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Marketing’s Oldest Old Wives’ Tale

by Bob Hoffman (@adcontrarian), San Francisco Bay There a few themes that keep popping up in this column. They are:

1. Misconceptions about “branding” and how brands are built
2. The folly of listening to “marketing experts”
3. The over-promise of online advertising
4. The over-promise of social media
5. The “death of advertising,” “death of TV,” and “death of marketing” nonsense
6. The chronic, silly belief in “the thing that will change everything”
7. The foolishness of marketers’ obsession with young people

Over the past few weeks I’ve written a number of posts about #7. But I haven’t really dealt with the main thesis that drives marketers to focus on young people when every trend in demographics and economics points to people over 50 as the drivers of consumer spending.

In case you haven’t been paying attention, here are the key facts:

Over 70% of the wealth in the U.S. is controlled by people over 50.
Half of all consumer spending is done by people over 50.
People over 50 have an average net worth 3 times that of younger generations
They account for 55% of consumer packaged goods sales and dominate 94% of CPG categories
Baby boomers spend an average of $650/month on technology, more than either Gen X or Gen Y
Younger boomers outspend younger adults in every major category
Baby boomers are the Internet’s largest constituency
Between now and 2030, the population over 50 will grow at about three times the rate of people 18-49
They buy over 60% of all new cars
They are the target for 5% of all advertising.

So the question is, if people over 50 are so economically dominant, how can it be that, as Forbes says, they are “the most neglected wealthy people in the history of marketing.”

There are a number of reasons. In a recent post entitled The Invincible Blindness Of Advertisers, I mentioned a few of the fictitious beliefs that drive this, including:

People over 50 are already too brand loyal to convert
People over 50 are too price-conscious
People over 50 don’t spend much
There is a “lifetime value” in targeting young people

It’s all nonsense. But perhaps the largest delusion about people over 50 is that they want to be like young people.

Do they want to feel young? Yes. Do they want to be like young people? No. This is a distinction that seems to be completely lost on marketers.

The baby boom is Barack Obama and Tom Hanks. It is Bruce Springsteen and Condoleezza Rice and Yo-Yo Ma and Steve Jobs. It’s Stephen Spielberg and Magic Johnson and Jonathan Franzen and Oprah Winfrey and Jerry Seinfeld.

The idea that these people and their contemporaries want to be like a 25-year old barista or a doofus college frat boy is absurd. The belief that they aspire to be like the knuckleheads who inhabit Bud Light, or Taco Bell, or KFC ads is beyond ridiculous.

The marketing industry does not understand this. They think of baby boomers as grandma and grandpa. They are not. They invented the personal computer. They grew up listening to the Rolling Stones and smoking weed. They didn’t invent sex, but they invented the sexual revolution.

And yet, the idea that people over 50 want to be like young people is the hopelessly out-of-date fiction that the advertising and marketing industry clings to while they waste hundreds of millions of dollars pandering to people who don’t and won’t buy their products.

– The Ad Contrarian is Bob Hoffman, ceo of Hoffman/Lewis advertising in San Francisco and St. Louis. Hoffman is the author of The Ad Contrarian and 101 Contrarian Ideas About Advertising. Reprinted from his blog The Ad Contrarian.

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Ad of the week with Oresti Patricios – AFCON and the spirit of Africa

MarkLives Ad of the Week with Oresti Patricios – AFCON and the spirit of Africa

The African Cup of Nations (AFCON) is on the go. In fact it is almost over. Mali faces off against Nigeria today (Wednesday 06 February 2013) at the Moses Mabhida Stadium in Durban, as does the Burkina Faso versus Ghana match which takes place at the Mbombela Stadium just outside Nelspruit, the capital of Mpumalanga. The semi-finals and finals go down this weekend on Saturday 09 February 2013 and Sunday 10 February 2013.

First up I need to declare my interests. I am a soccer lover of note and I have massive affection for Africa. Soccer is my passion but falling in love with this continent has been a matter of business, taking me from Kenya to Nigeria, from Ghana to Mozambique.

Over the past five years or more I have been travelling the continent, and let me tell you this has been a liberating, eye-opening and jaw dropping experience. I can only describe the experience as similar to blind dating, where you think you know someone from a distance and then meet them up close and experience their nuances, fragrance, wit, intelligence, culture and personality first hand.

The big problem that a lot of local brand marketers have is that they can view Africa as a country. Mighty Africa, of course, is no country but a massive land mass with very distinct and culturally disparate countries that are as different from one another as Alaska is from Australia. AFCON 2013 presented local brands with the perfect opportunity to explore this continent through soccer, a game that’s adored by so many South Africans.

But the last couple of weeks our national discourse has been consumed with everything but soccer as we fought over that FNB ad, buckled under the news of ESKOM hikes and got even more depressed about Nkandla and the corruption that’s killing this country.

Sadly we missed a magnificent opportunity to divert this country’s obsessive gaze with what’s wrong with our nation, and to focus it on a unifying, beautiful sport. That doesn’t mean ignoring this country’s social or economic challenges, it means remembering how much we have in common. That’s an important thing to remember to do, because it is only by working together that we can turn this great country around.

Football is such a magnificently unifying sport – who can forget the cheers and tears during the 2010 Soccer World Cup, when we filled stadiums in Soweto and screamed until our voices were hoarse? This is why I was so delighted to see Supersport’s series of advertising promos which were used to create excitement about AFCON 2013. (But equally disappointed to read the channel’s story ‘Lack of vibe dogs Afcon countdown’.

Using those four classic elements that rule our world – earth, fire, water and wind – award-winning video effects and production company, Ensemble, helped create a breath-taking series of spots for Supersport that captures all the drama of the game of champions.

The earth element promo shows a ragged and rocky outcrop littered with stony structures. There’s a creaking sound that signifies the pillars breaking form and then an African soccer legend emerges from the stone. Using his super powers he recreates the rock as a ball, which becomes a football that he then kicks directly at the audience.

The fire element ad evokes a scene from the X-men or something that Marvel comics would have conjured up. The promo opens with a lava filled pit from which a fire elemental emerges, only to become a football hero who then fashions a football from the molten lava and kicks it toward the audience. A similar theme is used with the water and wind elements.

The commercials are quick but very powerful, and speak to something we seem to have forgotten here at the southern tip of Africa. This is that we are part of a much powerful whole, an economy and a continent that is on the rise. That others on the continent have faced what we are facing now, but have triumphed over it.

Most importantly this series of ads with its inspired visual effects remind us to look for the heroes in our communities and in our worlds. They also inspire us to embrace the mighty game.

Damn it! The AFCON 2013 finals are here. Let’s grab a beer, watch the game and remember what’s good about this country and what this great continent is all about.

Ad of the Week is published on MarkLives every Wednesday. See past selections here.
Oresti Patricios is the CEO of brand and reputation analysis company Ornico.

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The Switch: What’s inside an insight?

by Alistair Mokoena (@AlistairMokoena) One of the occupational hazards of growing up in a medical family is that you are exposed to many medical terms at the dinner table. An interesting item of medical trivia I picked up over one of our Christmas lunches is the distinction between a sign and a symptom.

A sign is an objective, observable indication of an illness. In other words it is self-evident and does not require much investigation. An example of a sign would be a patient who presents with yellow eyes, who would be either anaemic or suffering from jaundice.

A symptom, on the other hand, is the tip of the iceberg. It’s a proxy for an illness which a patient communicates to a doctor and the doctor probes further until he arrives at a diagnosis. For example, a patient who presents with a symptom such as a headache needs to be asked a few questions before the doctor can arrive at a diagnosis.

In marketing and advertising circles there appears to be a great deal of confusion around the distinction between an insight and an observation. Possibly the difference between a sign and a symptom can help shed some light on understanding how an observation differs from an insight. An insight is one of those marketing concepts that go by many definitions. I’ve seen an insight defined as ‘observable human behaviour’ or ‘an observable unmet consumer need’, for example.

