Why Africa is the ‘final frontier’ for global brands

Brands are increasingly turning their sights to Africa as the next source of fast growth, but what are the challenges of launching on the continent, and how can marketers reach such a diverse range of consumers?

mtv
One of the new channel idents for MTV Base in Africa

The dynamics of the global economy are shifting apace. With uncertainty in developed markets such as the UK, the US and Europe, many brands are looking beyond their traditional customer bases in search of new opportunities and sources of growth. Africa, the world’s poorest continent but also the most untapped by consumer brands, looks set to benefit.

Africa is of course a huge landmass with massively varied conditions across its countries. Where some parts remain ravaged by war, famine and poverty, others are experiencing accelerated economic growth, urbanisation and a rising middle class. There are estimated to be more than 2,000 languages spoken, and individual countries and regions have their own distinct cultures.

The World Bank’s Africa’s Pulse report in September noted that some countries had registered sharp “slippages in economic growth” last year due to factors such as low commodity prices and domestic political problems. At the same time other countries such as Ethiopia, Rwanda and Tanzania “have continued to post annual average growth rates of over 6%”. Meanwhile, the Brookings Institution reports that the number of urban residents in Africa nearly doubled between 1995 and 2015 and is projected to almost double again by 2035.

Within this economic climate many western brands have been growing their presence. According to a recent report by African Business magazine, non-African brands have increased their share of African consumer markets in recent years to reach a dominant 84% in 2017. Non-African brands account for 84% of the top 100 most admired brands in Africa, and 99.3% of the most valuable, it adds.

Starbucks, H&M, Facebook and Business Insider are among the brands to have launched or opened offices in Africa in the past two years, while western marketing groups have also grown their footprint on the continent. Last year WPP launched the WPP Africa Academy in Johannesburg, South Africa, a talent development project that helps WPP’s African subsidiary companies to access training programmes.

As brands turn their sights to the African market, they must strive to understand a continent of diverse people and conditions that is becoming increasingly confident in its own creative self-expression.

Translating brands

US media giant Viacom, which owns channels such as MTV, Nickelodeon and Comedy Central, has had a presence in Africa for 12 years but is continually evolving how it communicates with an African audience. Last year the company hired Fort, an African-owned and run creative agency, to create a new visual identity for its MTV Base channel in Africa.

Previously the channel had drawn upon imagery and logo designs used at the global level. The brand refresh involved overhauling the visual identity to ensure it was entirely focused on the local market. To do this, Fort created numerous versions of different channel idents that mix vibrant custom-designed patterns with real life photography.

The channel imagery is designed to provide MTV with the flexibility to express itself in different ways across African markets and to match itself to different fashion trends, music styles, urban art forms and local cultural trends. The people photographed for the idents include Viacom and Fort employees as the project aims to represent “a diverse Pan-African spectrum”.

READ MORE: Marketing’s diversity problem

Dillon Khan, vice-president for Comedy Central Africa and creative services at Viacom International Media Networks Africa, says the refresh was driven by a need to move away from westernised forms of marketing and ensure the MTV brand was more in-sync with Africa’s flourishing cultural movements. “In the northern hemisphere [the idents] would perhaps use neon or retro colours, looking back at the 80s as an inspiration point,” he notes.

“Here in Africa those colours don’t necessarily translate as well. What does translate is what’s happening in the fashion scene here. You’re starting to see African print from across the continent and the wide scale of patterns and colours coming through, so we wanted to utilise the fashion and lifestyle aspect of our audiences and reflect it back.”

Khan argues that African design is a growing source of inspiration in the northern hemisphere. “Whether it’s Beyoncé using it in some of her music videos, or fashion labels that are also looking at Africa, it’s a way of further championing [MTV in Africa] as a music and lifestyle brand.”

MTV Base has relaunched in Africa with a new, locally-inspired identity

Mobile-first

The channel imagery was produced in multiple formats, including video, stills and gif animations, meaning that it could easily translate across TV and mobile. Given the lower barriers to entry and advances in network coverage in recent years, mobile has leapfrogged other forms of technology to the extent that many African consumers only engage with the internet on mobile devices. Research published last year by GSMA found that the number of smartphone connections across the African continent had almost doubled since 2014, reaching 226 million.

Having a strong mobile marketing strategy is therefore vital for any brand approaching the African market. “It’s the fastest growing youth population on the planet and to market to them you need to be on both linear and digital [platforms],” says Khan.

MTV has TV channel penetration across the continent, including free-to-air deals in some countries and a presence on pay-TV platform DStv in Sub-Saharan Africa. With offices in South Africa and Nigeria, Viacom shoots programme content on the ground and also hosts the annual MTV Africa Music Awards.

Whether you’re going through ups or downs in an economic cycle, there’s always opportunity here, it’s very entrepreneurial

Dillon Khan, Viacom International Media Networks Africa

Khan argues that besides the “main epicentres” of economic growth such as South Africa, Nigeria, Kenya, Tanzania and Ghana, there are signs that markets are maturing in countries such as Cameroon, Côte d’Ivoire and Angola. He notes that marketing to the whole of Africa is a “great challenge” and argues that brands must pick the right local partners when launching on the continent.

“Whether you’re going through ups or downs in an economic cycle, there’s always opportunity here, it’s very entrepreneurial,” he says.

