The fast growing internet smartphone penetration in South Africa and the continent continues to create an insatiable demand for digital media content among consumers, writes Ray Mahlaka. Which is why founder and former CEO of Primedia, William Kirsh, recently launched Tritech Media
The fast growing internet smartphone penetration in South Africa and the continent continues to create an insatiable demand for digital media content among consumers.
Despite this, fewer players are tapping into this fertile market for opportunities.
In fact, more research is pointing to consumers accessing the internet through smartphones and tablets compared with desktop computers.
Recent figures from Informa Telecoms & Media support this view, with the number of smartphone connections in Africa set to rise from 79 million in 2012 to 418 million by 2018.
Also the growing availability of mobile broadband networks in the continent is supportive in the connectivity of consumers, paving the way for a strong investment case in digital media.
Up until recently, telecommunications networks have provided digital media services such as music and gaming as part of their offering, as data usage has over years consistently has trumped voice.
A new player in the market looks to be the disruptor in the market. Founder and former CEO of Primedia, William Kirsh, recently launched Tritech Media, which he says is the first fully-fledged media technology group in South Africa.
Tritech Media focuses on three aspects of media technology; digital media, customised content and proprietary technology to both consumers and corporates.
For consumers, Tritech Media offers customised digital media content through its subsidiary Opengate, as the exclusive distributor of iTunes and Google Play prepaid physical and digital vouchers in the country.
“In South Africa you don’t have many digital media customisation opportunities. That is why we believe that we are strategically well-positioned in this market because the market is not customisation friendly,” Kirsh says.
It also offers companies technology to run their customer loyalty programmes. This is in line with the number of food and clothing retailers and banks launching a deluge of loyalty programmes in a bid to drive consumers to stores.
Kirsh says many industry players spend a lot of money in hiring consultants and acquiring technology to run their loyalty programmes. Some of its clients across the group’s range of services include Pick n Pay, FNB, Standard Bank, Checkers, Edgars, MasterCard and more.
With the fragmentation of the media industry – with consumers being spoilt for choice – Kirsh says this dynamic is creating challenges for advertisers in reaching audiences.
“The traditional media world is all about broadcast and there is very little customisation … I recognised that the customer loyalty industry in South Africa was about to take off,” he says.
The US is considered as the most mature digital media customisation market, with the likes of Netflix and Pandora offering video and streaming services.
“People are shifting to digital media because they can choose now; as opposed to ‘if you miss it, you don’t see it’. The whole content side of media is going to gravitate to consumer customisation.”
In South Africa, Kirsh expects more companies playing in this space spurred by the demand from consumers. Mass media conglomerate Naspers through DStv is already playing the space with video-on-demand (VOD), which enables consumers to rent movies, drama series and reality shows.
Building scale
Tritech Media has been in the making for five years following Kirsh’s resignation in 2009 from Primedia which owns 702, Cape Talk, Highveld Stereo, Ster-Kinekor and other online and advertising businesses.
It is already reaching more than 30 million customers through its prepaid load network and loyalty programmes.
Tritech Media has already hit the ground running with acquisitions of a swathe of consumer digital content and loyalty businesses of an undisclosed amount. Its first acquisition was Amazing Vouchers which delivers freebies, discounts and two-for-one offers to consumers and corporates.
Other acquisitions include data analytics firm Eighty20; OnePoint, which enables consumers to view their loyalty points online; and Mygeni, a social media content marketing company.
It also incorporated marketing services group WOW Marketing and GameOn!, The Loyalty Box and Colony. More acquisitions are in the pipeline in the next three years, as Kirsh puts it: “We are already in discussions with some companies, but the market will definitely see more acquisition activity in our space.”
Its growth ambitions also include growing the prepaid load network business for the distribution of iTunes and Google Play vouchers to 4 000 retail stores from its current 1 500. Tritech Media is also growing corporate loyalty solutions from small businesses to larger enterprises.
“From these initiatives we expect to be substantially larger in two to three years’ time” Kirsh stresses.
This post was first published by Moneyweb and is republished here with permission.
