Aspiration in South Africa – a growing crisis

2017-05-16 09:07


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After almost a decade of steady economic growth that saw millions of poor South Africans escape poverty and join the rapidly growing middle class, the 2008 financial crisis bruised more than just the economy. 

The decade since the country’s 2008 economic decline has thus far proven to be taxing on the aspirations of both the rich and the poor, leading to a 2016 study conducted by the University of Cape Town’s Unilever Institute of Strategic Marketing. The extensive 18-month examination of South African aspirations covered all income segments and aimed at providing marketers with a fresh window into the psyche of local consumers. 

A core finding across the board is that South Africans are experiencing a crisis of aspiration. The country’s socio-political climate has been a melting pot for frustration as hopes and dreams are not met, or delayed significantly, or remain tantalisingly out of reach. Evidence for the frustration is seen in everything from South Africa’s inordinately high rate of service delivery protests to the growing number of private schools and expanding entrepreneurial activities. 

In spite of the frustration, the Aspirations Report also comes as a timely reminder to marketers that, although budgets are tight, people continue to use their wallets to fund their dreams. The fundamental desire to move from a current state to a better state underpins many aspects of consumer behaviour. In a country like South Africa, the diversity of socio-economics plays another significant role in shaping the aspiration narrative into which marketers are so keen to tap. 

The Institute’s Aspirations Report investigated aspirations using a tri-component model summarised as ‘Do’, ‘Be’ and ‘Have’. This made it possible to consider the role of aspirations in ordinary people’s lives that embrace the relatively mundane desire for a new pair of shoes as well as the hope for a better education for their children. 

Up, down and stuck 

A number of themes permeate the findings of our research. Firstly, the impact of a stagnant economy and the simmering unemployment crisis cannot be overstated. Data from the National Income Dynamics Survey (NIDS) shows that 75% of earning South Africans are not moving out of their income bands (2008-2012). 

Equally poignant is that, of those who do show income mobility, the amount of people moving up is matched by those that move down. South Africa’s middle class is the most volatile group, with households moving into the Top End and others moving down into the so-called ‘missing middle’. The impact of this kind of financial stagnation plays a huge role in confidence and decision-making, and of course, in building frustration.

What it also means is that for many South African households, the frustration of having experienced a slightly better way of living and then having lost it is very real. Many households experience daily insecurity at the possibility of ‘falling back’. 

Looking for hope 

While most people have a fundamental desire for a job – or a better paying one – as a means to achieve other aspirations, the economy has turned many people’s attention towards the prospects of entrepreneurship. 

Nearly a quarter of South Africans said that their life would be better if they started their own business. Evidence for this phenomenon lies across the spectrum. In a case study from a low-income community in Cape Town, the Sustainable Livelihoods Foundation (SLF) found evidence of a 104% increase in micro-enterprises from 2011-2015. This significant increase in micro enterprises reflects a determination by many to ‘help themselves’, although about 61% of these are single person, subsistence enterprises. In an earlier Institute study called Connecting with Survivors’, the SLF estimated that the number of such enterprises probably exceeds one million.

Similarly, education proved to be a topic of some complexity, with many South Africans seeing education as a means to long-term achievement. Yet shocking research shows that almost half of all children who entered the school system in 2002 left before reaching matric in 2014. 

Sadly, even a matric certificate promises little hope of a secure career. University graduates, too, are without work as employment opportunities are relatively scarce. The linear route out of poverty that many millions of South Africans have benefitted from since 1994 has now been replaced by a far less certain future. While a move up the pyramid will happen for some, most will live a life of continuous uncertainty and financial instability. This applies to the poor, especially.

What people want?

The model of aspiration that we observed also moved away from traditional perceptions that people essentially just want more ‘stuff’. The tri-component (‘Be’-‘Do’-‘Have’) Aspirations Model encompasses a far more holistic and contemporary view of the desires that drive aspiration. 

In the research, for example, we found the desire for freedom and belonging to be strong themes. Classic desires to have more possesions and the experience greater degrees of comfortability were present, but not overwhelming. Other themes that presented strongly were  the desire for stability, health and wellbeing, experiences and respect. In spite of personal pressure, the desire to give back to family and the community was also a constant theme.

The ‘haves’ and ‘have-nots’

One observation from the study is that all of the identified themes were present across the full range of participants, regardless of race, gender and income group. When aggregating the thousands of pages of interview transcripts, it became clear that the ‘haves’ and ‘have-nots’ share many aspirations. 

There are, however nuances. For example, for one person a pair of new shoes might meet the need for comfort and material possessions, but for another it is more aligned with respect from peers. Similarly, freedom from burdens was a more prevalent theme among the poor, whereas independence was how the wealthier segments sought to experience freedom.    

Another nuance is in the articulation of these aspirations. While ‘stability’ is a shared aspiration, in more affluent homes this is expressed as ‘security’. 
Learning to stay positive 

Despite the setbacks, when asked about hopes, dreams and ambitions, most of the people that we interviewed had many aspirations for both the short and long-term. In fact, the NIDS survey of 28 000 people over four years found that, in spite of the economic stagnation, 62% of people – most in low income tiers – felt that they expected to move up the wealth ladder in the next two years, while 79% believed that the move would happen in the next five years. This unfailing positivity is a recurring theme in Institute studies in recent years.

While education, employment and entrepreneurship are seen as key gateways to a better future, debt is also a key aspirational role-player. South Africans use debt to fund their aspirations. While not always done responsibly, leverage still has a role in achieving dreams.

The role of debt, primarily unsecured loans, as enablers to a better state was a key insight. This study showed that for many South Africans, a loan is in fact the enabler to start a business, gain an education, buy a (second-hand) car, or buy or build a house. According to the Centre for Affordable Housing Finance, 44% of all registered properties are valued at under R300 000. This contextualises the value of an unsecured loan of say R100 000. When asked about a ‘world without debt’, respondents told us that ‘only the rich would have houses’.  

From the study, marketers are encouraged to approach the apparent crisis of aspiration with authenticity and empathy. Similarly, brands with honesty and purpose will tap into many aspirations that aimless brands will not. Marketers are encouraged to join consumers on their journey and to understand that individuals have constantly shifting aspiration and are making trade-offs all the time.

An issue that the study was not definitive on was the relevance of projecting deeply aspirational imagery as part of a brand’s promise, versus the depiction of reality. While the desire for a better life is a theme many brands embrace, the degree to which this is (even remotely) attainable requires careful consideration when crafting communication strategy.

- James Lappeman is head of projects at the UCT Unilever Institute of Strategic Marketing. Martin Neethling works with the Institute as a consultant.

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