Vodacom branding on the Ponte Building in Hilbrow, Johannesburg. Picture: GALLO IMAGES/FOTO24/FELIX DLANGAMANDLA
Vodacom branding on the Ponte Building in Hilbrow, Johannesburg. Picture: GALLO IMAGES/FOTO24/FELIX DLANGAMANDLA

Telecoms advertising in SA is again going through a pitch upheaval process, with MTN looking for new agency partners and Cell C on the cusp of changing agencies.

The FM understands Cell C has already made a decision to move its business from McCann1886, and that MTN hopes its pitch will be concluded in the next two to three months. Bedevilling the latter is the global Covid-19 lockdown, and it’s likely that this will be done remotely via video link.

The FM had a number of questions for MTN about its reasons for changing agencies and the new skills it’s looking for. The queries went unanswered. But it’s fair to say all local telecom advertising is undergoing a major shift in focus.

Notes veteran media planner Mike Nussey: "Telecom companies have been dealt a reality check and are not as arrogant as they once were. And they aren’t as cash flush. This has been driven in part by the focus on data costs by agencies of the SA government, which has caused a change in their thinking."

Nussey believes their advertising campaigns will have to deal specifically and honestly with the cost of data. In the past they have often been vague and confusing. In terms of the MTN pitch, the trade website MarkLives reports that MTN’s request for proposals covers all markets the company operates in, and all invitees are specifically global holding companies. MTN’s current local agency is TBWA\Hunt\Lascaris, part of the Omnicom Group, which has indicated it will participate in the pitch process.

As the process is unfolding, MTN has just been ranked Africa’s top telecom company by the brand research consultancy Brand Finance. Its latest survey values the brand at $3.3bn, boosted by "a solid overall performance for the year, despite challenging economic conditions and regulatory challenges in some markets".

Brand Finance says MTN has grown its subscriber level steadily over the past year and boosted its revenues. Customers spending more on data services and MTN’s 5G rollouts have meant the brand is well placed to cater to this growing demand. Says Brand Finance CEO David Haigh: "MTN is to be commended for its performance in its home market as well as further afield. It is increasingly recognised throughout Africa by customers as providing a high-quality service, because its brand image is deeply rooted in more than just marketing campaigns."

While that might be encouraging for MTN, the global telecom sector as a whole is on the back foot. Brand Finance says the brand value of the world’s biggest companies is set to lose an estimated $1-trillion as a result of the coronavirus outbreak, with the telecoms sector seeing less of an impact than the likes of the aviation sector.

Says Haigh: "The Covid-19 pandemic is now a major global health threat and its impact on global markets is very real. Worldwide, brands across every sector need to brace themselves for the coronavirus to hugely affect their business activities, supply chain and revenues in a way that eclipses the 2003 SARS outbreak. The effects will be felt well into 2021. The telecoms sector can be seen as much more resilient in the face of Covid-19, while it experiences a faster revolution in data handling as a result of the remote working revolution we are seeing all around the world. Telecoms brands are in essence already being pressure tested, having had an immediate spike in demand, and now is the time to engage with customers and promote their offerings during this crisis."

Verizon is now the world’s most valuable telecom company, with a brand value of $63.7bn, overtaking its US rival AT&T ($59.1bn).

Despite its 14% drop in brand value, Deutsche Telekom retains its place as the most valuable European telecoms brand. The fastest-growing brand is Vietnam Posts & Telecommunications Group, which recorded impressive 42% growth to $2.4bn.

Would you like to comment on this article or view other readers' comments?
Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.