers are getting a whole lot more picky about which pieces of mail they open and respond to and which pieces of mail they put straight into the bin. Isn’t it time you tried something new to attract their attention? And if your suppliers aren’t telling you about all the new, funky things they can do with DM, perhaps you need to start shopping around... Kathryn Price McKay creative consultant, Primaplus [email protected]

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[ cem ]

customer experience management:

engaging your ‘right brain’ with customers by Bob Thompson

In the mid-1990s, Customer Relationship Management (CRM) became a popular buzzword. Theoretically, CRM is a business strategy to build loyal customer relationships that result in long-term profitable growth. But, a more common perception is that CRM is a technology-centric, inside-out, tactical project concerned with organising customer information or automating marketing, sales or service processes. That’s all well and good, but observing my own experiences, I couldn’t help but ask: What does CRM – as it’s commonly practiced – have to do with the wonderful time my wife and I had at a local restaurant, when we were surprised with a free dessert? Or does CRM explain why we drive 30 minutes to visit those friendly and competent people at our dentist, when other dentists are much closer? Or did CRM make any contribution whatsoever to the skillful way a sales rep sold me a car by not selling me at all? I doubt it. Or, to use a brand almost everyone will recognise, has CRM helped the local Starbucks become my office away from my home office because it’s a relaxing and fun place to meet people or read the paper while sipping on a grande latte? All of these experiences, and many more, influence my feelings and behaviour. That’s the point of Customer Experience Management (CEM), because it’s about mapping, improving and delivering valuable experiences to the customer. You can call these ‘moments of truth’, a term popularised by former Scandinavian Airlines CEO Jan Carlzon in the 1980s as he turned around the struggling airline. CEM is concerned with all customer interactions, not just those that lend themselves to automation. And it deals with the customer’s perception of value, which has both functional – ‘Did it do what it was supposed to do?’ – and emotional – ‘Did I enjoy how I was treated?’ – components. Some CEM proponents, most notably CEM author and professor Bernd Schmitt, go so far as to say that products can be turned into experiences. I’d have to agree that’s one of the reasons I have an iPod and spend too much money at my local Starbucks! CEM helps managers to see their customers with the ‘right brain’ – concerned with perceptions, feelings and interactions that are harder to quantify but oh, so valuable, nonetheless. Instead of just looking at how valuable the customer is to the enterprise, CEM requires an inspection of the enterprise’s value to the customer. Rather than recording transactional information like leads, opportunities and average handle times, as many CRM systems do, CEM maps the experience from the customer’s point of view.

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Technology to support CEM could take you far from conventional CRM software, which tends to focus on internal processes. CEM is also more creative, where well-trained, helpful and friendly people play a critical role. In practice, the dividing line between CRM and CEM is blurred. In our research, we found that 80 per cent of the ‘best practices’ recommended by CEM experts are the same as those that we’ve proven deliver ROI in CRM projects. For example, the No. 1 driver of CRM success is developing a customer-centric plan. That is also the starting point for CEM. Whatever labels you prefer, rest assured that top-performing companies are adept at left- and right-brained customer management. In a survey of customers we conducted in April 2006, only 22 per cent of customer respondents agreed that companies ‘currently provide an excellent customer experience’. That’s a tremendous opportunity for competitive differentiation, given that our survey also found that customers rate the quality of interactions as equally important in earning their loyalty as the products and services they purchased. Does CEM really work? You bet it does. Our study also found that CEM effectiveness scores ‘predicted’ improved business performance (profitable growth) and that growth leaders earned CEM scores 29 per cent higher than laggards. CEM is a critical development in customer-centric business management. To develop genuinely loyal relationships, make sure you’re delivering experiences that your customers remember and enjoy. Bob Thompson is CEO of CustomerThink Corp., an independent research and publishing firm focused on customer-centric business strategy, and founder of www.customerthink.com. Thompson is a popular keynote speaker at conferences worldwide and has written numerous articles and reports, including Customer Experience Management: A Winning Business Strategy for a Flat World. Bob Thompson CustomerThink Corp [email protected]

[ variable data printing ]

variable data printing (VDP) and why it’s THE way to market by Loren Botha The technique of variable data printing (VDP) is a direct outgrowth of digital printing; it harnesses computer databases and digital print devices to create high-quality, full-colour documents, with a look and feel comparable to conventional offset printing. By using variable data in producing marketing communication, you create touch points and promotional offers that are more personal, relevant and contextual, this ENGAGES the customer. Being just a little more personal in how you help, hunt, handle and hold on to customers across every channel of engagement can have major benefits. The same applies to the process of prospecting, acquiring, cross-selling and up-selling accounts. In today’s homogenised world, customers want, expect and desire a more customised and personalised experience. This begins with marketers working much harder to individualise their offers, opportunity, overture and outreach in every form of in-person interaction. Fundamental to applying this marketing technique is the depth, value, reliability and availability of customer data that can provide behavioural, transactional, demographic, psychographic and ethnographic insights. Not only is an abundance of data available inside organisations, but sophisticated data integrators, information service providers, direct marketers and predictive analytics firms can bring more intelligence and knowledge to the process of how you leverage and action customer profiles, histories, propensities and inclinations. Yet, in the face of customers’ need for greater intimacy, understanding

and personal handling, many marketers are not yet fully embracing or exploring new ways to reach, resonate with, and respond to the market in a more individualised and effective way. For the customer, there is a deep and almost insatiable desire to be heard. Customers are desperate to have a relationship where they are nurtured, cared about and recognised. For marketers, there is a mandate to derive greater ROI, increase response rates and advance the customer experience. Marketers must extract value from the abundance of data that typically lies dormant and unused in many CRM and customer support systems. Marketers are still missing the mark on how to leverage and use data, and because of this they are unable to realise the full potential of

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personalisation tools, services and solutions. It is also worth noting that true personalisation goes far beyond mail merging and including a customer’s name on a given piece of collateral. To reach a customer there must be a multi-channel, multi-level personalisation strategy that takes all customer points of interaction into account… print, Web, e-mail, text message, call centre etc. Take your monthly account statement. You can use that ‘transpromo’ merchandising opportunity to include a highly targeted, personal offer or product coupon that is based on past consumption patterns, transactions and behaviours. By bringing a colourful or graphical personal message to this monthly, always-read vehicle, you gain customer attention, cost-effectively deliver offers, and minimise the use of inserts that are often neglected and discarded. Response rates on transpromo campaigns frequently exceed 20 per cent and provide immediate impact to top- and bottom line performance, not to mention the environmental benefits of reduced print output. As companies discover the value of personalised communications, there will likely be greater budgetary resources devoted to individualised messaging techniques. Importantly, marketers need to employ more effective communications techniques to maximise the value and ROI of their customer acquisition and development initiatives. The success of direct mail marketing has been relative and depends on goals and industries. Traditionally, publishing relies on direct mail to solicit subscriptions and consider a three to five per cent response rate above decent. Direct retailers, who mail more frequently, look for a higher response. For small companies, a successful direct mail campaign would eventually generate enough revenue to cover the costs of the mailing. Those costs would include the list, if one was bought, creative, postage, paper, printing and the labour associated with the mailing. In other words, a successful mailing breaks even. With the advent of new technology, this has changed due to the ability to produce more creative and dynamic direct mail pieces. Full colour, printed graphics, copy, fonts, numbering, etc. can now change on each piece printed and deliver totally unique mailings. Success rates have soared and hover around the 30 per cent to 40 per cent mark and in some cases as much as 80 per cent. By knowing your customer, and their touch points, your marketing collateral, whether it is personalised or customised, will stand a greater chance of success. It must be said that VDP must be used appropriately as its success is determined by the quality of the database, relevance of the message or offer, and be supported by good copy and design execution. Loren Botha business development consultant Antalis for the Kodak NexPress [email protected]

[ data ]

who needs data?

by Jonathan Manners

To answer this we need to embark on a journey starting with the following question:

would you share your data with your biggest competitor? Understandably, companies do not want to share their data with their competitors because these competitors would gain the ‘upper hand’. So how come this data is so valuable to competitors yet the companies holding the data do not use it to its full potential?  Companies think they know their business backwards and do not see the need for analysing their data to find out what they already know.  Clients are scared of their data. They may believe the data is in a poor state or simply do not understand it. Often, data is captured for financial purposes to run the business and using it for marketing purposes has not been considered.  Money! Data packages are expensive and don’t always give the right answers.

why are you scared of data? Using data in a marketing sense is no more complicated than a baker baking cakes (if a particular cake sells, he bakes more; if it doesn’t, he stops baking it). Similarly for data, we want to find out how we make our money and do more of that. Plus we want to find out where we are losing money and stop doing that – not that marketers can or ever will fathom the concept of an exit strategy. The only complications are how these data findings are presented and how to turn them into actions.

Next time you think about how realistic a loyalty figure is, I suggest you think of one or two real-life examples.

and the money issue? Marketers need to understand that, like CRM, data analysis is not a software tool that you can plug in and play. Real insights come from a real person looking at the data with their marketing hat on. Similarly, when it comes to CRM software packages, the important thing is not the software itself. What counts is how the data within the package is interpreted. So next time someone tries to sell you an all-encompassing CRM software solution, ask them what this software knows about your business, your market, your customers and your competitive landscape.

the marketing strategy

bursting some bubbles

in conclusion

Quite rightly, companies measure customer satisfaction and loyalty – but often they are doing the engineering equivalent of measuring temperature with a ruler. Why do call centres measure customer satisfaction by the number of calls answered in the day or by how many times they answered the phone within three rings? Maybe what the customer really wants is a solution to their query. It is not just call centres that measure in this way. Think about the last time a motor manufacturer phoned you to ask how your service was. They don’t seem to ask about the things that went wrong. But don’t worry – they have covered the important issues such as “Did the person greet you politely?” and “Did the person explain the invoice to you?”

In the words of Benjamin Disraeli: There are three kinds of lies: lies, damned lies, and statistics. Anyone can produce statistics but it is their interpretation and usage that makes them valuable. The first two of the above (lies and damned lies) will not help your business (unless you are into establishing large-scale ATL bragging rights). The last one (statistics) can – and will – give you the upper hand over your competitors.

‘I need to market _______.’ Insert just about any product in the space provided and you end up with the following marketing strategy: ‘LSM 8-10; TV, radio and print in these relevant magazines. Are we readily admitting that we know nothing about our customers other than they are LSM 8-10, watch TV, listen to radio and read magazines? Just because everyone else is marketing in this way, why should you? Do you want to lead or to follow?

Jonathan Manners analytics director, Wunderman SA [email protected]

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[ credit data ]

direct marketing and credit data – experiences from the credit industry by Thamir Hassan

When it comes to direct marketing, the lessons are often repeated and yet are seldom learned from. Within the credit industry, the challenges are not very different. Credit providers are on a continuous drive to increase sales and grow their customer bases. As part of these efforts, credit providers are particularly interested in running direct marketing campaigns to their internal customers for up-selling and cross-selling purposes or to external customers to grow their customer base. As we all know, there are several aspects to running a successful direct marketing campaign, including the communication channel, the creative, the product being offered and the customers being targeted. However, the emphasis is often incorrectly placed on the creative approach and the offering at the expense of the selection of targeted customers. While the creative and offering are no less important, mailing a wonderfully executed creative to the wrong customers will be a wasted effort and cost. In the case of offering a credit product through a direct marketing campaign, the credit provider will have to target customers who are likely to be interested in the product being offered. In addition, those customers who respond to the offer must be qualified from a risk and affordability perspective, especially based on legislation (the National Credit Act).

right respondents, right strategy Adopting a ‘spray-and-pray’ strategy – where limited segmentation is carried out during marketing planning – will result in high costs and wastage of marketing expenditure. In the credit environment, poor targeting poses significant damage. Poor selection of prospects means that many who respond to such marketing campaigns will be classified as poor credit risk. Many prospects, who are normally denied credit through normal application channels because of their poor credit rating, are keen responders to direct mailing campaigns for credit. This results in some excellent but inappropriate response rates; these prospects respond only to be turned away when assessed for creditworthiness and affordability. In the meantime, the credit provider continues to incur other costs and risks. In many cases, these ‘bad prospects’ are so significant in number that call centre and other fulfilment operations are overwhelmed by the volume of prospects that do not present any value to the business. This also has implications such as increased cost of processing applications (from paperwork, telephone call and effective use of resources). There is also the

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in the case of offering a credit product through a direct marketing campaign, the credit provider will have to target customers who are likely to be interested in the product being offered.

reputational risk in marketing to inappropriate prospects. A very negative message is created about a brand that offers products to individual prospects only to decline them later. The lesson to learn from all this is that selecting the right prospects starts and ends with the intelligent and effective use of data. To ensure a cost-effective marketing campaign targeted at the right prospects, one needs to work with a simple, but structured database marketing process. The first step is a proper understanding of the credit provider’s existing customer base, the products being offered and any previous marketing campaigns carried out by the credit provider so that one can learn from them. If there were no campaigns carried out previously, then it is critical to ensure that the internal operational systems and validations are aligned with the campaign in terms of dealing with responders. Many well designed and executed direct marketing campaigns fail because internal systems cannot deal with the responders efficiently resulting in a loss of sales.

extracting the right information The initial list of prospects for direct mailing can be obtained from different sources, one of which is list providers. However, these list providers have millions of records to offer. Accordingly, certain parameters will have to be defined to narrow down the selection of prospects. Because of the limited information held by some list providers, the

[ credit data ]

selection parameters are usually limited to age, gender and geography. Some list providers have more selection criteria such as census data, deeds information, etc. Typical parameters for the initial extraction from lists are an age range, a specific mix of gender percentages and certain geographical constraints, such as proximity to the credit provider’s branches. While these demographic parameters are valuable, they still cannot offer the marketer enough information to make the appropriate selection of targeted prospects. Enter credit data, which can play a major role in making the selection of targeted prospects much more powerful and intelligent. The credit provider can request the extraction (within certain limitations) of credit data from a credit bureau for the prospects on the list. Credit data is a very rich source of information at an individual level. It describes our credit activity in terms of our enquiry for credit, how many credit products we have, how much money we have borrowed, how are we use our credit limits, etc. It also describes how we are paying back our debt and whether we are in financial trouble.

analysis and selection Credit bureaus have also developed models based on this data such as credit-risk scores and income estimation. Based on the credit data and models, we can now make a very knowledgeable assessment and selection of the intended prospects for direct mailing, not only based on demographic characteristics, but on actual, measurable consumer credit behaviour Data on payment behaviour and credit-risk scores will help us to eliminate poor credit risk prospects before approaching them. The estimated income of the prospects coupled with known existing borrowing and estimated other expenses will give us a reasonable view of the affordability of these prospects. This will enable us to remove all those

who cannot afford the product being offered, not only protecting us from inappropriate respondents, but also ensuring compliance with legislation. Further analysis of the credit data can help us to identify the prospects who will likely want to acquire the product we are offering and who are creditworthy and can afford the product.

successful implementation

these well planned and structured campaigns result in excellent response rates and very high conversion or take-up rates. It also provides a positive brand image of the credit grantor that makes

The final selection of prospects to contact will be a smaller percentage of the initial list we started with. However, this shorter list is now very targeted in terms of risk, affordability and desire for the product. This represents a base of fully qualified, measured and appropriate prospects; hence ensuring that there is no wastage of marketing, operations and strategic resources on inappropriate prospects. With such a campaign, there will be no requirement to carry out any further assessments when the prospect responds apart from the National Credit Act regulations in terms of declaring income and expenses before deciding how much credit to offer the prospect. These well planned and structured campaigns result in excellent response rates and very high conversion or take-up rates. It also provides a positive brand image of the credit grantor that makes offers and accepts prospects. The simple lesson to be learned here is to let analytics and data drive the marketing process – not the other way round.

offers and accepts prospects. Thamir Hassan CEO: TransUnion Analytic and Decision Services [email protected]

