The economy is tanking - time for South Africa's entrepreneurs to shine
The Global Financial Crisis of 2008 may be well behind us, but many of the world's economies continue to struggle. Here in South Africa recovery was rapid, peaking in 2010.
Since that time, economic growth has been generally trending downwards once more. This time last year, growth was a very healthy 4% - this year the economy has shrunk by 1.2% in the first quarter. GDP was also down 0.2% year on year.
For South African businesses this is terrible news. Mining, one of South Africa’s major sectors shrank by 18.1% over the course of the last year. This was echoed by slightly smaller falls in the agricultural and transport sectors too.
Bad news for jobs
Continued uncertainty in every market has had a serious effect on jobs too. Unemployment currently stands at 26.7%, the highest level since 2003. This means that more than a quarter of the total South African labour force is currently jobless.
It is worth noting that some of these employment statistics are disputed. Back in 2012, local labour analysts suggested that unemployment rates may actually be just ~11% because of the way that jobs are recorded. The South African government does not record “informal jobs”, those which are beyond the reach of the tax system.
The general downward trend in the economy is concerning however, likely to see many more jobs lost if things do not improve soon.
An opportunity for entrepreneurs
Despite the general negativity surrounding an economic recession, many people without jobs find the conditions right for starting their own businesses. Indeed, a study conducted by researchers from the University of California found that the number of start-ups launched during a recession was unexpectedly high.
As traditional sectors struggle – like mining and agriculture – entrepreneurial South Africans have a good opportunity to join the digital revolution. There are now 25 million internet users in South Africa, representing a potential customer base that covers 47% of the population.
This online marketplace is set to grow in the near future, creating even more opportunities. Where South Africans spent R19.8bn to get online in 2014, they are expected to spend R59.6bn next year.
Targeted messaging can beat market trends
The key to successful marketing, whether the economy is in good health or not, is to create marketing messages that are finely tuned to specific individuals, and then making sure those messages reach your intended recipients. Targeting the right person, at the right time with the right offer will always buck wider economic trends.
For any would-be South African entrepreneur, being able to reach the right individuals will be critical to the success of their venture. One of the best early investments start-ups can make is an accurate contacts database, tailored to their target market sector.
Being able to communicate with relevant individuals from the outset allows new businesses to avoid the long, drawn-out process of building a contacts list from scratch for instance. And by choosing the right database, they may be able to gain a significant head start on their competitors – even those who are well established in the marketplace.
Finding a database supplier that has complete, accurate and up to date information is no easy task. Our research has turned up several players, only to discover that the majority have become significantly outdated. The player with the most complete and current list is a company called Global Database, which currently has access to a sizable rolodex of contacts across 142,000 companies, large and small, representing over 40% of South African business.
The Global Database service is much more than just an email list however. A one-year subscription buys access to direct dial phone numbers, postal addresses as well as personal email addresses for key decision makers. The data, which is updated daily for maximum accuracy, also allows entrepreneurs to filter and support based on industry sector, employee headcount and even annual turnover. This level of granularity ensures that they spend less time identifying their perfect targets, and more time engaged in the actual marketing and sales process.
Armed with this kind of information, entrepreneurs have a great chance of getting ahead in a negative market. To see why were so impressed by Global Database, why not arrange a no-obligation demo or request a free sample of data?
