UK consultancy Brand Finance has released their 2019 South Africa 50 report, an annual report on the most valuable and strongest South African brands.

Brand Finance also determines the relative strength of brands through a balanced scorecard of metrics evaluating marketing investment, stakeholder equity, and business performance. Alongside revenue forecasts, brand strength is a crucial driver of brand value.

According to these criteria, Discovery is the world’s second strongest insurance brand, behind China’s Ping An, and the nation’s 5th strongest brand across all sectors, with a Brand Strength Index (BSI) score of 86.0 out of 100 and a corresponding AAA brand strength rating. Despite there being a variety of sectors included in the ranking, tech is a sector that is greatly underrepresented. There is a need to develop brands within this sector if South Africa wants to close the gap with leading economies.

South Africa’s largest sugar producer, Tongaat Hulett, has dropped out of this year’s ranking, following an accounting scandal in which the brand is currently being investigated for overstating its 2018 results. It was recently announced that Tongaat has withdrawn its listing on the stock exchange and 5,000 employees have been sent retrenchment letters. This is not the first time a South African brand has hit the headlines for accounting fraud. In late 2017, it was uncovered that Steinhoff had recorded fictitious and irregular transactions, which substantially inflated the brand’s profits, and resulted in the brand’s market value wiping out and the CEO’s resignation.

Capitec is the nation’s strongest brand

Capitec (up 15% to R7.8 billion) defends its position as South Africa’s strongest brand with a BSI score of 88.7 out of 100 and a corresponding AAA brand strength rating. Since the bank’s inception nearly two decades ago, Capitec has disrupted the country’s financial services sector and traditional banks, through removing barriers to entry for everyday customers. This approach has led to the brand boasting a vast customer base, with 44% of South Africans banking with them. This number is growing exponentially as more people turn to the brand for its reliability, transparency and reduced fees.

Brand strength explained

Brand Strength is the efficacy of a brand’s performance on intangible measures, relative to its competitors. In order to determine the strength of a brand, we look at Marketing Investment, Stakeholder Equity, and the impact of those on Business Performance. Each brand is assigned a Brand Strength Index (BSI) score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding rating up to AAA+ in a format similar to a credit rating. Analysing the three brand strength measures helps inform managers of a brand’s potential for future success.

South Africa’s 10 strongest brands

  1. Capitec (Banking)
  2. Castle Lager (Alcohol)
  3. First National Bank (Banking)
  4. Black Label (Alcohol)
  5. Discovery (Insurance)
  6. Vodacom (Telecoms)
  7. Sasol (Oil)
  8. Outsurance (Insurance)
  9. Telkom (Telecoms)
  10. MTN (Telecoms)

To read the full report, click here.

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2], [3]. Image sources: Jacques Nel [1], [2].

Google will build a new undersea cable from Portugal to South Africa, which promises to bring superfast internet to local shores. The new cable will use state-of-the-art infrastructure based on space-division multiplexing (SDM) technology. SDM transmits information along parallel channels.

This will deliver approximately 20 times more network capacity than the last cable built to South Africa, Google said in a statement. “(It) will be the first subsea cable to incorporate optical switching at the fiber-pair level, rather than the traditional approach of wavelength-level switching.”

This greatly simplifies the allocation of cable capacity, giving Google the flexibility to add and reallocate it in different locations as needed. The new cable, which will be fully funded by Google, is expected to be operational in South Africa by 2021.

A contract to build the cable was signed with Alcatel Submarine Networks at the end of last year. South Africa has access to various undersea cables. Along the eastern Africa coastline, there are the Seacom cable built in 2009 and the SAT-3/SAFE (South Africa Far East cable) which is older. The WACS (West Africa Cable System), supported by MTN, was completed in 2012.

Recently, the Wall Street Journal reported on Facebook’s plans to build an underwater data cable that would encircle Africa. The group wants to lower data costs, and hopes to sign up more users in the process. The project is apparently named Simba, after “The Lion King”. Google’s new cable will be called “Equiano”, named for Olaudah Equiano, a Nigerian-born writer and abolitionist who was enslaved as a boy,

In the second phase of the project, the cable will be extended to Nigeria. Google says it is “looking forward to working with licensed partners to bring Equiano’s capacity to even more countries across the African continent”. While Google has only funded two other undersea cables, it has partnered with others on more than a dozen projects.

For more information from Google, click here. You can view the planned route for Equiano in the first image below, and all of Google’s subsea cable investments in the second image.

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2]. Image sources: [1], [2].

A new direct route between Cape Town and Newark, New Jersey, USA will be taking to the skies in December.

The seasonal route will be operated by United Airlines – their only route to Africa after they ended their Nigerian route a few years ago – and will operate between Cape Town International Airport and Newark Liberty International from 15 December 2019.

It will be a three-times-weekly service on Sunday, Wednesday and Friday from Newark, departing at 20:30 and arriving in Cape Town the next day at 18:00, and will depart again at 20:50 and arrive in Newark at 5:45. The flights will be serviced by a Boeing 787-9 Dreamliner.

It will cut travel time by eight hours for a round trip flight.

