Zibusiso Mkhwanazi employs the ‘strategic creative firepower’ he uses in advertising to help businesses innovate and survive the current crises.



Today, he is the Group CEO of M&amp;N Brands and co-founder of Avatar, but Zibusiso Mkhwanazi’s entrepreneurial journey started in primary school, when he would sell sweets to make transport money. The sugar rush was his first taste of entrepreneurship.



Later, in high school, during the holidays, he sold ice-cream in the sweltering streets of Johannesburg’s Central Business District, sometimes rewarding himself with KFC chicken at the end of a long day.



Somewhere along the way, he discovered a love for computers that would groom him to one day start his own website development business.



“My mom didn’t have the means to take me to varsity, so she gave me R2,000 ($118). I put it in the stock market and significantly turned it into about R14,000 ($820). I used that money to start my website business at a time when creativity was not implemented in the website industry,” says Mkhwanazi.



He also bought his first suit so he could attend meetings, printed his first company profile and started buying student website samples for about R2,000 and selling the designs to corporates for about seven times that amount. All of that enabled him to commence his business in 2001 when the internet was still new for most Africans.



“We saw a gap, the internet was growing, but ICT companies were designing horrible websites because they are not designers, but we knew people who could actually design and make something look really good,” he says.



He worked with big brands and that accelerated the growth. In 2006, the company merged with Krazyboyz, a digital solutions company present in Johannesburg and Cape Town.



In 2012, Mkhwanazi co-founded Avatar with business partner Veli Ngubane to move from web design to integrated marketing.



“We were just about ideas, whether for the web, the radio, TV or print; it was about ideas that solve human problems. We were building communication according to human truth and human insight, like how the consumer wants to be spoken to,” he emphasizes.



Mkhwanazi left Krazyboyz with nothing except a few customers and since then, Avatar has grown at over 100% every year according to him. In the first year, the company turned over about R1 million ($60,000) and today, is one of South Africa&#8217;s largest black-owned and managed advertising agencies.



Like most business affected by the coronavirus, Avatar has had its share of issues and has had to adapt.



“It is very important to be there for our clients in a time of need, so we try as much to accommodate them. What we did was pivot as a business and said ‘we have strategic creative firepower that we create advertising work with, what if we could use the same firepower to help companies innovate, because coronavirus means they have to change very quickly and all of that requires innovation’,” says Mkhwanazi.



As a business, he adds, that is what they do daily, solving problems in creative ways.



“Some companies are not built around innovation, we became their center of innovative thinking to help them rethink themselves and that is how we are helping many corporate companies survive the coronavirus under ‘the new normal’. The ultimate aim is to save as many jobs as possible,” he says.

Zibusiso Mkwanazi (left) and co-founder Veli Ngubane

From Selling Candy To Tasting Success

With Covid-19 emphasizing the human element in advertising, brands should re-evaluate their strategies and reframe their messaging to stay relevant. Saying nothing is wrong too, add experts.



“How do we respond to the biggest global conversation taking place?” asks Robert Grace, Founding Partner: Head Of Strategy, at M&amp;C Saatchi Abel, an integrated advertising agency with branches across Africa. “How are you actually going to match what you’re talking about with action?”



This is where advertising’s role becomes interesting, far from simply acting like a loudspeaker to products, or putting out mushy messages to engender brand loyalty.



How has marketing had to help brands pivot their messaging at this time?



The global pandemic is influencing every aspect of life. “I’ve never heard the word ‘unprecedented’ used so much. We’ve used so much hyperbolic language in this time,” says Grace.



From changing work cultures, to countries in lockdown facing economic crises, Covid-19 is impacting everyone in tangible ways. For agencies and by extension, brands, to pretend it’s not happening or go on with business as normal, reads as tone-deaf at best and disingenuous and ruthless at worst.



With that in mind, some brands have opted for silence, fearful of saying the wrong thing at the wrong time. “Saying the wrong thing is unforgivable – the consumer is smarter than they’ve ever been. You could have been in the right place but one wrong move could send you backwards,” explains Khuthala Gala-Holten, Managing Director at Joe Public in Johannesburg.



The risk of saying the wrong thing is paired with the risk of saying nothing at all. “Many brands have paused spending now, which is not the best thing to do, because people expect brands to play a role. 88% of consumers want brands to talk to them now,” says Shaun Frazao, Head of Digital at Wavemaker. The data backs this up – according to email service provider Everlytic, their March 2020 open rate was really high: 55.3 million unique opens.



Others that are still “talking” are dramatically pivoting on their marketing messages and communications.



“Whatever you say has to be authentic and not seen as a marketing opportunity,” explains Grace.



“There are some brands that should be going into quarantine over this period – don’t use this ‘opportunity’ to sell, rather use the time to refine your strategy. So that when you go back into the market, you demonstrate that you’ve understood what consumers will be wanting from your brand.”



Gala-Holten adds: “Strategy first – what are the guardrails? Sometimes clients have several agencies. So you really need to empower them with guardrails. This is now the ‘new normal’ – we will never be the same. From the creative perspective, in a way, it’s very exciting.”



Across sub-Saharan Africa, we’re seeing six key themes in communications and advertising, explains Frazao (see sidebar). “Consumer centricity needs to be first. Brands that are communicating now are looking long-term, to build trust, and not short-term at the sales they could make.”



