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Advertising Industry South Africa

The Advertising Industry in South Africa 2023

Yasmin Mahomedy | South Africa | 31 August 2023

The Advertising Industry in South Africa 2020

Kate Shand | South Africa | 05 June 2020

The Advertising Industry in South Africa 2018

Nina Shand | South Africa | 08 May 2018

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Report Coverage

This report on the advertising industry in South Africa includes information on the state of the industry, major trends and issues, notable players and factors that influence its success. There are profiles of 37 companies including major agencies such as Ogilvy, Dentsu, TBWA and Publicis, media agencies such as The MediaShop and outdoor advertising companies such as Outdoor Network and Tractor.

Introduction

• South Africa’s advertising industry has recovered since the pandemic.
• Digital advertising revenue is growing more than four times faster than traditional advertising, fuelled by the increasing number of internet users.
• The main avenues are Google search engine marketing, social media advertising and advertising on closed networks.
• With streaming services like Netflix advertising to subsidise cheaper plans, traditional advertising faces growing competition.
• Many South African agencies are subsidiaries of international companies. The five largest account for around 80% of South African advertising spend.

Trends

• Increase in digital advertising.
• Influencer marketing is being used to reach target audiences.
• The number of roadside digital screens is increasing, and many companies are trying out digital out of home for the first time.

Opportunities

• Growing digital out of home.
• Growth of online advertising.
• Investment in marketing technology as data-driven insights are becoming more important.

Challenges

• Concerns about accuracy and transparency of measurements in the out of home segment.
• Lack of transformation in the industry.
• Loadshedding is a threat to digital advertising.
• The industry is dominated by a few international holding companies.

Outlook

• The industry is expected to continue to grow, led by growth in digital advertising.
• The digital out of home segment has significant growth potential.
• Over the next five years, internet advertising is expected to show the largest revenue increase to almost 80% of entertainment and media revenue.
• It is forecast that digital advertising spend in South Africa will grow by 6.6% per annum between 2023 and 2027.

Read More..
The Advertising Industry in South Africa
The Advertising Industry in South Africa 2023