This is just another feather in the cap for the Cape Town Air Access team, making this their 15th new direct route since they started in 2015. According to Wesgro CEO Tim Harris, the new route is projected to bring in R425 million in direct tourism spending to the province by 2021, and R238 million in the first year of operation.

“By expanding air connectivity, we can expand opportunities for people, especially youth,” said David Maynier, Western Cape Minister for Finance and Economic Opportunities, at the launch.

It’s also expected to grow the US market by 20%, create 890 new jobs in the province in the first year and drastically increase cargo capacity between the two countries.

“We are grateful for the work done by our partners, especially the direct air access team,” lauded the city’s mayor Dan Plato.

“We see Cape Town, South Africa, as the gateway to Africa, and we have a lot to offer to the rest of the world.”

Why a direct route to Newark?

Americans are the third largest source market for tourists in Western Cape, after the UK and Germany, and while there has only been a 2% increase in passengers between 2017 and 2018, Business Class passengers grew by 19% in that same period.

Despite these numbers, New York (which is fed by Newark Liberty International) is one of Cape Town’s most under-served markets, followed by Brussels and Hamburg. Harris also noted that US travelers are also not beholden to seasonal travel – their numbers remain quite consistent throughout the year, even in the off-peak seasons when the city becomes a bit chilly.

And not only will a direct route boost tourism numbers, it will also boost trade exports and imports. Western Cape sells more to the US than it imports, and the US is its third biggest export market. The top six exports from the province to the US are products of iron or non-alloy steel, jewelry of precious metal, engine parts, citrus fruit, wine and yachts.

There will be a push to turn the seasonal route into a year-long route, but this is dependent on regular two-way traffic between the two countries. While marketing the US as a leisure destination to South Africans with the weak rand might be tough, the focus from SA Tourism’s side will instead be on the lucrative business travel sector.

Another point made by Harris was that the success of the air access program is the public-private partnership involved in route development, something that is unique in the world.

“We are competing with thousands of destinations around the world.”

“It is important to know what’s happening in the business sector when meeting with airlines, which is why you need a collaborative approach.”

What it means for South Africa

But the benefits won’t only be reaped by Western Cape.

For SA Tourism’s acting CEO Sthembiso Dlamini, direct air access is the best way to grow brand awareness of a country.

“Air access is very important in the business of tourism, which is a key economic growth factor for South Africa,” said Dlamini at the launch.

SA Tourism has plans and campaigns in place on the ground to drive traffic for the December launch.

“One of the key barriers to travel to South Africa is that it is too costly to get here from an airline’s point of view. So the first interaction a tourist or potential traveller has with a destination is through an airline ticket.”

“A lot of people say ‘you are not affordable’, but these issues are around perception. When you look at the currency or exchange rate, you get a lot of value for experiences using the dollar in South Africa.”

Other barriers highlighted by Dlamini are the appeal of other destinations over South Africa, concerns for personal safety and uncertain political climate – but these are, again, all an issue of perception according to Dlamini.

International visitors to SA saw a marked decrease of 1.3% between January and April 2019 compared to last year, while the domestic market saw an increase. SA Tourism plans to capitalize on this by reviving the ‘We Do Tourism’ campaign this year and getting corporates that aren’t necessarily in the tourism sector involved.

“We want to ensure that South Africans understand the value of tourism and the role that they need to play in ensuring that this sector grows,” says Dlamini.

While the US market saw a growth between 2016 and 2018 of 4.5%, major market China saw a 9% decline, which Dlamini claims is partly because the Chinese traveler doesn’t like layovers and want to fly direct.

She also noted that forward bookings were down for January almost 10%, as the peak booking period for this time took place during the drought crisis in Cape Town.

Besides the national markets, SA Tourism also wants to focus on special interest groups, LGBTQ+ travelers, repeat travelers, Millennials, and the meetings, conferences, and events sector.

Most US visitors travel to Western Cape, Gauteng and Mpumalanga, with traction seen in Limpopo, KwaZulu-Natal and Eastern Cape. SA Tourism will put their effort into showcasing those showing growth like the last three.

“We must look at what are the new products and experiences that we can start packaging so that South Africa presents a variety of products that people are looking for.”

SA Tourism’s plan of action is to “create desire through giving the traveler a vivid sense of the real South Africa before they visit” and “build confidence through giving access to real information that excites people about the country and dispels concerns”. For the US – and Canada – they want to market South Africa as an “ultimate adventure destination”.

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2]. Image sources: Nicolas Jehly [1], [2].

The South African government has recently announced two immigration- and visitor-related changes.

Change of Status

Foreigners who are spouses or children of South African citizens or permanent residents may now apply for change of status/condition from within the country, if they are currently in SA on normal visitors visas, without first applying for waivers.

Reciprocal Visa

At the Budget Vote 2019, the SA Minister of Home Affairs announced a new list of countries on South Africa’s visa-free list. The additions, to boost tourism, include Qatar, UAE, Saudi Arabia, Cuba, Ghana, Sao Tome and Principe, and New Zealand.

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2]. Image sources: [1], [2].