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[ innovative dm ]

tailoring innovative marketing solutions to meet DM needs In a tightening consumer environment, squeezed by mounting debt, escalating interest rates, spiralling food prices, and many other rising costs topped by the orbiting price of energy – coal, electricity, LPG, petrol and diesel, marketers have to assess their cost structures carefully. Traditional advertising remains a given but direct marketing accompanied by skilled experiential activations and sampling on a face-to-consumer basis is becoming a critical element of all advertising campaigns. In this economic climate more and more advertisers are seeking better returns on their marketing spend. Many businesses find advertising campaigns costphenomenal amounts of money, for some, excessive. Direct-to-home advertising solutions are often the answer, as providers of this alternative form of marketing concentrate on cost-effective service levels and focused-audience targeting abilities. With this in mind, advertisers should consider the benefits derived from innovative marketing solutions in venues where the promotion communicates directly with the consumer. Offerings should include tailor-made packages to suit clients’ needs and activations in venues such as homes, businesses, events and intersections. To maintain and accelerate superior service to clients the media owner must be positioned to collect and analyse relevant data for further marketing requirements, and deploy consulting teams to advise on the comprehensive strategies for dynamic, effective business distribution campaigns – from branding distributors to delivering creative, appealing messages cost-effectively and without wastage. Demand has required PRIMEDIA@HOME to develop a new product, Public Mobilisation. This is an interactive marketing package suited to the marketing needs of government’s communication initiatives. To achieve the benefits, the operator’s trendsetting Store Carnival was adapted and restructured as Public Mobilisation. Interactive, the platform generates anticipation and excitement around government activities and new promotions or events in various environments through creating exciting educational experiences incorporating music, entertainment and sales promotion techniques that build a celebratory atmosphere and increase awareness of government initiatives. The Government Communication and Information System (GCIS) recently awarded three government tenders to PRIMEDIA@HOME, based on the dynamics of Public Mobilisation. “We are appointed GCIS’ communication partner of choice for home direct distribution, bulk delivery of government information products – including the State of the Nation Address (SONA) and Imbizo. The list of tasks include a range of additional promotions, including 2010 updates and the distribution of the SA Year Book, and many other publications, including the nationwide distribution of Vuk’uzenzele, a strategic government magazine,” says Melvin Chagonda, Chief Executive Officer. Home Direct provides distribution of unaddressed advertising and promotional material to homes nationally to an exclusive 70 per cent share of the South African door-to-door market through 34 branches covering 6.4 million households, or 76 per cent of the total South African population. “The GCIS’ SONA direct marketing interaction in May required

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by Melvin Chagonda

distribution of 1.5 million leaflets targeted at the LSM 1-5 market via this medium,” Chagonda says. The marketing campaign also included advertising inside 8 500 Cell C Community Chat containers, each located in a peak traffic and high convergence township area. Each container attracts about 500 customers per day and provides exceptional focused exposure for GCIS’ communications. Consumers make over 120 million call minutes nationwide, per month, from Cell C’s outlets. During their forced dwell times as they spend at least two minutes per call, their eyes willingly lock into whichever advertisement is positioned above each mobile instrument inside the container. “GCIS and other clients can also target passing pedestrians and car, taxi and bus commuters with the recently launched external Community Chat branding opportunities. The containers have effectively been transformed into three-dimensional platforms visible from far and wide,” Chagonda adds.

ensure your distribution partners have a thorough understanding of your target audience and the capacity, both in infrastructure and database, to reach that audience effectively. Another element of the campaign is the direct distribution of SONA communication to various one-stop government service centres located in rural areas and townships, where the community members go to consult government officials about social grants, identity documents and passports. PRIMEDIA@HOME made deliveries directly to libraries, post offices and youth organisations to saturate the market. Winning the Vuk’uzenzele tender requires PRIMEDIA@HOME to distribute the multi-lingual magazine that enhances awareness of government programmes. “Its core focus is to meet public information needs on socio-economic opportunities created by government programmes and how to access these opportunities – especially among those with less access to mainstream media,” Chagonda explains. Targeted at the LSM 1–5 rural and deep rural markets, 1.6 million copies of the magazine are distributed door-to-door every six weeks via Home Direct. Delivery is also made directly to government service centres and departments, libraries, hospitals and clinics, rural post offices, police stations and regional GCIS offices. Public Mobilisation was launched based on an in-depth, wellresearched understanding of the target market that GCIS is trying to reach, which is the key to a successful campaign. A last tip for advertisers – ensure your distribution partners have a thorough understanding of your target audience and the capacity, both in infrastructure and database, to reach that audience effectively. Melvin Chagonda CEO, PRIMEDIA@HOME [email protected]

[ search marketing ]

why search

marketing works by Stafford Maisie

Wherever you are in the world, whatever your line of business, these are challenging times. Costs are rising fast, competition is increasing and the overall economic climate is more uncertain than it has been for years. The result is that company budgets are being studied closely everywhere to see where they can cut costs. Now, more than ever, online search marketing should be at the top of every CEO’s strategy for the flexibility, targeting and measurable cost-effectiveness that it gives to business. By removing the guesswork and replacing it with actual numbers, search marketing puts the advertiser in control. It enables them to target precisely, pay only for results and stay firmly in charge of costs. It turns advertising from an art into a science. First, there are no high upfront costs when advertising online. There are no expensive TV commercials to film or poster sites to rent. Search advertisers need only draft three lines of ad text and bid for keywords they’d like their ads to appear against – words that users looking for their products are most likely to type into the Google search box. Second, advertisers connect with potential customers at a time when they are searching for information – which makes it far more likely that this potential will turn into new sales. Instead of taking a scatter-gun approach, search marketing enables advertisers to target warm leads. Third, it is payment by results. Advertisers only pay if a potential customer makes the decision to click on their ad. As this is an active, deliberate decision, it’s far more likely to be rewarding for the advertiser. What’s more, the cost is in the hands of each advertiser. It is entirely up to them how much they are willing to pay every time a consumer clicks on their ad. Fourth, the Internet allows advertisers to root out waste and target their potential customers by geography and time. Advertisers can target a continent, country, region or even a square-kilometre radius if it suits them. So, a travel company offering specials on last-minute weekend fares out of Birmingham can ensure its ads only appear to those searching from the city on Friday, Saturday or Sunday. The key factor is the return on investment. Search marketing deals in cold, hard numbers: advertisers know their cost per customer acquisition down to the very last cent. In fact, Google provides free tools to advertisers which enable them to see how many times their ads are being seen, how often they are being clicked on, how many users are entering and leaving their website, average cost per click and even the advertising cost per purchase. It’s the sort of information which the most expensive market survey

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online search has changed the dynamics of marketing, allowing firms to target very accurately consumers who are actively searching for products or services they are interested in.

could only hint at without any hope of achieving the same level of accuracy. It enables advertisers to make accurate decisions on the cost and benefit of their campaigns. In the past, the underlying principle of mass-market advertising was to shout it loud and shout it wide. Or, to put it bluntly: send out your relatively undifferentiated message in the face of thousands in order to reach the hundred or so for whom it’s relevant. But, this has become more difficult and less measurable with media fragmentation and the growth in TV channels, radio stations and magazine titles. Online search has changed the dynamics of marketing, allowing firms to target very accurately consumers who are actively searching for products or services they are interested in. If a user types in the term ‘credit card’ in the search box, it’s because they are interested in applying for a credit card. This is known as pull marketing, as the users are specifically requesting information on the product or service you are selling. It also better serves the needs of consumers who are suffering the same pressures as businesses. With less money in their pockets, they are more determined than ever to spend wisely and are more likely to take the time necessary to ensure they do so. CEOs also need to take heed of Internet trends. According to eMarketer, there are now 37 million people online in the UK, representing 60 per cent of the population, all connecting, creating, sharing and communicating. According to the latest Forrester research, 55 per cent of households have broadband installed, and people in the UK are now spending an average of seven hours of their leisure time per week online. With the cost of Internet access falling and the speed of broadband accelerating, the Web is going to become an

[ search marketing ]

if search marketing can tell you exactly where every cent has been spent and only gets spent when someone shows a deliberate interest in your product, then it should be a business necessity.

increasingly powerful tool in the hands of consumers searching for what’s on offer and comparing prices. CEOs need to make sure they are following consumer trends. Google is confident in the continuing appeal of search marketing in tougher times. Companies increasingly appreciate the control that search marketing gives them – which is all the more important when money is tight. If search marketing can tell you exactly where every cent has been spent and only gets spent when someone shows a deliberate interest in your product, then it should be a business necessity. It’s why the predictions of the doom merchants on Web advertising have proved so wide off the mark.

five tips for success with search marketing target Search marketing allows advertisers to target ads to a captivated consumer by matching ads to search queries. Advertisers enter a list of keywords related to their business, and can bid to trigger an ad when a user types in that query. Advertisers only pay when someone clicks on their ad.

test Start with a small budget and see what works for your business. Experiment with different creative text and strategies to see what works and optimise your campaign as you go. If something doesn’t work change it. If it does, improve it and make it work even better to grow your business.

control Online advertising allows you to spend as much or as little as you want. Programs like Google AdWords allow you to lower and raise your daily spend with a simple click to reflect your business’ needs. For example, if you sell beds and you want to empty the warehouse to make room for a new delivery, increasing your daily budget to increase traffic to your site could increase sales.

analyse Online advertising produces a wealth of data for analysis (but don’t be put off by this, it is extremely user friendly!). Rather than simply looking

at the volumes of traffic arriving on your site, analyse conversations and the customer journey through your site, which allows you to improve your campaigns and their profitability.

mix If you’re running an offline media campaign, support this with an online campaign that mirrors your offline message to ensure that consumers get consistent information about your brand wherever they are searching. Stafford Maisie SA country manager, Google

direct > 2008

21

[ dm in sa ]

direct marketing in

south africa by Fraser Lamb

Direct marketing in SA is in a state of flux. Some of our direct marketers are world class. Others, however, have been approaching marketing in the same way for years, and have enjoyed enough success to justify not having to do things differently. But with new legislation heading their way, they will be forced to change. The National Credit Act has already come into effect. The Consumer Protection Bill is looming, and once it becomes law, permission-based marketing will become the only option for marketers wishing to use direct channels. Those marketers that have actively trained customers not to pay attention to endless irrelevant mailshots, e-mails and text messages will soon be found out. So how will direct marketers in SA ensure that they are able to form meaningful and relevant connections with their customers? One of the main barriers to relevance is the intelligent application of data, an asset that many businesses still do not fully recognise. Of course, there are South African marketers that do get it right. Many of our clothing and furniture retailers have established successful ‘club’ programmes with membership in the millions. BMW does direct well, mainly because it has worked hard to produce a custom magazine that is genuinely worth reading. Ford is starting to embrace the concept of retention through meaningful dialogue with owners of its vehicles. The challenge for agencies now is to demonstrate that the real power of direct lies in how it can contribute to customer retention and growth. But any retention effort will come to nothing unless people within a business get their bonuses not because they have helped keep existing customers, but have continually acquired new ones. As with any aspect of marketing, direct should be an integral part of business strategy, rather than simply an addendum to it. Get that right, and direct marketing will no longer be a compliance headache, but a powerful opportunity for building relationships with customers many years into the future.

wunderman explains how to think digital The Wunderman Network has developed this handy guide (How to think digital), which explains to analogue marketers why their careers are over, and how they can evolve to become digital marketers.

















 





key pointers: 





22

Digital has more impact because it has the potential to hit the right people at the right time Forget demographics – your core target is the people who are thinking of buying from you. Digitally enhanced word-of-mouth marketing is the most powerful form of digital media, but use it carefully (get it wrong, and you’ll be buried!). A key measurement is connectivity of an audience. And bad reviews aren’t always bad for your brand. Digital media is interactive; it’s about getting people to do things,

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rather than to think things. Make sure that the doing part is simple and carries some sort of reward for the consumer’s efforts. Spend as much time thinking about what happens after the click as you do thinking about everything leading up to the click. Don’t keep people waiting (for your website to download or your online ordering service to load). You cannot afford to be a dataphobe; learn to handle all data with care. Get the right (accurate) data, organise it correctly, don’t analyse it in isolation; think about whether you’re right to ask people for more information at a particular point, and whether the information is going to give you real insights. Make sure the networks between the various departments that use this data work. Digital media will continue to evolve, so don’t wait for the dust to settle; instead, adopt a permanent beta mentality in your marketing planning. Smartly managed digital relationships can last a lifetime (it beats trying to find new customers). Save money on media by finding the right partner, making sure they can bring real value to the table and won’t cannabalise your user base in the process. Web 2.0 is the ‘channel of we’, so start working with your consumer. Think in herds rather than in individuals. Experience is a great form of marketing and should be the starting point for the marketing campaign. Be very careful around privacy issues. Digital media need to evolve, and will become more efficient. Make sure you know enough to predict the future of marketing and media. The people who tried your service yesterday are talking to those who will try it tomorrow. Tell the truth and learn to cope with criticism. There is a growing demand for products and services that can be delivered instantly. Boring isn’t boring at the moment of truth (ie when you’ve just bought a bread-maker, the user manual is fascinating). Localisation involves much more than just a translation. Just because it’s digital, doesn’t mean it’s better. Make sure that digitisation means the quality of your service goes up, not down.

Fraser Lamb CEO, Young and Rubicam Brands [email protected].

[ mobile media ]

using mobile media in direct marketing by Rick Joubert

Today, the cellphone is available to marketers as a fresh and integrated response channel to use within their overall marketing mix. It is also a standalone medium, equally effective for delivering brand or direct marketing messages. Mobile is emerging as a particularly powerful direct marketing channel in developing economies like South Africa, where large sectors of the population do not have access to other digital media (Internet or e-mail) or indeed, a postal address for traditional direct mailers. The mobile medium presents an exciting and cost-effective alternative to traditional cold calling and postal direct marketing, and with penetration levels approaching 80 per cent of the adult population, allows direct marketers to target a previously unreachable mass market. Of course the same permission guidelines and direct marketing best practice applicable to traditional direct channels should apply to the use of the mobile channel. The escalation in the levels of unsolicited SMS spam is of great concern and the direct marketing industry needs to ensure that rogue marketers and list brokers are not able to compromise the growth of a fantastic new direct medium by abusing it. Vodacom has taken the initiative and established a permission-based mobile direct marketing platform called AdMe (www.adme.co.za), positioned to provide an outlet for consumers willing to be marketed to. Through the AdMe platform’s powerful profiling and segmentation capabilities which cuts across demographic, geographic, sociographic and interest attributes, marketers can target very specific market segments aligned to their message and brand/product’s target audience. Since AdMe’s public launch in mid January 2008, the campaign has generated more than 800 000 unique visitors to the AdMe mobi-site (mobile Internet site) and over 150 000 qualified opt-in members, using only mobile advertising and marketing techniques – testimony to the effectiveness of the medium! Mobile is an effective medium for both delivery of and response to a direct marketing message and is being used by many direct marketers for both lead generation as well as the primary campaign delivery channel. When used to facilitate lead generation or profiled data collection, mobile can be used as ‘pure play’ (eg a mobile Internet campaign for call-back or a Please-Call-Me campaign with a call back, SMS or USSD response call to action) or simply as a ‘back channel’ to facilitate an instant response (eg using an SMS short code or a USSD form) where the call to action is then delivered via traditional channels such as radio and print. When used to facilitate the execution of an actual direct campaign

to a permission database, the most effective mobile channels are SMS, AMS (voice messaging), MMS (multimedia message) and WAP push – these are rapidly evolving and new channels are always in development, making this an ever-evolving medium that lends itself to new and exciting initiatives. As an example, marketer’s leveraging the AdMe platform can target a highly defined audience through an MMS which includes up to 30 seconds of audio and video content, with up to 4 000 characters of text. The message may include a call to action such as a click-to-call (the user phones you) or call-back link (you are notified that the user expects your call), a link to the marketer’s Mobi-Site, which is accessible on the consumer’s mobile phone, or a simple SMS response. With these types of response mechanisms both the outbound and inbound actions are tracked and measured. Depending on the type of campaign, and alignment of the message and targeting attributes, marketers can conservatively expect average response rates of between two per cent and 15 per cent through AdMe. Mobile also enables direct marketing campaigns to be cost-effective (between R0.01 and R2.00 per contact depending on the channel), ubiquitous (millions of South Africans use voice calls, SMS, USSD and WAP every day of their lives), actionable and adaptable in real-time (as campaigns can be changed quickly based on real-time consumer responses). According to the Direct Marketing Association of South Africa, it is estimated that almost half of all direct marketing spend is already accounted for by mobile as a medium. Therefore, serious direct marketers should develop a strong mobile direct marketing competence if they wish to remain competitive within the marketing industry. For further information, go to www.on-the-line.co.za or www.adme.co.za Rick Joubert executive head (Mobile Advertising & Social Media team) Vodacom South Africa [email protected]

direct > 2008

23

[ dm today ]

the vertical line by Patrick Collister

I spend a lot of time looking at work from around the world which is winning direct marketing awards and I have noticed two things. Firstly, a lot of it comes from what used to be called above-theline agencies. And, secondly, a lot of it isn’t direct. Not in the strictest sense of the word, anyway. Earth Hour, from Leo Burnett, Sydney, is a case in point (www.earthhour.org). Now, the response required by the communication wasn’t transactional. It was to get a couple of million fingers to push a switch to ‘off’. I suppose there was an offer – save the world. But looked at dispassionately, it isn’t what Drayton Bird (author of Commonsense Direct Marketing) would have done, given the same brief. Also, Tate Tracks from Fallon London, the brainchild of Juan Chabral, the creative responsible for Sony Balls, Paint et al, not to mention the Cadbury Gorilla. The idea was to link art and music and get young people into Tate Modern to look at, and think about, the work there. Not a coupon to be seen though there was an offer. Free downloads of the tracks, which were created by (among others) Chemical Brothers, who had been inspired by the art. The point is, direct has been changing at such a rate that it is no longer a discipline, it has become an attitude. Thus it is legitimate to say, as one creative director told me: “Getting someone to laugh out loud at your idea is as direct a response as you could wish for.” It is an attitude about how communications works rather than about how to make a sale. Thanks to digital media, all communication can soon, loosely, be one on one. A commercial may go viral and the YouTube link spread from inbox to inbox, which is what happened with Dove’s

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essentially, this is a left-of-line activity, where direct marketers come into their own, identifying discrete audiences for a specific message. Right-of-line thinking is still less discriminating. Its attitude is broadcast rather than narrowcast, measured by the number of eyeballs attracted rather than sales made.