Full Report

R 20 000.00(ZAR) estimated $1100.87 (USD)*

Industry Landscape

R 14 000.00(ZAR) estimated $ 770.61 (USD)*

Historical Reports

The Advertising Industry in South Africa 2020-06-05

R 1 900.00(ZAR) estimated $104.58 (USD)*

View Report Add to Cart

The Advertising Industry in South Africa 2018-05-08

R 1 900.00(ZAR) estimated $104.58 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 3
2.2. Geographic Position 3
2.3. Size of the Industry 4
3. LOCAL 8
3.1. State of the Industry 8
3.2. Key Trends 11
3.3. Key Issues 11
3.4. Notable Players 12
3.5. Corporate Actions 13
3.6. Regulations 13
3.7. Enterprise Development and Social Development 14
4. AFRICA 16
5. INTERNATIONAL 18
6. INFLUENCING FACTORS 19
6.1. Loadshedding 19
6.2. Economic Environment 20
6.3. Labour 20
6.4. Racial Discrimination and Racist Ads 21
6.5. Technology, R&D, Innovation 22
6.6. Environmental Issues 23
7. COMPETITIVE ENVIRONMENT 24
7.1. Competition 24
7.2. Ownership Structure of the Industry 24
7.3. Barriers to Entry 25
8. INDUSTRY SUMMARY 25
9. OUTLOOK 25
10. INDUSTRY ASSOCIATIONS 26
11. REFERENCES 26
11.1. Publications 26
11.2. Websites 27
APPENDIX 1 28
Summary of Notable Players 28
COMPANY PROFILES 33
Accenture Song Production Studios (South Africa) (Pty) Ltd 33
Ad Outpost (Pty) Ltd 35
Ad Outpost Two Thousand and Seven (Pty) Ltd 37
ADreach (Pty) Ltd 39
Black Khaki Advertising (Pty) Ltd 42
Blueprint Advertising Agency (Pty) Ltd 44
Boo Media and Communication (Pty) Ltd 45
Boomtown (Pty) Ltd 47
Busi Ntuli Communications (Pty) Ltd 49
Catgraphics (Pty) Ltd 51
Dentsu South Africa (Pty) Ltd 53
FCB Africa (Pty) Ltd 56
Grey Advertising Africa (Pty) Ltd 58
Horsley's Marketing Services CC 60
Incubeta SA Operations (Pty) Ltd 62
J Walter Thompson Company South Africa (Pty) Ltd 63
JCDecaux South Africa (Pty) Ltd 65
Joe Public (Pty) Ltd 67
Kena Outdoor (Pty) Ltd 69
McCann Worldgroup South Africa (Pty) Ltd 71
Media Shop (Pty) Ltd (The) 73
MetropolitanRepublic Integrated Communications (JHB) (Pty) Ltd 75
MMS Communications South Africa (Pty) Ltd 77
Mullen Lowe Group (South Africa) (Pty) Ltd 80
Nethwork (Pty) Ltd 82
Ogilvy and Mather South Africa (Pty) Ltd 84
Outdoor Network Ltd 87
Outsmart Outdoor Advertising (Pty) Ltd 89
Penny Black Outdoor (Pty) Ltd 91
Primedia (Pty) Ltd 93
Provantage (Pty) Ltd 97
Southern Ambition 1385 CC 100
TBWA South Africa (Pty) Ltd 101
Tractor Media Holdings (Pty) Ltd 103
VMLYR (Pty) Ltd 105
Wunderman Thompson (Pty) Ltd 107

Report Coverage

This report covers the advertising industry in South Africa, with a focus on advertising agencies and above-the-line advertising and includes adverts for print, radio, television, out-of-home such as billboards, digital, cinema, direct mail, e-sports and gaming. It includes comprehensive information on the state of the sector and statistics on advertising revenue, agency and brand rankings and trends. There are profiles of 35companies including major agencies such as Ogilvy and TBWA. Other profiles include agency FCB Africa, which has rebranded to Nahana Communications Group and outdoor advertising companies such as Outdoor Network and Outsmart.

Introduction

This report covers the advertising industry in South Africa, with a focus on advertising agencies and above-the-line advertising. The total revenue of the advertising industry was estimated to be R30.4bn in 2019 (a 2.8% increase on 2018’s R29.5bn) with television and video dominating advertising spend at 21% of the total. The internet is expected to account for 25% of the advertising market in 2023 from 13.1% in 2019, and by then it will have overtaken television advertising. It is difficult to predict how the coronavirus crisis will affect the industry.

Strengths

• Adspend continues to grow steadily.
• Establishment of the Advertising Regulatory Body.
• Strong growth in mobile advertising.
• Well-established industry with decades of performance and experience, including international award-winning ads and campaigns.
• Well-established large agencies owned by international holding companies.

Weaknesses

• Environmental impact of outdoor and print advertising.
• Lack of transformation in the advertising industry.
• Migration from traditional print and broadcast to digital leading to a reduction in billings.
• Point of purchase industry tends to be fragmented.
• Skills shortage when it comes to core technological skills needed to compete with the advances technology has afforded the advertising industry.

Opportunities

• Digital transit advertising is an under-utilised ad space.
• In-house agencies offer an attractive alternative to the current model.
• Online shopping.
• Programmatic advertising makes adverts more target-based.
• Rise in online advertising opportunities.
• The development of augmented and virtual reality.
• The growth of social media has created opportunities for advertising.
• The performance of South Africa’s most valuable brands poses a potential source of growth for the economy.
• TV advertising.
• Video games, e-sports and podcasts are relatively new and are growing at a similar rate to online advertising.

