Transformation of advertising & marketing industry: Introduction: Progress Report to the Portfolio Committee on Communications
12 November 2002
Yacoob Abba Omar
Honourable Nkenke
Kekana
Chair
of the Portfolio Committee,
Honourable MPs,
Colleagues from the communication and marketing fraternity
Government and
the media
I learnt from a wise person a few years ago that not only does knowledge throw light on a number of subjects, it also creates shadows. The large number of people who have been involved in the process, which we have come to refer to as the 'Advertising Hearings' have been constantly reminded of this. The hearings hosted by this Committee in October 2001 sharply raised a number of issues. The rest of the year has been spent digging in those shadows.
I trust that by the time we finish these sessions we would find that we have managed to cast light on a number of issues. However, we hope that this report shall also be appreciated for having identified the shadows and how to address them.
At the outset I would like to express my personal gratitude and the appreciation of all those who have been involved in these hearings to Patti McDonald. Her professionalism, enthusiasm, humour and sheer hard work kept all of us motivated. Our appreciation to the Triple A, which became the ACA, for having hosted all of the plenaries and many of the sessions of the working groups. When on their premises, we were never found wanting for sustenance.
Both Ms McDonald and I would like to put on record the contributions of our respective employers who allowed us to concentrate on these hearings with no expectations of any benefits in return.
Modus operandi
Following the October 2001 hearings, we applied ourselves to the task at hand with alacrity. GCIS and the Department of Communications hosted a meeting on December 1 of a range of industry bodies. At this Plenary it was agreed that mandated representatives of all industry bodies would be encouraged to be part of the Plenary Body and attend Plenary Sessions. During the course of 2002, a further seven Plenary Sessions were held.
Throughout the proceedings, a reasonably wide perspective was taken of what constituted the industry. At one extreme it included media owners but not the journalists themselves. At the other extreme it included commercial designers but not the struggling creative artists.
As you would see from some of the reports being tabled here, the communication value chain is seen as beginning with the marketer wishing to meet some need in the market. A marketing plan is developed and an agency briefed on the basis of that. Once it is determined that above-the-line advertising is required to meet the marketing objectives, designers set about to prepare the required adverts while the media agency develops a placement plan. The appropriate media are thus identified and the plan executed.
It is estimated that the following number of people work in the industry:
| . Companies with a marketing function | 1 100 |
| . Marketing staff on their database | 6 286 |
| . Advertising agencies | 715 |
| . Agency employees | 5 078 |
| . Media strategists and planners | ±650 |
There was no need to turn this process into a witch-hunt for acts of racism. In fact, very little time was spent defining notions of race or racism. Our focus was on carrying out research into the appropriate areas, identifying the problems where they existed and developing solutions to these problems. It was a simple approach, but we hope not a simplistic one. We hope that the research we present will leave no doubt that, as the Honourable Dene Smuts put it during last year's hearings, there is a problem in the advertising, communications and marketing industry.
The problem is at various levels:
- At the simplest,
and yet the most fundamental, of levels it is a problem of race.
The research to be presented by the Department of Communications
under the section 'Empowerment' shall show that transformation
in this industry has been woefully inadequate. Eight years after
the democratic election, and even more years since the scrapping
of many pieces of discriminatory legislation, the research shall
show black employees languish at the bottom of most rungs of the
industry. A similar point shall be made of ownership patterns.
(See Point 5 of Report)
- While the
research indicates the state of affairs in terms of representivity,
the presentation on 'Education for the Industry' shall address
what we had identified prima facie as one of the obstacles
and a potential entrance enabler to the industry. Ian Sutherland
shall present this report.
(See Point 6.1 of Report)
- One of the
conundrums we faced was that for an industry, which prided itself
on creating images and brands, why was it not able to attract
more black talent? Mohale Ralebitso shall describe the problems,
which have been identified, and some of the strategies to be used
in effecting the changes.
(See Point 6.2 of Report)
- At a slightly
more complex level, it is a problem of the decision-making process
in the value chain described above. This process from the time
the brief is prepared by the marketer to the time the adverts
are created to the very placement of the adverts is in the hands
of predominantly whites. Anecdotal testimony was mentioned of
how, despite their best attempts media, which largely served the
black market were unable to attract adverts naturally aimed at
their viewers, listeners or readers. The presentation by Brenda
Wortley and Sue Bolton of research into advertising spending patterns
shall highlight this problem.
(See Point 4.2 of Report)
- Perhaps one
of the most important reasons why this industry is of enough concern
for public representatives and government to devote so much time
examining it is that it shapes the norms and aspirations of all
South Africans. At the core of this industry is a deeply creative
process; a process, which like the wine industry, tries to produce
masterpieces on a mass scale. While this area was not directly
part of the remit, it was encountered sufficiently to warrant
a presentation of its own, which Thebe Ikalafeng has kindly agreed
to do.
(See Point 3 of Report)
- A critical
debate through many of the proceedings was the state of regulation
of the industry. The presentation by Nkwenke Nkomo and Delien
Beukes shall highlight the need to strengthen the regulatory framework
while the presentation by Amanda Lotheringen shall look at options
that exist within existing legislation.
(See Point 2 of Report)
- The view
was expressed that despite the specific transformation charters
in existence, there was a need for an overarching Industry Values
Statement. Patti McDonald shall present this.
(See Point 7 of Report)
At the end of these proceedings I will be pleased if you feel we have shed some light on the challenges being confronted. However, we have already identified a number of areas lurking in the shadows. These include:
- Our work
did not take into consideration areas such as below-the-line and
sponsorships, which could be at the same size as the advertising
spend.
- We did not
look into the relationship between programming and advertising.
- A clearer picture of the future of the industry. We seem to have consensus that this will be determined by the interplay of four key factors: the state of the economy; the future of media; the impact of technology on the way we do our business in this industry; and the values our society subscribes to.
- How do we increase the size of the pie? This will need to address questions such as how can small firms access government assistance to small, medium and micro enterprises (SMMEs), what policy should there be around foreign produced adverts etc.
I want to take
this opportunity to thank the various working group chairs and members
who sacrificed so much of their personal time. In particular, I
want to thank Brenda Wortley who tirelessly supported the process
and during this time developed a ground-breaking new tracking model
for advertising spend in the industry.
- Yacoob Abba Omar