Evolution ad. It may have run once in Holland, but it has been seen over five million times online. And it too won awards at Cannes and elsewhere in DM categories. Quite frankly, Lester Wunderman would probably not recognise it as direct marketing.

neither above nor below but beside the line There was a time when the demarcation between above and below the line was clear. This is no longer the case and some commentators and, indeed, some agencies, have talked about how there is no line any more. Well, the line does still exist. Certainly in the UK within the minds of most marketing directors there is a clear distinction between brand advertising and marketing services and few would entrust both to one agency. Elsewhere in the world, marketers are forced by budget to consolidate their communications into one shop rather than two, three or even four, as is the case in Britain or the US. And it’s in these agencies that you get to see most clearly that the line is still alive and well. But it isn’t horizontal. It is vertical. And as a result, what we are beginning to see is the emergence of beside-the-line agencies. In developing the theme here, I’d like to pay tribute to Mark Hancock, Director of Strategy at Proximity, London, and one of those planning types with a brain the size of an IBM mainframe. He was, I think, the first to speculate that the line has simply changed its axis when he wrote, “There is a general misconception around the roles of communication based on the belief that rational messaging (BTL) will lead to behaviour change following the deployment of

[ dm today ]

emotional ATL communications. This is nonsense. The integration of digital has meant that all communication needs to be emotively charged to succeed. Moving sound and image – the best drivers of emotional responses and brand ‘likeability’ no longer resides in the ATL agencies” – but in all creative agencies irrespective of their discipline. Here’s a little chart:

The vertical line is now like the marker on a radio. On the far left you have rational, on the far right you have emotional. In every bit of communication, you slide the line further away from or closer to those two end-points, depending on the nature of the task. The vertical line assumes that every pack, email and microsite will have a bearing on the brand just as every TV ad will have an influence on the nature of every offer in one-to-one communication. Or should have, at any rate. The vertical line gives DM agencies permission to push up and out from their traditional roles as purveyors of acquisition materials and closer to brand country, using online, ambient and even broadcast media to do so.

the left-of-line agency Perhaps a more accurate way to differentiate agencies is as leftof-line or right-of-line. So, reflecting left-brain/right-brain theory, left-leaning agencies will specialise more in logical, transactional messaging with right-of-line agencies concerning themselves with emotional engagement. Left-of-line agencies create positive response to the offer or promise. Right-of-line agencies create positive response to the communication itself. Both need to be branded. The important distinction is that the two sorts of agency are no longer differentiated by media as they used to be. Both agencies may use the same channels, but they will use them for very different purposes. An idea that gets people to interact with the brand online and become a part of the experience is ‘direct’ in many ways but at the same time it is also an undiluted piece of brand communication.

the end of the big idea If the concept of the vertical line helps explain how old-style ATL and BTL agencies are now beginning to occupy the same spaces, without putting each other out of business, it also helps signal that the day of the Big Idea may be at an end. Big Ideas really only suit marketing directors of big companies. They are easier to manage than swarms of little ideas and they allow the bigwigs to feel they are in control. In truth, what may well suit the brand best are lots of little ideas, which, together, add up to a lot. Richard Branson seems to have understood this intuitively from the very start. And Nike seems to be pursuing little ideas with typical energy and success. No end line, no unifying style, no one bold thought. Rather a series of engagements which allow the brand to appear local even while it is a global behemoth. Compare and contrast that with Gillette, say, whose campaigns featuring top sportsmen are obviously made at some global centre and are then pushed out to the regions. Why these ads look and feel so incredibly wooden is, I suspect, because they are driven by old-fashioned demographics. The thinking is: young males across continents are all influenced by the same sort of sporting role models they envy and admire. Ergo, bung a couple of those sports stars in the adverts and make sure the scheduling is spot on so you reach those young shavers wherever they gather and hey presto! You sell a lot of razors. If you buy the vertical line theory, then there is a third consequence to it for DM agencies. It is the mechanic that allows DM agencies to grow out of that slurry pit at the bottom of the chart, acquisition, and into the profitable areas of retention and brand by speculating, identifying, testing and proving that the most valuable customers may not be those identified by demographics – but by behaviour.

lost gamers are all ages To identify the over-fifties as Silver Surfers, for instance, is segmentation by demographic. But what about surfers who are Lost in Space? (Both my son and my wife are committed gamers). Or the In-and-Outs who see the Web as no more than an electronic Yellow Pages? The moment you start identifying audiences by what they do and where they go, rather than by age and income, you can’t help but have interesting (small) ideas. Essentially, this is a left-of-line activity, where direct marketers come into their own, identifying discrete audiences for a specific message. Right-of-line thinking is still less discriminating. Its attitude is broadcast rather than narrowcast, measured by the number of eyeballs attracted rather than sales made. However, the two approaches are blurring. And that for me is the joy of direct marketing right now. It’s where some of the most interesting ideas in marcomms are taking shape as smart marketers learn to use direct tools to build their brands in new beside-the-line ways. Based on an article written for Directory Issue 7. Directory is a quarterly publication showcasing the best new ideas in direct marketing from around the world. For more information, visit www.directnewideas.com Patrick Collister editorial director Directory [email protected]

direct > 2008

25

[ podcasting ]

podcasting and audio downloads:

content on demand by Ryan Till

Podcasting is enjoying an interesting time in South Africa. Although technically not a direct marketing tool, as it is predominantly specific programmes requested by listeners as opposed to marketer-driven outbound communication, it does serve the purpose of engaging specific target groups. Essentially, podcasting falls into the broader category of audio downloads. In the case of radio, that would be giving listeners the chance to consume exactly what they want, when they want it. So in this sense, more often than not, the core purpose of podcasting is to allow consumers access to great content, rather than for marketers to market their products. Podcasting came to South Africa with much fanfare, but that initial hype has subsided quite a bit. Those who do offer podcasting services have invariably found the niched products in their content offering, and package those products for a mostly niched subset of their entire market.

it’s also important to note that South Africa has incredibly high levels of mobile phone penetration, but is very far behind, relative to developed nations, as far as Internet penetration is concerned.

While podcasting represents a great opportunity to offer listeners a value add, it is to an extent limiting: it’s only available to those with a computer and only appeals to those with an affinity for podcasting. To bridge this gap, many content providers are moving into the mobile realm. Today, almost every cellphone is Internet-enabled, allowing consumers the opportunity to access content more readily and easily. So while traditionally, a person would have to be sitting behind their computer and log onto a website to access the podcast or audio download they can now download audio via their cellphone. This substantially broadens the reach of this content beyond the traditional ‘podcasters’.

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At Primedia Broadcasting, we have worked hard to find a system to make audio and video available, on demand, to almost anyone with a mobile phone. The success of this has been based on the fact that we’ve made access incredibly easy – as far as the listener is concerned it’s all via SMS. By way of example, we have instituted this system on two of the biggest comedy features on the Rude Awakening breakfast show on 94.7 Highveld Stereo – the daily Traffic Joke and the Stupid Sports Joke podcasts. Listeners interested in hearing either of these jokes after the broadcast that morning simply SMS the respective word (JOKE or STUPID) to 33VIP and then click on the reply SMS that comes back to their phone. This automatically downloads the latest version of the content they have requested. Most of them are not even aware they’re doing this over the Internet. Despite the advances in this regard, it’s important not to leave the traditional podcast market behind. To this end, we also make the same downloads available on our website. It’s worth noting that many older phones don’t handle large file sizes well, and that’s where traditional podcasting comes into its own – enabling people to download and listen to longer pieces of audio (such as interviews, press conferences or special features). Taking into account the penetration of mobile phones, and the typical radio listener’s habits, we’ve noticed listener response definitely favours mobile phone downloads as opposed to podcasts. Although this isn’t rocket science, it’s simply the most innovative way we’ve seen any radio station offer content on demand to its audience. It’s also important to note that South Africa has incredibly high levels of mobile phone penetration, but is very far behind, relative to developed nations, as far as Internet penetration is concerned. I really feel that concentrating on the mobile phone is the key to giving today’s tech-savvy users exactly what they want: access to great content on demand. Ryan Till chief operating officer, Primedia Broadcasting [email protected].

[ internal marketing ]

engaging your

internal market by Grace Harding and Terri Brown

encouraging employees to define the behaviours for themselves, rather than dictating behaviours chosen by executive leadership, proved immensely powerful in ensuring greater participation (84 per cent), ownership and buy-in.

Internal marketing provides a welcome solution to the challenge of communicating with employees in a way that captures their hearts and minds. In spite of a global trend towards a more engaged employee communication approach, many companies still operate under the mistaken belief that because employees are on the company payroll they’re obliged to pay attention to whatever the company tells them. But the fact is that, either consciously or unconsciously, employees tune out when they encounter communication they feel is irrelevant, confusing, overwhelming or boring. And while you may feel comforted knowing you sent an e-mail, memo or newsletter, you may also be shocked to learn how few employees read, let alone internalise and act on the information contained in them. The reason for this is not that employees are inherently disinterested, but rather that they’re swamped by communication (the average person encounters 30 000 messages a day, according to Anders Nylstrom). Internal communicators have lost sight of the reason for communicating, which is to bring about a desired behaviour in employees that delivers on the business strategy. They’ve become so enamoured with communicating for communication’s sake, and send out endless newsletters, memos, posters, desk-drops, e-mails and intranet posts. The net result is disengaged, communication-fatigued employees. If businesses want to mobilise employees and direct their energy towards business objectives, they need to take a new approach – one that’s dynamic, creative and, above all, engaging. It has to be communication that hooks employees in on a cognitive, emotional and behavioural level and reinforces the cultural and strategic fundamentals of the company.

welcome to the world of internal marketing. Think of it as marketing turned inside out. Internal marketing relies on similar principles to traditional consumer marketing and advertising, and applies them to the internal market (employees). It’s a communication ethos that can be applied to any message regardless of size, scope or type. We’ve used it effectively for everything from once-off, short-term messages to ongoing internal campaigns that last indefinitely. Underpinning it is an approach that uses communication to engage employees so that they behave in a way that delivers on a given business objective.

So, how to get it right? To begin with, internal marketing demands a mind shift when it comes to how companies perceive employees. Traditional communication no longer works because it’s patronising, uni-directional and draconian – an approach that the new generation of employees doesn’t respond to in the way that its baby-boomer predecessors did. Only when companies start to see their employees as individuals who can be trusted to add valuable input, will they manage to set the correct communication tone and thereby capture the ears, minds and hearts of employees. How internal marketing is expressed practically and the difference that it can make to a business’ bottom line is perhaps best illustrated by an example. Actuate was recently briefed to help Absa Corporate and Business Bank improve its client satisfaction and employee climate survey scores. In order to do so, we needed to conceptualise an internal marketing campaign that would communicate the behaviours necessary to address both employee and client concerns. Being familiar with the pitfalls of traditional employee communication, we took employee engagement as our starting point and divided the employee group into teams with team leaders, each of whom was equipped with a facilitation pack containing a facilitator’s guide, flip chart, marker pens and a voting system. Employees then set about identifying the behaviours they believed would help improve customer and employee satisfaction through a manager facilitated process. In all, over 1 000 employees participated and identified 500 behaviours. These were clustered into seven key themes, each with four behaviours, which were approved by the business leaders as being appropriate before being packaged into an employee guide. The same list of behaviours might have been defined by an executive team, but the net result would have been very different. Encouraging employees to define the behaviours for themselves, rather than dictating behaviours chosen by executive leadership, proved immensely powerful in ensuring greater participation (84 per cent), ownership and buy-in. It also sent out a clear message that the business trusts and relies on them, values their input, and is therefore prepared to give them accountability. Grace Harding, co-founder, Acuate Terri Brown, co-founder, Acuate (011) 343 9100

direct > 2008

27

[ crm ]

using CRM and data

management by Monique Smith

With the average individual receiving thousands of marketing messages every day, South African consumers are suffering marketing fatigue. Coupled with the challenge of clutter, businesses have also been realising for a while now that it is far more expensive to acquire new customers than it is to retain existing customers. While this scenario presents some obvious challenges to marketers it also delivers great opportunities for direct marketing interventions. However, successful direct marketing campaigns require insight into the customer or else they are bound to also disappear into the clutter. Marketers need to know how old their customers are, whether they have children, and their lifecycle and lifestyle needs? What are their personal preferences? What is that something special that will really excite them? The list of questions is endless. Knowing your customers intimately and being able to use the information to nurture a relationship and develop tailored offerings that meet their needs is the Holy Grail of marketing. However, while many aspire to this elevated state of customer understanding, few businesses actually manage to implement effective customer relationship management (CRM) processes successfully and leverage customer data to support their direct marketing campaigns.

eBucks collects data in many different ways such as member surveys, data enhancement questionnaires and formal research.

The trap many companies fall into is to simply deploy a CRM solution without interrogating their data requirements and developing a real CRM business strategy. Without understanding the kind of customer data the business requires and how it will be used by different parts of the business, many companies will become disillusioned with their CRM investment and never realise the true potential of their data. For rewards programmes such as eBucks, CRM and data management form a fundamental part of the business. eBucks’ main drive is to understand members’ behaviour through the data it collects through various channels and means, thereby gaining insight that will enhance the reward experience for the member.

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To achieve this, the member information used needs to be current and accurate but, most importantly, the data needs to be relevant. eBucks uses the data it collects to tailor promotions, competitions and marketing communications to the specific needs of individual members. For the data to be relevant to the business’ requirements it needs to include basic demographics such as age and gender as well as psychographics such interests and preferences. eBucks collects data in many different ways such as member surveys, data enhancement questionnaires and formal research. Some of the most valuable and relevant details required to tailor member offerings lies in the transactional and usage data eBucks collects based on how, where and on what members spend their eBucks. In piecing all these bits of information together, one ends up with a well-rounded picture of the member. If relevant data has indeed been collected, this picture is invaluable in developing targeted marketing campaigns. At the heart of a successful CRM programme lies an understanding of what the business needs to know about its customers, a strategy on how it will actively collect and manage this data throughout the customer’s lifecycle and, most importantly, the ability to use the data to support direct marketing campaigns to grow customer relationships. Monique Smith head of Member Experience, eBucks [email protected]

[ loyalty ]

in pursuit of

loyalty by Nici Stathacopoulos

The very nature of a human being is to engender loyalty from all the other beings they have a relationship with; the most common of these is the relationship with their dog. It is natural to assume that a pet will display loyalty to their owner; after all, they get fed free, nurtured, played with and loved; tenets of any great relationship. Beyond that we have happy marriages where a couple are truly in love with their partners and will behave in a certain way with their partner that ensures their loved one doesn’t display disloyal behaviour. Is it possible to translate this behaviour into a consumer-to-brand experience? Why do I, a mom of two teenage sons, want to display loyalty to my mobile provider? Why do I want to display loyalty to the brand of car I drive? The only answer I, as a marketer and a consumer, can give is that I want to get something real back from that brand. ‘Real’ for me means:  Great service  Decent pricing  A brand I identify with  A product or service I need and /or want  I receive help when I need it.

In turn, loyal customers’ actions can be seen as follows: They have emotional equity in your brand  Your brand is their first choice  They look to you to solve their needs/problems  They ask you for guidance  They discuss your offering not your price  They positively suggest how you can improve  They want you to succeed  They advocate ‘their’ brand to others  The emotional equity translates into positive buying behaviour. 

