Discovery's coffee, smoothies and profit
The company’s imaginative marketing has borne results, and it has plans for more expansion projects
It should come as no surprise that Discovery has a market cap higher than those of Liberty and MMI combined. While the two older businesses are still life offices at heart, Discovery has shown the ability to stretch into different product lines and various territories. The group’s operating profit increased by 13% in the six months to December. But Discovery founders Adrian Gore and Barry Swartzberg could easily show better short-term returns if they didn’t keep setting up new businesses. Even after throwing in the towel with its failed US insurer, Destiny Health, back in 2007, Discovery did not lose its appetite for expansion. The company has differentiated itself with its marketing flair. It sometimes looks frivolous, as it did with the 3.6m coffee and smoothie vouchers given as rewards for physical activity in SA alone. But this gimmick has led to an increase in physical activity and, more to the point, 30% fewer lapses and claims from these smoothie slurpers. The model has prove...
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