Trends in South Africa
November 18, 2013
The good business journey
South African brands have begun embracing brand purpose by
incorporating it into every aspect of their businesses. Purpose is
no longer limited to a single issue like sustainability or social
investment; instead, brands are working to impact multiple
categories at once.
Successful initiatives do good on many levels: delivering
products and services that support business aspirations; achieving
environmental sustainability; building strong communities; and
investing in innovation.
Woolworths in South Africa is leading the way in brand purpose.
The company has fundamentally changed its business approach to
prioritize its commitment to social transformation and sustainable
energy, water, farming, and fishing. It has decreased energy
consumption by almost 27 percent since 2004 and was named one of
the developing world’s 16 sustainability champions.
High loyalty, high reward
Sluggish growth in South Africa has left most consumers highly
conscious of their wallets. Brands have responded by offering
reward programs, a relatively new strategy for the country. The
insurance company Discovery has introduced an innovative program
called Vitality, the first of its kind in South Africa, that
rewards customers as they act to improve their health.
Powerful partnerships make it work—Vitality members get
significant discounts to gyms and cash back on healthy food at Pick
n Pay or Woolworths. Healthy behaviors, in turn, earn points for
members, who then receive discounts on their insurance bills. Up
next for the brand is Discovery Drive’s Vitalitydrive, which
rewards safe driving with petrol discounts.
African brands looking to build successful reward programs will
reach out to powerful, inspiring partners, use innovative tools to
make participation easier, and provide immediate rewards.
South Africa’s lagging growth and polarized class structure have
led some large brands to move beyond the country’s borders to
capture growth in East and West Africa. Other international brands
are bypassing South Africa altogether to invest in Nigeria, Kenya,
The keys to successful expansion on the African continent will
- Consistent, high-quality supply and
distribution. Shoprite had a first-mover advantage, but
also secured a leadership position by developing local supply
chains that deliver quality and consistency.
- Products tailored to regional markets. In
Kenya, Chinese car brands are offering products optimized for the
area, such as larger petrol engines for the long distances traveled
- Adoption of alternate payment systems. The
haberdashery Suitsupply now allows Kenyan consumers to pay with
m-Pesa, a mobile payment system extremely popular in the developing