Loyalty will be engendered when customers transact with your brand again and again of their own free will. Many businesses confuse rewards (points, discounts) programmes with loyalty programmes. However, a points-based programme (less so a discount programme) is part of a retention and database building strategy, not a loyalty strategy. In fact, many programmes, such as air mile programmes, often engender a feeling for the customer that he is a prisoner, forced to continue flying with the airline due to a build up of miles – which they can never redeem – but the seats are uncomfortable, the food awful and the check-in service appalling. According to Colloquy, membership of USA loyalty rewards programmes has reached 1.3 billion, but the average household belongs to no less than 12 loyalty programmes, and only 4.7 yield active participation. In my opinion, the word ‘loyalty’ does not describe these programmes. Simply call it a rewards programme. To optimise customer loyalty, besides understanding product and brand loyalty, customer loyalty must be derived from the customer experience and relationship. This can be done by building knowledge of the customer (database marketing), which should be both research and experience data, which then enables marketers to understand the motivation of customers and therefore price- enhance customers’ experiences, not only targeted communications. Therefore, creating loyalty among your consumers is a brand personalised event that cannot be commoditised with a rewards programme. It is the experience the discerning consumer has and the reason why they choose relevant brands. Differentiate and prove real value to high-spending customers to ensure continued buying behaviour. Change the value that your customer experiences. The clutter in the marketplace confuses and distresses the consumer, who has become even more stretched for time and has less disposable income, especially in the recession we currently find ourselves in. And the varying degree of media messages has increased countless fold – as Seth Godin puts it: “Television was a miracle, in a heartbeat it all fell apart – TV commercials ceased to be the one-stop shop for all marketers – we’ve got so many other ways to hear stories they’ve lost their effectiveness.” The reality is there are only so many consumers, we are all going after this potentially lucrative segment, with little product differentiation, shorter product life cycles, intense competition, price wars and, finally, media saturation – so we need to find differentiated ways of building loyalty towards our brand that translates into positive buying behaviour that is sustainable over time. Nici Stathacopoulos managing partner, proximity#ttp [email protected]

direct > 2008

29

[ custom publishing ]

customer magazines can improve your DM performance by Martha Dimitriou

Customer magazines are about connecting customers to brands through engaging and useful content. If the brand-generated content is relevant and of a high quality, the time customers spend engaging with the brand is increased and their relationship with it is enhanced by the positive experience. Once a brand has the customer’s attention, it has the opportunity to improve its image, create higher levels of awareness, increase loyalty and ultimately impact the bottom line. The effectiveness of customer media (magazines and increasingly online and mobile components) can, to some degree, be measured by their ability to inspire two-way communication between the brand and the customer. Hundreds of companies, across all industry sectors, have discovered that a customer magazine can deliver measurable results. Unlike other means of communication, such as advertising and direct mail, consumers do not find magazines intrusive. In fact, research reveals that consumers are more likely to take action as a result of reading magazines than from watching television. Successful customer magazines work to specific objectives, which must be measured and met. These magazines should balance the needs of the client against the aspirations of the reader. Achieving that balance is not easy but, as our clients can testify, the rewards are great. To understand the success of customer magazines, one has to understand their effectiveness; how the magazine affects the image of the brand it’s communicating; how it supports and personifies the brand, and impacts the customer’s behaviour.

effectiveness Edgars Club Magazine is produced for fashion and beauty retailer Edgars in South Africa. It has a current ABC of 918 222 (Jan–Mar 08), goes out monthly to all Edgars Club members and is one of South Africa’s biggest fashion and beauty magazines. Research was conducted by Millward Brown SA on the September 2006 issue of the magazine. The results confirmed what Edgars had been sensing about their customers, says Stacey Schubart, Edgars Club publications manager. “While our customers are fully aware that they are reading a customer magazine (which is fundamentally about selling more products and Edgars Club services), they still love to read it and they are more loyal to us as a result of it,” she maintains. The numbers make for a great case: 75 per cent of Club members read at least half of the magazine and, on average, pick up each issue

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2.7 times; 91 per cent think the magazine they receive is informative, and 85 per cent actively enjoy reading it. Two-thirds find it both relevant and entertaining. One in five consumers would even be prepared to pay to receive a customer magazine. Nearly a third keep it and another 33 per cent pass it on to their friends.

the impact on customer behaviour Time and again clients have indicated or confirmed that the unique selling point of customer magazines is their ability to create a dialogue with customers. In doing so, they support other elements of the marketing mix and generate an increase in sales. The Millward Brown report indicated that 24 per cent of readers purchased a product or service from Edgars as a direct result of reading the September 06 issue of the Club magazine. That amounted to approximately 220 000 customers making a purchasing decision as a direct result of reading the publication. An impressive 48 per cent of Edgars Club Magazine readers visited an Edgars store as a result and are more likely to go on using the company or to select it for another purchase in the future, while 18 per cent recommended Edgars to a friend after having read the magazine. In a climate where companies are constantly vying their customers’ attention the research showed that customer magazines are a compelling tool – on average, customers choose to spend 31 minutes reading Edgars Club Magazine. This equates to 62 television ad spots (30 seconds each) – at a fraction of the production and flighting cost. Ultimately, effective marketing is not just about the quality of the marketing message that we put out, it is also about the quality of attention given to the message. Customer media facilitates true two-way communication and constant feedback allows customers to be a part of the continuous evolution of the brand. Martha Dimitrou new business director, New Media Publishing [email protected]

[ awards ]

the john caples awards Fondly referred to as ‘the Caples’, these awards, which have international chairs in 53 countries around the world, were founded in 1978 by Andi Emerson. They are funded by industry agencies, clients and suppliers, and run by industry volunteers. “The Caples Awards is a one-of-a-kind opportunity for creative people in the direct marketing industry to demonstrate, on an international stage, how creativity can be used to solve problems. Unlike other award shows, Caples is only judged by creatives for the sake of creativity. The one and only charge: Develop the most innovative creative solution to a real-time marketing problem,” says Gary Scheiner, Executive Creative Director TBWA, New York (he’s also the senior vice president of the judging of the Caples). “It is to your advantage to fully describe the real-world situation your entry had to face, such as exceptional competition, new kind of product, low budget, geographical restrictions, etc. Points are awarded based on the way your team CREATIVELY addressed these direct marketing difficulties,” he adds. Stuart Stobbs, a Caples judge and creative partner at proximity#ttp, says that any direct campaign needs to have a great idea to begin with. “It needs to have great writing and great creative, and good results etc, but it also needs to be built on that one great idea, which will make the judges think: ‘I wish I’d done that’.” The results of the campaign will back up the great idea. In fact, says Stobbs, there needs to be the right balance between results and creative idea, because great results might be the result of a great offer, not of a really great idea. Judging is based on the following criteria: creative solution, concept, copy and art direction. To become a finalist, each entry is vetted by a

triumvirate of creative peers during two successively eliminative judging rounds. In the final round, finalists are numerically scored for copy, art and concept, by two separate triumvirates of international judges. The cumulative total of the six individual creative directors is decisive. If no finalist reaches the preset score for a prize level, no prize is awarded. If two or more reach the same prize-level score in the same category, there will be multiple winners. Aside from the standard awards, there are four additional awards:  The Courageous Client award for innovative campaigns that insecure clients would never authorise  The Sackheim Best of Show award, presented to a truly ingenious entry  The Irving Wunderman award, given to a creative who has achieved a minimum of 10 years of exceptional direct response work  The Andi Emerson award, which recognises lifetime service to the direct marketing industry. “To be chosen a winner means the problem-solving strategy and execution was judged ‘excellent’ and the creative ‘superb’,” says Nici Stathacopoulos, who is the SA Chair for the Caples (and managing partner, proximity#ttp). “Direct mail has not been superseded by online campaigns but it’s growing,” she says. Stobbs goes on to say that since direct marketing is no longer about the medium, but rather about a philosophy of one-on-one communications, it’s not surprising that there are more integrated direct campaigns, and increased use of new media platforms. “Increasingly, you try to enter your campaign into something like the Caples, and you find that there is no category for your campaign, and that’s exciting, it means you’re ahead of the game,” he says.

the assegai awards After a four year hiatus, the Assegais were reinstituted last year, as an independent awards programme for the direct marketing industry, with sponsorship from the Post Office. According to Michelle Perrow, chairperson of the Assegai Awards, there are two sections to the Awards. The first is the media category, which recognises work in all direct media channels. In this section, judges focus on results and ROI (with the weighting at 40 per cent for ROI, 30 per cent on strategy, and 30 per cent on creative). Judges are well briefed, says Perrow, because with ROI making up such a large component, it is easy to be mislead if one does not consider the media channel and the audience. For example, at a glance, an e-mail campaign might deliver better results than a direct mail piece, because of lower costs and better response rates. In terms of strategy, it is important that the strategy chosen for the campaign be optimal, given all the possible strategies in the direct marketer’s tool kit. And of course, there’s the big idea, and the fit with the brand.

A second section focuses specifically on creative awards, and this section includes any entries which demonstrate great creative, but have no results, or entries which might have an ‘unfair advantage’ (eg a direct event invite for 10 of the media personalities might yield a 90 per cent response rate, and be deemed to have an unfair advantage). In this section, art direction and copy are considered by judges (creative is no longer considered in this section). The Assegais also recognise student work, with an award for the young direct marketer of the year, and the student marketing team of the year, as well as the campaign of the year. And there are also awards made to the best of breed in the DM industry, with awards for the supplier of the year, the organisation of the year, the direct marketers of the year, and the DMA Hall of Fame award). Of course, the best of the rest is the Inkosi Assegai winner, who takes home the title of being the best overall direct marketing campaign.

direct > 2008

31

[ loeries experiential in dm ]

the loeries –

thoughts on the experiential category by Peter Bidenko

I like the way the Loeries have defined their categories, especially the fact that they’ve created an Experiential Section. It covers a lot more than what I would have normally thought of as experiential marketing. But it’s quite simple and logical, if it involves the audience and expects them to do something with what they’re presented with, then it’s covered in this category. Whether it’s direct marketing, promo, events, digital or all of the above. It’s not to say the advertising section and its work won’t be involving, in fact, in my opinion all the award-worthy work will be. It’s just that the Experiential Section covers… umm… experiences. And I guess that’s what will take away the metal in July.

in my experience the things that stand out really stand out. It either makes you laugh out loud, stand in awe of the audacity and sometimes even shed a tear. I’m hoping to see lots of that sort of stuff.

the best experiences win awards I’ve not seen it done the same anywhere else in the world, so hats off to the organisers. In fact, I hope it’s copied because it’s good. Focusing more on direct, much has been written lately about the changing nature of direct marketing. Yes, it IS an ever evolving, increasingly harder to define industry. We’ve learned that there are many more ways to engage an audience than traditional media (and in traditional I’d include Web these days). In fact, how we come in contact with people is as much a part of the

32

direct > 2008

creative idea as the creative itself. And that’s where the opportunity for breakthrough stuff really occurs. And again, it’s also one of the things that catches a judge’s eye. But I’d also say the fundamentals of direct still exist… response driven, customer focused, measurable and two-way. It’s always excited me because of the way we can get a lot closer to our audiences. Our job as direct marketers is still to find out more about our customers and let them tell us what they want. Then deliver on that. These days we’ve just got a whole lot more channels to do it with. At its best, it creates a much closer connection between consumers and brands. I’ve been pushing the barrow of intimacy lately when talking about direct creative. When we’re invited in by an audience and they give us permission to have a conversation with them, the language we use and the way we are allowed to relate to them is a lot more intimate. And with all of that said, a good idea is still a good idea. Right across the board whether it’s direct, promo, events or digital. In my experience the things that stand out really stand out. It either makes you laugh out loud, stand in awe of the audacity and sometimes even shed a tear. I’m hoping to see lots of that sort of stuff. Finally, and most importantly, I would imagine we will also award relevance. There’s nothing worse in the integrated categories of having, for instance, 16 different channels when one would have been more appropriate. It probably would realise a better ROI, make for easier measurability and greater insights for the future and, let’s face it, create fewer ulcers. Peter Bidenko creative director TEQUILA\ Australia [email protected]

[ loeries ]

how the loeries assess

excellence A Loerie Award is the most sought-after recognition for any work carried out in brand communication in South Africa. Through the process of identifying those pieces of work that represent the best executed innovative concepts, the Loeries define excellence in the industry. Direct marketing is recognised at the Loeries within the Experiential category and, as with any of our other categories, we judge submissions on the following criteria:

   

An innovative concept, bringing new and fresh thinking Excellent execution Relevance to the brand Relevance to the target audience Relevance to the chosen medium

Any communication, be it a traditional above-the-line television ad, a corporate identity or a direct marketing piece, should meet these five criteria, as they form the foundation for what any brand communication is intended to achieve. The fifth criterion takes into account the work’s relevance to the chosen medium, which, in conjunction with the other criteria, defines whether a piece of work like a direct marketing campaign has the characteristics that combine to make a winning piece of work. The overriding criterion here is creative excellence, which is the key point that the Loeries seek to award. We are primarily promoting

change, rewarding things that are done differently. If an entry excels in all other areas, but the idea isn’t new, it will not win. This is not necessarily to say that something that isn’t innovative won’t work. Communications that promise 50% off all day Sunday – doors open at 7am, may meet some criteria for a successful campaign, but if we don’t see innovation or freshness in the idea, then it won’t be recognised at the Loeries. Experience shows that campaigns that are innovative are also those that are most effective in the marketplace. Innovation is what catches the eye of the public, then wins their hearts and minds, and inspires them to act. Andrew Human MD of the Loeries [email protected]

judging direct marketing at the Loeries Loeries judges are all selected for their expertise in their own fields. Nici Stathacopoulos, managing partner at innovative marketing services agency, proximity#ttp, is a Loerie Awards board member and the local chair for the Loeries Experiential Panel. She defines what constitutes excellence in a direct marketing campaign. Direct marketing, with its focus on personal contact with consumers, and a resulting call to action, is measured by the response it elicits. In order to do so, a truly excellent campaign will cut through the clutter of mundane and ordinary marketing with breakthrough ideas and innovative ways for the consumer or customer to respond. To achieve excellence, the marketing strategy backing up the direct marketing campaign would have to be excellent to start with. The tone of the campaign and the manner in which it communicates should resonate with both the audience and the brand. Messages are effective if they elicit an emotion, make the recipient think or make use of humour, but most importantly, if they show an understanding of the recipient by talking in their language. The message (irrespective of the DM medium even traditional mediums such as DRTV) must be relevant, rewarding, recognisable and relevant to the recipient – otherwise it won’t be effective and certainly cannot be deemed to be innovative or creative! In judging the Loeries, we do take into account results as well as innovation, because the symbiosis between innovation and effectiveness is evident. You can be as innovative as you like, but if you are not effective, the campaign won’t work, and vice versa – simply put – boring campaigns are not effective.

direct > 2008

33

[ echo awards ]

the

DMA echo awards by Duncan Gray

First, a bit of history. The DMA Echo Awards was founded long, long ago in a country called America which used to rule the direct marketing world, where letters were five pages long and everything was tested into submission. It has hardly changed over the years and sits alongside the Caples awards and Cannes, in a trio of leading international DM awards, but they are all quite different. Cannes is a great brand, a newcomer to awarding DM and is a fantastic beauty show that we all want to win (but with over 2 000 entries, the odds aren’t good!). The Caples exists to reward creative solutions to marketing problems and is uniquely only judged by creative directors. The Echos specifically recognises the DM disciplines of strategy, creativity and results equally. The majority of winners are mailings and the show seems rather stuck there – not able to fully recognise the full breadth of DM channels, probably due to the fact that many are difficult to measure. The Echos recently made a point of stressing its creative credentials, but the other two award shows have occupied that space for much longer. The Echos was originally founded to award strategy and results ie account folk. That is why the late Andi Emerson founded the Caples, to celebrate creativity in DM, and that was 30 years ago!

This is how the Echos works: 

All entries are judged on strategy, creativity and results.



Judges are a mixed bunch from all aspects of the DM industry, so there could be a CD sitting next to an agency MD and a data or digital printing specialist!



Entries are judged by business category. There are 12 and you can only submit a piece of work once.

There are three rounds of judging. Round 1 is a regional elimination by discussion, not scoring, which is done in New York, Denmark and Australia. If you get through that, Round 2 is held in New York. Here the work is scored numerically by several, mainly US judges. I have done it a few times and will also do it this year to help ease the US opinion bias. Last year a quarter of the judges were from outside the US, which is a great improvement. If you get through that you are a finalist and you have to re-enter your work in book format (they supply one) and pay another entry fee. These submissions are judged three times by a small group of senior marketers, mainly American, and scored again numerically. Depending on the total scores, Gold, Silver or Bronze will be awarded. It is possible for there to be multiple winners on each level.