But, I think these definitions confuse insights with observations. Examples that flow from these definitions include ‘people use deodorants to stay dry because they don’t like being wet or ‘we all want clean homes for our families’. These statements are too obvious and superficial to be insights. Anybody can make these observations without applying much thought. They are therefore signs and not symptoms.

In my opinion (and that of others, too), an insight is a universal human truth or a unique penetrating truth about consumers that explains the choices they make. An insight is often made up of a need and a rationale for that need.

For example ‘some women are scratch cooks because they view cooking as an extension of love for their families.’ That’s a good insight, it explains an observation in a meaningful way and I can see it sparking some really interesting creative ideas. Another good insight is ‘men like to bond over a beer to fill up on their masculinity needs.’ I can see copywriters having fun peeling masculinity like an onion. To arrive at an insight one takes an observation and interrogates it for deeper meaning.

One practice that I find useful is to take an observation and ask the question ‘why’ three times (a la how a child often responds to a parent’s explanation – ‘Don’t put the cat in the swimming pool.’ ‘Why?’ ‘Because the cat doesn’t like it’. ‘Why?’ ‘Because the cat gets wet.’ ‘Why?’) Once I have answered the question why three times, I will have ‘expanded’ the original observation to arrive at a unique interpretation of it. And it is the uniqueness of the insight gives the marketer a competitive advantage.

Some insights are need or fear driven; for example ‘young people are cliquey because they have insecurities about not belonging’. Another example: ‘the fear of being considered a failure makes us work hard so we can acquire material trappings of success’. Armed with such strong insights marketers are able to do a really good job of differentiating their brands by segmenting the market, selecting the right target market and positioning their brands for success.

So, the next time you draft or receive a brief, interrogate the insight by asking a few ‘whys’ to ensure that you end up with a differentiated interpretation of an observation. This insight is singularly important because it makes for relevant work that taps into a deeply felt need and gives brand distinctiveness.

And remember, if it feels too obvious, it’s a sign … but if it requires some deep reflection and unpacking it’s a symptom. Keep searching for those game changing symptoms!

Alistair Mokoena (@AlistairMokoena) is a Unilever-trained Chartered Marketer with lots of blue-chip marketing experience. He’s currently MD of Draftfcb Joburg. Mokoena contributes the monthly “The Switch” column to MarkLives.com.

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Tech Law: SA law advances dealing with social Web issues in Facebook defamation ruling

by Paul Jacobson (@pauljacobson) The innocuous looking case of H v W which was handed down in the South Gauteng High Court on 30 January 2013 is anything but. Judge Willis’ 30 page judgment recognises the harm a Facebook post can do to a person’s reputation and throws the weight of the Court behind the person defamed (and who can afford the legal fees).

What the judgment says

Background

Judge Willis’ judgment begins with some background information (the names of the parties were redacted to prevent further harm). W (the “respondent”) published an open letter to H (the “applicant”) on Facebook “for public consumption” which included the following paragraph:

I wonder too what happened to the person who I counted as a best friend for 15 years, and how this behaviour is justified. Remember I see the broken hearted faces of your girls every day. Should we blame the alcohol, the drugs, the church, or are they more reasons to not have to take responsibility for the consequences of your own behaviour? But mostly I wonder whether, when you look in the mirror in your drunken testosterone haze, do you still see a man?

Judge Willis continues and explains that –

The applicant is an insurance broker who is separated from his wife. The respondent had been a close friend of the applicant. This friendship extends back from the time before the applicant married his wife. In terms of a Deed of Trust, the applicant and his wife had jointly appointed the respondent to be the guardian of their three minor children in the event that both the applicant and his wife died or became incapacitated before their children attained their majority. The applicant had provided the respondent with guidance in starting her current business venture. The respondent had lent the applicant money to tide him over certain financial difficulties.

The applicant and his estranged wife are engaged in a divorce action. The applicant’s estranged wife is presently residing with the respondent. The applicant’s wife left him to stay with the respondent on 14 January, 2012. The applicant pays for the children’s medical aid, extra mural classes, stationery and a full time tutor to assist them. The three minor children born of the marriage between the applicant and his estranged wife are Z, born in 1997, M, born in 1999 and C, born in 2001. These minor children have been residing with the applicant for the last few months. The two minor daughters are both ‘friends’ on Facebook with the respondent. A ‘friend on Facebook’ is a ‘term of art’ to which I shall later refer. The applicant and the respondent were friends on Facebook but, consequent upon the applicant’s wife leaving him and moving into the home of the respondent, the applicant has ‘defriended’ the respondent.

The applicant complains that the posting in question publishes information which portrays him as:
(i) A father who does not provide financially for his family;
(ii) A father who would rather go out drinking than caring for his family;
(iii) A person who has a problem with drugs and alcohol.
The applicant’s attorney, in her letter dated 28 February 2012 addressed to the respondent, referred to the possibility of a claim for damages. The respondent claims that she posted the posting not to defame the applicant but in order for the applicant to reflect on his life and on the road he had chosen.

The law the Court relied on

The lawyers involved in the matter conducted what appears to be fairly substantial research on the law on defamation online and with reference to Facebook. Judge Willis relied fairly heavily on two academic articles by –

South African Professor of Private Law at the University of South Africa, Anneliese Roos (her article is titled “Privacy in the Facebook Era: A South African Legal Perspective” and was published in the 2012 South African Law Journal); and
Associate Professor of Law at the New York Law School, James Grimmelmann (his article is titled “Saving Facebook” and can be found in the 2009 Iowa Law Review).

The Court quoted extensively from Roos’ article, largely as a means to understand Facebook and its mechanics. Although reliance on Roos’ article and her explanation of how Facebook works may not be integral to the judgment, it is unfortunate. Roos appears to have a fairly limited understanding of how Facebook and its privacy settings work and this gives the impression that activity on Facebook is unavoidably more public than it need be. One example of this is Roos’ explanation of Facebook’s primary privacy options:

In Facebook there are three privacy settings to choose from for information other than the user’s name, profile picture, gender and networks. Users can choose to make other information visible to “everyone”, or to “friends of friends”, or to “friends only”. It is important to recognise that a “friend” on Facebook is someone you have listed as a “contact” – such persons are not necessarily friends in real life.

…

Users can control their visibility to some extent by using the privacy settings to make personal information available only to friends, and of course by limiting the number of friends or contacts they add to their networks. In general, however, most users give out an extraordinary amount of information.

The last part about people sharing a lot of information is true, of course, but what Roos missed is that users can also share fairly selectively using Facebook lists which stand apart from the default “Public”, “Friends”, “Friends except acquaintances” and “Only me”. To be fair to Roos, though, her article was published in 2012 and Facebook’s privacy controls have changed since then and, in many respect, have become somewhat more secure in some respects, and have eroded protections like users’ privacy by obscurity. That said, she made a few good remarks about what I see as privacy’s contextual nature:

In the context of SNSs, one could argue that subscribing to an SNS and completing your profile information is similar to appearing in a public place. The Internet is a very public place, and Facebook clearly warns subscribers that their privacy cannot be guaranteed. However, in my opinion the privacy settings that one choose, should also be taken into account when considering whether a person has really chosen to disclose his or her information to an indeterminate number of persons. If you chose to reveal your personal information to “Friends Only” and if you limited the number of friends that you added, it could be argued in my opinion that you did NOT choose to reveal your information to an indeterminate number of persons. You have, in fact, revealed your personal information to a limited number of people. If one of your Facebook Friends then further discloses personal information that was provided by you in these circumstances, I would argue that you should have a delictual claim for infringement of privacy.

Roos made another important point to bear in mind when considering whether a person’s right to privacy has been infringed is similar to a defamation analysis (and which Judge Willis touched on in his judgment):

It should also be remembered that the wrongfulness of an infringement of privacy is negated by the presence of a ground of justification. Neethling identifies the following traditional grounds of justification as relevant to the right to privacy: necessity, private defence, consent to injury, and performance in a statutory or official capacity. Another ground of justification which is relevant to privacy is the protection of legitimate interests, including the public interest.