Threats

• Ad-block technology.
• Ad-free business models.
• Agencies are noting a decline in work commissioned and billings, and a rise in retrenchments and forced pay cuts due to the coronavirus pandemic.
• Alcohol advertising may be threatened by coronavirus alcohol restrictions.
• Closure of Caxton magazines and Associated Media Publishing.
• Coronavirus is a threat as there is no point in advertising in outside spaces when everyone is staying at home.
• Coronavirus threat to various advertising awards events, sporting events and other events attracting advertising and sponsorship.
• Ownership of industry in the hands of international holding companies.
• The increased spend on digital advertisements, further increased by coronavirus, is threatening traditional advertising agencies.
• The poaching of creatives between agencies would have ramifications for the future of advertising.
• There are concerns about accuracy and transparency of measurements, as well as ongoing breaches of consumer privacy and brand safety with regards online advertising.

Outlook

With so many people at home, there is an increasing use of online and social media. Out-of-home advertising has been affected. In an IOL interview, Richard Lord, media and operations director of media agency, Meta Media encouraged business to keep advertising during this time of recession and lockdown. “There’s very clear evidence that shows that brands that continue to advertise through a recession come out far stronger at the end of it.” With more people on social media than ever before, it is a good time to invest in digital and influencer marketing. More people are using, or considering using, online shopping options and this is pushing the retail space to online. People are also watching more television. Where products are available, television advertising spend has remained or increased but where products and services are not available, spend has been suspended for now. The rapid changes in the digital advertising industry coupled with the uncertain future the world is facing make it difficult to predict the industry outlook.

Read More..
The Advertising Industry in South Africa
The Advertising Industry in South Africa 2020

Full Report

R 1 900.00(ZAR) estimated $104.58 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 73.21 (USD)*

Historical Reports

The Advertising Industry in South Africa 2023-08-31

R 20 000.00(ZAR) estimated $1100.87 (USD)*

View Report Add to Cart

The Advertising Industry in South Africa 2018-05-08

R 1 900.00(ZAR) estimated $104.58 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 5
2.2. Geographic Position 8
3. SIZE OF THE INDUSTRY 9
4. STATE OF THE INDUSTRY 15
4.1. Local 15
4.1.1. Corporate Actions 22
4.1.2. Regulations 23
4.1.3. Enterprise Development and Socio-Economic Development 26
4.2. Continental 26
4.3. International 28
5. INFLUENCING FACTORS 31
5.1. Economic Environment 31
5.2. Input Costs 32
5.3. Technology, Research and Development (R&D) and Innovation 32
5.4. Coronavirus 32
5.5. Environmental Concerns 35
6. COMPETITION 35
6.1. Barriers to Entry 37
7. SWOT ANALYSIS 37
8. OUTLOOK 38
9. INDUSTRY ASSOCIATIONS 39
10. REFERENCES 40
10.1. Publications 40
10.2. Websites 40
APPENDIX 1 42
Summary of Notable players 42
COMPANY PROFILES 45
AD OUTPOST (PTY) LTD 45
AD OUTPOST TWO THOUSAND AND SEVEN (PTY) LTD 47
ADREACH (PTY) LTD 49
AEGIS MEDIA SOUTH AFRICA (PTY) LTD 52
BLACK KHAKI ADVERTISING (PTY) LTD 55
BLACK POWDER STUDIOS (PTY) LTD 57
BOO MEDIA AND COMMUNICATION (PTY) LTD 59
BOOMTOWN (PTY) LTD 61
BUSI NTULI COMMUNICATIONS (PTY) LTD 63
CATGRAPHICS (PTY) LTD 65
ELEMENTS CREATIVE DYNAMICS (PTY) LTD 67
FCB AFRICA (PTY) LTD 68
HORSLEY'S MARKETING SERVICES CC 70
INCUBETA SA OPERATIONS (PTY) LTD 72
J WALTER THOMPSON COMPANY SOUTH AFRICA (PTY) LTD 73
JCDECAUX SOUTH AFRICA (PTY) LTD 75
JUPITER DRAWING ROOM CAPE TOWN (PTY) LTD (THE) 77
KENA OUTDOOR (PTY) LTD 79
KING JAMES ADVERTISING CAPE TOWN (PTY) LTD 81
MCCANN WORLDGROUP SOUTH AFRICA (PTY) LTD 83
METROPOLITANREPUBLIC INTEGRATED COMMUNICATIONS (JHB) (PTY) LTD 85
MMS COMMUNICATIONS SOUTH AFRICA (PTY) LTD 87
MULLEN LOWE GROUP (SOUTH AFRICA) (PTY) LTD 90
NETHWORK BBDO (PTY) LTD 92
OGILVY AND MATHER SOUTH AFRICA (PTY) LTD 94
OUTDOOR NETWORK LTD 97
OUTSMART OUTDOOR ADVERTISING (PTY) LTD 99
PENNY BLACK OUTDOOR (PTY) LTD 101
POSTERSCOPE (PTY) LTD 103
PRIMEDIA (PTY) LTD 105
PROVANTAGE (PTY) LTD 109
SOUTHERN AMBITION 1385 CC 112
TBWA SOUTH AFRICA (PTY) LTD 113
TRACTOR MEDIA HOLDINGS (PTY) LTD 115
VMLYR (PTY) LTD 117

