Regulatory shifts bring risks and opportunities for brands and media owners
Because the compliance landscape is changing rapidly in the media, marketing and advertising sector, industry players need to understand how new legislation affects their interactions with consumers.
Acts relevant to the industry include the Consumer Protection Act (CPA), the Protection of Personal Information Act (Popi), the Cybercrimes & Cybersecurity Bill and the Liquor Products Amendment Bill. The last named is expected to be tabled in parliament later this year or during 2018. Mediamark MD Werner Lindemann says that, as a whole, these regulations have a significant impact on industry activity, both for brands and media companies, which is why industry players need to be aware of compliance issues.
The big take-out: Changing legislation means big changes for both media owners and brands – marketers need to understand the new legislation or they risk being charged with noncompliance.
The Cybercrimes & Cybersecurity Bill in its current form prohibits the use of data analytics software to collect, monitor or analyse data and use it for marketing or advertising, according to the Interactive Advertising Bureau (IAB). In addition, the bill poses an additional challenge to companies that collect data, in terms of evidence preservation and disclosure obligations.
According to Lindemann, legislation can even threaten revenue streams for media owners, in addition to creating business risks that require careful management. The current Alcohol Bill, he says, places further limits on how, when and where alcohol brands can advertise. “This equates to a possible R2.4bn risk of revenue loss for many publishers and broadcasters.”
Popi brings its own challenges, raising issues about how personal information is stored and secured. It also dictates procedures around how audiences are reached via text messaging, e-mail and direct marketing. “This means that once Popi comes into effect, there will be heavy fines for non-compliance,” he says, adding that companies will have to be extra vigilant about how they manage their e-mail and SMS databases.”
Ultimately, with legislation changing, brands and media owners need a new set of tactics, says Lindemann. For example, alcohol brands may need to look to more direct customer engagement as opposed to above-the-line campaigns so as to comply with new restrictions on advertising.
Mobile provides excellent opportunities to communicate with customers in a way that is both personalised and engaging, says Lindemann. Quoting World Wide Worx research, he says there are now more than 21m Internet users in SA, most of them on mobile. He predicts that data costs will fall in the near future and more people will have access to smartphones in SA. As such, mobile will continue to grow, as will video consumption on mobile devices – providing opportunities for native advertising and advertiser-funded programming.
And though Lindemann admits there may be a dip in revenue because of the loss in big campaigns, followers on social media, users on mobile apps as well as e-mail and SMS databases can be leveraged on behalf of clients to make up for it. These databases are particularly useful, says Lindemann, as Popi dictates that companies cannot contact people who are not existing customers, unless they have permission first. “To this end, brands will be happy to make use of media owners’ established audiences to reach new customers. Moreover, they will be better able to measure the success of their campaigns, tracking engagement and conversion rates because of the data media owners collect,” Lindemann says.
Importantly, Popi also touches on social media and other forms of electronic communication. “A consumer clicking ‘like’ or ‘follow’ does not give the advertiser permission to put messages on his timeline, particularly if they have a private profile,” cautions Lindemann. Added to this, marketers cannot process information regarding children unless granted permission by an adult (usually the parent) – even where the information is publicly available.
It’s a challenging environment, admits Lindemann. That said, integration remains key to maximising points of contact with consumers, as does co-ordinating radio, TV and digital campaigns and integrating the measurement of ROI and management of campaigns across various platforms.
“Consumers are bombarded with messaging. They’re also spending a lot more time on digital mediums, which makes a multichannel approach so important,” he stresses. Added pressure from regulatory compliance means that even more effort should be made by launching engaging and personalised strategies that resonate with consumers.