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direct > 2008

Unique to Echos is the Leader award, which is basically a fourth place. Otherwise, you remain a finalist. There are also a bunch of other awards (Diamond, Gold Mailbox, etc.) that are given to highest scoring winners after awards committee discussion. The best way to win at the Echos is to look at what wins at http://www.dma-echo.org/gallery.jsp and how best to enter at http://www.dma-echo.org/echo-cardiogram/docs/sample-entryform_2008ECHO.pdf The Gold winners can be anything from the simple dramatisation of child abuse by asking people holding an envelope to bend it and be shocked by the enclosed pencil snapping, as easily as a child’s bone, to a highly personalised, four-part mailing programme for a cruise company. The contrast between the three main award shows can be illustrated by a winner from Spain titled Lopetegui Deposit. At Cannes it won a Gold and Best in Show. At Caples it won Silver and at Echos, just Bronze. This year, again, I will plough through tediously long and sometimes badly written entry forms, examine good, average and some extremely bad creative, and give my honest opinion based on the Echos’ judging criteria. Winning an Echo is something to be really proud of, as it’s a long road from brief to the award podium and the recognition of your industry peers. Believe me, when I say many entrants don’t stand a chance of winning, because they have not done their research about what wins and how to submit a good entry. I’m always amazed at the final mix of international winners, the fact that the US has actually managed to win some awards and how much I’ve learnt about digital personalised reward programmes delivered at the expense of too many trees! Duncan Gray executive creative director, Proximity London [email protected]

[ research ]

research highlights here are some of the top direct marketing reports from Forrester Research, which you should be reading

do you have the right digital skills? In his report (Agencies must build digital skills to survive, 11 April 2008), Peter Kim found that traditional marketing agencies see their business threatened by digital agencies. Consumers are increasingly living a digital reality, and competition has emerged based on digital criteria. Analogue agencies must shift their thinking holistically, to a model that emphasises consumer focus over specific channel skills. To start this shift, agencies must:  Plan experiences with a consumer-centric approach  Formulate creative ideas, incorporating digital insight at the beginning of the creative process to ensure the media gets the proper treatment and attention  Exploit emerging research tools and techniques  Use the tools being recommended to clients (blogs, wikis and online video, for example) Internal digital skills must be built up at three organisational levels; that is hiring digital executives at top level as well as retraining middle staffers and attracting future digital talent. Independent agencies will not last long, as clients will demand cross-channel expertise, so they will need to be integrated into larger agencies.

maintaining customer experience during an economic downturn Bruce Temkin writes (Eight steps for keeping customer experience momentum during an economic downturn, 25 April 2008), that during economic downturns, it is common for companies to lower their financial outlooks, and sometimes place less emphasis on customer experience. Temkin makes the following recommendations to customer experience executives: 1. Keep an eye on the customer in spite of the focus on financial issues. 2. Prioritise key moments of truth: pick the right areas of customer experience, as there is less money available to spend on wide-ranging customer experience initiatives. 3. Avoid across-the-board cuts: the majority of cuts should be in areas that have the least impact on your most important customers. In some cases, it may be best to cripple the experience for less important customers if you can deliver better experiences to your most important customers. 4. Aggressively seek usability improvements that enhance customer experience 5. Focus on small-scale cultural changes 6. Communicate! Keep all of the people connected with your customer experience efforts informed of any shifts in priorities, even if only informally. 7. Don’t give up on innovation: There may never be a better time to innovate than when your competitors are cutting back. 8. Gauge the CEO’s appetite for customer experience: if he/she decides to cut back on customer experience, your job may become redundant.

getting value out of CRM Forrester Research offers companies five steps to take to ensure that they get optimal value from their investment in CRM (Topic overview: customer relations with management 2008, by William Bond). 1. Anticipate and exploit customer and technology disruptions, such as the new solutions based on social networks, for example 2. Strategise to pinpoint quick wins, especially in the areas of customer strategy, process, technology and people. Recognise the need for change in these areas, lead it and become a part of it, and then take the necessary steps to maintain that change. Be selective about how and where to invest resources and focus CRM investment. 3. Justify CRM investment to prove value. 4. Select the right CRM solution by establishing clear evaluation criteria for all initiatives. 5. Optimise customer processes with best practices.

direct marketing: green enough? Forrester Research’s David Frankland, writes (Direct marketing needs a green wake-up call, 18 April 2008) that consumer concern for the environment cannot be ignored by direct marketers. “Piles of unread catalogues and credit card offers make direct marketing an easy target for criticism,” writes Frankland. In his research, he found that most agencies neglect green issues and rarely consider environmental impact. Most direct marketers decrease their impact at the margins through the use of environment-friendly materials, for example. But this is generally done to save costs, increase response rates, or be seen to have greater relevance (rather than being the result of environmental concern). Environmental concerns must be embraced. Some simple strategies include:  Starting small – include a recycling call to action asking your customers to recycle your mail, packaging and products  Auditing and disclosing your environmental impact  Promoting your green activities cautiously  Acknowledging that going green does not equate to saving costs  Developing a set of industry of standards. For more information, or to register and purchase reports, visit www.forrester.com. Simon Macdonald country manager: South Africa and Mauritius, [email protected]

direct > 2008

35

[ case study: budget/bulksms.com ] client: budget car and van rental campaign: budget steps agency: maverick media A brand-building campaign to increase share of voice and present a call to action.

solution: Client-branded aircraft boarding steps on 35 units and ran it for about 24 months at Cape Town, Durban and Port Elizabeth airports. results: Conclusively successful in achieving our objective. The opposition sat up and took notice immediately when this campaign was launched, something that had never happened before, as Budget simply didn’t have the budget to play in that arena and could not sustain above-the-line campaigns of this magnitude. This was the first of its kind for Budget, and we were extremely happy with the return on investment. Competitors chastised the agency for not having approached them before Budget to participate in this space. Market leaders have since then taken it one step further and have branded aircraft to participate head-on in that market. Unfortunately, Equity Aviation has lost the tender to continue operating at airports and, as a result, this opportunity has now come to an end.

client: bulksms.com campaign: google adwords for bulksms.com agency: google Founded in June 2000, BulkSMS.com (a small messaging services company based in SA) grew rapidly in its first six months and its owners were quick to spot the potential for expanding the business into the international market. Dr Pieter Streicher, managing director, explains: “South African businesses rapidly embraced the concept of using SMS to communicate with customers and colleagues. Now, even the major banks use SMS regularly. We were confident that businesses in other countries would soon follow suit.” But BulkSMS.com faced the dilemma of not having sufficient funds to penetrate international markets and acquire new customers. The company needed to grow its visibility in foreign markets, in order to expand, and it had a limited budget with which to achieve this.

solution: In June 2001, the entrepreneurs approached Google. “Our objectives were to enhance awareness of the brand and acquire more international customers. Google AdWords offered us a low-cost, low-risk strategy to penetrate international markets from our base in South Africa,” says Dr Streicher. Despite the fact that BulkSMS.com had only US$500 per month to spend on advertising in the first stage of its expansion strategy, it was enough for the company to immediately establish an online presence. The company’s pay-per-impression English text-based ads appeared alongside relevant Google search results, capturing the attention of people from all over the world searching for SMS services online. This established the company’s credibility. “The whole process of setting up an ad campaign took just three hours,” says Richard Simpson, director at BulkSMS.com. “Within days,

budget we attracted customers to our English language website from the United Kingdom, Australia, the Middle East, India and Malaysia.” AdWords targets business customers in their local language, and the text ads appear alongside relevant Google search content. This is encouraging local customers to click on the ad to find out more. From the website, they can use a credit card to pay for the company’s services – directly into a South African bank account. Simpson explains: “Google AdWords removes the costs involved in setting up a local office or the hassle of setting up a bank account outside of South Africa.”

results: Fifty per cent of BulkSMS.com customers are now based outside South Africa – the split being 40 per cent from the United Kingdom and 10 per cent from Europe, the Middle East and Asia. Simpson attributes this large international customer base to its Google advertising strategy. BulkSMS.com is now aiming to increase sales in Europe, particularly among non-English speaking customers from countries it views as potentially strong markets for its services. For example, the company has created a German language version of its South African website, which makes it possible for the country’s non-English speaking customers to view BulkSMS.com products and services. The company has already gained a steady foothold in the German market and is reinforcing brand recognition through a mixture of print advertising in magazines and billboard advertising. Within two years of starting to advertise on Google AdWords, BulkSMS.com had grown by 37 per cent. Since 2003, it has continued to grow at the same rate year on year. With 60 per cent of all new customers coming through Google, it is not surprising that the company now allocates 70 per cent of its advertising budget to Google AdWords, and spends around US$600 a day on this advertising programme. “We’ve established an acquisition cost per client through our own research and using Google Analytics. It’s clear that AdWords is a very cost-effective way of gaining online sales, and this return on investment ensures it remains at the heart of our advertising strategy,” says Dr Streicher.

bulksms.com 36 direct > 2008

[ case study: look & listen/volkswagen citi ] client: look & listen campaign: egg agency: mick + nick Mick + Nick where tasked with developing a themed Easter campaign to be carried through below-the-line media for retail client Look & Listen. The Hunt For Your Favourites This Easter competition invited fans to SMS the names of any two bunnies, ranging from famous bunnies like Roger Rabbit and Thumper, to infamous rabbits like Donnie Darko.

solution: Mobilitext & Mobiliwin, offered from in-store POS across 18 stores, the Easter retail catalogue and national daily newspapers over Easter weekend. results: Generated over 3 600 SMS responses with the winner receiving a

look & listen

R1 000 Look & Listen voucher. All user info was preserved as per Mobilitrix’s user privacy terms.

client: volkswagen citi campaign: citi campaign agency: ogilvy The challenge for Volkswagen and Ogilvy was (and still is) to keep the Citi brand top of mind, relevant and desirable within the entry level youth market, and to thereby continue increasing sales at a time when:  The product/brand is 22 years old and nearing the end of its life cycle  Pressure from competition is great, and constantly increasing – new-generation vehicles, better safety and technology with modern design  The brand had realised little advertising support since 2002.

solution: Ogilvy developed a campaign which would meet the following Citi objectives:  Resonate and connect strongly with the youth market  Reassure current customers of their choice in Citi  Entice new customers to the Citi brand  Position the brand appropriately among its competitors  Keep the brand fresh and exciting  Communicate that Citi is not on its way out. The campaign involved a 360-degree, multimedia approach. Traditional ATL media was used in conjunction with online and cellphone advertising as well as advertising on university campuses across the country, to communicate the Citi message. The campaign was developed to appeal to first-time buyers, 18 – 24 year olds (with media targeting extending to 29 years and older). The campaign was built around a Web-based competition, whereby the public was invited to enter at a dedicated Citi (community) competition website, www.citilife.co.za, to win a Citi R-Line. To enter, one had to register on this site and upload a photograph that represented Citi Life. Members of the public could vote for their favourite photo as well as engage in other interactive activities, such as e-mailing photos to friends. The public was driven to the site by online and offline advertising. Online advertising took the form of banner ads strategically placed on the 5FM, CareerJunction, MSN Messenger and Student Village websites as well as on the Volkswagen corporate website. The competition was also advertised with a graphic ad on MXit. Ogilvy created a Citi Life group on the social networking site, Facebook, where people could engage and interact with the Citi Life concept via information fed from the competition administrator, or they could enter the competition through a link from the Facebook group to the Citi Life website. To make sure that Internet users arrived directly at the Citi website when searching for it on Google, a search engine optimisation campaign, Pay Per Click (PPC), was put into place. MMSes and SMSes (as well as e-mailers with click through to the competition website) bearing the ad were sent to the Volkswagen database between the ages of 18 and 30.

On campuses, scrolling display posters, tabletop ads, campus TV ads and static desktop ads took the message to students.

results: Visitors and page views (www.citilife.co.za): 48 345 Total number of visits to site Number of unique visitors 26 569  Number of page views 772 065 – Total for vw.co.za for same period 2 508 000  Average time spent on site 11’41” – Average for vw.co.za for same period 6’19”  Pages per visit 15.97 – This is high – average is between 4 and 5. – Average for vw.co.za for same period was 7.3 pages per visit.  Bounce rate 24.57 per cent. – Percentage of people who landed on the site and left immediately. – This figure is low – average bounce rate is between 35 – 40 per cent.  11 129 e-mailers sent out  3 452 e-mailers opened (31 per cent)  

Membership and uploaded images:  Enabled images  Members  Votes

5 365 8 301 14 165

volkswagen citi direct > 2008

37

[ case study: fnb/94.7 ] client: first national bank campaign: remember me? a letter from the destitute agency: action ambros FNB has seen an unacceptable decline in the payment of credit card accounts. Plus, recent economical strain means that people are no longer prioritising their credit card bills. The credit card division needed to get existing Silver, Gold and Platinum card customers to realise the arrears amount on their credit cards, and to educate them on the risks and legal implications of not settling these amounts. Customers were encouraged to pay five per cent of their current balance to restore their credit status.

solution: A creative direct mail pack was created, comprising a cardboard note from a now homeless friend and a letter from FNB offering the ideal solution. This mailer was sent to a database of 64 334 customers, and was personalised to specify the amount each customer owed on their accounts. The cardboard note highlighted the implications of defaulting on their debt and how it affects their standing with financial institutions (it also highlighted the commonly expressed denial, ‘it will never happen to me’). This note prompted customers to focus on their own situation and to take the right steps to correct it. The letter from FNB then offered the solution, enticing customers to pay the minimum five per cent to restore their credit status.

results: of the 64 334 customers mailed, 54 106 made a minimum five per cent payment (a response rate of 84.1 per cent). The total cost of the campaign was R432 739 (each pack cost R6.37). The total value of the payments received was over R26 million (which translates into ROI of more than 5 000 per cent).

fnb

client: 94.7 highveld stereo campaign: 94.7 highveld stereo podcasts. The rude awakening traffic joke; the stupid sports joke; and whackhead’s window on the world agency: in-house The Rude Awakening is a breakfast show with a difference. It’s centred on humour – and lots of it. This has been a mainstay of the show over the past 11 years and has grown and developed substantially over time. Listener demand over this period has shown that people love the humour so much they often want to access it after the original broadcast – either because they missed it the first time around or just to hear it again! By introducing podcasts of the show’s three most popular comedy features we’re able to give listeners access to premium station content, on demand, via their mobile handset or computer.

solution: Listeners either podcast the relevant feature from the 94.7 Highveld Stereo website or download it on their mobile phone. On the podcast side, anyone with ipodder software (such as iTunes) gets the updates automatically on their playlist, while on the mobile side, listeners SMS a word relative to the content they’re looking for to an

established short-dial number. Accepting the reply SMS automatically downloads the latest version of that content to their phone. This has been successfully implemented on the Traffic Joke and the Stupid Sports Joke. Due to the large file sizes, Darren ‘Whackhead’ Simpson’s Whackhead’s Window on the World remains available as a traditional podcast via www.highveld.co.za

results: These three features enjoy around 150 000 downloads a month, which includes podcasting and downloads to mobile phones.