Report Coverage

The report on the South African advertising sector describes current conditions, recent developments and factors influencing the success of the industry. Profiles for 35 companies are provided. These include Black Powder Studios (Pty) Ltd, which was launched as a through the line agency and recently transformed from a majority black-owned to a 100% black-owned business. Also profiled are Provantage Media Group, which acquired a majority stake in leading African billboard company, Global Outdoor Systems in 2018, making it one of the largest out-of-home media owners on the continent, and Dentsu Aegis Network which purchased a 52.05% stake in advertising agency FoxP2, a deal that highlights the trend for media and creative agencies to work together.

Introduction

According to the most recent statistics from Nielsen, South African advertising spend totalled R38.13bn between July 2016 and June 2017. Television and Newspaper together accounted for 72.6% of the total advertising spend over this period while Direct Mail’s share of the total decreased further to 0.4% or R146m. While Television advertising dominates the industry, Internet advertising is expected to be the largest contributor to growth in the sector in the next five years. Media agencies have already seen a reduction in billings with the migration from traditional print and broadcast platforms to digital, thus adding pressure to revenue streams.

Strengths

• A well-established sector with a variety of channels and a variety of role players.
• Outdoor advertising is an effective and low-cost means of communication for businesses.
• The local Point of Purchase industry has strong international links.

Weaknesses

• Lack of transformation, with the sector remaining largely white-owned and male-dominated.
• Negative environmental impact of outdoor advertising.
• The sector is dominated by four international companies.
• The sector is impacted by economic conditions.

Opportunities

• Increasing technological developments in the sector.
• Increasing use of mobile devices and the Internet.
• The rapidly growing middle class and increased market sophistication in Africa.
• The rise in digital, omni-channel advertising opportunities.

Threats

• Ad-block technology.
• Ad-free business models.
• Inability of agencies to innovate and adapt to latest technological and consumer trends.
• Legislation banning the advertising of alcohol and cigarettes.
• Migration from traditional print and broadcast to digital leading to a reduction in billings.
• The trend for advertisers to work directly with Facebook and Google on their digital marketing strategies.

Outlook

A key issue facing the advertising industry in South Africa is transformation. The Marketing, Advertising and Communication Charter deadline was 31 March this year and many companies and creative entrepreneurs are scrambling to ensure they have met all the requirements. At the same time Government is preparing legislation that threatens to restrict the quantity of alcohol marketing in South Africa, a move that will have a negative impact on the advertising revenues of agencies. Spend on Internet and digital marketing is expected to continue on its upward trajectory and although TV adspend is decreasing globally, in the domestic market it is likely to remain a popular medium. An increase in the popularity of and spend on online video advertisements is also forecast.

