Africa is one of the most diverse continents in the world, and not always one of the best understood ones. Succinctly expressed by Sami Ghabrial, Board Member and Chairperson for the African Market Research Association (AMRA), “Africa has 55 different countries and a population of more than 1.25 billion, with broad diversity in cultures, level of development and consequently, the market research industry.”
ESOMAR’s GMR2018 tries to shed light on the African region by presenting data on some of its markets. Currently limited to a fraction of the countries, ESOMAR hopes to be able to increase the number in the near future and, consequently, improve the reporting and representation of the region.
“Markets across Africa are generally full of surprises and uncertainty”, says Jasper Grosskurth, Managing Director at Dalberg Research and ESOMAR representative for Kenya. “These include, among many others, torrential rains with impact on infrastructure, power cuts, frequent strikes, haphazardly implemented legislation, little recourse in justice, spontaneously declared holidays, disruptions during political campaigns, niches of corruption and more”. This may look like an overly challenging state of affairs but, as he explains, “under such circumstances, solid market research can be a de-risking strategy and substantial competitive advantage. People are willing to pay for quality and are keenly interested too in quality-control measures”.
Prevalence of face-to-face research
According to the GMR2018, African countries share a higher-than-average share of market research performed through face-to-face methods – for most countries around half of all research, which is substantially higher than the global 9%. Sami explains this phenomenon through low labour costs, and forecasts will continue over time, even though “other challenges like accessibility to special groups of respondents is giving way to mobile interviews. This is happening in social research mainly, where some US companies developed, with successful results, excellent tools to interact with pre-smart phones, i.e. SMS”.
Jasper adds to this notion the low online penetration – where 22% of the population has access to the Internet, according to the World Bank – and the type of work conducted. As he explains, “surveys in agriculture, education, health care and similar topics require face-to-face methods to understand the context, cross-check the answer and facilitate the execution of surveys that in many cases take 1.5-2 hours per respondent”.
Cities as research hubs, and other mistaken hubs
Sami presents an interesting insight that may surprise readers unacquainted with Africa: many African cities host the largest variety of respondents, as they are “a hub for different tribes and ethnic groups which makes it is much more convenient and economic to reach directly.”
Leonie Vorster, Chief Executive Officer at the South African Market Research Association (SAMRA) and ESOMAR representative for South Africa, adds her perspective on southern Africa, home of tremendously diverse markets. According to her,
“…major differences in terms of the characteristics that are important to investors and marketers, within each country, and between the southern African countries, makes local competence the key to market research in any of the southern African markets.”
Outsiders may consider South Africa, wrongly, the hub of the southern African region for having the oldest and largest insights industry, but as she explains “yes, South Africa has the largest Gross Domestic Product and the largest – and oldest – insights industry in southern Africa. But did you know that the fastest growing southern African economy in 2018 was Tanzania? That, with more than 80 million people, the Democratic Republic of Congo has the largest population? That Botswana has the highest per capita income? That there are more than 130 languages spoken in the 16 SADC member countries, with about 40 official languages between them, and English is the only official language in just three of these countries”?
Her conclusion to understanding the African markets is clear: “if you are thinking of accessing a market – not just in southern Africa, but in Africa and the rest of the world – you best make sure you ‘go local’, even if that means investing extra time and effort to truly understand the market, get your hands dirty, and in some instances, build local competence in the process.”
Indeed, a good grasp of the working requirements for each country is essential in Africa. As Jasper explains, “the non-profit and positive social impact are sectors with intense red tape, scrutiny and high cost of mistakes. However, benefits exist in stability of prices and the inherent satisfaction of a positive social impact”. However, opportunities arise from all governmental levels – “the state, county or province level” – and all industry-related sectors – “from telecommunications companies, even if increasingly inclined towards DIY techniques and cost-cutting proposals to the tobacco industry, recently under pressure across the continent”.
The challenge of skills in the labour force
Leonie points at a noteworthy distinction in this concept, as having a shortage of skilled labour force is not the same as a shortage of skills.
Shortage of a skilled labour force may be due to “poor quality and lack of access to education, inadequate infrastructure, negative career perceptions, poor career advice services, ineffective talent management, etc. and is usually evident in industry as difficulty filling vacancies”. Leonie mentions that according to the ManPower Group 2018, South Africa, performs close to the global average in terms of difficulty to fill vacancies.
On the other hand, shortage of skills arises due to “people movement and mobility, changes in skills needs, demand exceeding supply in terms of especially new skills, etc. As the GMR2018 shows globally, the industry is currently facing the challenge of a lack of skills needed for the transformation of the industry, such as data analytics and statistics, data and database management, programming, etc.
In that sense, Sami explains how the AMRA has as one of its objectives to “develop the profession through various tools, including training and online coaching programmes sponsored by providers who have the knowledge, capacity and innovative means of reaching the African market research professionals”.
Future of market research in Africa
AMRA, supported by ESOMAR, will organise its third Annual Forum in Lagos, Nigeria, 15 to 17 April, with a programme focused on Africa, by Africans. In Sami’s words, “AMRA wants to build an environment where market research professionals in Africa can relate what they learn to what they actually see and do, learning innovative ways of conducting research from each other’s experience and building a cooperative environment”.
Jasper adds by noting the intrinsic youth in leadership that results from the adaptation of research companies to new trends, bringing higher education and aligned with global professional standards and management. In his view
“…while the market for simple brand health surveys and U&A studies will remain stable, the real growth is in data driven decision support.”
Leonie concurs, as she thinks the fastest growing component of the insights industry in South Africa for the foreseeable future is the “digital and data analytics space, coupled with moderate to high levels of growth in qualitative research”.
With the support of ESOMAR, AMRA will continue to work on establishing global standards and a code of conduct in the growing African insights industry. Furthermore, as Sami notes, “the increased weight of social research due to its relatively large demand has positioned the region as one of the best places to perform this type of research in the world”.
In the case of South Africa, however, Leonie points at the specific role of the manufacturing, finance, real estate and business services, transport and communication, and trade, catering and accommodation industries as drivers for growth. Moreover, national elections in South Africa, as well as for another 15 African countries, will most likely have a noticeable positive impact market research spend.
Africa is a very dynamic region that has seen a substantially improved business environment. As Jasper notes, the World Bank’s Ease of Doing Business ranks Rwanda in 29th position, ahead of Spain, Russia and France, Kenya as 61st, ahead of Luxembourg, Costa Rica and Peru. “While many countries still lack the volume and infrastructure for substantial market research, key markets are opening up quickly and growing fast”. At ESOMAR, we will keep a close eye in the future of Africa and continue to support the insights profession in the region.
1 comment
such a nice piece!!
Uncertainties to African markets have been the leading cause to not achieving the desired GDP, but thanks to research that provides data that helps trace where we are, where we were, and where we are heading to.