Masterclass Notes: Highlights from agencyScope 2017 South Africa
by Johanna McDowell (@jomcdowell) Here are some trends to look out for in the coming months, based on the results of Scopen’s agencyScope 2017 South Africa research to find out what marketers are looking for in their agencies.
[Full disclosure: Scopen Global and Mazole Holdings (the company that owns IAS 100%) have formed a company in South Africa called Scopen Africa. Scopen Global holds the majority of the shares; Mazole is a minority shareholder. Johanna McDowell is a director of Scopen Africa, as is Cesar Vacchiano, global CEO of Scopen.]
This second wave of the study reached many more marketers than the first wave in 2016. Our sample of 217 face-to-face interviews among marketing professionals — 61% of whom were CMO level — on a national basis was robust and representative. In terms of the content of the results, we are very happy that the views and opinions expressed are solid and our reports for the market place have been well-received. One hundred-and-fifty-two agency professionals were also interviewed, via a short online survey, for their views on aspects of the industry, along with 15 procurement specialists.
In terms of client-agency relationships, 499 relationships were analysed; we believe that this is the most that has ever been done in South Africa and the findings provide excellent benchmarks for the industry.
In addition, because of Scopen’s global reach into 12 countries, including South Africa, we are able to compare SA each time to the global benchmark.
Here are some interesting observations:
- Our analysis reveals that South African marketing budgets, as a percentage of turnover in the respective corporate companies, average 2.68%. The global benchmark is 2.5%.
- Digital spend in SA has increased from 18.59% in 2016 to 24.36% in 2017. The global benchmark is 28.3%.
- 77% of all agency selection processes are done with a pitch process that includes strategy and creative in South Africa. Most marketers claim to pay for pitches.
- Procurement departments are involved in 46.2% of agency negotiations in SA. The global benchmark is 60%.
Length of relationships
- The average length of client/agency relationships in creative agencies in SA is 4.26 years. The global benchmark is 4.47 years.
Contribution to business growth
- Marketers told us that their agencies contribute to business growth by about 17.31 %. The global benchmark is a lot higher at 25% but this is affected by a 52% contribution made by agencies in Brazil, where media and creative agencies are still combined by law. Interestingly, Spain, China and the UK marketers record lower contributions to business success by their agencies, compared to here in South Africa.
Level of satisfaction with agencies
- 72% of marketers here say they are satisfied with their agencies. The global benchmark is 76.4%.
Likelihood of changing agencies
- 19.4% of marketers in SA will change their agencies in the next 12 months; the global benchmark is 15.1 %. We think that our economy and that we are an emerging market plays a role in this particular fact.
- Masterclass Notes: Trends from agencyScope SA 2017 fieldwork
- Masterclass Notes: agencyScope 2016 SA — what marketers want
Johanna McDowell (@jomcdowell) is managing director of the Independent Agency Search and Selection Company (IAS), which is partnered with the AAR Group in the UK. Johanna is one of the few experts driving this mediation and advisory service in SA and globally. Currently she is running the IAS Marketers Masterclass, a programme consisting of masterclasses held in Cape Town and in Johannesburg. Twice a year she attends AdForum Worldwide Summits.