In the context of SNSs, consent is a particularly relevant ground of justification. Whenever the user discloses personal information on his webpage, he or she consents to the publication of that private information. However, in order to be valid the consent must meet certain criteria.

She then went on to discuss the parameters of the consent required to justify a privacy infringement. Essentially, consent must be informed although in light of the Protection of Personal Information Bill, we can adopt the Protection of Personal Information Bill’s defintion of “consent” as –

any voluntary, specific and informed expression of will in terms of which permission is given for the processing of personal information

Unfortunately Roos’ understanding of Facebook’s privacy controls and how it works, generally, is limited as expressed by her article and Judge Willis has accepted her explanation as a complete and accurate exposition of privacy on Facebook. This will likely, and unfortunately, colour future Court judgments regarding Facebook privacy issues. One inaccurate statement is Judge Willis’ understanding that –

Accordingly, although one can control one’s own Facebook profile but there is no method, within the Facebook system itself, by which one can control what other people place on their profiles about oneself and who can look at that.

This is not really correct. Users have the ability to exercise a fair amount of control over whether other users can post their personal information and tag them (Roos seems to have largely misconstrued how tags can be restricted and controlled by the person being tagged).

After exploring Twitter briefly, Judge Willis turned to established case law in South Africa including authority for the proposition Roos expressed that a privacy infringement can be justified in a similar way that defamation can be justified and a more recent Supreme Court of Appeal judgment in the 2004 Mthembi-Mahanyele v Mail & Guardian case which, according to Judge Willis –

affirmed the principle that the test for determining whether the words in respect of which there is a complaint have a defamatory meaning is whether a reasonable person of ordinary intelligence might reasonably understand the words concerned to convey a meaning defamatory of the litigant concerned

The Court, in the Mthembi-Mahanyele case set out the test for defamation as follows (and cited a 1993 case in the then-Appellate Division of Argus Printing and Publishing Co Ltd v Esselen’s Estate) –

The test for determining whether words published are defamatory is to ask whether a ‘reasonable person of ordinary intelligence might reasonably understand the words . . . to convey a meaning defamatory of the plaintiff. . . . The test is an objective one. In the absence of an innuendo, the reasonable person of ordinary intelligence is taken to understand the words alleged to be defamatory in their natural and ordinary meaning. In determining this natural and ordinary meaning the Court must take account not only of what the words expressly say, but also of what they imply’

Referencing one of the justifications for (or defences to) defamation, namely that the defamatory material be true and to the public benefit or in the public interest, Judge Willis drew an important distinction that is worth bearing in mind –

A distinction must always be kept between what ‘is interesting to the public’ as opposed to ‘what it is in the public interest to make known’. The courts do not pander to prurience.

The Court moved on to explore another justification, fair comment. In order to qualify as “fair comment” –

the comment “must be based on facts expressly stated or clearly indicated and admitted or proved to be true”

The person relying on this justification must prove that the comment is, indeed, fair comment and “malice or improper motive” will defeat this justification or defence, regardless of its demonstrably factual nature. In this particular case, the Court found that W acted maliciously and she was unable to prevail with this defence.

The Court’s finding

Flowing from the Court’s finding that W’s Facebook post was defamatory and unlawful, Judge Willis considered a procedural issue. H instituted proceedings on motion, which means that H used an expedited approach relative to the more conventional trial action and sought a court order requiring W to remove the post and stop posting about H (the very simplied and incomplete version). Normally an applicant instituting motion proceedings would be asked to explain to he Court whether there is “an absence of similar protection by any other ordinary remedy”. W’s legal team pointed out (as respondents frequently do) that H could have sued her for damages (monetary losses) through a trial action.

Judge Willis considered this argument and took a pretty important step in developing the common law that governs these sorts of proceedings. He said the following:

It is in respect of the remedy where infringements of privacy take place in the social media that the common law needs to develop. The social media form a subset of the electronic media but are not coextensive with it: the social media are all part of the electronic media but not all the electronic media are social media. The electronic media were, almost certainly, beyond the imagination of the court when Setlogelo v Setlogelo was decided in 1914. Not only can items be posted and travel on the electronic media at a click on a computer in a moment, in an instant, at the twinkling of an eye, but also they can, with similar facility, be removed therefrom. This can also be done at minimal cost. The situation is qualitatively different from the scenario where newspapers have been or are about printed in hardcopy and distributed. The law has to take into account changing realities not only technologically but also socially or else it will lose credibility in the eyes of the people. Without credibility, law loses legitimacy. If law loses legitimacy, it loses acceptance. If it loses acceptance, it loses obedience. It is imperative that the courts respond appropriately to changing times, acting cautiously and with wisdom.

He went on to explain that –

[t]he historical reluctance of the courts to interdict publication in the media has its roots only in the issues relating to technology and economics that arise from ‘stopping the press’ but also a concern about the social consequences of stopping the free flow of news and information. This concern about the ‘chilling effect’ of court orders on freedom of expression has been manifested in the case of National Media Limited v Bogoshi recently decided in the SCA.

This is an interesting perspective. Just as social media accelerates the rate at which people can share (and remove) their thoughts, it also addresses the courts’ concerns about ordering that defamatory materials be removed from these social services because the costs involved are minimal. Ironically, though, litigation remains a pretty costly exercise so this must also factor into litigants’ cost analysis. For the courts, though, it would seem that the social Web removes an obstacle to judicial activism when it comes to defamation. Of course it isn’t just about the economics involved, courts will continue to assess the relative value of one party’s right to freedom of expression when weighed against the other other’s right to dignity, for example. As Judge Willis points out –

resolving the tensions between every human being’s constitutionally enshrined rights both to freedom of expression and to dignitas is all about balance. In the case of Le Roux v Dey Freedom of Expression Institute and Another as amici curiae) the Constitutional Court emphasized the need to take into account the context in which a publication occurs.

W’s advocate attempted to argue that H could take the matter up with Facebook itself as a violation of its terms and conditions but Judge Willis wasn’t convinced. He didn’t feel there was anything before him to “assure me that Facebook would comply with such a request”. He further noted James Grimmelmann’s argument that “it is better for the courts to focus on users rather than Facebook itself if intrusions on privacy are effectively to be curbed”. Essentially, “if one wants to stop wrongdoing, it is best to act against the wrongdoers themselves”.

Media reports about this case referenced the orders H sought against W which included a prohibition on W “posting any information pertaining to the applicant on Facebook or any other social media”. Judge Willis refused to grant this order as he said he has “no way of knowing for certain that there will be no cicumstances in the future that may justify publication about the applicant”. I think he made the correct decision there and this means that these complaints will have to be dealt with on a case by case basis with careful consideration of each case’s merits.

The Court also refused to grant orders placing W under arrest if she fails to comply with the order and that the Sheriff of the court be ordered to remove the offending post. Instead W was ordered to remove the posts and pay H’s costs. As a practical matter, Judge Willis made the following point:

Those who make postings about others on the social media would be well advised to remove such postings immediately upon the request of an offended party. It will seldom be worth contesting one’s obligation to do so. After all, the social media is about building friendships around the world, rather than offending fellow human beings. Affirming bonds of affinity is what being ‘social’ is all about.

A few more interesting points

Judge Willis went on to deal with public figures and the prospect of having to deal with a flurry of relatively minor complaints after this judgment.

With respect to public figures, he pointed out that while they enjoy a right to privacy, “[t]here is legitimate public interest in the affairs of public figures” and this means that they may not enjoy the same degree of protection as citizens not in the public spotlight when it comes to defamation online. As Judge Willis put it –

Trenchant commentaries on the performances of politicians as politicians, entertainers as entertainers, musicians as musicians, artists as artists, writers as writers, poets as poets, sports stars as sports stars will generally pass legal muster, even if posted in the social media. When it comes to freedom of expression in South Africa, there are oceans in which to swim and upon which to sail as freely as the wind blows.

