A draft bill seeking to ban – or at least strictly regulate – alcohol advertising still has not been made available for public input, leaving the alcohol marketing and media industries in limbo.
Cabinet approved the Control of Marketing of Alcoholic Beverages Bill on 18 September 2013. The next day, social development minister Bathabile Dlamini announced that it would be published in the Government Gazette immediately, but at the time of going to print in mid-December, there was still no sign of it.
Government has given no information about the bill or the delay in publishing it. The Media spoke to national health department spokesman Joe Maila, who said he could not fill in the gaps. He reiterated government’s stance that there is a clear correlation between alcohol abuse and alcohol advertising, adding, “The bill is designed to protect people from the harmful effect of alcohol. Children and young people can’t get into this kind of thing… We know for a fact that [alcohol] has a health impact.”
Maila would not say what the bill contains, or even whether it seeks to ban or merely regulate advertising. When asked his thoughts on the marketing and media industries’ claims that the bill would cause thousands of job losses, he said, “I don’t think so at all. But people have their own take on it and when it’s published, then people can make comment.” He also would not say why it was taking so long to publish the bill, or when it would appear in the Government Gazette.
Health minister Aaron Motsoaledi has identified alcohol as a serious social problem and a burden on public health, which his department is bent on tackling. The department follows guidelines laid out by the World Health Organisation (WHO) and aims to cut per capita alcohol consumption by 20% by 2020. The draft bill is just one of many measures proposed. Motsoaledi has taken aim at big alcohol companies, calling them “arrogant”, and has refused to meet with industry bodies, like the Association for Responsible Alcohol Use (ARA), or with its individual members. ARA represents ‘big booze’, including SAB, Distell and brandhouse, which together sell 90% of the country’s liquor, as well as retailers like Spar’s Tops. ARA and media industry bodies like Print and Digital Media South Africa (PDMSA) have been preparing responses to the draft bill, but this is difficult when there is little indication of what the bill will look like.
What there is to go on is a prior iteration of the bill leaked to the press in 2012. This draft was unrealistic and “absolutely draconian”, says media analyst Chris Moerdyk. It sought to ban all forms of alcohol branding, from wine bottle labels to signage and the logos on delivery trucks. Moerdyk says the lag in getting the bill published may mean that this harsh approach is being tempered. It is also rumoured that cabinet may have ordered an impact assessment to be done first. Maila would not confirm whether this was the case.
The stakes for the alcohol, marketing and media industries – as well as a host of other related sectors, like sports marketing and signage companies – are high. Moerdyk’s own research indicates a conservative estimate of
2 500 jobs, mostly low-income earners, would be lost, affecting 30 000 dependants, and that the loss of revenue could be R1.8 billion in above the line spend alone. A 2013 Econometrix report on the impact of the bill says that in 2012, alcohol advertising constituted 7% of all ad spend and that the alcohol industry is the seventh biggest advertiser.
Media owners are worried. Out of Home Media SA (OHMSA) head Les Holley says that his industry has made submissions to government on the bill, but they appear to be “falling on deaf ears”. He says the effects of a ban go way beyond outdoor proprietors. “Spending on out of home (OOH) by liquor companies is considerable and in many instances these companies use small OOH media owners. So the banning of alcohol advertising would have considerable impact on the industry, especially on the smaller players who have erected purpose-built units for their advertisers,” says Holley.
“The bill proposes the banning of advertising including on-premise signage and branded vehicles, which will have a huge effect not only on the OOH industry, but also the signage industry and will lead to job losses across the board and even closure of many of the smaller role players, not to mention many of the smaller flighting/billposting companies that will become unsustainable.”
Most affected of all media proprietors will be the SABC. “SABC TV has by far the largest share in above the line alcohol ad spend
(R515.2 million, or 28.4% of the total). If a total ban is imposed on alcoholic beverages adspend… SABC TV will stand to lose advertising income of over R500 million per annum,” says the Econometrix report. The SABC already has well-documented financial woes and such a huge loss in ad revenue would further compromise its ability to buy and commission quality programming.
ARA spokesman Michael Mabasa says marketers are scared that in an election year, the government’s attention will be diverted from the issue and they will have to wait even longer. But there are a host of finer points and apparent contradictions that need addressing urgently, he adds.
“We do most of our marketing on Facebook and Twitter now… And most of these conversations are not even initiated by us, but by our customers. They go to events and try one of our products and then tweet about it. How do you control that? The Champions League is sponsored by Heineken. Are we now going to ban Champions League games from being shown in SA because they might have Heineken banners next to the field? It will be very interesting to see how these contradictions are managed,” says Mabasa.
Motsoaledi said in October, “The arrogance I am getting from the alcohol industry is the same as I got from the tobacco industry, although I have never seen any evidence of anything good the tobacco industry has brought.” He was echoing an oft-made comparison with 2003’s tobacco ad ban. Moerdyk, however, says the two industries are “chalk and cheese”. For one thing, the alcohol industry is 10 times the size of the tobacco industry. Social acceptance and cultures of consumption of cigarettes and alcohol are entirely different. And while there is evidence that South Africans are smoking less than they did 10 years ago, Moerdyk says this is due to the fact that many smokers have turned to counterfeit cigarettes because government ‘sin taxes’ are so high. Government itself stands to lose out on tax revenue should alcohol marketing be banned.
Back in 2003, the media barely felt the loss of tobacco advertising because there was another player waiting in the wings – cellphone companies. However, the world economy has changed a great deal since then, says Mabasa. While cellphone companies did indeed step in to fill the breach, there is no sign of an equivalent industry on the horizon now. And, post-recession, companies are pulling spending on sponsorship. Says Mabasa, “Sponsorship is just very expensive and corporates are cutting costs that aren’t core to their business.” He points to Absa’s recent withdrawal from its sponsorship of Bafana Bafana. “The national soccer team’s other sponsor is SAB. So if the bill passes, sponsorship for Bafana will be pulled altogether.” And quite possibly there will be no one who can afford to step in this time, says Mabasa.
There is little evidence of a direct correlation between advertising and alcohol consumption, says Mabasa. Alcohol ad spend has grown over the past 10 years, but the number of drinkers has not, he says. He argues that alcohol advertising is not intended to increase consumption of liquor, but rather to woo consumers from one brand to another – to change to Mainstay, as the old ad had it. No one is arguing that the liquor industry needs regulation, Mabasa adds, but it should be trusted to regulate itself.
The Econometrix data, taken from WHO studies, suggests that a ban on booze ads actually wouldn’t do much to help alcoholism. South African adults are very abstemious: 73% of adults don’t drink and 65% have never had so much as a tot in their lives. The other 35% make up for it with enthusiasm, giving South Africa one of the highest per capita consumption figures in the world, but – and here’s the rub – only a very small percentage of those drinkers are consuming branded alcohol. There is a large illegal alcohol industry in South Africa that is not driven by advertising.
Ultimately, says Moerdyk, the bill is really just about government looking good for the World Health Organisation (WHO), which doesn’t mention banning alcohol advertising in its guidelines but rather “controlling” it. “[The draft bill] is all about our government being seen to be doing something. It’s all about votes. There’s no question that South Africa has an appalling alcohol problem and the WHO is putting pressure on countries like ours. But advertising is being used as a convenient scapegoat.”
Precedents from other countries, like Canada, Denmark and New Zealand, show that the impact of bans on advertising on alcohol abuse are negligible. These countries have all repealed similar bans, says Moerdyk.
Meanwhile, the media and marketing sectors are preparing for the worst, as much as they can with the little information they have to go on.
This story was first published in the January 2014 issue of The Media magazine.