South Africa In(c) Series Brand South Africa Research Report African market entry strategy Can the Nation Brand bridge the familiarity gap in Asia? learning to listen and listening to learn By: Dr. Petrus de Kock General Manager, Research, Brand South Africa
Contents 1. Executive Summary 2. Introduction 2.1. Background on the ITU World Exhibition and Forum 3. Background from Brand South Africa s International Investor Perceptions research on Asia 4. Main findings and recommendations from interactions with stakeholders at the ITU
1. Executive Summary Based on findings from both the Brand South Africa international investor perceptions research, and research engagements at the ITU World Exhibit and Forum, South Korea (September 2017), the following main findings and recommendations can be noted: The Asian region, with exception of India, have low levels of familiarity with South Africa as a business and investment destination; Geographical and language barriers present a specific challenge; Respondents are aware of South Africa s natural beauty and cultural diversity. These elements can be leveraged to increase interest, and attract business tourists to the market; South African sources of information (e.g. websites) are in English. It is recommended that entities such as Brand South Africa, DTI/Invest SA, and provincial investment agencies provide translation facilities to make country specific information accessible in major world and regional languages; Given dynamic expansion of markets in Asia (particularly the ASEAN block) the South African Nation Brand requires a dedicated strategy for the region and key markets therein; Global South Africans were cited as sources of information on the country in the regions especially in Singapore, South Korea where numbers of South African teachers live and work. This calls for a concerted GSA strategy and intervention in markets such as: New Zealand, Singapore, South Korea, Japan, China; Colleagues and business associates in South Africa were cited as major sources of information on the country. This calls for closer contact and sharing of information with Asian embassies, corporates active in the South African market. 2. Introduction During September Brand South Africa s SA Inc research project, for the first time, branched out into Asia. For this intervention research was conducted in South Korea as part of the organisation s support for the Department of Telecommunications & Postal Services that hosted a National Pavilion at the International Telecommunications Union (ITU) World Exhibition and Forum, South Korea, 25-29 September 2017. This intervention presented an opportunity to interact with a range of business stakeholders from across the Asian region. As per the fieldwork plan, and in addition to other support provided for the Team SA engagements at the ITU, the research & stakeholder team conducted interviews with delegates. In total, in the course of two days (26-27 September), thirty interviews were conducted. The interviews primarily targeted Asian companies, and exhibition stands hosted by Asian countries. This research report covers several dimensions of Brand South Africa s findings: 1. Background from Brand South Africa s International Investor Perceptions research on Asia; 2. Main findings and recommendations from interactions with stakeholders at the ITU.
Findings from interactions at the ITU supports and confirms findings from the international investor perceptions research. As illustrated in Section 3, the Asian region, with the exception of India and Russia, presents the Nation Brand with unique challenges in terms of low levels of familiarity. Brand awareness and familiarity are the proverbial foundations upon which higher level favorability, trust and advocacy can be built. It is for this reason that the title of this report carries an open-ended question, being: Can the Nation Brand bridge the familiarity gap in Asia? The findings presented here may not give definitive answers to this question, however, if viewed against the backdrop of the growing economic significance of Asia, and Emerging Markets, for the future of not only the world economy but particularly for the South African Nation Brand this report aims to open a conversation on how best Brand South Africa can implement new and inspiring strategies to enhance awareness, familiarity and ultimately cultural, economic and business, and civil society ties with dynamic Asian countries and markets. 2.1. Background on the ITU World Exhibition and Forum ITU Telecom World Exhibition and Forum is a unique gathering that brings together Heads of State, Prime Ministers, Ministers, Chairs and CEOs of major companies, Heads of UN Agencies, regulators and industry leaders from across the telecommunications/ict sector. One particular objective of the Department of Telecommunications & Postal Services, Brand South Africa intervention at the ITU was to enhance awareness of not only the ICT sector, but more broadly to communicate on and market South Africa s hard and soft infrastructure, investment opportunities, technological profile, and innovation capabilities. In the 21 st century the latter issues will become increasingly important to profile due to rapid digitization of economies, the demands and challenges posed by the so-called Fourth Industrial Revolution. The ITU World Exhibition & Forum is a platform for high-level debate, knowledgesharing and networking to help drive the continued success of the global ICT community, and to address critical global socio-economic challenges. The focus is to consider the role of innovation in ICTs to drive economic growth and social good. The ITU included entrepreneurs especially SMMEs and other innovators. The Republic of South Africa, in an effort to promote the South African ICT sector, participated in the ITU Telecom World event to enhance the image of the country and to attract investors, promote the business interests of the ICT sector, and facilitate the exchange of ideas and best practice.