When it comes to the prospect of being inundated by defamation claims (my words), the Court referenced the National Media Limited v Jooste case and Judge of Appeal Harms’ comments that –

the question of whether private facts are worthy of protection is determined by reference to ‘ordinary or reasonable sensibilities and not to hypersensitivities’.

Similarly, Grimmelmann has referenced the legal maxim de minimis non curat lex which Judge Willis translated as “the law is not concerned with trivia”. Ultimately, the cost of litigating, even when it comes to motion court proceedings of this nature, will stem the flow of applications to court. Litigation remains a costly exercise and this cost may not always be warranted, regardless of how hurtful the comments may be. This is especially so in the context of motion court proceedings where courts tend not to grant damages as relief because of how these motion court proceedings work.

Lastly, the judgment didn’t deal with another complication: the infamous Streisand Effect. This phenomenon kicks in regardless of your entitlement to protect legitimate rights. It has the ability to effectively negate the practical value of a court order such as the one Judge Willis granted and should always be carefully considered and weighed up against the risks in any matter. There are going to be cases where it is better to walk away and focus on damage control and other cases where it is worth risking the phenomenon and going to court. A critical factor will be whether the legal advice you take is adequately informed about not only the law but the social Web dynamics to form a better risk assessment before you pull the trigger.

This case is an important one. It advances the law dealing with social Web issues and, if it is upheld or applied by other (and higher) courts, it will change the tone for how courts will deal with issues like online defamation and privacy.

Paul Jacobson is founder and director of Web•Tech•Law. Web•Tech•Law / CC BY-SA 2.5

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Africa Style: How the NFL stretched its brand, and why you should too

by Masingita Mazibuko The television remote is often described as a weapon of contention in a household. The stereotypical portrait is usually ‘said wife seeks to watch something other than sport’ and ‘said husband wants to watch sports and more sports’. And, of course, the children have their own viewing preferences.

In our home, my husband has won the battle of the remote. This means, that if I want to spend time with him while major events are playing out on the sporting calendar, like the current Afcon Cup, I must get intimately engaged with channels like ESPN.

Watching one of the games in the National Football League (NFL) recently, my mind began to wander – obviously – and I lapsed into questioning mode.

The NFL as an organisation dates back to 1800s. Throughout its history, it has fundamentally remained the true to its core proposition while maintaining an innovative flair.

This season’s commentary, for example, has focused on two rookies who have been at each other’s throats as competitors since high school, Robert Griffin III and Andrew Luck.

The story being touted by the NFL and commentators is that, despite being rookies, they have essentially taken on the leadership mantle and resurrected their respective teams.

The NFL has used this fact (or fiction?) to spark interest and drive broader involvement in the sport this season. It has, to use marketing speak, stretched the brand that is the NFL to enhance appeal across a wider audience.

The game of cricket, far more popular in South Africa than American football, did just that several years ago. In a bid to spawn excitement and boost ticket sales locally, to counter the poor attendance at games, the sport evolved.

Now we have a new game and new fans courtesy of the T20. And, as a result, new interest in all formats of the game from this 20-overs high energy option to the full traditional five-day test.

However, returning to the NFL, that fact that it has managed to stay true to its core while creating broader engagement and involvement over many years should be of interest to South Africa’s many heritage brands.

These are those brands that have stood the test of time but must still deliver growth in the current market. This growth should be achieved without detracting from or disparaging the personality created for the brand by great marketers through the years.

At the same time, it is also a cop-out to default to the ‘South Africa No. 1’ tagline in a bid to hold onto leading share.

As brand custodians, strategists and marketers, we know these brands satisfy an enduring need. Yet, because it’s our job, we are often tempted to evolve the positioning when we are not seeing the share we desire. Tempting as it this is, it may spell disaster for the brand.

The challenge, as I see it, lies in capitalising on the heritage brand’s growth trajectory to lift it to iconic status.

Of course, this is never an easy feat. I can’t offer a quick answer or a blueprint for success. I will, however, make two suggestions about the thinking and strategising that brands might want to consider.

First, are you solely striving for brand differentiation as per the marketing literature, or are you ensuring distinctiveness? ‘Distinctiveness’ ensures your brand is not at any risk of being forgotten with the plethora of entrants fighting to grab share. ‘Distinctiveness’ ensures that whatever you do facilitates engagement and purchase of your brand.

To be distinctive, the brand must have a clearly defined character and must stay true to this over time. Axe, which migrated from the South African-created Ego, has done just that to capture the imagination of young males over time.

So, too, has the Mastercard ‘Priceless’ campaign. And what about the English secret agent, James Bond, who saw cinema-goers at Pretoria’s Brooklyn Kinekor dress in black tie to watch his latest exploits in ‘Skyfall’.

A study (Brand Asset Valuator, as quoted in ‘The Hero & The Outlaw’ by Margaret Mark and Carol Pearson), has shown that brands with character are grow 66% faster.

How characterful and distinctive is your brand?

Secondly, at times the answer lies in culture. Here, the question you have to answer is what is the freshest and most relevant expression of your brand’s essence that will ensure present day relevance?

As the big banks scramble for share, the much smaller FNB has been voted the most innovative brand globally in addition to taking several local awards for its ‘Steve’ radio campaign which fired listeners’ imagination, and got the nation talking.

So, my hiatus during that NFL game, made me acknowledge once again that how we position a brand goes beyond simply defining what the brand does. The role of positioning needs to be more textured if it is to engage and inspire.

Note: Ray Lewis and the Ravens won the Superbowl this past weekend! – Ed

Masingita Mazibuko is an Associate Director at brand development and marketing insight consultancy Added Value. For more insights, visit www.added-value.com/source/. Mazibuko is a regular columnist for MarkLives.

Media Future: Z10 is BlackBerry reinvented

The first phone of the new BlackBerry era will be released in South Africa a month from now. Arthur Goldstuck (@art2gee) gives his initial impressions of using the Z10.

The long-awaited resurrection of BlackBerry has begun, with a single phone model released. Another is on the way, with promises of half a dozen to follow, all on the back of the new BlackBerry 10 operating system on which the company has staked its future.

The first of the new generation of BlackBerry devices, the top-of-the-range Z10 touchscreen phone, was unveiled last Wednesday night. A second model, the Q10 with QWERTY keyboard, was briefly introduced but not demonstrated. The Z10 was released in the United Kingdom on Thursday, but will only arrive in South Africa on 1 March. The crucial US market will receive the device at the same time as South African outlets.

Meanwhile, a few advance units arrived in the country last week, providing the opportunity to get to know the device through using it in the real world, rather than through prototypes and demos. Consider this a preview, ahead of more in depth and comparative reviews.

The most surprising feature of the Z10 is not how well it lines up, visually, alongside the rival high-end phones from Apple and Samsung. That was always a minimum requirement.

The big surprise is how appealing BlackBerry has made the user experience.

As an operating system, BlackBerry 10 would not be alien to anyone used to the stacked rows of Apple’s iOS or the swiping gestures that unlock the screen on Google’s Android operating system.

That is where most similarities end. iOS appears to define itself by stacked rows, and brooks no argument for a variable experience. Android is the opposite: defined by lack of structure and the ability of individual phone makers to place their own skins over the potential chaos.

The third player in major phone operating systems, Windows Phone, provides a structured progression from a tiled and adaptable front door to a rigid structure of lists, rows and further proprietary entry points to individual applications.

In that context, BlackBerry 10 is a revelation, despite the seemingly small 4.2” screen. While not as poky as the iPhone 4S (3.5”) and iPhone 5 (4”), it is substantially smaller than the screens of the current leading phones from Samsung and HTC. But, because the glass portion of the phone front is around 4.8” – the same as the Samsung Galaxy S III screen – it appears to offer a similar screen experience. It is puzzling, though, that BlackBerry chose to use a slice of that glass frontage for branding and front-facing camera that could have been situated on the phone edging, as it is on the Galaxy. It certainly leaves room for improvement in subsequent versions.

