Cover Story

Campaign billions and the poverty question

While the country basked in a euphoric glow created by billions of shillings being spent in a 60-day political campaign period analysts across professional divides have questioned the long term effects on business and the economy at large
BY AAMERA JIWAJI generational gains, the challenge is that the brand is anchored on the individual. Parties are able to create a very powerful brand during election periods but after the elections, they dump the political party and the brand becomes associated with the political party leader, said Sissey. Uhuru Kenyattas and Raila Odingas parties, for instance, dont have any meaning without them as leaders. Sissey draws a parallel with the business sector, where a company is associated with a strong CEO and instead of the company being the brand, the CEO is the brand. The business should be separate from you as the chairman or the CEO of the company so that if anything happens to you it does not hurt the business or the company. The branding should not be about the leader of the party; it should be about the party itself, he says. In terms of rebranding, the same principle applies to political parties and business although it is more common in politics with frequent party hopping. As a business, you are allowed to rebrand, but you are not allowed to rebrand every now and then, says Sissey. The multiple rebrands of the telecomm company Airtel (which moved from Kencell to Zain to Celtel), for instance, damaged brand consistency in the minds of Kenyan customers who still inadvertently use an old brand name to refer to Airtel. Sissey also attributes the creation of strong brand presence to a proven oratorship ability (Raila and Ruto, and further aeld Obama), and the emotive appeal of shared challenges (ICC proceedings for Kenyatta and Ruto). The core element in creating a successful brand, however, is the application of two concepts: stickiness and consistency. A successful brand, Sissey says, may be evaluated in relation to how far it has created a narrative that convincingly sticks in peoples memories and the consistent use of that narrative. You have to structure your message in a manner to increase memorability, and one of the most eective ways of increasing memory

or the rst time in Kenya, the exorcism of choice in selecting a political leader has become of paramount importance. The country has been ooded with below and above the line communication as aspirants aggressively woo voters through dierent leadership brands. While the short time frames and high stakes have added a sense of urgency to the campaigns, media and brand analysts concur that the 2013 political arena can oer lessons to Kenyan businesses on how to develop strong brands. Marvin Sissey, management and communications specialist at Marvin Sissey Consultants, acknowledges the sophisticated application of brand psychology to the 2013 elections and the creation of strong identities by some candidates. The three front runners in the presidential race, for instance, are riding on established family names (Kenyatta, Raila and Mudavadi). While this allows them to capitalise on
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CAMPAIGN SPENDING

March

Nairobi Business Monthly |

Cover Story

Hopes of economic gains from huge spending are illusory

BY DAVID WANJALA

of a brand is being consistent, he says. A political candidate like Raila Odinga, for instance, has built his messaging standpoint on the football analogy, such that a soccer narrative has come to be identied as Railas brand. Any other politician giving a narrative of soccer is seen as if he is copying or imitating Raila, because Raila has created his brand as a storyteller of the soccer narrative, Sissey says. His consistent use of the narrative in rallies has been picked up by the media, which has served to reinforce the stickiness of the message. This narrative has contributed to the emotional connection that Raila has developed with his followers such that he is referred to as Baba, says Dismas Mokua, Vice President of Sadiki East Africa who used to be on Prof Ole Kiyiapis campaign team. And so any action on his part is assumed to be in the best interests of the country. Any decision [of his] seems to be informed by our expectations as a people, says Mokua. Railas use of the football narrative - which resonates with the Kenyan public - Sissey says is an important learning point for Kenyan businesses, especially for international brands that
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enter the local market, because it localises the brand to the Kenyan consumer. Sakaja Johnson, Chairman of The National Alliance (TNA), describes this as brand ownership: the ability for people to own the brand such that they feel like part of the experience. Sissey refers to the example of South African brewer Castle who did not incorporate the local element in their Kenyan advertising and suered as a result, culminating in their rapid exit from the market. Similarly, the former KenCell had employed an elitist form of communication which the majority of Kenyans could not identify with. A company like Safaricom on the other hand, both Sissey and Mokua concur, adopts localised advertising through their use of sheng and local landscapes in their campaigns, and they create a narrative that can be easily remembered by the Kenyan audience. It feels Kenyan to be on Safaricom, Johnson says. Consistency of message is another key factor in brand development, and although

