I was recently asked why black-owned ad agencies are so often excluded from requests for proposals (RFPs). It may add value to share some of these reasons publicly, to help buyers understand the challenges we face.
It is important to consider the context: according to the 2016 Nielsen AdEx survey, total advertising spend in SA was about R42bn. Less than 1% of this was spent on all the black-owned agencies combined. Black-owned agencies are competing only for the smaller projects and are not given opportunities to pitch for the big, well-paying jobs.
The department of trade & industry recently had to introduce a marketing, advertising and communication charter to compel the industry to transform, which is sad, considering our "new" democracy is already 24 years old. For example, a few months ago, JSE-listed MMI Holdings appointed three new advertising agencies, none of which was black-owned. When we contacted them to raise our concerns they simply dismissed them, with no commitment to change their ways. Our conversation with their group head of communications is on record.
The most common excuse for slow transformation is that black-owned agencies lack capacity. However, not even the likes of Ogilvy & Mather SA or FCB Africa would have sufficient capacity to service an account such as FNB, if they won it right now.
To do so, they would have to immediately hire more staff. The reason is that it makes no business or financial sense to sustain unutilised resources.
Pitching for tenders and large projects is also extremely costly. We are expected to present campaign ideas with an average of three concepts, without being paid for them, just to be considered.
In many instances our ideas are used later, though we are not awarded the work, which can be perceived as exploitation. No construction company will build a house for you before you have agreed to pay for it. Best practice determines that agencies should be judged by their credentials and by criteria such as relevant experience, case studies and a project plan. Considering our history, requirements such as 20 years' experience and turnover of R50m are unrealistic and unacceptable.
I quote the owner of another well-respected black-owned agency, who prefers to remain anonymous: "One of the biggest gatekeepers to the lack of transformation is pitch consultants. They are the ones who determine who gets invited to submit proposals. They use a scoring sheet . Even if a client specifically requested a black-owned agency, it is often blocked by pitch consultants' scoring calculations . Should a client insist on using a black-owned agency, it might be perceived as not following due diligence."
Most RFPs require substantial free creative elements, which again come at a notable cost. We have to utilise our resources at the expense of other, paying, jobs to stand a chance of winning another, higher-paying job. It recently cost us about R150,000 to compile one presentation for a big pitch - including senior resources and three weeks of work - and then we did not get the job. We therefore have to pitch selectively and subject to available resources. Bigger agencies do not have such limitations.
To create an award-winning campaign is expensive and requires substantial entry fees. Typically, smaller agencies would rather utilise their budgets on business development. Again, looking at the AdEx baseline of ad spend with black-owned agencies, it implies that only a handful of black-owned agencies enter because they get a disproportionate share of the available work.
We acknowledge that black-owned agencies must see things from a client's perspective. We cannot assume that we are automatically entitled to get business. We must have proven capability and a solid track record.
We are not asking companies to give us work just because we are black. We are simply asking for an equal chance - and acknowledgement that there are indeed black-owned and operated agencies that are able to play in the same space as the bigger agencies.
• Gosa is the founder and creative director of BWD Advertising..