As with the iPhones, the screen size is forgotten when the phone is put to use.

The virtual keyboard draws on BlackBerry’s reputation for the best physical keyboards on phones. Unlike traditional predictive text, the predicted words appear between the keys of the keyboard, so that the user can remain focused on the keyboard. The correct word, if it does appear, can then be flicked up into the message area with a simple gesture.

The phone learns your typing style, as well as the context of the message, and suggests words accordingly. When I typed a question, in BlackBerry Messenger (BBM), asking a contact how the message appeared on her phone, I typed only the first letter of each of six words. The phone anticipated what would follow, and gave options that always included the correct word, allowing me to type only six letters to complete the message. There are times when it cannot anticipate the word – especially proper nouns – until you’ve typed more than half it, but at other times, based on the context, it was regularly able to predict the next word before the first letter had been types.

I’d seen it in action before, but always in prototypes and preview versions. Seeing it work in the real world was magnificent.

A technology called Flow allows for the greatest ease of movement between apps yet on a phone, including a multi-tasking window that allows all apps in use to remain live, in a single view, rather than demanding exiting from one app to use another.

The revamped app store, now called BlackBerry World, is smooth, fast and intuitive – adjectives unknown in the old App World. It is obvious that the vast ranges available on the Apple App Store and Android’s Google Play are not matched by BlackBerry World, but the market leading apps are almost all available. Paid apps are all available in South African Rands.

Providing a sense of playing in the same “space” as other app stores, the main highlighted app in BlackBerry World during its first week online was Angry Birds Star Wars. Both the installation and the gameplay were smooth. The sound was clear, the action sharp and responsive, and the Droid pigs were mincemeat in seconds.

The new BBM includes well-integrated voice and video chat, along with video-conferencing, which instantly ups its potential for both social and business use. The new user interface of BBM is attractive, displaying more contacts’ avatars in a single view. BBM can be reached via its own independent app, or through a messaging Hub. However, when messages are reached through the Hub, the apps delivering the messages appear to have less functionality than when reached directly through the app.

Thanks to the multi-tasking window, though, it is possible to display all the messaging apps separately, and access them individually if you prefer to manage your messages that way. While it may be a workaround, it also demonstrates BlackBerry 10’s open approach to the way the user manages the experience.

From a hardware point of view, the most startling aspect of the Z10 is that it has no buttons on the front, seemingly trumping the iPhone’s advantage of having only one button. However, contextual controls for every application add extensive controls while you’re using a specific app.

These are the most obvious examples of BlackBerry upping their game. In the same way that the success of the old BlackBerry in South Africa was based on a combination of factors, if the new BlackBerry succeeds, it will be because of the combined appeal of many features, rather than one lone aspect of the offering.

* Arthur Goldstuck heads up World Wide Worx (www.worldwideworx.com) and is editor-in-chief of Gadget. He is a Consulting Editor to MarkLives and our media tech columnist. Follow him on Twitter on @art2gee. Reprinted from Gadget.

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Moegsien Williams Q&A: The New Age business model, the business breakfasts and Helen Zille

by Gill Moodie (@GrubstreetSA) Is The New Age the Great Evil or just another newspaper trying to get off the ground?

Ever since it launched two years ago, controversy has swirled around the paper because its main shareholders – the Gupta family – are close associates with the family of our controversial president, Jacob Zuma.

The paper has always said its intention is to tell the good-news stories of South Africa and give the government credit where it’s due but not to be the mouthpiece of the ruling party.

But its detractors – especially since the latest controversy around parastatal funding for its SABC business breakfasts – say the paper is nothing more than another Citizen of the infamous Info scandal of the 1970s.

Grubstreet interviewed The New Age’s editor, Moegsien Williams, last week to find out more about how The New Age operates, its emerging business model and what kind of paper he wants it to be.

GILL MOODIE: There’s a lot of us who would really like to know why you left such a powerful position (Gauteng editor-in-chief and group editorial director) at the Independent Newspapers and went to The New Age (in September last year)?

MOEGSIEN WILLIAMS: You know, I kind of abdicated the editorship (of The Star) in February last year after editing the paper for almost eleven or twelve years. And the reason was that the paper was struggling from a circulation and financial point of view – not unlike other papers (in SA) but The Star is the flagship paper of the company – and I’d been in conversation with my superiors at Independent for about a year and a half before February…

I had to pose a tough question to myself: whether it was not time for the paper to have a new editor to introduce fresh blood and fresh ideas. I had this conversation for a while with the chief executive (Tony Howard) of Independent and Nazeem (Howa, then COO of Independent who joined The New Age as CEO of parent company TNA Media in January 2011) when he was still there.

Eventually we came to a decision (with Howard) at the beginning of last year that I should pay more attention to my night job at Independent, which was group editorial director – dealing with politicians, cost-cutting, centralisation, group initiatives and group units, etc… Between March (when I relinquished The Star’s editorship) and June – when I marked my 60th birthday – I realised that not being on a newspaper directly was probably something I was going to miss. I wasn’t looking forward to a job in which I would be bored and not directly challenged…

But I’d been having calls from and conversations with Nazeem asking if I wanted to move (to The New Age)…

So in June on my 60th birthday, I took Steve Jobs’ advice: that if you’re going to make one last career move, you might as well make it a big one and a wild one because you might not live long enough to regret it… so I said: “Let’s give it a go.”… So to answer you question in a nutshell, it was to make one last career move that I hoped at the time would be interesting and exciting.

MOODIE: And it has been exciting. Are you feeling under siege at the moment?

WILLIAMS: You mean our controversial business briefings? You know, I started here on a Sunday and we had a business breakfast on the Tuesday. And if I had any doubts about having joined The New Age, when I looked at the energy of the staff at that particular function – the fact that from the shareholder to Nazeem to the senior creative editor here, they were all up at 6 o’clock putting up banners and getting the tables ready.

It’s that kind of operation. It’s really, really hands-on. It’s a real collective effort to put out this newspaper and I must say I’m enjoying it immensely.

Also, because the paper is new, we are able to innovate and try new things. If we have an idea, we talk it over a bit of lunch in our building and the next day we implement. There’s no long meeting, unlike some other companies that are like super tankers – you know, difficult to turn…

MOODIE: Well, let’s talk about innovating. I wrote an opinion piece last week putting forward that your business model could be to be a events company first and a newspaper second. That is a business model we’re seeing in overseas publications – but not here yet.

WILLIAMS: No. We only started off with one or two breakfast briefing a month, if I’m not mistaken…

MOODIE: So am I wrong on that?

WILLIAMS: Well, yes and no, Gill. You know, The Times of India is a seven-percent stakeholder in The New Age. I’ve just come back from India and the reality for us as an industry – and I say this having come back with my eyes wide open – is: “God, we have to change”.

The Times of India’s secret of its success is that they’ve segmented that market like you can’t believe…(with localised editions, supplements on religion, editions and supplements aimed at school children and students, etc)… (At The Times of India) there is also a very, very close relationship with the advertising department and the editorial departments… One day 90% of the front page, while I was there, was an advert…

Coming back to The New Age it is our desire and our intention to look at papers like The Times of India and ask: “How can we change the way that we do thing to ensure the survival of newspapers in this country?”

MOODIE: But now you’re at war with (DA party leader and Western Cape Premier) Helen Zille (who pulled out of speaking at a breakfast and has called for a commission of inquiry into the funding of paper).

WILLIAMS: It’s not a war. We are simply responding to some of the things she has done and has said… And she has responded and we have responded…

MOODIE: You know, it seems to me that The New Age has always been a pretty even-handed newspaper when it comes to reporting on politics. There hasn’t been that much to distinguish it from the other newspapers in South Africa but now, with the row with Helen Zille, I detect a bit of a change. For instance, there was a funny little flag on one of the Zille stories (last week) that said “Helen Zille Scandal No 3”. You do seem to be leaning more towards supporting the ruling party.

