Transformation of advertising & marketing industry: The way forward

13 November 2002

A need for transformation

The process the Portfolio Committee initiated in response to complaints about adspend patterns has confirmed the need for further change in spending and transformation of the advertising and marketing industry.

There has been progress in redressing inequity in use of resources to communicate through advertising and marketing. But it has been uneven and far short of what is needed.

With respect to participation in the industry - in ownership, management and operations - the progress has also been disappointingly slow.

An important milestone

Nevertheless, this is an important milestone: bringing more clarity on what is still needed and ways to achieve it; highlighting interrelationships between factors sustaining inequity, which need to be if tackled in an integrated way.

Critically, this is a product of unprecedented interaction between industry and government brought about by the Committee's initiative. It is informed by a consensus that the process must continue.

The process and these second hearings have created conditions for faster and more focused change.

Developing the framework for transformation

Following the report to the Portfolio Committee the various departments in government affected - including some not yet part of the process - will need to work together, in consultation with the industry, to develop a framework for transformation in the light of what has emerged.

That would include definition of desired outcomes, and setting of targets and time frames as well as mechanisms and processes. It would be informed by interrelationships between patterns of expenditure and the representivity of the industry and its relationships with society.

All these initiatives may lead to the consolidation or strengthening of the existing legislative framework, as well as to an industry charter.

Given the scope of what has emerged, a first task of government therefore will be to brief Cabinet on the process, for guidance on the way forward for government.

Maintaining the momentum

In the meanwhile the momentum must be maintained. We must build on the foundation laid by this past year's work, continuing to work towards identified goals and developing the framework for more effective.

Continued research and monitoring of trends in the industry's landscape, as defined by patterns of expenditure on advertising and by the participation in the industry should inform faster progress towards the goals and targets.

What follows is a partial list, needing development, of things emerging from reports and discussions, some needing industry action; some needing government action; some needing interaction. Some are issues for further discussion.

Expenditure on advertising, marketing and communication

There is need, in the light of current and ongoing research and monitoring, to devise steps towards more equitable expenditure on advertising and to work to ensure implementation.

  • Continue monitoring adspend placements against target markets and channels, quantifying gaps and developing segmentation tools (criteria of wealth; consumer profiles wrt FMCGs etc)
  • Review placement procedures in the light of findings and in the context of more targeted communication
  • Finding place for consumer advocacy groups in the monitoring process.
  • Addressing imbalances in access to media

Affirmative procurement

There is a need to assess what constrains and what promotes affirmative procurement.

  • Ensuring clarity in and promoting effective use of procurement policies and guidelines, including in subcontracting, to accelerate the process in all dimensions (ownership; HRD; subcontracting)
  • The implications of the forthcoming Black Economic Empowerment policy statement will also need to be taken into account
  • Steps to align government and parastal procurement policies would assist the process.

Representivity in the industry

There is a need to assess what constrains and what promotes employment equity in the industry, and to work to accelerate empowerment at all levels

  • Government interaction with industry to promote an action plans to identify and undo blockages
  • Interventions especially in the education system to equip more people to enter the industry and steps to promote representivity at all levels thorough ongoing training and development programmes offered through the education system and the SETAs.

Regulatory framework

There is a need for a comprehensive assessment of the efficacy of current complex legislative framework and regulatory regime concerning advertising.

  • Assessing the functioning of the current legislative framework, including relationship of ASA and the Consumer Affairs Committee, and the possibility of a Liaison Committee under the Unfair Business Practices Act as a means for doing that
  • A consumer awareness programme to ensure that citizens are aware of their rights and are able to access the means of protecting those rights.

Continuing the process

Maintaining the momentum also means keeping together in an integrated way the various issues and processes which have been reported on separately and maintaining interaction. The bare bones could include:

  • A consolidated report of this hearing; for
  • An early plenary meeting to agree and assign tasks and processes
  • A plenary mid-2003 to assess progress.