illions of shillings that have been pumped into the economy courtesy of campaigns for the General Election threaten to blight positive projections for 2013. While campaign spend by the three presidential candidates in 2007 totalled to Sh3.457 billion, the 2013 elections could represent a ve fold increase. Even more worrying for business circles and economic analysts is that this amount is being released into the economy in less than 60 days. This is apart from the budgets for County Representative, Parliamentary, Senatorial and Gubernatorial seat aspirants, where nearly 50% of expenditure is disbursed as cash handouts. Through a tight monetary policy which saw interest rates being hiked to 18% for the seven months from December 2011 to June 2012 and the injection of a a $600 million syndicated loan at the end of that period to safeguard the shilling, the Central Bank had attempted to control the runaway ination which besieged the market. Ination had hit 19.72% in November 2011 with the dollar hitting an all time high of 106 against the shilling in October the same year. Other measures employed by included mopping up excess liquidity through Term Auction Deposits and Repos (sale of secu-

the challenge in the political arena is the short term application and uidity of association between a candidate and a party, Sissey believes that TNA has successfully created a strong association with the colour red, which TNA party Chairman Johnson says was deliberately chosen to embody youth, vibrancy and energy. The Cord Alliance, in comparison, the foremost rival of the Jubilee Alliance, is not strongly associated with a particular colour although its primary party has capitalised on the colour orange and the ODM brand that was developed during the 2010 constitutional referendum.

CAMPAIGN SPENDING
Campaign spend during the 2007 General Election:
Mwai Kibaki - Party of National Unity - Sh2.1 billion Raila Odinga - Orange Democratic Movement - Sh1.2 billion Kalonzo Musyoka - ODM Kenya Sh157 million Total - Sh3.457 billion Source: Coalition for Accountable Political Finance

Mohamed Wehliye

Moses Waireri

rities with an agreement for the seller to buy them back at a later date), and directly selling US dollars to the market to curb end-month demand. By most accounts, their attempts were successful and in December 2012, ination stilled at 3.2%. However, their eorts may have been in vain for economic stability in 2013 in the face of vast sums of money that are being injected into the economy as political parties line up unprecedented war chests that boast billions of shillings. Opinion is however divided on the direct economic eect. According to Mr Moses Waireri, an actuarial scientist and head of research at Genghis Capital, economic fundamentals are unlikely to tilt solely on the account of political campaigns but the shilling will weaken against the dollar. Already the shilling is under intense pressure. It may have hit the 88mark against the dollar by end of February, said Mr Waireri mid last month. Mohamed Wehliye, Vice President at Riyad Bank, one of the largest nancial

institutions in the Middle East, sees it dierently. For him, the impact of campaign spending depends on the source of the money. The economic principle that correlates to campaign spending is opportunity cost: what one sacrices to achieve something else. In Kenya, we failed to pass the campaign nancing law and we therefore dont know where this money is coming from. The source of the money is key because only then can we know if the impact will be positive or negative, he argues. He says theres a school of thought that ascribes to the idea that campaign spending helps stimulate the economy, but stresses that for that to happen the money has to come from a less productive use. Buying campaign cars and adverts for example, is better for the economy than stashing your money in some overseas account or unproductive land. If this money was under the mattress or overseas or previously invested in unproductive land, spending it is positive for the economy, he says. He however, says that if the money is coming from a productive use or from individuals or corporate entities that would have used it for productive purposes, it will have negative ramications. Even when campaign spending does have a positive eect, it will still not help the economy much, Mr Wehliye concedes. Such gains would be illusory, since campaign donations reect shifts in consumption habits and nothing more.

What 2013 presidential candidates are spending on: Raila Odinga - Cord Alliance

Sh13 billion

4 helicopters 2 xed wing aircrafts 135 branded 4-wheel drive vehicles Campaign secretariat in Upper Hill

Uhuru Kenyatta - Jubilee Alliance

Sh10 billion

6 helicopters 4 10-seater xed wing planes 47 branded Land Rovers Undisclosed number of 4-wheel drive vehicles