WILLIAMS: You know, Nazeem tells the story of how the two of us – when we were at Independent before the launch of this newspaper – were the key architects in a strategy to make sure this paper didn’t survive. Our fundamental approach was to try and position the paper in a certain way… And I think virtually all the newspaper companies in the industry tried to paint The New Age in certain way. They try to portray The New Age as the ANC mouthpiece.

The noble intention of the proprietors and shareholders of this newspaper were simply to provide a voice that will promote and defend the interest of South Africa – that’s it. You can interpret that in many ways.

But the main shareholders are saying: “Provide a balanced discourse on politics, etc., in your newspaper”… And if I’m labelled as a pro-ANC newspaper and a pro-government newspaper, let it be so. The proof is always in the reading of the newspaper. It has given us in a perverse way a niche so I’m saying, as an editor, if I’m labelled in a certain way, there’s no use in trying to deny it or run away from it. The proof is always in the reading of the newspaper.

The reality of the situation is that the ANC can quite correctly say that before the arrival of The New Age virtually every single newspaper would not give them the time of day… That is the perception of the ANC – that the press is this country have adopted the mantle of the political opposition.

Where does that leave The New Age? It gives us a gap. It gives us an opportunity to say: “OK. If every single newspaper last December by the tone of its content were hoping that Jacob Zuma would lose the ANC presidency in Mangaung, The New Age will do the opposite. We will say: ‘Hey man, here’s the guy’ ” – and we did it very scientifically.

We went to count for ourselves through sources and contacts what the (ANC) branch votes were doing. And every Friday in the run-up to Mangaung, we did take-outs on what it looked like in Limpopo and in the Western Cape, etc., and if I’m not mistaken, we were probably out by one percent.

Our groundwork showed and we really reflected the reality of the situation in the ANC best of all the newspapers in the run-up to Mangaung. And why? Because we were given a gap by our rivals.

MOODIE: But is this tactic translating into finding a readership? This is the crucial thing we don’t know about The New Age because you are not audited by the ABC. Why don’t you just get audited by the ABC and clear this all up?

WILLIAMS: The Voice (which Howa was instrumental in launching when he was at Independent Newspapers) is not audited…

MOODIE: Yes, I’m well aware of that and I know you don’t have to be audited by the ABC but isn’t this a weakness for The New Age?

WILLIAMS: We are being audited as we speak, I can tell you that much, for the first quarter of this year. So by the end of March we will be able to give you an audited figure of our sales.

MOODIE: Yes, but not by the ABC. Why not just get audited by the ABC – the standard for the industry?

WILLIAMS: But why?

MOODIE: Because why not just see off your naysayers and say: “Here we are”?

WILLIAMS: Because we want to be different.

MOODIE: I find that quite perverse.

WILLIAMS: …Look, we talk to our clients. We show them our figures and our market research and we are now ready to subject ourselves to an external audited process of our circulation – and for the simple reason that we have our internal SAP system working properly so we can now show proper receipts for sales, etc., in a proper accounting system… We are following a different model.

The Times of India give away half of their print run and the reason they do that, they say, is that they’ve got advertisers to satisfy because they want eyeballs on the ads. We are quite openly saying that we are looking at that model and, to some extent, we have done that with our print order (of about 100 000)… We try and sample half… That is the model we are pursuing.

To come back to our business briefings, they work for us. At the breakfast with (Police Minister) Nathi Mthethwa (last week) there were about 300 people if I’m not mistaken. I would assume that 95% of them paid an entrance fee and they are all registered now for a six-month subscription so every time we have a breakfast, we grow the subscription base by the number of people who attend.

The sponsorships covers the rest of the costs. I’m guessing now but if you want to hire a venue at the Sandton Convention Centre, you’ll be out of pocket by about R150 000 to R250 000. We run a complete back office here to organise the event – about eight to 12 people – and that is costly. There’s the cost of the food that we serve and the audiovisual system – all these other costs in terms of staging an event like this. That’s where the sponsorship goes.

It’s a model that works for the sponsor because it’s great marketing and branding. It works for us in giving a new entrant in the market a bit of a name and for SABC, it gives it content. They can fill almost an entire morning’s programme with it…

But to get back to your question about what distinguishes us from the rest of the newspapers, the truth of the matter is some of the problems I am encountering now is that staffing was done in a very hurried way. (The first paper’s editor, Vuyo Mvoko, and senior staff walked out at the launch of the paper in late 2010.)

There were great ideas but the execution probably fell short. There were – and there still are – some serious defects in the newsroom operation that are not peculiar to The New Age but let me not skirt the issue: it’s a very junior newsroom… I’m trying to put a new team together here.

The reality is that I’m going to have grow my own timber here because I just can’t find the people to produce the different kind of paper I want The New Age to be and that you’re not seeing yet.

The DNA is here. There is no other newspaper that covers the provinces the way we do. We, in fact, have offices in all the major provincial centres. If you ask me a straight-forward question about whether they are working very well then I would have to be honest and say ‘no’.

But we have the basis for producing a newspaper – and now you can see the parallels with The Times of India – and hopefully before I retire, I would like to put a newspaper into Limpopo, for instance, that is going to go to five of the key towns there with different zoned edition.

I would want to put a newspaper into Durban called The New Age that would maybe cover the North Coast, Pinetown, Durban central and the South Coast in different zoned edition. That is the dream.

That is what is going to make us different.

I’m what is called a writer’s editor. I put a lot of emphasis on writing… sometime I cringe in the morning when I pick up the paper and read some of the writing – and, again, this is not peculiar to The New Age. It’s probably going to take me five years to get it right. Hopefully, Gill, when you pick up the newspaper then, you’ll say: “Hey man. This paper is distinguished from the other newspapers for these reasons”.

– SA’s leading media commentator, Gill Moodie, offers intelligence on media – old and new. Reprinted from her site Grubstreet.

Agency Leaders: 2012’s most-admired ad agency in South Africa

by Herman Manson (@marklives) Who is the most admired ad agency, creative director, or agency boss in the country? MarkLives asked South Africa’s ad agency MDs and CEOs to nominate their peers whom they most admired during the course of 2012.

Cape Town executives overwhelmingly chose King James as their most admired agency, and King James co-founder and Group Creative Director Alistair King as their most admired Creative Director. King James Group Chief Executive James Barty was voted the most admired agency boss in Cape Town, an accolade he shared with Claire Cobbledick, MD of The Jupiter Drawing Room Cape Town. Ogilvy Cape Town was voted the Cape Town agency with most success in integrating digital into its offering.

Agency executives in Johannesburg picked Joe Public as the Johannesburg agency they most admired and its leader, Gareth Leck, as their most admired Joburg agency leader. Pete Case, Creative Director at Gloo Digital Design, was voted as their most admired creative director by Jozi ad executives. They selected Draftfcb as the Jozi agency with most success in integrating digital into its offering.

To get a sense of who senior ad execs admire on a national level they were also invited to forget city and provincial boundaries and select their most respected peers regardless of their location within South Africa.

The agency SA’s ad executives most admire

Most Admired: Ogilvy Cape Town
Runner-up: King James

While Cape Town executives voted King James as their most admired agency Joburg executives, freed from voting limited by geography, overwhelmingly voted for Ogilvy Cape Town. Together with substantial support in Cape Town it propelled Ogilvy Cape Town into the top slot as the most admired agency in South Africa.

The agency enjoyed immense award success with its ‘Be the coach’ campaign for Carling Black Label and has been admired for its investment in digital education through the ODMA.

King James and its leadership team dominated the Cape Town poll. It is well respected, awarded and retains an independent, sometimes maverick, streak in spite of continued fast paced growth (Cape Town agency revenue stands at around R40-45m and group revenue between R65-70 million).

Ogilvy Cape Town drew 48% of the total vote and King James 36%. Black River FC and Joe Public tied as second runners-up.

