Coen Welsh | Nov 14, 2017 | 0
Logos more on – less is more
The recent splash of malls led to a number of fairly valid comments questioning their development value.
The specific point underlying the questions was could there be a more useful way to direct those funds towards more effective development. Retail development has a useful role to play in development.
Here’s how it works… There is a lot of emphasis on developing Namibia’s economy, particularly in the realm of manufacturing.
Not only will manufacturing provide for import substitution and reduce capital outflows in favour of Namibian manufacturers, but it will also create employment, be a potential basis for trade and all of that good qualitative economic stuff.
It is not sensible to take on the world (or the region) however, if you can’t make a success of your home territory.
Local selling is the basis for growth that supports territorial expansion.
The entire success of the manufacturing drive hinges on the link between the manufacturer and the consumer. To paraphrase that, a factory which cannot sell or misses its potential is not a particularly sustainable or economically valuable factory at all.
Going a step further, the manufacturing drive and developmentally useful retail space have to go hand in hand with the demand creation that various elements of branding and marketing.
Whether a start-up or product expansion, the plan and budget have to contain a strong brand and marketing component. Namibia has hit and misses in this realm.
There are large national brands, several of which also successfully cross borders. There are also brands which limit their potential with weak branding and marketing.
Two factors are telling: the ambition of the entrepreneur and the subsequent willingness to commit budget to the product. I
f both of these are present, the project has a better than average chance of success. The competitive product differential may be that the product is better suited to the Namibian market by virtue of adaptation to the country. This may create opportunity for acceptance of the premium on a local product which is implicit in a price comparison with a regional manufacturer that has achieved economies of scale. However if the product has to compete with a premium, it has to provide a local adaptation, and cannot be a just a copy of a regional product. The fact that a product is manufactured in Namibia is not sufficient.
Once that is dealt with, the challenge will be primarily in the presence and communication that lead to the sale. Firstly, packaging has to be able to compete and make itself known in cluttered shelves.
If baseline quality of packaging competes with what is produced in SA and stands out on the shelves, half the battle is won.
Make liberal use of comparisons with packaging from the region, and work with the local packaging developer. If that doesn’t work go to a reputable regional packaging developer. Secondly, the decision to purchase will be made at point-of-sale (POS) in retail. Focus a liberal amount of budget there.
Consider all the possibilities that retailers can offer including fridges and shelf-ends. Ask the retailer for her or his considered opinion and assistance. It is in the retailer’s interest to make the product profitable.
This will come at an expense, but that will not be more expensive than an under-performing product line and the resources that go into manufacturing it.
Thirdly, spend sensibly on advertising.
For a new product launch, billboards offer exceptional value, and even if you aren’t doing a national launch, you can tailor their presence to cover just one city of Namibian region.
You should also read up on successful Facebook campaigns as this gives extremely good reach for a very low budget.
The fact of the matter is that development actually depends to a large degree on marketing and branding, and so do enterprise profits. There is no real impediment to it other than recognition of the fact and willingness to budget.