Many companies talk about expanding into Africa. It's the next obvious frontier. However, it would be wrong to assume that a week's visit to Nigeria for example, with a population of over 160 million and 350 ethnic groups with twelve languages, will give you a true understanding of how to operate your brand in that market.
Nonye Mpho Omotola
With global economies declining and emerging economies on the rise, it appears that the second gold rush to Africa is fast becoming a highway for global brands. Everywhere you'll see headlines about investing in Africa.
Gross Domestic Product (GDP) on the African continent has been growing at a fast pace of 5% with Nigeria, Ghana, Mozambique, Tanzania and Angola as key target markets and it was recently announced that 5% of Foreign Direct Investment (FDI) from South Africa has gone to the African continent.
There are opportunities for growth and return on investment on the continent, as successful expansion of brands into the continent such as Woolworths, Mr Price, MTN and Shoprite can certainly testify.
Businesses however cannot simply adapt the same business or communication strategy for each African country unless they are aiming for failure. If they do, the risk is being called an arrogant post colonial opportunist.
Promoting inter trade on the continent
There are challenges of building and sustaining a brand in these markets and whilst it is increasingly obvious that brands must have an African expansion strategy for growth and increased profit, it is also important that the tightened policies which govern tax, immigration and employment laws, should be constructive enough to promote inter trade on the continent.
This is where the free trade area (FTA) due to be complete by 2015 will be of huge benefit promoting integration, infrastructural development and intra regional trade for members.
Your Africa strategy
Africa is a large continent of 54 countries each with diverse cultures - so challenges such as language barriers, political instability, location, corporate governance, currency differences and poor infrastructure can be costly and hamper operational goals. In the same vein it provides opportunities for development and growth for those with sound business acumen and a huge appetite for risk.
Your Africa strategy has to consist of sound qualitative and quantitative research, supported by strong macroeconomic indicators and a unique differentiator which sets you apart from competitors.
You will need to identify policies and legalities that govern the particular business environment and understand your target market fully, knowing the different segments, their lifestyles, disposable income, purchasing and product use behaviour especially when it comes to the rise of the middle class in emerging markets and the large mass market.
How people spend their money and their psychographic differences, won't just depend on how much they earn, as factors such as infrastructural challenges, like no electricity and the use of generators have a huge impact on lifestyle and brand/product choices.
Your brand values and commitment to growth must include the use of local intelligence, local operations, local staff and consumer insights. These are key to success in addition to the acknowledgement of cultural nuances, as building relationships is critical but acknowledging respect for the locals is even greater.
Companies doing business in Africa need strategic plans indicating product offering, intended value to the economy, brand positioning, intrinsic values, employment opportunities for the locals, training and social responsibility plans so as to induce brand endearment.
Your African brand strategy must represent something in the hearts and minds of your consumers and be consistent so as to gain their trust and loyalty.
If you get this right you will indeed build and sustain a long brand relationship in each market you choose to operate in.
Nonye Mpho Omotola is the former group head of corporate communications for Oceanic Bank Nigeria, now Ecobank. She is a brand strategist and a global African communicator, and passionate about African development. She consults for a number of corporates across Africa and is now based in South Africa. Contact Nonye on .
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Nonye, whilst I agree largely with what you say, I get the feeling that you are advocating a country by country approach for big brands.Having worked across the African continent for the past 10 years on brands like Coca-cola, Celtel and Zain, what I learned is that human truths are the same everywhere. True, one size does not fit all, but when it comes to execution of advertising, we all have the same basic wants and needs. Maslow defined that years ago.I have heard all too often, especially from Nigeria, that you have to create your own commercials because 'things are different in Nigeria'. That is true, but that is a whole other conversation. We, very successfully made Pan African commercials that built strong brands using the human truth approach.I hear of so many brands wanting to localize. You end up with small budgets, a lack of clear direction and locally poor results. Sure, small local brands will make that work, but that is all they will ever be. Small local brands. Global brands require global thinking. Sure, local knowledge is important and I am in no way saying discount it, but do not become a slave to research that says zig, when you know the brand needs to zag.Local can be employed for certain aspects of a brands offering, but don't get too bogged down by local nuances.
Thank you for your comment Tim. I agree with you in the sense that it is the essence of a brand I.e 'the human truth' that connects us as consumers. What I am referring to in my article is 'how' the human truth gets connected. I.e How do you communicate this human truth. What channels? Which stakeholders'. How does the global brand become relevant and have ROI in an African local market.
Hi Nonye, fantastic article. Although brands may represent invaluable intangible assets, creating and nurturing a strong brand poses considerable challenges. Many business executives now recognize, perhaps one of the most valuable assets that any firm has is the processes and factory designs often can be duplicated, strongly held beliefs and attitudes established in the mind of consumers often cannot be so easily reproduced. The difficulty and expense of introducing new products however always puts more pressure to skillfully launch new products as well as managing existing brands. One always has to reflect new thinking concepts in order to adopt stronger global perspectives by updating and streamlining. The emphasis is placed on understanding the psychological principles at individual or organizational levels as to how to improve decision making with respect to brands.
Hi Nonye, great write up indeed. Loved it. It is absolutely true that iti is 'the human truth' that connects us as consumers and even as people. While I agree with Tim that our desires and needs often cut across race, religion and beliefs that have global similarity; the issue of 'differentiation' must not be ignored in the push for universal homogeneity. What has kept Africa in the shadows for so long is our belief that a European or American branding and creative concept must fit our perspectives. It never does. So, quite clearly we must consider local factors in every country system we hope to impact in. In investing in Africa we must identify the 'differentiating' factor that makes Angola, for instance, different from Cote de Voire and use that as the basis for creating unique branding concepts that can impact favourably in our choice target market. Of course ROI is evidently the final arbiter for assessing how effective our branding and marketing concepts did, but success in any market, particularly in Africa, comes with some degree of 'differentiation'-appreciation in our research process.
One final from me, You are 100% right Valentino, there has to be room for local nuances. As we are all saying, one size can not fit all, but a big idea should work where ever. But it may need a local adaptation.