Brand South Africa Objectives @ ITU South Korea 2017 To support the Department of Telecommunications & Postal Services (DTPS) in terms of brand design and positioning of the South African Nation Brand at the South African pavilion; Support the DTPS and Team SA interventions through PR and Communications; Utilize the Pavilion space to conduct intercept discussions/interviews with delegates to develop insight into questions, concerns, positive and negative perceptions of the South African Nation Brand; Co-host with the DTPS a media briefing. SA Inc Research Objectives: The ITU World Exhibition & Forum presented an opportunity to interact with, and conduct interviews with delegates. This platform provided a perfect opportunity to engage with business stakeholders and gather input regarding: 1. To test levels of familiarity with South Africa as a market to trade with, travel to, and invest in; 2. Perceptions of the South African market; 3. Questions and/or concerns, or perceived strengths and key brand associations with the South African market. The South African Pavilion @ ITU 2017
Dr Petrus de Kock, Minister Cwele & DG of DTPS @ South Africa Media Briefing 3. Background from Brand South Africa s International Investor Perceptions research on Asia Findings from the 2016/17 round of the international investor perceptions research indicate that Asian markets presents unique challenges to the Nation Brand. In this section we will briefly reference the following findings, including: Country reputation index Familiarity levels Favorability According to the country reputation index scores it is clear that three markets, being, Singapore, Japan, and China have a relatively low score out of 100. India and Russia have a far stronger reputational perception of the South African market than regional counterparts.
In terms of findings it is evident that Singapore, Japan, and Russia have low levels of familiarity with the South African market. India shows the highest levels of familiarity, and while Chinese respondents are relatively familiar with the country given the strategic partnership that exists between the countries through diplomatic relations, much work remains to be done to increase familiarity with South Africa as investment destination and trade partner. Pertaining to favourability with the South African market, once again, India is positively predisposed towards the country. However, once again we note that Singapore and Japan present challenges in this regard. In the survey respondents are also asked to indicate what makes a country attractive to invest in. The image below captures main responses from each market. While the features
differ according to market, it is important to pay attention to such nuances due to the fact that it can play an important role to inform Brand South Africa, and South African business when marketing their goods, services, or investment opportunities in these markets. 4. Main findings and recommendations from interactions with stakeholders at the ITU As per the fieldwork plan, and in addition to other support provided for the Team SA engagements at the ITU, the research & stakeholder team conducted interviews with delegates. In total, in the course of two days (26-27 September), thirty interviews were conducted. The interviews primarily targeted Asian companies, and exhibition stands hosted by Asian countries. The boxes below capture main findings and issues raised by stakeholders during interview discussions. Confirming Investor Perceptions Research Findings Several respondents were not very familiar with South Africa, particularly in terms of its unique infrastructure, technological, and innovation offerings. Hurdles/Obstacles to doing business with South Africa One of the primary factors identified pertains to geographical distance. For example, respondents indicated that it takes two days to travel to South Africa. However, some respondents indicated willingness and interest to experience the friendly people, wildlife, and natural environment. This may present business tourism opportunities to enhance awareness. Associations with South Africa An important finding, that corresponds with International Investor Perceptions research, is that the primary economic sectors associated with South Africa are mining, tourism (e.g. diamonds are closely associated with the country); The city of Johannesburg was also most closely associated with the country; And Nelson Mandela as global icon is still closely associated with the country.
Language & cultural barriers Another factor mentioned by respondents pertains to the language barrier between Asian countries/companies and South Africa. Important is the language in which South African websites present information about the country. A respondent from Japan, for example, noted that there are software modules available that can translate the Brand South Africa, or South African websites into at least 80 languages. Based on feedback from other respondents this is a crucial issue to address in order to make the country s economy, and knowledge of the country, accessible to Asian markets and companies. This is particularly important for institutions such as the DTI, Invest SA, Provincial and Metro/City Investment Agencies. Sources of information Media: CNN was most cited as media source. Global South Africans (GSA): South African teachers working in South Korea, and the region were identified as important sources of information and perspective on the country. This point underlines the importance of the GSA network and the need to build it especially among South African teachers active in the region. Colleagues & friends in South Africa: Through interviews with companies at the ITU it also became apparent that their colleagues and business associates in South Africa is a major source of information. Investment related institutions & information Respondents indicated that they are not familiar with organisations or institutions to contact, and work with, when they want to invest in, or do business with South Africa. This may call for a more concerted marketing effort to bolster awareness of Invest SA and related provincial and Metro/City investment agencies.
Brand South Africa s Research Notes and Research Reports communicate findings from Brand South Africa research and related panel discussions. The Research Notes and Reports are intended to elicit comments, contribute to debate, and inform stakeholders about trends and issues that impact on South Africa s reputation and overall competitiveness. Views expressed in Research Notes are those of the author(s) and do not necessarily represent those of Brand South Africa, or the Government of the Republic of South Africa. Every precaution is taken to ensure the accuracy of information. However, Brand South Africa shall not be liable to any person for inaccurate information or opinions contained herein. Dr. Petrus de Kock, Brand South Africa, General Manager - Research petrusd@brandsouthafrica.com