94.7 highveld stereo 38 direct > 2008

[ case study: lexus/children’s hospital trust ] client: lexus campaign: j&b met agency: action ambros Lexus, as the official vehicle sponsor of the J&B Metropolitan Stakes 2008, wanted to gather information for its customer database, and also to encourage race goers to book a test drive. Meeting objectives would be challenging, given that there would be no vehicles at the actual event, and Lexus is still a somewhat unknown brand in South Africa.

solution: Lexus decided to target the 700 VIP guests who were invited to the exclusive event marquee, and bring them face to face with ‘the art of perfection’ (the streamlined thoroughbred horse as well as a Lexus). The VIPs each received a pair of binoculars set in a beautifully designed pack with the messaging: ‘every moment is a close encounter. Even from afar‘. These guests were invited to submit their details for future contact, and were entered into a competition where they could win a weekend at a picturesque Drakensberg equine estate boasting three thoroughbred stallions owned by the Royal family of Dubai.

lexus

results: Of the 700 gift packs that were distributed to guests, 294 yielded leads for future acquisition drives, a response rate of 60 per cent.

client: children’s hospital trust campaign: december appeal agency: primaplus As the fundraising arm of the Red Cross War Memorial Children’s Hospital, the Children’s Hospital Trust battles it out with other non-profits for share of wallet. PrimaPlus aimed to raise funds and build awareness of the hospital outside of regular donors as well as create a sound donor base that it could look to for regular donations.

solution: By instituting direct mail appeals to both inside and outside list names (a bought list) PrimaPlus hoped to establish a donor base. However, with the hospital being in the Western Cape, raising funds nationally was difficult, and they needed maximum response from a bought outside list, while activating inside list donors to donate more. Fundraising appeals to outside lists are usually, at best, set a target of break even, with the knowledge that the real ROI will come from subsequent donations over the lifetime of the new donors. This is often hard to accept for an organisation that is investing substantially in a campaign and may only see results later. However, this mailing was the exception, and the client saw significant ROI immediately. December is a key time at which the hospital needs additional funding, making it ideal for a DM appeal. The thought of children in hospital at this time of year was bound to touch hearts, and this was something that could be played on by including a festive bauble that could be sent back to the hospital with the potential donor’s name and best wishes, to decorate the tree in the wards for the children to see. It now felt that potential donors would find it hard to turn down the opportunity to brighten up a children’s ward – and sending back a bauble with their wishes, but without financial aid would be hard. Also included was a second bauble for the donor’s tree – with a ‘thank you’ message as well as a third for recipients to pass to a friend, asking them to support the hospital. This fulfilled the need for awareness and put the hospital into the homes of a wider audience. An emotive story was told of a child saved through the intervention of the Red Cross Children’s Hospital – featuring a picture of him and his mother, who donated a kidney to save his life. A ‘miracle’ theme was used – at a time of year when the word is most prevalent – and their baubles were coloured by children within the wards of the hospital, with the little artists’ names on the back.

results: Three segments were targeted: 







Regular donors (0.3 per cent of mail) – who, through other efforts, were already making monthly donations. Response rate: 7.7 per cent. ROI (R earned/R spent): 67.24:1. Once-off donors (0.9 per cent) – had made ad hoc donations in the past. Response rate: 19.2 per cent. ROI (R earned/R spent): 44.41:1 Outside list names – cold prospects (98.7 percent) – the largest, most challenging group. Response rate: 0.5 per cent. ROI (R earned/R spent): 1.27:1 or 27 per cent return on investment. New donors introduced to the database: 387.

children’s hospital trust direct > 2008

39

[ case study: mweb business/woolworths ] client: mweb business campaign: mweb business self build agency: primaplus MWEB Business created an application to provide small businesses with the tools to set up their own websites, called MWEB Website Self Build. The biggest challenge in marketing this product was the targeted consumer’s lack of understanding of both the functionality of such a product as well as the need for the Web as a channel in one’s marketing mix. According to research, small business owners view website tools as requiring too much maintenance and time. They see them as too costly and think they may be unsafe or risky. In addition to these hurdles, research also indicated that people believed that simply having a website meant that business would come to them – so there was an educating job to be done as well.

solution: The strategy for this campaign was based on overcoming the target’s initial aversion to such a product as well as on a key insight: that this market strongly relies on word of mouth to make decisions. We therefore employed a strategy of testimonials as well as basic education – where the channel allowed. The following channels were used: press (only community papers),

client: woolworths campaign: woolworths myschool programme company: virtual market place Established by Virtual Market Place (VMP) in 1997 with the aim of improving communication between parent and school using technology to meet the challenge of raising funds, MySchool is a community-based rewards programme that benefits a common cause rather than the individual. The concept behind the programme is simple: parents and other relatives join MySchool (at no cost) and shop at MySchool partner retailers who contribute a percentage of the value of the purchases to their specific school.

solution: The relationship between MySchool and Woolworths began in 1999 when Woolworths was approached to support the concept in four stores in Johannesburg. As the programme is aligned with Woolworths’ belief that investing in education will address many of the challenges South Africa faces, in 2001 Woolworths acquired 26 per cent of the business, enabling it to expand nationally. The MySchool programme was rolled out in a phased approach and by September 2003 a national footprint was established. Woolworths purchased VMP and MySchool in 2006; they continue to operate as independent entities within the business. Woolworths has continued to drive the programme successfully through its marketing campaigns and stores, encouraging customers to become MySchool supporters. MySchool is closely aligned with Woolworths’ CSI activities and is a cornerstone of its ‘World of Difference’ loyalty programme. In addition, it provides an ideal opportunity for cause-related marketing activities. To offer customers without children or whose children have finished school the opportunity to support other worthy causes, the programme has been expanded to offer a wider choice of beneficiaries. MyVillage, which was added in 2006, focuses on selected charities, including the

Web banners (on business sites), a dedicated site to Website Self Build (which consumers were driven to through other communication channels), emails to selected small businesses and a direct mail piece (DL postcard sent to small business owners). The message and tone was based on testimonials – from the mouths of real Website Self Build clients – and also punted the price, which drove the consumer to the website, where they could find more information.

results: This campaign was the most successful for MWEB Business to date – with a 1 100 per cent increase in leads for the product.

mweb business Amy Biehl Foundation, the SPCA and the Heartbeat Foundation. MyPlanet (added in 2007) supports selected environmental organisations such as The Wildlife Foundation, NSRI, Footprints and the Cart Horse Foundation. Based on the emotional bond between parent and child, MySchool has, from the outset, engendered high levels of loyalty and driven changes in shopping behaviour. Supporters feel empowered to make a difference with the funds that they raise for their beneficiaries. When the programme is actively supported by parents, school principals and governing bodies, there is no question that there is significant sustainable benefit for the school. At the same time, the MySchool programme also offers numerous benefits for its retail partners in terms of supporting their CSI strategies and increasing customer loyalty and support.

results: Today, MySchool boasts over 400 000 active supporters and some 160 partner brands, and raises funds for more than 10 000 schools around the country. Over R1.5 million is raised for beneficiaries every month. Woolworths’ involvement in MySchool has also led to the creation of value-added programmes in the form of the ‘Making the Difference’ educational initiatives which provide curriculum content for educators on subjects in which they may not have the required expertise. Launched in 2004, Making the Difference Through Nutrition targets Grade 4 learners and forms part of the Life Orientation curriculum, encompassing nutrition, healthy living and environmental awareness. Up to two million learners are exposed to the content of the programme and brand. Making the Difference Through Design was introduced in 2006 to provide teachers in the new FET Design Course with a comprehensive and inspiring resource guide. MySchool and the value-added programme provide Woolworths with the opportunity to effectively balance social investment and profitable customer relationships, as MySchool customers are more loyal and valuable to Woolworths than most other customers on its database. It further provides the opportunities for young learners to be exposed to the Woolworths brand and its way of doing business. This has resulted in positive feedback from learners, parents, media and government, and has impacted positively on Woolworths’ BEE strategy and achievements to date.

woolworths 40 direct > 2008

[ case study: pcmall.co.za/primaplus ] solution: After running several trial campaigns with other search engines

client: pcmall.co.za campaign: pcmall.co.za adwords agency: google Since PCMall.co.za was founded in 2005, it has grown to become South Africa’s second largest online technology retailer. Its website – PCMall.co.za – offers IT products to businesses and consumers across South Africa. With an easy-to-use online store, nationwide delivery and a call centre able to process high order volumes, the company is handling an increasing number of consumers. In 2005 PCMall.co.za was nominated one of the Top Computer Stores in the South African E-Commerce Awards. Despite being smaller than many of its competitors – it has just 13 employees – PCMall.co.za is on its way to becoming South Africa’s leading online IT superstore. Its biggest challenge was driving traffic to its site. “Before PCMall.co.za, there was only one major online IT retailer in South Africa, which had a well-established customer base within the online community. As the newcomer, we had to work hard to attract customers to our store,” says Jerome McClement, director, PCMall.co.za. McClement’s aims were to increase national traffic to PCMall.co.za, while enhancing brand image and recognition, and boosting product awareness.

and sites, McClement opted for Google based on its unparalleled reach and administrative and reporting tools. PCMall.co.za makes use of the Google AdGroup system, and Keyword Tool to categorise its products and make sure that it reaches as many potential customers as possible. Over the past two years, PCMall.co.za has devoted 70 per cent of its advertising budget to online media. “In part, our strategy targets consumers who are already likely to be searching for products online. They are early adopters – people who are keen to have the latest gadgets and use the Internet to inform their buying choices,” McClement explains. PCMall.co.za targets the same audience in tits offline campaigns by advertising in men’s magazines, for example. And it only pays when interested consumers click through to its website. “With other media we pay merely to display an ad to potential customers,” says McClement.

results: “The campaign is giving us fantastic results,” says McClement, pointing to the 11 500 unique visitors that AdWords is driving to its website each month. “Our sales follow our Google spend almost exactly. As the number of clicks rises, so too does the number of transactions.” Google AdWords has also helped PCMall.co.za to achieve the following:  Gain a better understanding of its target consumers and their behaviours. “With Google Analytics, we can see exactly where our traffic is coming from. By acting on this insight, we can improve our results by modifying keywords and ad text, or creating new images,” says McClement.  Better targeting of campaigns online and offline through the use of traffic stats and AdWords Ad Scheduling (which allowed PCMall.co.za to switch the campaign off outside of regular South African working hours, thereby avoiding the cost of click-throughs from non-South African users).  Strengthening the PCMall.co.za brand image through the use of image ads.

pcmall.co.za

Client: primaplus Campaign: primaplus year-end self promotion Agency: primaplus Before changing its name change, primaplus was known as PrimaProximity, a below-the-line agency. Although PrimaProximity shared several clients with other above-the-line agencies, they noticed that more and more of them were trying their hand at direct marketing strategies… and encroaching on what they considered their exclusive domain. That’s when they decided to it was time to beat the other agencies at their own game… solution: In the advertising industry, above-the-line agencies are generally perceived to be ‘more creative’. That’s why, when these ‘creatives’ started trying their hand at direct marketing PrimaProximity noticed several clients were approaching them to do more work – in something which PrimaProximity considered their exclusive territory. To prove that they could be as creative as any above-the-line agency, they decided to use the invitation to their end-of-year party to accomplish this. They needed to find a channel that was traditionally direct, but at the same time completely unique. They realised the key was in the means of delivery – as that is what DM is all about – and the response channel had to be clear and just as effective. So they sent out carrier pigeons! PrimaProximity created branded ‘pigeon boxes’ and attached an invitation, complete with personalised RSVP slip attached to each box.

A PrimaProximity representative went to each client to deliver their bird, and helped the recipient place their completed RSVP form inside a ring on the leg of the pigeon, and then let the bird fly.

results: PrimaProximity delivered all 60 birds over a period of three days, and had a 100 per cent response rate. The campaign was also an Echo finalist.

primaplus direct > 2008

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[ case study: seeff properties/transunion ] client: seeff properties campaign: mobilitrix agency: in-house Seeff adopts a ‘smart move’ approach to selling properties and Mobilitrix’s suite of products offers a dynamic, one-to-one communications platform allowing consumers to request more information or download photographs, videos and even podcasts via mobile phones while browsing through property guides or looking at advertisements. Seeff also benefits from the feedback from buyers and sellers of individual properties, advertising campaigns and services as this enables it to pick up new trends in the marketplace quickly. “When looking to buy a property, access to the Web has proven to reduce the number of viewings before purchase, and the mobile Web solution is the logical next step. It is the most efficient way to get information to consumers and enhance their buying experience,” says Samuel Seeff, CEO Seeff Properties.

solution: Mobilimedia adds an interactive element to Seeff’s existing print campaign by allowing prospective buyers to request additional information such as property images, specs and agent details to their mobile phones in real time. Mobilitalk adds a dynamic element to Seeff’s static advertising

client: major sa retailer campaign: in-store credit card account acquisition campaign consultant: transunion With the slowdown in consumer spending following the introduction of the National Credit Act (NCA) last year, the high inflation rates and the increases in interest rates, retailers are experiencing a decrease in through-the-door applications. To compensate for this decrease, one of the major retailers in South Africa approached TransUnion to assist in facilitating the launch of a large direct marketing campaign, which offers in-store cards to appropriate new prospective customers. The campaign required a segmentation approach that defined these prospects, and minimised wastage of marketing expenditure and maximised return on investment.

solution: Firstly, a large sample of new prospects was sourced from a list provider. TransUnion assisted the retailer in identifying and segmenting the list based on the market segments to be targeted in the campaign (age and gender stipulated by the retailer), taking into account that the list be restricted to only those that lived up to a maximum of 10km away from one of the retailer’s stores. The prospects from the initial list were then matched against TransUnion Credit Bureau’s database. A set of variables (referred to as the Credit Characteristics) summarising each prospect’s credit information was extracted. Based on a number of credit characteristics, a credit filter model was developed to identify and filter out prospects having difficulties paying their debts. The second stage was to identify prospects that fit the profile of the previous campaign respondents from previous marketing campaigns, and filter out those that did not fit the profile. In the third stage, the future debt payment behaviour of prospects was assessed through the development of a customised risk scorecard (that predicts the future likelihood of failure of payment) and low-scoring prospects were filtered out. The final stage was to assess the affordability of the prospects, using TransUnion’s Income Estimator model, which estimates the prospect’s gross income. The amount of disposable income can be calculated based on the prospect’s known credit commitments (provided by the

42 direct > 2008

through an ‘opt in’ Please-Call-Me function, which enables buyers to request an agent to contact them.

results: In one month, 279 mobile requests to view multimedia content on Seeff listed properties were received, of which five where Please-Call-Me and 22 requested additional property information to be emailed to them.

seeff properties credit bureau’s database) and on other estimated expenses. Prospects that did not have sufficient disposable income to afford a new credit product were removed from the initial list. This affordability assessment was not considered sufficient to satisfy NCArequirements, since the income and expenses were not yet declared by the prospect (this declaration would need to be secured from the consumer prior to a credit amount being offered or a credit agreement being signed and accepted). To address these legal issues, TransUnion proposed a novel approach using SMS communication as part of the direct mailer and fulfilment process. The direct mailer asked the prospect to calculate their expenses and then to SMS their ID number, income and total expenses to an SMS short code (hence responding to the campaign with intent). This was received by a computer program pre-loaded with the estimated income of the prospect and their known credit commitments. Based on all this info, the program calculated the appropriate credit limit and encoded the amount in a reference that was sent back to the prospect via SMS, requesting them to go to their nearest store and provide the reference to activate the credit card with the appropriate credit limit.

results: The retailer was initially apprehensive about the new SMS option and was concerned that the response rate of the campaign may be adversely affected. However, the results of the campaign showed excellent response rates with very positive feedback on the SMS option to declare income and expenses. The retailer calculated the total costs incurred by the campaign and the purchases made by the new customers and reported substantial return on investment for the campaign. Responses were excellent and a conversion ratio in excess of 10 per cent was achieved. Based on the success of this campaign, the retailer has planned another major campaign based on similar principles, seeking to reapply the lessons learnt from the first campaign.

transunion

[ case study: wiredloop/sasko flour ] solution: Mobilitalk, the permission-based interactive mobile marketing product which allows customers to request a Please-Call-Me. Mobilimail, allows consumers to request a text-to-email for additional information, which needs to be viewed on a bigger screen. This text-toe-mail option will allow this information to be sent to consumers’ e-mail.

client: wiredloop campaign: mobilitrix agency: in-house Wiredloop’s primary need was to drive sales leads from its print media spend, and to create an effective solution to manage the inbound sales requests which inundated its telephone system, leading to compromised service delivery.

results: “In our prepaid vendor deployment business, inbound sales enquiries tend to create a bottleneck in the telephone system, which leads to compromised levels of service to existing customers. With Mobilitrix’s SMS sales pipeline management system we have succeeded in creating another channel through which to handle new sales enquiries without compromising our existing customer. The system is user-friendly with remote management functionality and can be scaled up or down by my staff independently of Mobilitrix which has greatly improved our efficiency,” says Nkululeko Mvulana, executive director, Sandulela.

wiredloop

client: sasko flour campaign: building relationships with mobile marketing cgency: mo-b Sasko Flour has risen to new heights as it has added mobile to its marketing mixture. After last year’s successful Mara & Friends campaign (‘Mara & Friends’ was a television show conceived to bring Sasko Flour’s message of ‘better tasting baking’ to life), Sasko Flour distributed the Quick & Easy Better Tasting Baking recipe booklet to viewers. Sasko Flour now has a list of over a 20 000 names and cellphone numbers. Instead of hoarding numbers in an Excel spreadsheet, mobile marketing specialist, mo-B (www.mo-b.co.za), worked with Sasko Flour to assist in integrating the cellphone element into various campaigns and nurturing its relationship with consumers.

solution: Sasko Flour spoke and listened to its customers via cellphone. Having sent out the recipe booklets, the company SMSed consumers asking them what their favourite recipe was, and found that consumers were truly touched. Sasko also used its database for market research, asking consumers to comment on whether they liked its packaging; mo-B, together with Multimedia Solutions, developed an MMS that was sent to consumers showing them a picture of the current packaging and offering a R3 airtime voucher as a thank you for their comment. The database was pre-checked, according to standard procedure, and the message was only sent to cellphones that were MMS enabled, thus improving the efficacy of the campaign. Considering the database consisted largely of black females with families in LSM 4-6 an MMS-enabled average of 62 per cent was good news for the campaign.

