The numbers speak for themselves: 500,000 overseas visitors, 100,000 UK visitors, 3 million tickets, 64 matches, 10 venues and US$3bn in additional income for South Africa. When England kicks off against the USA in Rurstenburg on June 12th, it will be more than just national pride and football glory at stake. The World Cup is an event like no other and now has a significant impact not only on the host nation’s economy, but on the global economy as well. Thus it comes as no surprise that publishers from all over the world are eager to exploit the opportunities this event offers.
Economic Outlook
Forecasting the economic impact of the World Cup should be based on the fact that the South African economy is still very much an emerging one. The economy has seen consistent 3-5% year-on-year GDP growth since 2000, but it contracted by 1.8% in 2009. Latest forecasts show a marked recovery with 2.2% GDP growth this year. Against this positive outlook, the domestic South African magazine market is also predicting continued growth following two successive years of double digit increases. Alongside this, the imported magazine market is developing an ever stronger foothold in the minds of the magazine buying South African consumer.
Retail Landscape
All the indicators are pointing towards a vintage year for magazine sales in South Africa. Consumer retail spending is growing and local retailers are preparing to make the most of the new school holidays scheduled for June and July to celebrate the World Cup.
The retail landscape for imported press is concentrated on bookstores and grocers with retail multiples holding the key to success. Without listings at retail, there is no route to market for imports. Under normal trading conditions, the South African market for imported press is dominated by CNA which accounts for over 50% of sales across its 222-store estate. CNA’s dominance is attributable to its extensive range of both domestic and international press which has made it a destination store.
Exclusive Books is predominantly a book chain akin to Borders and in recent years magazines have come to play a pivotal role in their total consumer offer. As a result, for certain titles, Exclusive Books can drive considerable sales that belie its modest 48-store count.
The supermarket sector, as in the UK, is the powerhouse for domestic South African publishers, delivering up to 60% of total sales. International magazines have been increasing their presence in this channel with key retailers Woolworths, Checkers and Pick ‘n’ Pay now delivering significant sales volumes for certain mass appeal titles. Conversely, airport sales in South Africa are comparatively small, delivering less than 5% of total sales.
Tourism traditionally accounts for very few sales and publishers rely on the domestic South African consumer for the majority of their business. In June and July however, the consumer landscape will look considerably different with a large influx of international visitors supplementing regular domestic consumers.
Success during the World Cup depends upon meticulous planning and a thorough understanding of the target audiences. Know your audience!
Regular Readers
It is easy to get swept up in the World Cup “circus” itself with impressive FIFA forecasts about the number of visitors, how much they are going to spend and on what. What FIFA doesn’t tell you is that your core South African audience is going to be as affected as visiting fans. Remember that the entire South African school term system has been re-scheduled to allow all children to be on holiday during the World Cup, demonstrating the major impact it will have on South Africans’ daily routines. Add to this a blitz of mass marketing and the core South African mindset will be very different to normal. This gives publishers the perfect opportunity to try previously unachievable promotions, products, pricing strategies and listings to increase trial, sales and retention.
Football Fans and Families
With over half a million people expected to visit South Africa during the World Cup, 20% from the UK, there is a sizeable opportunity to generate additional sales. Compared to regular readers, this group will bring with them an entirely different set of demands. All activity targeting this audience must focus on their preferred UK brands and be available in areas where they are most likely to impulse shop – airports, key shopping malls in the major tournament centres and hotels.
Retailers
The importance of retail support during the World Cup should not be underestimated. Just as you must plan for your key audiences, you must understand your retailers’ consumers, plans and needs to successfully develop promotional plans that deliver immediately and generate longer term benefits for both retailers and publishers. Demand for promotional and display space will be at its peak so publishers need to ensure their ideas and plans achieve cut-through with the retailer; they must be easy to say ‘yes’ to. Matching the retail buyer’s needs with those of your magazine creatively will ensure a promotion stands out or gets a title the required shelf space during the tournament.
Making the most of the market
With promotional activity from all sectors at retail set to peak during the World Cup, it is an ideal time to make the most of the extra footfall coming into the category. Domestic South African publishers have increased their promotional and advertising budgets to coincide with the World Cup. This will drive more customers to the category, which will benefit all magazines. It is therefore prudent to ensure your title has the best visibility and promotional space possible.
Given the similarities between the UK and South African retail landscapes, many initiatives that are successful in the UK can be adapted for the South African market. South African promotional mechanics are predominantly units within range plus some out of category locations. It is therefore important that any promotional space secured is used to promote relevant editorial or added value to draw the consumer in.
Value
Delivering value to the consumer is the most important aspect of any South African promotion. This holds true for the World Cup. It is worth remembering that 70% of South Africans earn less than £400 per month. With import press prices ranging from R20 to R150 (£1.75 to £13) most South Africans need to justify to themselves that they have got real value for money. Promotions that deliver value, be it through special editorial, price, gifts or packs will see the greatest uplift in sales. This applies not only to the domestic audience, but also to overseas visitors. As with other tourist markets, UK based consumers bring with them specific value expectations for their regularly purchased magazines and promotional activity must deliver against these.
Football
It wouldn’t be the World Cup without football based sales opportunities. Football titles will have spent months preparing for the event and are well positioned to bring some theatre to the retail scene during the tournament. Here, complementary titles from different publishers can work together to deliver eye-catching displays that bring new consumers to the fixtures to drive sales. What makes these promotions different in South Africa from Germany is the opportunity for retention. Whereas in 2006 the fans came and went in a short time, in South Africa, there is a thriving football community that has the potential to deliver publishers long term sales benefit. Some comparatively small scale investment in South African centred editorial could pay long term dividends.
Exclusives
Exclusivity is a watch-word for all of South Africa’s major retailers. Tailoring a promotional programme that includes retailer-exclusive activity delivers on all fronts: retail can claim a point of difference; publishers can secure valuable space; and consumers benefit from the promotion itself.
Timeliness
The World Cup lasts for exactly one month; therefore there is a finite window of opportunity. If you are targeting UK based consumers in South Africa for the World Cup or publish information heavy titles, you will need to get your product to market in a timely fashion. With standard shipping times of four weeks, event preview issues could arrive after the event has finished! The solution is to airfreight issues to ensure that content remains fresh and relevant. However, air-freighting needn’t be limited to titles with a football on the front cover during this period. UK families in South Africa for the tournament will be looking for their favourite titles, thus extending air-freighting for this period to mass market Women’s and Men’s titles will be beneficial.
The World Cup and similar sporting events that bring large numbers of people together in one country can present great opportunities for publishers. To capitalise on these, it is important to work with a distributor that has developed relationships not only with their agent in the territory, but also with the retailers themselves to help unlock your portfolio’s potential. Working with them to create innovative plans will mean that come July 11th, you will not only be looking forward to the Brazil v Germany final, but also to getting your sales results in the not too distant future.
