Most Advertisers And Marketers Are Failing To Connect With SA’s Mass Or ‘Main’ Market

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Andrew Weinberg, CEO of Retail Engage.

CEO of Retail Engage, Andrew Weinberg, states that 54% of the South African population falls between LSMs 3-6, with there being an estimated 13 million shoppers in the independent and informal retail sector. This is not traditional, bottom-end or emerging, this is the ‘main’ market of South Africa. 

However, despite all the research done to date about this economically active consumer base, there are still nuances and misconceptions around low-income consumer behaviour resulting in marketers generally failing to connect with this crucial market. To demonstrate the continued employment of outdated strategies by brands, the current advertising spends directed at the LSM eight to ten bracket is 70%, with over 81% of households therefore not being proactively engaged with. 

In other words, most advertisers and marketers are missing the boat when it comes to targeting South Africa’s mass market. Those in the know refer to this market segment as the mass market but we believe the label of ‘main market’ is more fitting because of the vast potential it offers to brands and marketeers who are willing to rethink their marketing and sales strategies. 

According to the UCT Research Institute’s latest report named the ‘The Top Million’ research report, South Africa’s ‘Upper Middle Class’ has the potential to make or break brands with a combined spending power of R700 billion, making up almost 40% of all consumer spend and 5% of total households. The first real data and insight into the untapped ‘mass-market’ started in 2012 with reports suggesting that 70% of South Africa’s consumer market lives in households that collectively earn less than R6000 per month. 

A lot of progress and further research has been made since then to reveal the power and importance of understanding and connecting with the mass market in Africa that moves between formal and informal retail spaces to search out the best fulfilment method for their needs. I have made it my business to understand this market and consumers’ behaviours in order to effectively provide access to brands to promote products in this growing middle-income segment across Africa.

A moving target, this main market moves fluidly between formal and informal retail spaces such as Spaza shops and cash and carry’s, trying to best fulfil their needs that include value, experience, convenience, trust and connection. This constant state of flux makes it incredibly difficult to find a strategy that works and for many brands – it is a constant challenge to find a way in. Brands need to approach this segment with precision rather than with broad-based tactics. 

Since having established Retail Engage, we have successfully implemented a consumer-facing brand, bonsella®, across South Africa, which has helped brands gain crucial data and insights about the independent retailer environment and its consumers. Technology has helped us introduce effective brand engagement opportunities that include shopper marketing and loyalty programmes in the main market. 

There is vast potential for marketers who are willing to rethink their marketing strategies and the key is going back to basics to find a solution that brings value, experience, trust and connection in the main market space. These needs are not limited to this income bracket, however, until now brands are failing to meaningfully connect here. Retail engage specialises in establishing connection points in the shoppers’ day-to-day lives by leveraging modern trade spaces to build brand awareness and loyalty through experiences while simultaneously driving penetration and consumption occasions in the informal and independent trade. 

Brands and companies need to put their thinking caps back on in order to generate relevant content. The only way to do this is by getting inside consumers’ minds to fully understand their aspirations, behaviour and what drives them. I believe the key for brands to tap into the main market, which has often been referred to as a ‘blind spot’ by big brands, is through education and working with experienced and established agencies that have a proven track record in this exciting space.

RETAIL ENGAGE
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info@retailengage.co.za
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