The creative director SA’s ad executives most admire

Most Admired: Alistair King (King James)
Runners-up: Mike Schalit, Pete Case, Chris Gotz, Ahmed Tilly (tied)

King James co-founder and Group Creative Director Alistair King was voted the most admired creative director in the country. King is well known and admired for his work on Allan Gray (its market share has grown from 3.9% to 16% since 2003 when King James won the account), Santam and Kulula.com amongst others. King is well known for being outspoken on industry issues and remains one of the most approachable creative directors in the country.

No fewer than four creative directors were tied for the slot of runner up. In total ten names were nominated by agency bosses.

Alistair King took 36% of the vote while Mike Schalit (Net#workBBDO South Africa), Chris Gotz (Ogilvy Cape Town), Pete Case (Gloo) and Ahmed Tilly (Black River FC) all tied as runners-up. Pepe Marais (Joe Public) and Brett Morris (Draftfcb South Africa) were tied as second runners-up.

The agency boss SA’s ad executives most admire

Most Admired: James Barty (King James)
Runner-up: Gareth Leck (Joe Public)

King James Group Chief Executive James Barty was voted the most admired agency boss the country. With business partner Alistair King voted the most admired Creative Director in the country by agency executives, the team form a powerful duo at the top of their game, and the tale of how they built their independent agency still inspires creatives to find suites as business partners and vice versa and going it alone.

Joe Public MD Gareth Leck was the runner up. His agency, also an independent, grew revenue 105% during the course of 2012, before going on to win the Nedbank ATL account.

Other nominations with a multiple votes included Mike Abel (M&C Saatchi Abel), Claire Cobbledick (The Jupiter Drawing Room Cape Town, Nunu Ntshingila (Ogilvy South Africa) and Gavin Levinsohn (Ogilvy Cape Town).

The agency with most success in integrating digital into its offering

Most Admired: Ogilvy Cape Town
Runner-up: Draftfcb South Africa

* Only agencies or agency staff who received more than a single nomination was included when we worked out voting percentages.

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Tech Law: Is WHATSAPP violating your privacy rights?

by Paul Jacobson (@pauljacobson) The popular mobile and multi-platform messaging service, WhatsApp, was investigated recently by the Office of the Privacy Commissioner of Canada and the Dutch Data Protection Authority for apparent violations of Canadian and Dutch privacy laws. The investigation found a number of violations and the Canadian Privacy Commissioner released an update on 28 January 2013 reporting back on the violations which have since been addressed and those which remain unresolved:

The investigation revealed that WhatsApp was violating certain internationally accepted privacy principles, mainly in relation to the retention, safeguard, and disclosure of personal data. For example:

In order to facilitate contact between application users, WhatsApp relies on a user’s address book to populate subscribers’ WhatsApp contacts list. Once users consent to the use of their address book, all phone numbers from the mobile device are transmitted to WhatsApp to assist in the identification of other WhatsApp users. Rather than deleting the mobile numbers of non-users, WhatsApp retains those numbers (in a hash form). This practice contravenes Canadian and Dutch privacy law which holds that information may only be retained for so long as it is required for the fulfilment of an identified purpose. Only iPhone users running iOS6 on their devices have the option of adding contacts manually rather than uploading the mobile address numbers of their address books to company servers automatically.

At the time the investigation began, messages sent using WhatsApp’s messenger service were unencrypted, leaving them prone to eavesdropping or interception, especially when sent through unprotected Wi-Fi networks. In September 2012, in partial response to our investigation, WhatsApp introduced encryption to its mobile messaging service.

Over the course of the investigation, it was found that WhatsApp was generating passwords for message exchanges using device information that can be relatively easily exposed. This created the risk that a third party may send and receive messages in the name of users without their knowledge. WhatsApp has since strengthened its authentication process in the latest version of its app, using a more secure randomly generated key instead of generating passwords from MAC (Media Acess Control) or IMEI (International Mobile Station Equipment Identity) numbers (which uniquely identify each device on a network) to generate passwords for device to application message exchanges. Anyone who has downloaded WhatsApp, whether they are active users or not, should update to the latest version to benefit from this security upgrade.

WhatsApp’s Privacy Notice

If you are a WhatsApp user, you probably already know that the WhatsApp app lists all your contacts in your phone’s contacts list and reveals which of your contacts use WhatsApp. Aside from the authentication and encryption concerns the Canadian and Dutch authorities raised, this seems to be the source of the currently unresolved concerns the Canadians and the Dutch have.

Essentially, these concerns are that WhatsApp collects details of your contacts automatically (unless your phone is running iOS 6, in which case you would be prompted to allow WhatsApp to access your contacts’ details) and uploads that data to WhatsApp’s servers to be compared to its database of users so it can identify which of your contacts are using WhatsApp and allow you to message them using the app. So far, so good, but WhatsApp doesn’t subsequently discard the data pertaining to non-users after it has compared them to its database.

As the Canadian press releases mentions, this touches on two personal information processing limitations, namely purpose specification and related processing limitations. Specifically, WhatsApp is processing personal information for longer than it requires, given its intended purpose and may be collecting more than it requires. It seems that the concern is specifically about the non-user personal information and the expectation seems to be that WhatsApp discard non-users’ personal information once it establishes that they are, in fact, non-users and that the app prompt users to agree to submitting contacts’ details to WhatsApp when users want to check whether additional contacts are users.

The WhatsApp Privacy Notice deals with this in a couple sections:

The Information WhatsApp Collects

WhatsApp may obtain the following types of information from or concerning you or your mobile phone device, which may include information that can be used to identify you as specified below (“Personally Identifying Information”):

User Provided Information: You provide certain Personally Identifiable Information, such as your mobile phone number, push notification name (if applicable), billing information (if applicable) and mobile device information to WhatsApp when choosing to participate in various uses of the WhatsApp Service, such as registering as a user, updating your status or requesting status for your contacts. In order to provide the WhatsApp Service, WhatsApp will periodically access your address book or contact list on your mobile phone to locate the mobile phone numbers of other WhatsApp users (“in-network” numbers), or otherwise categorize other mobile phone numbers as “out-network” numbers, which are stored as one-way irreversibly hashed values.

and

The Information WhatsApp Does Not Collect

WhatsApp does not collect names, emails, addresses or other contact information from its users’ mobile address book or contact lists other than mobile phone numbers—the WhatsApp mobile application will associate whatever name the WhatsApp user has assigned to the mobile telephone number in his/her mobile address book or contact list — and this occurs dynamically on the mobile device itself and not on WhatsApp’s servers and is not transmitted to WhatsApp. This means that if you have your friend’s mobile phone number associated with the name “Shakespeare” in your mobile address book, that’s the name that will appear for that mobile phone number in your WhatsApp contact list. We do not collect location data, but users may voluntarily share their location with other users via the WhatsApp Service.

The big question is whether WhatsApp should retain non-user phone numbers after it has conducted its comparisons between the captured data through the app and its database?

South African law

At present the main issue in South Africa is whether transmitting your contacts’ personal information to WhatsApp violates their privacy. Our current privacy law is informed by the right to privacy in the Bill of Rights, prevailing case law developed by our courts and legislation like the Electronic Communications and Transactions Act and Consumer Protection Act. The Protection of Personal Information Bill has not yet been passed although I’ll deal with that below.

The answer to this lies in the implicit (or explicit, if you have it) consent you have from your contacts to take the personal information they give you and pass that on to WhatsApp and then contact them through WhatsApp if they are users? This is a tough question to answer in the absence of an explicit preference from your contacts one way or another. Presumably they gave you their contact details or made them available with the expectation that you contact them. Whether a contact would object to being contacted using WhatsApp is a secondary issue. Conceivably some users may object to their personal information being passed to WhatsApp due to concerns about its privacy practices or out of a desire to remain out of that system and where a contact expresses that preferences, you should certainly act appropriately. Absent that express preference, may users assume they have their contacts’ implicit consent? Perhaps.

