Market Research Wrap: Media Inflation Watch reveals declining exposure
Cheryl Hunter (research at marklives.com)’s weekly wrap of the latest market and consumer research:
- Media Inflation Watch Q2 2018 released
- The rise and rise of Uber SA
- Sorghum beer category saturated
Problematic overall performance
Media Inflation Watch Q2 2018 has been released, covering advertising rates and performance trends, plus an MIW Index (a Cost Per Thousand calculation), and revealing a problematic overall performance. This is according to Mike Leahy, Media Manager managing director.
Very different pictures continue for the two categories of TV. Although the average rates are +7.41% Jan–Jun 2018 on Jan–Jun 2018, free-to-airs are +15.92% compared to pay TV’s -10.62%.
Leahy notes, “Quite simply, the SABC need[s] the cash; DStv Media Sales and others on its platform are repositioning themselves in the bigger world of video on demand. Plus there is still the uncertain [effects]s of the migration of the analogue TV signal to digital on free-to-air TV viewership.”
Rate increases for print are at the lowest level ever recorded, and the rate of performance decline of circulation of many dailies/weekends and consumer magazines does appear to be softer. The MIW Index (CPM), however, is still +12.76%. The overall rate increase for radio has moved to +9.17%, mainly on SABC-owned stations (+15.67%). In addition, many stations appear to have lost audience, some significantly. Out of home again continues flat, compared to competing media platforms, but much depends on the contractor, format, advertiser demand and location — a good format unit in a prime position will be in demand and command a premium rate. A schedule of top online sites reflects a calculated increase of +7.40% although, in real market terms, negotiations would negate most or all of this increase.
Says Leahy, “The overall performance change of -4.13%, pushing the MIW Index to +11.69%, is the second-highest first six-month number in the last 10 years. It means that, unless advertising budgets increased by 11.69% or buyers negotiated even better this year, compared to previous years, exposure went backwards.”
• For more, go to Media Manager Online.
Uber meets growing needs
by Brandon de Kock. By the beginning of 2018, Uber had around 1m active riders in SA, with over 12 000 drivers using the app — not bad for a niche service that only launched in 2013. In BrandMapp, for the last three years, we have tracked total usage with a simple question: Which of these travel apps or platforms do you regularly use? And the growth has been staggering.
For the middle class (people living in households earning between R10 000 and R40 000 a month), usage has risen sharply from 14% to 26% and now 44% in that time and top-end usage (those living in R40 000+ households) has similarly risen noticeably from 27% to 38% to 44%.
So, while the top-end seems to be reaching saturation, it’s extraordinary that the middle class has caught up to similar levels of association with one of the world’s leading disruptive enterprises. Between sensible users avoiding drunk driving, urban dwellers making relatively short trips, spouses and their children using the same accounts and students ride-sharing on a weekend, there are almost more people who now consider themselves to be Uber users than there aren’t.
So, while it’s an amazing story about how successful technology-driven services can be when allied to a basic human need, more importantly, it might well be having an effect on the automotive industry. Over the past few years, although we’ve seen a massive increase in the middle class of this country, motor-vehicle ownership percentages have been dropping.
From parking hassles in major centres to car repayments and insurance —and add petrol approaching R20 a litre — you start wondering how many Uber miles you have to do in a month before being a carless driver isn’t a very, very sensible option.
• For more, go to WhyFive Insights.
Sorghum beer demand drops
The sorghum beer industry is a well-established one, operating within a very competitive space, and a recent BMi Research report, “Sorghum in South Africa”, suggests the market has reached saturation in terms of supplying demand.
From a demand point of view, sorghum beer is seen as a traditional African beverage and is limited to particular market segments. In this context, the category is facing mounting competition from alternative beverage categories, such as craft beers and lagers, which may be seen as more attractive, modern options and a natural alternative.
In times where sorghum beer pricing increases, it’s believed that consumers are increasingly tempted to seek out other clear, alcoholic beverage categories, particularly given the underlying price sensitivity for the category.
• For more, go to BMI Research.
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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