Cost of hiring a helicopter for one hour

Sh150, 000 to Sh200,000

Johnson says that the colour red was deliberately chosen in relation to the target voter for TNA. 91% of the country is below 50 years; 86% is below the age of 40, he says, and since the youth are a a population group which is inherently aspirational, you must sell possibilities, opportunities. He continues that the same principle must be applied by businesses since they should begin by identifying their target population - often dened by age because of the common patterns that run through despite

small variances - and then understanding the audience. The evolution of party name, Johnson continues, was determined by a similar principle and so The National Party of Kenya was modied to The National Alliance which was further shortened to the acronym TNA, a popular application in modern branding practices (HFCK from Housing Finance of Kenya, DTB from Diamond Trust Bank). Uhuru Kenyatta, Mokua believes, has successfully managed a signicant coup in terms of

rebranding his individual identity since he has positioned himself as an ordinary person, as a man on the street despite the fact that he is probably richer than Mitt Romney. When you see him speaking with people, you do not see a rich man. Despite the fact that he was born in a castle and is a prince, he is able to position himself as an ordinary person, Mokua says. The juxtaposition of Uhurus two identities is perhaps subconsciously mirrored by the dual elements in TNAs slogan: two English words: I believe, with a Swahili word: Tunaweza.
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Cover Story

Marketing lessons from election campaigns

1. The Internet is changing the way we market
Whether youre marketing your candidate or your product on the internet, the basic idea is to promote specic key items by providing targeted content to a specic person.

2. The best brand always wins

Dismas Mokua Johnson Sakaja

Sissey also attributes the strong creation of political brands to the prevalence of social media, which nearly all of the presidential candidates have embraced to varying extents. While Peter Kenneth and Martha Karua are prominently associated with it since they actively interact with Kenyans on social media, as a party it is TNA that has promoted a digitally strong identity through the creation of a number of apps and their live streaming of campaign activities. Social media, Johnson says, has transitioned from a tool to enhance awareness and has become much more powerful since it can generate a larger customer base. The impact is so immense, he continues, that some businesses, for instance Rupu and Samsung, now use it as a primary means to communicate promotions and oers. What you create with social media, and business must get this, is a loyalty loop. The rst thing people do when looking for a product or information is search online. This means there is interest. When they walk into a supermarket or on voting day to the ballot, they remember that and they buy a television, for instance. In conventional marketing, it ends there but when you are creating a loyalty loop, it doesnt end there. You get their details and you keep engaging with them after they have bought the television, says Johnson. The same principle applies to engagement with a voter. 29.2 million people have mobile phones and 80% of households have access to the internet because most mobile phones are internet
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enabled, Johnson says, and while he accepts that this election many not be determined by the category of people who are online (the next election however will, he says), he is adamant that businesses must develop this culture and the best way to do it is through social media. While tactics such as these have helped Kenyan politicians to develop positive brand connotations and oer insight into brand creation for local businesses, Sissey says some political candidates have chosen to embrace negative brand associations through media heroics in order to enhance name recognition (Sonko and Waititu), and that this is something business brands need to be wary of. Waititu is a learned person, he has a degree but he has created a brand as a rogue. His brand is crude through the mechanism of grati: Waititu for Governor. It is a strong brand, yes people know him, but a negative one. In politics they say any publicity is good publicity, but that is not true for business. It is very easy to get negative publicity so as a business you need to take a lot of care to guard your reputation, he says. Other negative associations that abound in both the political arena and business circles relate to ethnicity. While business is dened by the bottom line, Johnson says many business brands - like political brands - are associated with a particular community because of ownership. The Mitsubishi brand, for instance, owned by Simba Colt translates to customer loyalty from a particular community. Nepotism in supplier relationships and hiring practices follow the same trend.

All brands are personal. The consumer takes them personally so they must be developed on a personal level by the marketer. In a political context, the product is the person/ candidate. In branding, it is brand positioning; in politics it is called spin. The whole political candidate package must convey a single brand concept. Any deviation from the brand image in the mind of voters will cause market (or election) loss.

3. The best defense is a good oence

Act with your marketing and dont react with it. If youre reacting, its already too late. Youve been beaten, The competition has gotten a message to your customers and the rest of the market before you did. If you reactively market, you are in eect reinforcing the competitions message.

4. All marketing is local

People only really care about what aects them directly. Too many times marketers macro market their business, and talk about services and features (or in politics, make promises), without answering the Number One questions which is Whats in it for me? If you can answer that one question, you will win every time. Adapted from Shotgun Concepts, 2004