Demand-led Growth Key to Sustaining Top Line Profits
25 Jan 2005|Added Value
South African companies still need to develop better consumer insight to be able to determine where the true opportunities for brand growth lie. This will enable businesses to use pertinent lead-indicators in stimulating the demand for a particular brand or product, says Charles Broome, chief executive of international marketing group Added Value, who have been operating in the South African market for two years.
The answer, Broome says, lies in demand-led growth.
“Demand-led growth is about finding new ways to get to the heart of what a brand is about,” he says. “It is about providing consumers with features and attractions truly relevant to them and their lifestyles, therefore inspiring them to buy more of a particular brand or product. By really connecting with consumers in the marketplace to establish insight driven marketing strategies and innovation, demand-led growth has the potential to drive absolute top-line profits, whilst ensuring companies of long-term, sustainable business growth.”
Broome says popular marketing techniques have generally become extremely outdated in South Africa. “Marketing methods have not evolved with today’s rapidly changing society, resulting in poor brand growth and financial dissatisfaction for many South African companies,” he says. “Whereas many companies have primarily relied on market research for consumer insight, this is no longer enough.”
In his opinion, a big problem is that marketers’ skills are not sufficiently challenged to inspire them to devise innovative new branding solutions. “To achieve real demand-led growth, both strategic and creative bedrock is required,” he says. “This creates a need for companies to partner brand experts with people skilled in consumer insight so as to generate holistic brand growth – part of a fundamental uniqueness to Added Value.
“Conventional research only provides a historic view of the market. Without adequate mining of the information to develop marketing strategies built on insight and innovation, the research itself becomes of little value,” he says.
Instead, Broome believes that South African companies will have to find more innovative ways of reaching consumers in future. This involves looking much wider for consumer insight and by consulting various experts. When working with Levi’s, for example, the solution to a completely new innovative approach came from inside the company, when one of the fabric technologists share an unlikely insight – and Levi’s Engineered Jeans were born.
Added Value helps companies uncover this consumer insight through a multi-phased approach aimed at getting to grips with consumers’ needs. While market mapping is done for market segmentation, Added Value not only differentiates in terms of LSM, but looks at consumer attitudes/ mindsets to truly understand their motivators. In addition, a range of other methodologies (such as ethnographic research and semiotics) is employed for more forecast type research.
Broome says it is also vital to obtain further insight into the companies themselves so as to determine their hopes and visions, their view of the market and general operational mindset.
Many South African companies’ attempts to achieve demand-led growth are hamstrung by their being local representatives of a bigger global company, with marketing decisions being made at the overseas head-office. However, as South African companies are increasingly assigned the responsibility for Pan-African growth, South African companies have the opportunity of leading global conglomerates in the use of tried and tested local strategies for breaking into Africa.
“The only real barriers to demand-led growth lie in the restrictions that people put on themselves in terms of lack of innovation, creativity, energy and enterprising spirit,” says Broome. By continuously inspiring employees about the potential for success, the positive spirit that emerges as a result has the potential to feed through an entire organisation, establishing a model with inner momentum that ensures companies of sustained, long-term, demand-led growth,” he concludes.prev next