results: The response was awesome – a huge 25 per cent. With the positive feedback from consumers on their recipes, Sasko Flour launched its own mobi site (mobile website) packed with favourite recipes. Now, Sasko Flour customers can go to www.saskoflour.mobi from their cellphones, wherever they are, to search for and view their favourite recipes. They can also have the list of ingredients SMSed to them from the website or mobisite, so they know what they need to buy on their next visit to the shops. Judging from the 4.4 per cent response rate to the SMS about the launch of the mobisite, Sasko Flour’s customers are finding this a useful tool. Mara Louw has continued talking to her fans about Sasko Flour through her mobile fan club messages on Fan Touch (www.fantouch.mobi), with heart-warming responses. Sasko Flour also is rolling out the red carpet at its annual Shoppa

Shows: a nationwide road show with competitions with prizes from Sasko Flour. Each loyal Sasko Flour customer is sent an SMS to notify them of when it’s going to be in their area. Mobile has proved to be a powerful weapon in Sasko Flour’s marketing strategy, and has caused sales to rise. The two things that have stood out in the use of mobile marketing have been the high response rates and the emotive replies Sasko Flour has received from its customers. Lisanne Bower, Sasko Flour brand manager says: “Cellphone communication has also created a more personal touch with people being greeted by name. The personal communication resulted in some touching replies. “The responses showed that we were reaching a wide range of people, including those working in bakeries or home-industry stores that are key target markets for us, and which we’ll be looking at building on,” she says.

sasko flour direct > 2008

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[ case study: cell c/bmw ] client: cell c campaign: hummerville agency: proximity#ttp Churn is a massive problem in the cellular market, so Cell C was looking to strengthen loyalty through personally relevant one-to-one communication. However, it didn’t know much about its subscribers.

solution: An above the line acquisition campaign that offered six Hummers as incentives to join Cell C had been devised separately. There was no provision made in this campaign to enable existing subscribers to also have a chance to win any of the Hummers. Therefore an interactive campaign was proposed whereby existing subscribers could participate in the competition by giving personal data that would enable the client to start interacting with them on a more personal level. An online interactive, living ‘questionnaire’, in the form of a game, was developed. Players would have to answer personal questions in order to progress. In the game, each player had to get their Hummer across South Africa, and interact with various characters to find a place called Hummerville. The game was intelligent (if you said you were male, you would be approached by a female to find out if you are married). Other interesting technology allowed for the player to receive an automated phone call when they reached a certain point, giving them clues for winning additional prizes. Once they had reached their destination, players were required to look after their Hummer in order to win more prizes. The campaign kicked off with e-mails to Cell C’s subscribers followed by an SMS and statement stuffers; e-mails kept the campaign going. “The journey through to Hummerville was the central idea and an exciting trip for subscribers to go on. We chose it because it was a great way to show off the prize and a fun way to collect data. It was highly interactive which captured customer interest and enthusiasm, for example, customers received phone calls during the game which gave them clues to improve their chances of winning. They also had the chance of playing ‘rock, paper, scissors’ with a San woman in order to refuel, and they were asked to guess the name of the song being played by a cheer-

client: bmw sa campaign: the new bmw 1 series 3- and 5-door sports hatch agency: ireland/davenport and aqua online BMW SA required an integrated modular campaign with a strong focus on digital and innovative media to launch its 1 Series 3-door and enhanced 5-door models in July 2007. The primary objective BTL was to generate qualified conquest leads. A secondary objective was to facilitate test drives and, thirdly, to grow the existing database and awareness of the new models with a view to future communication.

ful man at a crossroad in order to get directions,” says Audrey PriceDix, Direct Marketing Manager, Cell C.

results: 60 000 Cell C contract subscribers were targeted, for whom the agency already had e-mail addresses. The total entry rate was 42 per cent. The flash game was played by 87.6 per cent and 12.4 per cent completed the non-flash game. The total completion rate was 20.5 per cent (these were customers who completed all data fields in the game, which included name, nickname, surname, e-mail address, birth date, marital status, physical address, children and friend referrals. The average response rate in South Africa is usually five per cent.

cell c solution: Current BMW 1 Series owners and prospects were invited to Come and Meet the One(s) at selected Primi Piatti outlets countrywide. With an incentive designed especially for the target market, participants were able to stand the chance to win limited edition branded 1 gig-flash drives as well as a range of iPod nanos and branded BMW merchandise. With pre-arranged WiFi access, participants were able to enjoy the promotion while being able to stay in touch with their office. Added to this, each participant was entitled to a complimentary beverage of their choice. Registration for the event was done either via the campaign website or on touch screens at the venues. Each registered participant then received a Mobicode (a bar-coded SMS), which enabled them to receive confirmation (via electronic scanning of the SMS) on the day of the event, making them eligible for the prizes.

results:      

Total number of Mobicode registrations 2 505 Total number of Mobicodes redeemed 1 156 (46 per cent) Highest percentage redeemed at Canal Walk (Cape Town) Total number of test drives generated 648 (56 per cent of redemptions) Conquest (non-BMW drivers) target 60 per cent Actual conquest (non-BMW drivers) participants 63 per cent.

BMW 44 direct > 2008

[ case study: bmw/chabad house ] Trainees were recruited through the Online Academy Various activities and tests were undertaken  All results monitored  The activities and training facilities were ‘unlocked’ over the course of the campaign  Each test section was concluded with a profile question  We exposed the recruits to each test of stamina – mental as well as physical  Each stage of the tests were passkey coded for direct recipients  The codes were delivered via direct mail and email – linking virtual and physical worlds  Successful completion at the end of the training entitled one candidate to a trip to Star City, Moscow (the elite Cosmonaut Training Centre). The offline direct mailer consisted of a specially designed M3 booklet and a box with two test tubes filled with iron filings. The silver surface in the centre of the box hid a magnet in the shape of the M3 logo. The copy on the box invited people to sprinkle the iron filings on this surface to reveal the answer to the question; what does metal dream of becoming? The answer was revealed as the M3.  

client: bmw sa campaign: the launch of the new bmw m3 coupé agency: ireland/davenport, aqua online An integrated TTL campaign was needed to achieve the following objectives:  Complement the launch of the new BMW M3 Coupé, and position it as the ultimate expression of BMW technology design and performance innovation  Leverage the halo effect of M3 to generate 3 Series leads  Reaffirm the M positioning through a direct awareness campaign  Generate scored hot-leads to participate in M communication and brand events  Ensure that all communication is consistent in building the BMW brand.

solution: The agency developed a direct campaign comprising both online and offline elements. The direct campaign elements would:  Create an emotive experience for loyal customers  Provide loyal M3, M5 and M6 customers with added value  Maintain campaign interest through a powerful communication piece  Retain campaign exclusivity for loyal customers  Enhance excitement and anticipation for the arrival of the new M3 coupe via an impactful and intelligent offline communication piece,  Have a strong tie-in with ATL  Leverage the halo effect of M3 to generate 3 Series leads  Establish a direct awareness campaign to reaffirm M positioning  Generate scored hot leads to participate in M communication and brand events  Generate a database made up of 60 per cent conquest and 40 per cent loyal customers. The online campaign was modelled on a virtual 3D training centre for ‘M pilots’.

results: For a very niche, intense and highly demanding campaign the BTL element resulted in an impressive total of 9 398 unique entrants With an entrant target of 60 per cent non-BMW customers the campaign achieved a target of 61 per cent non-BMW customers. The demographics of the target audience were mostly male between the ages of 25 and 39. The campaign achieved a target of 91 per cent male and 62 per cent between the ages of 25 and 39 Of the 39 per cent loyal BMW drivers who entered the campaign 18 per cent was made up of loyal M drivers who all received the direct mailer couriered to their preferred address. For the direct mailer a dedicated telephone call handling process was used to collate preferred courier addresses of all recipients.

bmw

client: chabad house campaign: miracle drive time pledge agency: mo-b The Miracle Drive dinner is a fund raiser event held by Chabad House annually. This year, instead of asking people to pledge money, Rabbi Masinter wanted the community to pledge their time to make the world a better place. Mobile marketing specialists, mo-B was approached to develop and manage the Miracle Drive Time Pledge campaign on the night and going forward.

solution: To drive participation and excitement, the SMS number was announced by the MC and immediately a graph of the incoming responses was spread on the big screen showing the results as they happened. As each participant SMSed their pledge, they received an SMS reply thanking them for their pledge and confirming what they had promised to do. What’s more, their friends could also see their promise rolling on the ticker tape. The competition was visible and it made for an exciting and worthwhile evening. After the hype of all the promises in the heat of the moment, Chabad House ensured that each participant kept their pledge. So, at the appropriate time, it sent out a personal message either asking people if they had done the deed or giving them instructions about the next step. Based on the success of the Miracle Drive Time Pledge, and having gathered permission to communicate with mobile messaging in the community, Chabad House decided to launch a world first for it: a mobisite (mobile website) with the help of mo-B and Multimedia Solutions. Now,

from anywhere in the world, a congregant can visit www.chabadjoburg.mobi for an inspirational message from Rabbi Masinter, to look up Halachic times or to find a synagogue near them.

results: With a 47 per cent response rate and each person making an average of 1.24 pledges on that one night, Rabbi Masinter was confident that we had started a wave of positive action that would be maintained throughout the year. Mobile marketing has been an invaluable communication tool to spread the message of hope and build an informed and inspired community.

chabad house direct > 2008

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SPORTS SPONSORSHIP

Fans for your brand Sports marketing and sponsorships allow brands to snuggle up to sports fans and, hopefully, make a meaningful impression on them. Amid today’s clutter, empowered consumers and social networks, reaching the consumer through sport is the way to go for many brands. Sports fans read their favourite magazines from cover to cover, while live sports programming pulls in huge audiences (and generates enormous hype). Brands are aware of the power that sport has when it comes to branding. Samsung, for example, has taken up a few sports projects globally to leverage the positive impact of sports on a brand. Daniel Lamberti of Samsung Marketing – phones division- explains:

threshold fear that Golf+ will address by focusing not just on golf but on the lifestyle around the game,” says Scholtz. Because the golfing game requires the kind of mindset that spans demographic profiles, this is a market that is peculiar, and highly active socially and economically. In terms of ad spending in the sports media, insiders say that there is pressure on the media to provide advertisers with fresh and powerful solutions. “Clients want more for less, they want a tangible return,” says Paul Kaye, publisher of Runner’s World and Bicycling magazines. The

marketing spend is allocated to sports marketing and sponsorship. BMI data collected in 2006 found that local direct sports sponsorship spending amounted to R2.6 billion, with an additional R2.2 billion spent on activating and leveraging these sponsorships. De Villiers says that the figures for 2007 will be substantially higher, driven largely by the 2010 FIFA World Cup, which has seen process increase dramatically in soccer, for example, the broadcast deal between SuperSport and the PSL is valued at over R1.6 billion over five years. “Sponsors now widely recognise that sport

Highest TV audiences Sports Marketing Surveys reports the highest average audiences by sporting code on SuperSport only (this doesn’t include M-Net):  Super 14 Rugby – Highest Average Audience – Sharks vs Chiefs – 17 May 2008 - 537 250 viewers  Standard Bank Pro20 Series – Highest Average Audience – Nashua Titans vs Nashua Dolphins – 25 April 2008 – 144 290 viewers  FA Premier League – Highest Average Audience – Manchester United vs Arsenal – 13 April 2008 – 110 167 viewers

“The main focus on sport is the mass appeal it creates, which crosses cultural and international boundaries.” Sports websites are gaining momentum, as are mobisites and mobile services, and there are countless blogs dedicated to sports worship, commentary and discussion. Consider that SuperSport’s website is ranked among the top 10 fastest growing websites in SA (reported by Nielsen Online, 5 May 2008), with unique browser growth of 103 per cent over figures reported in March 2007. New magazines with a greater focus on the lifestyle around sport are entering the market. Touchline Media, in conjunction with the MoreGolf Group, recently launched Golf+, which goes out to a targeted base of 25 000 individuals, according to Jaco Scholtz, publisher for Touchline Media’s Special Projects Division. “There is no waste and through their membership of the MoreGolf Group, they have signed up for a golfing lifestyle,” he says. He points to the trend towards custom titles, where retailers who have intimate knowledge of their market work from a demand-driven base. “There is a

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challenge is to provide innovative solutions for clients, while ensuring that the content and the message are relevant to readers. Lamberti adds that with budgets being tighter, companies must secure sports sponsorships that yield the best results in terms of brand presence, sales, consumer recall and brand equity. Sponsorships are a viable option for brands looking to get into the sports mix. “Since 1986, sponsorship has been the fastest growing element of the marketing and communications mix – and sponsorship of sport properties has certainly been the place where rapid growth has occurred,” says Brand de Villiers, group CEO, SAIL. He believes that almost R5 billion worth of

properties can offer a number of distinguishing characteristics which make them a more attractive sponsorship vehicle than other options.” But, as Marc Jury, acting managing director, Sports Marketing Surveys, says: “Too often research is used to justify sponsorship spend post-campaign and generally is the last element considered when parties draft their budgetary expenditure.” He emphasises the need for research to play a bigger role in the planning phase to ensure that the leveraging of sponsorship properties yields the greatest return on investment. Owning a sports team or events is yet another option, particularly for the brand or company

2010 FIFA World Cup “Based on the unparalleled spending we have seen on this event, we would have to say that there is no shortage of confidence related to FIFA 2010,” says Brand de Villiers, group CEO SAIL. He says that companies are well into their planning phase for 2010 and, in some instances, are already rolling out initial campaigns here in SA. Emphasis should be on building awareness and legacy-related programmes, and we can expect to see an increase in local activity after the European Championships and building up to the Confederations Cup 2009.

SPORTS SPONSORSHIP

Most watched sports Initiative Media brings us the facts and figures on the most watched global TV sporting events. “This information is invaluable to marketers and advertisers because many sports federations still persist with publishing potential rather than actual TV audience figures. That is to say, they report that billions of people have the ability to watch a programme, rather than the number of people who actually do watch it,” says Marc Taback, managing director, Initiative Media South Africa. When assessing the value of sport versus other TV content, it makes sense to use the same approach that is used with the other programming (ie one that measures actual audience ratings). These figures also have implications for broadcasters, who are seeking local success in generating TV audiences. “Many people watch sport for nationalistic, rather than sporting reasons. So they will watch a sports event because an athlete from their country is participating. That means broadcasters need to pick and choose events wisely to try to predict those where they believe there is likely to be the greatest local interest,” says Taback. Using this data to predict likely audiences for future events is also useful. “Many sports broadcast rights are extremely expensive, so it is vital that broadcasters choose wisely in their acquisition strategy,” says Taback.

The ViewerTrack report yielded four major trends: 1.

New formats can quickly achieve success. Both the Cricket World Cup and also the inaugural Twenty20 World Championship took place in 2007. The average live global TV audience for the final of the latter was three times higher than for the former. This goes to show that a new format, tailored to understand the needs and demands of busy individuals in the 21st century, can quickly become popular.

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Nothing damages TV audience figures more than the perception of corruption and cheating, in whatever form that may take. So for example, the final stage of the Tour de France has always been one of the top 10 most watched sports events of the year in all of Initiative Media’s ViewerTrack studies, at least until 2007. However, last year the cumulative effect of so many years of doping allegations became so great that TV audiences in a number of major cycling markets, especially in Europe, fell considerably and hence the commercial value of the sport is now significantly lower than it was a few years ago. 3. In a growing number of countries, a sports event was the most watched TV programme of the year. In an era of audience fragmentation, few genres are able to attract viewers to watch in the same numbers as they used to. One exception to this, however, is live sport. With time-shifting not being a realistic option for most viewers (since the beauty of sport for true fans is to watch live and enjoy the unexpected unfold in front of them), major sport is becoming an increasingly valuable property for brands to invest in. 4. Soccer has always been the world’s most popular sport, and its lead over other sports is growing over time. Soccer is the only sport that truly appeals right around the world, with previously ‘immune’ markets such as the USA, Japan and Korea catching the bug over the past few years. The growing popularity of soccer in these countries, on top of its traditional heartlands in Europe, Latin America and Africa, means that the audience figures for major properties such as the UEFA Champions League, UEFA European Championships and FIFA World Cup continue to stand out from the rest of the field. The scale of the investments being made in soccer reflect this. For more information or to get a copy of the reports, contact Marc Taback on (011) 780 6117 or [email protected]. 2.

