Market Research Wrap: Where next for SA online retail?
Cheryl Hunter (research at marklives.com)’s weekly wrap of the latest market and consumer research:
- Retail research in SA
- Launch of Fusion data
- Sponsorship grows globally
Call to action for online retailers
Online Retail in South Africa 2018 sees World Wide Worx, Visa and Platinum Seed partner to deliver insights into South African digital shopping, and shoppers. Results of this study will be presented at the end of October 2018, and every retailer which participates will get a summary of the research with actionable insights that they may use to improve their business, an invitation to the presentation, and entered into the Online Retailer of the Year 2018 Awards.
Says Arthur Goldstuck, World Wide Worx MD, “Online retail reached 1% of overall retail during 2016, the last time we conducted this survey. At the time, retail was growing well, achieving a growth rate of above 20% a year. SA online shopping has grown consistently, at around this rate, since the turn of the century, initially off a very low base. By 2016, total online retail had reached just over R9bn, in comparison to total retail, which grew to just below R900bn.”
He points out that, since the last survey, some 50% of the online retailers surveyed had consolidated or had gone out of business: “It is a tough market, but a growing one. The recession, of course, will bring new challenges to online retailers.”
Early indications from the research are that numerous specialist and online niche shops are emerging. In order to track this growth, World Wide Worx, Visa and Platinum Seed are calling on all online retailers to participate in an online survey. Online retailers have until Wednesday, 3 October 2018, to complete the survey and the results will be presented in collaboration with Heavy Chef in Johannesburg on 31 October, and in Cape Town on 1 November.
The study is endorsed by the E-Commerce Forum Africa and includes an industry study of retailers, demographic data on consumers, and an overview of trends in global online retail and in payment technologies. World Wide Worx has collaborated with pan-African research house Ask Afrika in the collection of demographic data.
Complete the survey at surveymonkey.com/r/OnlineRetailSA.
PAMS/CPS Fusion data launched
Initiated and funded by the Publishers Research Council (PRC), with Consumer Panel Survey (CPS) data supplied by Nielsen, the first PAMS/CPS Fusion data has just launched and sees the fusion of the existing PRC PAMS 2017 data with real audited and scanned purchase data, based on 4 000 South African households.
This follows a vacuum in the local market in terms of brand data since the last release of AMPS in 2015. In the three years since, things have changed dramatically in the market, including the development of the new generation segmentation model, the SEMs. Despite this, media planners and clients have had no way of following the changing behaviour of the consumers buying their brands. Against this backdrop, the PAMS/CPS Fusion data is intended to greatly assist advertisers and agencies in their media planning.
One of the biggest strengths of fusing PAMS with the well-established Nielsen CPS panel is supposed to be that it’s based on audited/verified brand measurement, as opposed to the recall methodology used in other studies. CPS collects actual, scanned data from households, at least once a month, resulting in 48 000 household visits a year, and measuring over 200 000 shopping occasions. This results in coverage of more than 3 000 consumer goods brands and 190 product categories, which will be further enhanced by the fusion with PAMS that already includes motor, finance, retail and cellphone branded data.
Advertisers spend on sponsorship
Advertisers are expected to spend a combined US$66bn on sponsorship this year, mostly on sports properties, although fewer than one in five are confident that they can actually measure the ROI of the sponsorships they undertake.
The WARC Data Global Ad Trends September 2018 report focuses on sponsorship and shows it’s trending ahead of most paid media, growing faster than all channels excluding internet formats. North America makes up the greatest share of spend (36.8%), followed by Europe (26.7%), Asia-Pacific (25.2%), Latin America (7.0%), and then the Middle East & Africa (4.3%). Most of this money is going to sports properties; among these was the FIFA World Cup in Russia, which is thought to have attracted US$1.7bn in ad investment.
As media continues its fragmentation, sport offers large, engaged, multiscreen audiences: by volume of data, the 2018 FIFA World Cup was the most-streamed sporting event in history. TV is still king for live sporting events, with world cup matches reaching 44% of the global population via television.
Generating brand awareness is the most-important objective for sponsorship campaigns. This mirrors separate WARC research in this year’s WARC 100 that found 61% of successful campaigns counted brand awareness as a core objective.
Sponsors rely on intermediate metrics; true ROI remains a challenge
Only 19% of sponsorship professionals are confident that they can actually measure the business value return of the sponsorships they undertake. Further, only 37% of practitioners have a standardised process for measuring sponsorship. The top two tools used for evaluation are digital and social media metrics. However, the North American-based Association of National Advertisers (ANA) states that social media metrics often provide a “distracting noise” due to their weak relationship to sales. Social is considered the no. 1 activation channel for sponsorships by 83% of marketers, yet the prevailing sentiment is that authentic engagement of sponsorship, through digital and social activation, remains a challenge.
Summing up, James McDonald, WARC Data editor, says: “As brands continue to jostle for a finite amount of consumer attention, sports generate an engaged, mass audience that sponsors can reach, before amplifying their campaigns via social media and experiential events. Sponsorships facilitate the upper part of the sales funnel — driving brand awareness and consideration — in much the same way as TV. This can present challenges, however, such as the knowledge gap between brand impact and sales impact.”
Buy the report at WARC.
Updated at 1.22pm on 28 September 2018
Cheryl Hunter (@cherylhunter) has written for the South African media, marketing and advertising industries for more than 15 years. A former editor of M&M in Independent Newspapers and contributor to Bizcommunity, AdFocus, AdReview and the Ad Annual, she has also produced for various television networks and currently consults on communication strategy and media liaison. She now does the new weekly “Market Research Wrap” column for MarkLives.com.
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