“The market is great for new opportunities to grow and I think lifestyle and culture is coming out of Africa more and more. Whether it’s fashion or music, Africa as a continent is and has been on the rise for a while and the opportunity for Viacom has been here for 12 years. We’ll continue to be here as we serve consumers of all ages, whether it’s with Nickelodeon, MTV or Comedy Central. All ages need catering to as that middle class grows.”

‘Decolonising’ the creative economy

This notion of African self-expression is a core ethos of MTV’s partner agency, Fort. Earlier this year the agency launched Create Movement, a campaign that aims to encourage and develop home-grown creative talent across Africa. The campaign includes a video featuring African musicians, celebrities and social media influencers (see below) and is part of an ongoing effort by Fort to build a network of creatives across the continent through workshops and training programmes.

The cause is close to the heart of Fort CEO Shukri Toefy, who started the agency with Amr Singh in Cape Town, South Africa in 2006 when they were friends at university. One of the stated aims of the Create Movement is to “decolonise the African creative economy” from excessive external influence – a provocative phrase that Toefy hopes will encourage people to reassess their interpretations of African marketing and creative expression.

“The majority of advertising and marketing companies [in Africa] are foreign-owned,” he says. “I can count on one hand, and we’re included in that, the number of locally-owned companies that are actually real players that can win big brands and big tenders. The rest of them are all Publicis-, WPP- [or] Omnicom-owned agencies.

“In South Africa, you drive down the street and at universities they’re tearing down statues of Cecil John Rhodes and all these colonial leaders, but then you drive further and there’s Ogilvy and Saatchi & Saatchi. Those are colonial relics and that’s a form of neocolonialism as well. I’m not saying we should take to the streets and start taking down signs, but there’s not even a consciousness around it, and I think that’s what’s interesting about what we’re doing with Create Movement.”

I can count on one hand the number of locally-owned companies that are actually real players

Shukri Toefy, Fort

Following recent signs of resurgent nationalism in certain parts of the world including Brexit and the election of Donald Trump, Toefy believes there is an opportunity for Africa to become more assertive on the global stage. This includes ensuring that campaigns by non-African brands are not simply imported direct from overseas, but rather have an “Afro-centric approach” that resonates with local audiences.

“We’re saying that yes, we need to be very grateful for foreign direct investment and grateful for the skills and knowledge we can learn from other markets, but that there needs to be a consciousness around bringing it home and making it real within an African context,” he says.

Fort, which also works with Unilever and SABMiller, urges brands to think carefully about their approach to market research when launching in Africa. Toefy notes that many western brands are coming to regard Africa as the “last frontier” for capturing new consumers, given they have often already entered emerging economies such as the BRIC nations (Brazil, Russia, India and China).

“Be open to finding that African insight and being driven by something that’s non-traditional,” he advises. “Redefine strategies that are more in-line with African audiences and with the complexities that make up Africa.”

Cultural sensitivities

Drinks group Diageo has reaped the benefits of investing in an African strategy. The company’s latest financial results show that Africa now accounts for 12% of total group sales and that net sales in the region rose by 4% in the six months ended 31 December 2016.

A breakdown of this activity reveals the challenging trading conditions facing brands, but also the opportunities for fast growth through new product launches in new markets. For example, while beer performance was impacted by a significant increase in beer duty in Kenya, with Guinness down 22%, sales of the Satzenbrau range rose by 108%.

Diageo has identified Africa as an important source of further growth and has brought African themes to its advertising in the UK, as well as African markets. Smirnoff’s latest ‘We’re Open’ campaign features Jeffrey Jewell, a Congolese-French DJ with albinism who is aiming to break down prejudices about the condition in parts of Africa. The advert is currently running in both Nigeria and the UK and is to be rolled out across other African countries during 2017.

DJ Jeffrey Jewell in Smirnoff’s Africa campaign

“DJ Jeffrey Jewell shares Smirnoff’s belief that socialising across social divides makes the world better, which has been part of his inspiration as a DJ,” says Luke Atkinson, vice-president of global communications at Smirnoff. “We partnered with him in our new Smirnoff campaign to give him the opportunity to play and to tell his story in Africa.”

In addition to honing its communications strategy, Diageo has thought carefully about local customs, including the drinking culture, in different African markets. This includes launching special product variants such as Smirnoff X1, an “extra smooth” line of the vodka specifically created for the Nigerian market.

“Africa is diverse – and we believe its growing population of urbanising consumers will aspire to progress towards more formal, safer drinks,” says Atkinson. “This is where a brand like Smirnoff can play.”

Whether planning communications, market research or product development, all marketers should pay heed to these complexities when approaching the African market. Get the strategy right, and the opportunities could be huge.

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Comments
  • Jacqueline 20 Apr 2017 at 11:50 am

    Great read!

    These are many of the topics we will be discussing at our African fashion industry conference in london http://www.fashionafricaconference.com

    And why we started our business mission trips to African countries too

    See http://www.fashionafricasourcingtrips.com

  • Piers Schmidt 24 Apr 2017 at 12:07 pm

    Great piece Jonathan. Having worked on the continent in countries as diverse as South Africa, Nigeria, Zimbabwe, Botswana and Mauritius, in 2009, we published a white paper outlining the opportunity for luxury brands in Africa. Coincidentally, we subtitled this with a ‘New Frontier’ rather than the ‘Last Frontier’ but that was immediately post-Lehman and the onset of the global credit crisis. The report can be downloaded here: http://www.luxury-branding.com/wp-content/uploads/2015/04/SA-A-New-Frontier.pdf

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