Get a demo Do I subscribe? News sign-up
Print

LSMs 'not actionable information'

News, 06 October 2015

JOHANNESBURG: Many South African marketers don't properly understand the Living Standards Measure (LSM) segmentation and are using it incorrectly, according to a leading industry figure.

Peter du Toit, CEO of market insights agency Brands Laduma, told BizCommunity that "LSMs are not actionable information", or at least not as a standalone measure.

He felt that marketers found it easier to simply assume that LSMs were "an equivalent measure of income, race or even the willingness to spend", when in fact they needed to be combined with various other datasets – such as language or life stage – to create meaningful segmentations of South African consumers.

This, he suggested, was particularly true when trying to reach township consumers, who tend to be bracketed as "poor but aspirational". Du Toit pointed out, however, that aspiration in the townships doesn't differ from aspiration anywhere else in the country.

"Township residents aren't a demographic, and they are certainly not an LSM bracket," he said, so "just about any kind of 'spray and pray' media campaign aimed at township residents is an example of doing it wrong".

Making assumptions based on incomplete data often served only to alienate the target audience, he said. "It is only by having a conversation every day with people you are researching that you can reliably say that you know who they are".

He noted that it was becoming easier to reach township residents via digital channels as more and more people were using Android devices.

"Social media activation is definitely becoming more of a possibility," he said, "but we still think that understanding and using township networks is more important."

He explained that townships have extensive networks and links built around a variety of organisations and suggested that "companies should be reaching into township communities to be able to affect the decision-making and conversations about them right where they happen".

Data sourced from BizCommunity; additional content by Warc staff