Under the anticipated Protection of Personal Information Act (I refer to the “Protection of Personal Information Bill” interchangeably with “Protection of Personal Information Act” because it is still going through the legislative process of being passed as an Act of Parliament), the question is ordinarily what sort of consent is given and whether this covers the intended personal information uses. “Consent” is defined as –

any voluntary, specific and informed expression of will in terms of which permission is given for the processing of personal information

When it comes to individual users, the Protection of Personal Information Act probably won’t require individuals to comply with its restrictions when it comes to compiling their contacts lists where doing so is “in the course of a purely personal or household activity”. WhatsApp wouldn’t be able to take advantage of this exclusion so it would be required to obtain its users’ consent to process their personal information.

Will the Protection of Personal Information Act apply?

You may have noticed that WhatsApp indicates that it stores non-users’ (or “out-network”) phone numbers as “one-way irreversibly hashed values” which, when coupled with improved encryption options make it practically impossible to resolve those hash values back to phone numbers (classified as “personal information” in most jurisdictions).

The Protection of Personal Information Act has a further exception to its application in that it does not apply to personal information “that has been de-identified to the extent that it cannot be re-identified again”. It would be interesting to test whether this exclusion would apply here and would probably be dependent on whether the hashed values could, somehow, be associated with individuals despite the encryption. WhatsApp only collects phone numbers and not names and other details (the association between a number and a name occurs on your device, not on the server) so this exclusion could well apply and get WhatsApp off the hook when it comes to potential Protection of Personal Information Act compliance. It would also likely address residual privacy concerns because the phone numbers will appear to have been practically and irreversibly anonymised.

Even if the Protection of Personal Information Act applies

If this exclusion does not assist WhatsApp, the Protection of Personal Information Bill contains a number of processing limitations along the lines of the limitations the Canadians and Dutch found were exceeded.

One processing limitation is “Minimality” which states that –

Personal information may only be processed if, given the purpose for which it is processed, it is adequate, relevant and not excessive.

The Protection of Personal Information Bill requires that personal information be collected directly from what it refers to as “data subjects” (in other words, the people the personal information relates to) and one of the exceptions to this is where –

collection of the information from another source would not prejudice a legitimate interest of the data subject

Given the steps taken to disassociate the phone numbers collected and pertaining to non-users with the non-users’ identities, this may be an exception to the general rule that the personal information be collected directly from the non-users concerned. In this case the “other source” would be the WhatsApp user submitting the personal information.

The Protection of Personal Information Bill’s purpose specification limitations include the following which are more appropriate to what WhatsApp is doing:

Collection for specific purpose

(1) Personal information must be collected for a specific, explicitly defined and lawful purpose related to a function or activity of the responsible party. (2) Steps must be taken in accordance with section 18(1) to ensure that the data subject is aware of the purpose of the collection of the information unless the provisions of section 18(4) are applicable.

Section 18 deals with the necessity for informed consent from data subjects and includes the following exclusion which is similar to the exclusion dealt with above:

non-compliance would not prejudice the legitimate interests of the data subject as set out in terms of this Act

Another processing specification limitation in the Protection of Personal Information Bill which relates to the Canadian and Dutch requirements is the following:

Retention and restriction of records

(1) Subject to subsections (2) and (3), records of personal information must not be retained any longer than is necessary for achieving the purpose for which the information was collected or subsequently processed …

Section 14(1) has a number of exclusions which probably won’t apply here but section 14(4) may assist WhatsApp:

A responsible party must destroy or delete a record of personal information or de-identify it as soon as reasonably practicable after the responsible party is no longer authorised to retain the record in terms of subsection (1) or (2).

Section 14(2) deals with personal information processed for “historical, statistical or research purposes” but may not apply here.

On the topic of this retention restriction, its not clear why WhatsApp retains “one-way irreversibly hashed values” based on non-users’ phone numbers? If “one-way irreversibly” means that these phone numbers are not capable of being translated back into phone numbers (as I have assumed) then its not clear what purpose is being served by retaining this data? If these “one-way irreversibly hashed values” can be translated back into phone numbers then the exclusions in the Protection of Personal Information Bill will probably not apply and WhatsApp will be, almost by definition, in violation of the Protection of Personal Information Bill’s processing limitations where it does not obtain consent from non-users to process their phone numbers.

On the other hand, if “one-way irreversibly hashed values” does, in fact, mean they can’t be translated back into phone numbers and will remain as seemingly random data strings, then they will likely not be regarded as “personal information” in the first place as personal information is defined, at least by the Protection of Personal Information Bill, as including “information relating to an identifiable, living, natural person”. If that is the case then the debate about whether the Protection of Personal Information Act becomes largely academic from WhatsApp’s perspective as non-users’ phone numbers cease to be personal information when they are converted into “one-way irreversibly hashed values”.

Of course, when it comes to WhatsApp users, they are bound by the WhatsApp Privacy Policy and part of that includes their consent to their personal information being processed by WhatsApp in the manner described in the Privacy Policy.

Where does that leave WhatsApp?

So where does this leave WhatsApp? When it comes to South African law, there may be far less of an issue about WhatsApp’s retention of non-users’ personal information in South Africa than the Canadians and Dutch seem to have with the service although if their definitions of personal information are similar, it should, perhaps, be less of an issue for them too if these “one-way irreversibly hashed values” can’t be translated back into phone numbers and will remain as seemingly random data strings.

Is it safe to keep using WhatsApp? In light of the increased security added after the initial Canadian and Dutch investigations, it does seem to be safe to use WhatsApp. At least from this perspective.

Paul Jacobson is founder and director of Web•Tech•Law. Web•Tech•Law / CC BY-SA 2.5

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Magazine covers we love

MarkLives.com runs a regular slot featuring the best local and international magazine covers every week. We recognise well thought out, powerful and interesting (and hopefully all three in one) magazine covers and celebrate the mix of pragmatism, creativity and personal taste that created each of them. By media blogger MediaSlut.

INTERNATIONAL

Westword, 24 January 2013

This cover holds reference to a very touchy subject; abortion and the (in this instance Catholic) church. Nevertheless, it’s one of my favourites because of the treatment on the cover and the striking illustration and meaning behind it. It also reminded me of my favourite TV series at the moment; American Horror Story Season 2… Those who watch it will understand what I mean.

New GUP, 2013

GUP stands for “Guide to Unique Photography”, and the special issue out now (New GUP) is all about the young new photographers in the Netherlands who are up and coming. It offers readers a selection of 10 beautiful covers to choose from. Above are 3 of the 10.

Bloomberg Businessweek, 28 January 2013

A very playful and creative cover concept to show what designers and creatives have to go through to get to the end result… It reminded me of the new ‘posters’ flying around the internet featuring the stupid and idiotic feedback that desginers have received from clients. A must see.

LOCAL

VISI 64

Picture tweeted by @HannerieVisser, showing her cover in progress... — Picture tweeted by @HannerieVisser, showing her cover in progress…

Just reading some of the tweets about the new VISI 64 DIY DELUXE issue and cover seems to suggest this might not only be their best issue but also the most creative VISI cover yet. And I can completely see why! For the DIY issue, the cover is filled with little holes, and “I LOVE DIY” ‘cross-stiched’ onto it. But what makes the cover extra special, is that they are inviting readers to create their own creative designs around the “I LOVE DIY” design (see examples above), and I’ve seen a few people tweeting their designs in progress. To kick off their creativity, every reader is also getting a nice red piece of thread to start playing around with (see picture tweeted).

– The (for now anonymous) blogger behind MediaSlut knows way too much for his own good about media in South Africa. Magazines in particular. His mission is to show when South African magazines might fail, but most importantly, succeed. If you’re looking for a library about South African magazines and news, your one-stop pitstop is MediaSlut. #MagazinesForTheWin

– Find a cover we should know about? Tweet us @marklives and @mediaslut
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