Its social demographics, disparity of income and 11 official languages are just some of the major challenges that face the research industry. Then it is forced to operate in an environment where it cannot readily use two major tools of the profession - the fixed line telephone and door to door interface with respondents.
It is a country which has been openly declared as having two economies by its current head of state, President Thabo Mbeki. Such a distinct have and have not divide has precluded the use of fixed line telephony based research unless to certain sectors which are well serviced with such telecommunications. The majority of people just do not have direct access to such a facility. This split has also reduced access for door to door interface due to property security against crime or plain fear of safety in conducting such a vulnerable research option.
The managing director of South African owned research company, Ask Afrika, Andrea Rademeyer believes that these restrictions have spawned more creative methods and approaches to successfully research the market for business, marketing and political insights and direction.
"There is no doubt that South Africa lags behind the world in the use of technology for market research. Internet penetration is low so not much energy has been put into web interviewing technology and web research methodologies. Even the use of laptops, PDAs and other technologies for field data collection have largely been too costly to implement and there is limited or no use of sophisticated research platforms like SPPS's dimension.
"One must bear in mind that the local economy - particularly the vast black market which is being targeted for marketing and political reasons - is unreachable through any telecommunications except by expensive mobile telephone access which has exploded in the country amongst this very target audience but is still expensive compared with fixed line charges," she explains.
That is set to change however, as the government eased the monopoly of local telecoms company, Telkom, regarding fixed line voice transmission on February 1, this year. This has paved the way for a second fixed line operator to enter the market which should speed up fixed line expansion and through competition reduce costs. It also lowered barriers for the use of voiceover IP which should enable the country to adopt best practice overseas methods, thus allowing local research companies to compete for CATI work internationally rather than have to rely solely on its internal models and income streams in a very competitive environment.
This competitive arena is produced by the 38 companies that are corporate members of the local representative body, the South African Market Research Association (SAMRA) based in the principal commercial city of Johannesburg. In line with international trends, the $150m (R900 000) industry is dominated by about five major players that command about 70% of market share. Most dominant players have WPP/VNU shareholding (CAN, MBSA,RI,RS,RPI) and some have strong international links. There are, however, still strong privately owned companies successfully operating.
All large players have a primary generic product that they advocate. The result of this is that few statistical specialists are employed in the industry at large and much in-sourcing occurs which once again reflects an international trend.
Referring to clients, Rademeyer said the traditional clients still function with significant market intelligence (MI) departments that mostly dominate the translation and digestion of MI into their companies. However, new market entrants, consulting companies and industries riding the growing economy are demanding more intuition, integration and consulting from the MI suppliers, she concluded.