Read More..
The Advertising Industry in South Africa
The Advertising Industry in South Africa 2018

Full Report

R 1 900.00(ZAR) estimated $104.58 (USD)*

Industry Landscape

R 1 330.00(ZAR) estimated $ 73.21 (USD)*

Historical Reports

The Advertising Industry in South Africa 2023-08-31

R 20 000.00(ZAR) estimated $1100.87 (USD)*

View Report Add to Cart

The Advertising Industry in South Africa 2020-06-05

R 1 900.00(ZAR) estimated $104.58 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 3
2.2. Geographic Position 5
3. SIZE OF THE INDUSTRY 5
4. STATE OF THE INDUSTRY 10
4.1. Local 10
4.1.1. Corporate Actions 14
4.1.2. Regulations 15
4.1.3. Enterprise Development and Social Economic Development 18
4.2. Continental 20
4.3. International 22
5. INFLUENCING FACTORS 24
5.1. Economic Environment 24
5.2. Ban on Alcohol Advertising 25
5.3. Labour Resources 25
5.4. Ad-free Business Models 27
5.5. Technology, Research and Development (R&D) and Innovation 27
5.6. Environment 31
6. COMPETITION 32
6.1. Barriers to Entry 33
7. SWOT ANALYSIS 34
8. OUTLOOK 35
9. INDUSTRY ASSOCIATIONS 35
10. REFERENCES 37
10.1. Publications 37
10.2. Websites 37
APPENDIX 1 39
List of ASA Members 39
APPENDIX 2 40
List of ACA members 40
APPENDIX 3 42
Acts Affecting Advertising 42
APPENDIX 4 44
List of SA POPAI Members 44
COMPANY PROFILES 45
AD OUTPOST (PTY) LTD 45
AD OUTPOST TWO THOUSAND AND SEVEN (PTY) LTD 47
ADREACH (PTY) LTD 49
AEGIS MEDIA SOUTH AFRICA (PTY) LTD 52
BLACK KHAKI ADVERTISING (PTY) LTD 55
BLACK POWDER STUDIOS (PTY) LTD 57
BOO MEDIA AND COMMUNICATION (PTY) LTD 59
BOOMTOWN (PTY) LTD 61
BUSI NTULI COMMUNICATIONS (PTY) LTD 64
CATGRAPHICS (PTY) LTD 66
ELEMENTS CREATIVE DYNAMICS (PTY) LTD 68
FCB AFRICA (PTY) LTD 70
HORSLEY'S MARKETING SERVICES CC 72
J WALTER THOMPSON COMPANY SOUTH AFRICA (PTY) LTD 74
JCDECAUX SOUTH AFRICA (PTY) LTD 76
JUPITER DRAWING ROOM (CAPE TOWN) (PTY) LTD (THE) 78
KENA OUTDOOR (PTY) LTD 80
KING JAMES ADVERTISING CAPE TOWN (PTY) LTD 82
MCCANN WORLDGROUP SOUTH AFRICA (PTY) LTD 84
METROPOLITANREPUBLIC INTEGRATED COMMUNICATIONS (JHB) (PTY) LTD 86
MFELANE CREATIONS CC 88
MMS COMMUNICATIONS SOUTH AFRICA (PTY) LTD 89
MULLEN LOWE GROUP (SOUTH AFRICA) (PTY) LTD 92
NETHWORK BBDO (PTY) LTD 94
OGILVY AND MATHER SOUTH AFRICA (PTY) LTD 96
OUTDOOR NETWORK LTD 99
OUTSMART OUT OF HOME ADVERTISING (PTY) LTD 101
PENNY BLACK OUTDOOR (PTY) LTD 103
POSTERSCOPE (PTY) LTD 105
PRIMEDIA (PTY) LTD 107
PROVANTAGE (PTY) LTD 112
SAATCHI AND SAATCHI (PTY) LTD 114
SOUTHERN AMBITION 1385 CC 116
TBWA SOUTH AFRICA (PTY) LTD 117
TRACTOR MEDIA HOLDINGS (PTY) LTD 119
VML SOUTH AFRICA (PTY) LTD 121