SPORTS SPONSORSHIP

Most watched global TV sporting events in 2006 (ViewerTrack): Ranking 1 2 3 4 5 6 7 8 9 10

Sport Soccer American Football Olympic Games Soccer Formula One NASCAR Baseball Golf Tennis Basketball

Event FIFA World Cup Final (France vs Italy) SuperBowl (Pittsburgh Steelers vs Seattle Seahawks) Torino 2006 Opening Ceremony UEFA European Champions League Final (Barcelona vs Arsenal) Brazilian Grand Prix Daytona 500 MLB World Series (Game Five, Detroit Tigers vs St Louis Cardinals) US Masters (Final Day) Wimbledon (Men’s Singles Finals, Roger Federer vs Rafael Nadal) NBA Finals (Game Six, Miami Heat vs Dallas Mavericks)

Ave audience (millions) 260 98 87 86 83 20 19 17 17 17

Total audience (millions) 603 151 249 209 154 47 55 59 69 48

Most watched global TV sports events in 2007 (ViewerTrack): Ranking 1 2 3 4 5 6 7 8 9 10

Sport American Football Formula One Soccer Rugby Athletics Baseball Handball Golf Tennis Cricket

Event Ave audience (millions) NFL Super Bowl (Chicago Bears vs Indianapolis Colts) 97 FIA World Championship – Brazilian Grand Prix 78 UEFA European Champions League Final (AC Milan vs Liverpool) 72 33 IRB Rugby World Cup Final (England vs South Africa) IAAF World Athletic Championships – Men’s 100 metres Final 24 MLB World Series (Game 4 Boston Red Sox vs Colorado Rockets) 24 IIHF World Men’s Handball Championship Final (Germany vs Poland) 23 US Masters (Final Day) 21 21 Wimbledon (Men’s Singles Final, Roger Federer vs Rafael Nadal) ICC World Twenty20 Championship Final (India vs Pakistan) 20

Total audience (millions) 142 152 148 61 70 72 56 76 52 40

SPORTS SPONSORSHIP

with the budget to pull it off. “The ownership of events effectively cuts through the clutter, if done effectively,” says De Villiers. The trick for these companies or brands is to maximise on the opportunity. “The long-term impact of this strategy remains difficult to predict. Certainly, title sponsorships (as for Vodacom with Super Rugby) are not novel and are a feature of every professional sport around the world. However, the creation and ownership of events offers a more significant long-term impact. It’s difficult to see how this might be sustainable, given the congestion in the calendar,” says De Villiers. Smaller sports will have to be clever in adopting a niche positioning strategy, if they hope to attract the kind of sponsorships that can compete with those of the top three sports in SA. The sports to watch out for says De Villiers, pointing to the results of a BMI study into the sports with the largest growth in spectators between 1995 and 2005, are dance sport, swimming, hockey and cricket. Given the emphasis on new media platforms, online and social networking as well as mobile, sports media and brands must look to these to exploit the opportunites that they represent for two-way interaction with sports fan. “Sports sponsorship can be enhanced through good integration across the new marketing platforms. In terms of the youth, these new forms of marketing are key as this is the best way to target them,” says Lamberti. Broadband connectivity is improving all the time, says says Fahmeeda Cassim-Surtee, GM: SuperSport and News, Oracle Airtime Sales (OATS), so opportunities in this area are improving. “There is no doubt that both mobile and online platforms are developing very rapidly at the moment, but their viewership is different. Online is heavily viewed in the office environment, whilst mobile is very personal ‘anywhere’ content consumption,” she says. Magazine publishers recognised the opportunities presented by the online space some time ago, and have been evolving websites that deliver huge value to the reader and the advertiser. “We started viewing ourselves as brands a while ago and merely adapt our content to our platforms,” says Kaye. “We can’t wait for broadband! Online, we can personalise, and harness a sense of community among riders and runners. Online is also where we give our readers a voice – they get to communicate not only with us, but also with each other,” he says. Kaye believes that unique online users will overtake circulation, and as long

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Picture courtesy EImage

as the magazines keep innovating and keep users engaged, the online platform will be a strong revenue generator. While clients still see Internet advertising as a new platform, successful case studies are proving that this is a measurable medium that delivers ROI, says Cassim-Surtee. “Sports content may need to be packaged somewhat differently, since there is now the potential to consume sports in much smaller ‘portions’,” says De Villiers. Look out for growth in mobile offerings, which take sports news and highlights directly to the fan. SuperSport also has content deals with cellular service providers using a 3G service, and there are also opportunities for brands to get involved and get customised solutions,” says Cassim-Surtee. She explains that there is room for brands to become content sponsors, or to create ad stings during content playout, or static on-screen branding. They must keep in mind that advertising needs to be quicker and shorter in the mobile space. Yet, in spite of the growth of these newer platforms, nothing can replace the excitement and value of the live broadcast. “Rights holders know that their greatest revenue stream is exclusive live rights, and this will probably remain so for the medium term at least,” says De Villiers. These rights holders will work hard to protect their rights, while creating new revenue streams on new media distribution platforms. Marc Taback, managing director, Initiative Media SA, suggests that advertisers secure ad spots in final or semi-final matches/games, especially if South Africa is playing. “It’s more expensive, but it delivers huge audiences,” he says. As to the question of which sport is the right sport to get involved with, the answer is that it depends on the market that the brand is trying to target, and also on the brand itself.

Picture courtesy EImage

Questions have been raised around the power of PVR, which has had an impact on TV programming in general. “We have not conducted any formal research on PVR viewing, but our recent sports qualitative and dipstick research shows that ‘live’ sport tends to be viewed ‘live’ and, along with news, is thus the most ‘timeshift resistant’ content,” says Cassim-Surtee. However, clients need to be smarter about their creative executions around sports. “The more relevant the commercial creative is in a sports environment, the higher the likelihood of the commercial being viewed,” she adds. Taback says, “The NFL Super Bowl (Chicago Bears vs Indianapolis Colts) marks the pinnacle of spot advertising during a sports event. As a result, this helped ensure that the NFL Super Bowl was the number one ranked TV sports event in 2007 in terms of average global audience. Rather than changing channels during the commercial breaks, many people actually watched the NFL Super Bowl because – rather than in spite – of the adverts.” It’s no wonder that advertisers are prepared to fork out up to US$3 million for a 30-second spot. What can we expect moving forward? Eddie Roux, insights manager at Sports Marketing Surveys, feels that with the impact of media fragmentation, IPTV will play an increasing role in entertainment, especially among younger audiences. “But technology is also influencing how older audiences interact – basically influencing developmental stages. This is fascinating stuff, and it will be interesting to see how sponsorship will develop and continue to grow with new forms of media developing.” Red Bull’s Air Race, for example, has launched a dedicated YouTube channel to tap into this (at the time of writing, it had 3 660 channel views and 132 subscribers). 

CENTRAL SA INTELLIGENCE

Hidden gem It turns out that Central SA (the Free State, North West Province, Northern Cape and parts of Gauteng), holds a lot of potential for brands and media. And slowly, the perception of this region as the dusty outback of the country is evolving. “Central SA, I feel, still suffers to a small extent from the perception that there is no business there, or that the potential business on offer is small in comparison to the larger populated regions. Truth be told, Central SA is the country’s best-kept secret; still a relatively untapped top-end market with huge wealth waiting to be accessed and serviced,” says Nick Efstathiou, OFM marketing manager. According to AMPS 2007/B there has been a drop in the overall number of adults classified in LSM 2 in this region, and a significant increase in homes that have DVDs, while the number of

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overall adults with debit cards has risen to 7.4 per cent, with a significant increase noted in Bloemfontein. TV trends find that SABC 2 and SABC 3 as well as e.tv are capturing growing audiences. Outdoor advertising, likewise, is flourishing. There have been country-wide increases in the exposure to bus shelter, trailer, minibus, train and bus ads, with significant increases noted in Bloemfontein and Kimberley. This is a market that is online, active on their cellphones, curious and engaged. “This market is very savvy and is connected to the world,” agrees Efstathiou. Property trends indicate positive growth for the central SA region. Marietjie Neumann, area principal for Pam Golding Properties in Kimberley, says that the city is enjoying increasing economic growth, with the Northern Cape

region being buoyed by the strength of the mining and agricultural sectors as well as tourism. Demand for homes to rent increased by over 15 per cent last year, with a further demand for office rentals. Plus, construction is set to begin soon on the New Kimberley Mall, while The Diamond Pavilion is undergoing a R64 million expansion; new business complexes and a cement plant are also due to open soon, while Mittal Steel is set to expand its output. The Department of Minerals and Energy recently launched the Gold Chain Technologies project, under government’s Minerals Beneficiation Strategy, which involves the development of a R100 million jewellery factory in Kimberley. Vodacom Park Stadium in Bloemfontein is undergoing a R221 million upgrade, which is due to be completed by

CENTRAL SA INTELLIGENCE

September this year, in preparation for 2010. The Royal Bafokeng Stadium in Rustenburg has also been upgraded. All in all, very good news for this region. “However, among key economic drivers of Kimberley is a definite upswing in tourist volumes with positive news of a R50 million project by mining conglomerate De Beers to upgrade the Big Hole as a tourist attraction, along with the construction of a R44 million Protea Hotel adjacent to it,” says Neumann. The economic downturn that has everyone tightening their belts and their budgets is having an impact on this region, and the negative sentiment is being felt, says Gary Stroebel, CEO, OFM. “However, retail business is still strong. OFM’s direct sales have not yet felt the impact as our strategies have been based around relationships, client training and up-skilling, and solid concepts based on trying to establish an ROI or at least focusing a client on one or other tangible outcome,” he says, adding that agriculture and mining in the region are doing well, and this has informed the economy. The Central SA region is the gold, diamond and platinum mining hot spot of the country, after all. “Despite the current economic conditions, the Free State is still a highly active region. For example, the recent property transaction of Mimosa Mall sold to Pareto Limited (shareholders in Sandton City and the JHB convention centre and owners of Southgate, Tygervalley and Pavillion – among others),” says Susna Stemmet, advertising manager, MyWeek Bloemfontein. “Consumers here are still spending. Car sales are down, and property stalled, but everything else is doing okay,” says Efstathiou. Greta Daniel, regional manager for Pam Golding Properties in the central provinces, says that there is little activity over the R2 million mark in the Northern Cape and Kimberley; but there is major activity in the lower end of the market. “In the Free State the market is relatively stable and seems to be holding its own, although this market is also affected by the general economic conditions affecting the property market in SA,” she says. In small towns like Clarens and Bethlehem, it’s the second home market that is being hardest hit. “A trend we are noticing, particularly in the Vaal Dam area, is that people are looking at small towns and are considering commuting to their places of employment,” says Daniel. She adds that while there is a reduction in unit sales, the market in Central SA is not experiencing a lack of confidence in property as an investment.

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Magazines in Central SA: Note: circulation figures are those distribution figures verified by each magazine’s distribution department, unless otherwise stated

The Media Magazines AMPS reports that magazine penetration in the region has increased, and publishers are encouraged by the growing readership in the region. National magazines (the consumer glossies, for example) find that the majority of their readership comes from the urban zones, but they still acknowledge that the support of the central region is valuable. As Julia Raphaely, managing director, Associated Magazines, says: “The central region of SA is just as valuable to us as any other region. Research has shown that our glossy magazines are mostly read by women in the urban areas and more specifically Gauteng, the Western Cape and KZN. As for the central regions, the Free State and North West Province are supporters too.” Mahareng Publishing, a joint venture between OFM and Caxton, publishes several titles in the central SA region. OFM Wheels is a catalogue-style magazine, focusing on new and used cars; 20 000 copies of the mag are distributed at local Midas, Checkers and Engen stores as well as selected news stands. The website, www.ofmwheels.co.za, allows advertisers in the magazine to also feature online. Play On is a newspaper focusing on school sports and cultural activities in Bloemfontein; 10 000 copies are distributed to schools in Bloem, and are also made available at selected stands in town. Students can also visit www.playon.co.za. Free community mag Get It is also published for the following regions: Bloemfontein, Vaal, Potch/Klerksdorp, and soon, Rustenburg. MyWeek’s Bloemfontein issue is seeing steady circulation figures, according to Stemmet. “MyWeek Bloemfontein has been growing from strength to strength and now (approaching our second year) it is rewarding to know that we are not only seen as a valuable advertising medium, but, thanks to overwhelming readers response, also a welcome edition to our readers households,” she says, adding that their success is in part due to the fact that the magazine is a vehicle that cane take clients’ adverts to the portion of the market with disposable income. “Advertising income has been consistent over the last year,” she says.

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Community radio stations in the Free State (listener figures are past seven day figures taken from RAMS April 08):

Community radio stations in the North West (listener figures are past seven day figures taken from RAMS April 08)

Community radio stations in the Northern Cape (listener figures are past seven day figures taken from RAMS April 08):

Radio OFM is one of the commercial stations serving the Free State region, and it certainly has the lion’s share of the market. “The OFM demographic is targeted at the upper end of the market; LSM 7-10, aged from 25-49. Our target audience is 50 per cent white, and 50 per cent black and coloured. The audience we offer to businesses and brands is of a high quality with large amounts of disposable income. The living standard within Central SA is high, and at a lot less costly than the larger populated regions of SA,” says Efstathiou. In terms of programming and communication channels, the station is committed to an allchannel approach; its website WOMF (www.ofm.womf.com) gets around 70 000 unique visits each month, and allows listeners to interact. The station also makes use of mobile services to give its listeners access to its content on the device that ‘they can’t live without’.

Podcasts, says Efstathiou, have allowed audiences to access content that they would like to keep and listen to again or share with friends; they are a great solution for advertisers who need more than 30 seconds to explain a new product or service. Local partnerships and sponsorships of local sports teams (Vodacom Cheetahs and Gestetner Diamond Eagles, for example), as well as festivals allow the station to connect with its audience in a meaningful way. OFM is opening a branch in the new Potchefstroom Mall in the next few weeks, and will be broadcasting daily from the northern part of its footprint. Other commercial stations in the SABC’s bouquet are Lesedi FM, Phalaphala FM and RSG. Lesedi FM’s largest listenership is in the Free State. AMPS 2007b reports that the average household income of listeners is R4 111 and their average age is 39 years. Phalaphala FM serves young, urban black listeners in the North

West province. Listeners have an average household income of R4 188 and an average age of 33 years (AMPS 2007B). RSG targets Afrikaans speakers aged 25-49 in LSM 7-10. The station has an average of 1 135 million listeners a day. Their average household income is R10 041 and their average age is 48 years (AMPS 2007B). In order to grow audiences and maximise its visibility, RSG has embarked on a campaign drive with outside broadcasts focusing specifically on the Northern Cape, Eastern Cape, Western Cape and Karoo areas. “To support the drive, RSG is also involved with the Volksblad Kunstefees in Bloemfontein in July and Aardklop in Potchefstroom later this year, presenting Die Beiteltjie which is a production of SABC archive material that was previously aired on RSG,” says Louise Jooste, marketing manager, RSG. The station is also involved with SABC2’s Dorp2Dorp marketing campaign where the emphasis is on visiting smaller towns and interacting with people on their own turf. The annual Gariepfees in Kimberley is one of the major festivals where RSG is present through the RSG music stage and broadcasts from the festival. “RSG successfully hosted a radio workshop for high school learners at last year’s Gariepfees to present the dynamic world of radio to them in order to spark interest in a possible radio career, and to explain and show how things work behind the scenes,” says Jooste. Added to the mix of commercial stations there is a plethora of community stations in the Central SA region offering advertisers a more localised platform through which to reach smaller niche communities.

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CENTRAL SA INTELLIGENCE

Newspapers Newspapers in the region are seeing increased penetration, according to AMPS figures. “After Gauteng, the North West is Beeld’s second largest market with regard to readership, and it has grown by 31.5 per cent since 2005/2006,” says Gavin Rheeder, marketing communications manager, Beeld. “We now have 71 000 readers in this province.” He goes on to say that this market is very important for Beeld, given that the Afrikaans market in the region enjoys a healthy income, which has been growing steadily. “Naturally, they will also feel the pinch of the tough economic climate; the same can be said for advertising revenue,” says Rheeder. The average household income for Beeld readers in North West is R4 503, while for readers in the Northern Cape and Free State it is R4 948 and R4 166 respectively. Peet Bodma, manager: Central SA, MCS24 (responsible for the circulation of Media24 newspapers and magazines in central SA) says that while there is greater penetration of newspapers and magazines in the region, circulation is under pressure, thanks to the economic environment. This has impacted on advertising revenue, as well as subscriber numbers (readers are opting to buy the titles, instead of subscribing to them). He believes that this will continue to be a challenge to the industry, and the titles that survive will be those that create very niched followings, and deliver real value to the reader. “We have, however, seen consistent growth in our community titles,” says Bodma, “and enormous growth in our knock-and-drops.” 

Free newspapers in Central SA (ABC Jan-March 2008)

Community newspapers in Central SA (ABC Jan-March 2008):

Newspapers in Central SA (ABC, Jan-March 2008): Note, figures are national circulation figures, unless otherwise stated

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