Interview with Gustav Goosen, CEO of The SpaceStation
This year the Loeries has seen a record number of entries in its digital categories. We spoke to Gustav Goosen, the CEO of digital media sales agency, The SpaceStation about online advertising, his thoughts on the growth of digital in SA and the international trends we are likely to see repeated locally.
9 Sep 2013 12:45
*The SpaceStation just won the Overall Media Owner award at this year's MOST Awards. This is the first time a winner in the digital category has walked away with this accolade.
- Growth of online retail - what developments are we seeing in SA and how does this affect consumer behavior and online advertising?
The aggressive rise of digital connectivity sees more people becoming digitally savvy and taking the leap to being digital consumers. Albeit e-commerce is still in its infancy in SA, it's definitely growing fast enough to now attract the attention of large traditional retailers and we're seeing them increasing their digital footprint and offering. The combination of increased connectivity, coupled with more e-tailer offerings is no doubt a catalyst to e-commerce and the changing behaviours of SA consumers. Digital advertising will benefit from this growth as it affords e-tailers the opportunity to target potential consumers whilst they're connected and digitally engaged. A recent study by Mastercard into the online spending habits of South Africans showed that we spent R3,3bn online last year and that that figure is likely to grow by 25% this year. The study also suggested there seemed to be a problem attracting customers (rather than keeping them as they are very happy with their online shopping experiences).
- Monetising online publishing platforms: There seems to be a shift towards paywalls in SA. How will this affect online advertising and are clients/advertisers likely to see these users as "better quality'" and therefore are more likely to spend on these platforms?
Calling it a shift towards paywalls in SA is a bit aggressive. Yes, a few publishers decided to put up paywalls, but there are many more who haven't and they're not about to either. People will only pay for content, which they believe to be uniquely valuable. If you can find the same or similar content free elsewhere, anywhere in the world, I doubt you'll be prepared to pay for it. Additional services or value to substantiate the premium might offset the resistance to paying, but it has to be uniquely valuable.
Whether these paying audiences qualify as being better quality to advertisers is debatable - these audiences might just view the advertising less favorably since they're paying for the content, whereas non-paying audiences may be more appreciative and expecting of ads around free content. I'm sure either side of this debate will have supporting arguments that meet their needs, yet I don't believe paying for content will by default result in better quality audiences; however I do believe that publishers have to afford advertisers better insights to audiences and ability to better target and engage those audiences; be it related to free or paid-for content.
- Globally it is said that social networking has affected the way online advertising is done - is this the same for here in SA? Are we as sophisticated a market as the US and Europe when it comes to linking social networking with our online advertising?
Yes, I think we are and I think our advertisers do. We might be a smaller market, but we're definitely not a lagging market. We now package most of our offerings to include Twitter and Facebook so we have definitely embraced social media in order to leverage off it what we need to enrich our clients' online advertising offerings. However, the "blueprint" for social media integration with advertising is still being written through new developments on a daily basis. Not every campaign can, will or should include a fully integrated social media execution, unless it's truly additive to the campaign fulfillment, its objectives and ROI. When its required and executed properly, it undoubtedly affords benefit, but I'd suggest it be integrated and managed closely.
- What are the key drivers for growth in online advertising in SA? Internationally it is said to be economic growth, mobile advertising and subscriptions. Can we say the same for Africa and if so, why?
Knowledge. Many more local advertisers and advertising agencies have upskilled and increased their digital knowledge; this affords greater insights to realise the potential of digital, the profound impact it has had and will continue have, at a greater scale, on content and information consumption and how that drives change in consumers.
Increased connectivity, data consumption, rise of smart phone penetration, increased tablet sales, all of these positively reinforce this knowledge that media consumption and the opportunity to engage consumers is changing rapidly, which in turn positively contributes to the use of digital advertising.
- Online digital media can also be seen as a key in driving the growth through evolution of the consumer. The bandwidth in SA is seen as a problem here - do you agree? Is the South African consumer likely to become a more digital savvy consumer and if so, how will this affect the growth of online advertising (if at all).
Bandwidth is to a consumer what chocolate is to a chocoholic; there's a constant need for more. With the local environment improving and the cost of connectivity decreasing, we're definitely heading in the right direction; we just need more momentum in the movement. I mentioned it earlier; yes, the SA consumer is becoming an ever more savvy digital consumer - they want more information, they want more interaction, they want more engagement, but they also want this on their terms = marketers and advertisers will have to involve their brands and products and intertwine them with these always on consumers' consumption of media through the use of digital advertising, in whichever the most appropriate format might be at the time.
- There is talk of a global visual revolution with the massive popularity of elements like infographics and video. How important is the visual to a South African consumer? Are we a design-focused nation or should advertisers be focusing more on the type of content ie, what we say and not how we say it.
Being digitally connected doesn't simplify consumers or somehow afford a "one size fits all" solution. Consumers remain complex. We have noticed though that digital audiences are less inclined to wade through reams of content or 10's of minutes of footage; they seek much quicker gratification, even instant gratification and this does impact how you communicate and what you use to do so. The trick is to try to cater for all different audiences, by providing a wide array of opportunities to talk to them in the language they want to be spoken to. That means rich video content for video viewers, mobile rich media for those who prefer to engage on their mobile devices and native content for those who prefer tailored content specific to their interests and needs.
- Multi-screen engagement is massive in the US (watching TV while engaging on your iPad or smart phone). Are South Africans growing into a screen savvy nation too? Are local publishers and broadcasters doing enough to create the multiple touch points a South African consumer needs in order to engage at this level?
There are multiple examples locally of successful use of multiscreening. SuperSport, by example, is a great exponent of this in its magazine programmes; presenters use multiscreen engagement and interaction with viewers to draw them into the show, into the content, into the topic, into the discussion and its working fantastically well. There are many more great examples already and we're bound to see much more in future. We can see clearly from the timing of the traffic to the mobile websites and apps we represent that consumers are multi-tasking. Mobile web and app usage is high in the evenings, overlaying traditional TV evening program viewership. Mobile usage is also taking an earlier upswing than before, with our platforms starting to spike from 6am now, instead of the traditional 7am or 7:30am.
I think local advertisers are keen to integrate mobile more readily into their campaigns and local publishers and ad sales companies are making it easier, offering integrated packages and the design skill to create the components like mobile rich media.