Every agency interviewed for this article has seen a combination of two trends: contracts shrinking as businesses struggle to make money, and a shift to digital marketing. “The way business has been done will change in the advertising world. We have been moving gradually to a very focused marketing landscape, and this will be the tipping point to push them into that realm at a faster pace,” says Darren Leishman, CEO of Spitfire Inbound.



For digital agencies or agencies with digital service offerings, this shift has been less painful, but agencies with offerings like TV ads (that require crew and a studio to shoot in) and eventing (where large groups of people meet) are the hardest hit.



“People are spending more time online and media figures are reflecting higher views than normal for online ads. Clients are cutting spend in offline channels in favor of online ones. However, most brands remain very cautious with marketing spend in general at this time,” says Brian Carter, Executive Creative Director at Digitas Liquorice.



Clint Paterson, CEO at sport and entertainment agency Levergy, adds: “New behaviors and lifestyles will take root, but it’s critically important to remember, people’s passions won’t die. The role of the brand or event owner becomes one of adaption here, how can relationships be reinterpreted, reinvented and reimagined to generate the kind of connection with audiences appropriate to this new normality?”



Grace puts it another way: “Any cracks you had before Covid-19 will turn into gaping holes.”



Diana Springer, Partner: Head of Strategy for strategic consultancy Black &amp; White, adds marketing as a whole has become increasingly performance-based and goal-orientated. But in unforeseen times, “brands have to reframe what they’re measuring,” says Springer. “Otherwise, they can lose relevance. You have to change how you define success to shift your strategy. This pandemic is really making us consider the fundamentals.”



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‘6 Marketing Themes FOR This Time’



Shaun Frazao, Head of Digital at Wavemaker, advises six key pandemic-driven themes in marketing for Africa:



<ul class="wp-block-list"><li>Supporting the frontline workers</li><li>Repurposing production (instead of making products, brands are making products to help their consumer, such as South African Breweries donating alcohol to make hand-sanitizer)</li><li>Helping the vulnerable</li><li>Health messages (posters on social distancing, Pick n Pay’s message to avoid panic buying, and SA Tourism advising people to travel later)</li><li>Making staying at home easier (brands are trying to be empathetic by making staying at home easier, like Vumatel increasing internet speed for free)</li><li>Distributing positivity (Nandos’ latest ad is all about remaining positive, and Nike did something similar).</li></ul>







&#8211; Samantha Steele

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Why It Must All Ad Up

Nigeria’s advertising and media market is on the cusp of growth. Newly-affluent consumers, new products and communication channels abound but navigating them with a clear marketing and media strategy remains a major challenge. Two things that are not lacking though are enthusiasm and innovation within the Nigerian creative industry and it’s this nascent market that is the core of Dentsu Aegis’s long-term growth strategy.
Dentsu Aegis is a media agency that builds a communication channel between brands and the people who consume their products and services.
And the woman who is driving the company’s foray into the Nigerian market is Dawn Rowlands.
Rowlands took control of the group in 2010 as Chief Executive Officer and increased revenue and staff at the company by 200% within two years. Her key focus now is expanding the group’s reach into Africa with a focus on West Africa’s largest economy.
“The kind of opportunities offered to young creative people by markets like Nigeria is phenomenal,” says Rowlands.
“The South African market is not moving fast enough and consumers here are completely desensitized to the conversations that brands want to have with them. In Nigeria, the market is completely fresh. When banks cold call consumers in Nigeria, they actually want to hear what they have to say. The level of innovation that allows is great!
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“There is still a lot of work to be done in getting the quality of communication and content and that is a result of a lack of global exposure and competition. We can get in there and make a big difference,” she adds.
Rowlands’ career was built on pioneering new markets and what she calls “a relentless pursuit” of what she believed is right.
Born in South Africa’s capital Pretoria, Rowlands considered pursuing journalism as a career but was dissuaded by the lack of press freedom in South Africa in the early to mid-1980s. She pursued advertising instead and attended the AAA school of advertising and entered the industry as a creative.
“The industry was a great deal more fun than it is now. People spent more time on building relationships and we had more fun,” she says.
Rowlands’ first job was as a media assistant at a small agency after which she spent two years at media agency Bates Wells before moving on to its larger competitor Ogilvy &amp; Mather in 1991. Her goal was to become a media director by age 26 – a position traditionally occupied by middle-aged men in the early 1990s. True to type, Rowlands became the youngest female media director at Ogilvy.
“I am one of those people that when someone tells you can’t do something, I stick to my guns,” she says, crediting Yvonne Johnston, former International Marketing Council of South Africa and Ogilvy &amp; Mather Group Media Director as her mentor at the company.
Rowlands went independent three years later by founding the first strategy-only agency in South Africa with partners Peter Vogel and Jim Taylor.
“When you pioneer something, it’s hard for people to see your vision. And that’s ok. Having the conviction to go on is the most important,” she says.
The business went on to flourish and was sold to the Tempus Group in 1999 with Rowlands staying on in the company until 2002. She went on to found an agency operating the outdoor advertising space, which at that stage was a largely disorganized market capturing just 3% of total media spend. The business was sold to Aegis, ultimately leading Rowlands to her current position. She says that the agency has allowed her to exercise her entrepreneurial ambitions.
“As an entrepreneur, you want to work with like-minded people and Aegis is very entrepreneurially wired.”
Rowlands was named Business Woman of the Year in 2012 by the Businesswomen’s Association of South Africa; she received a global STEVIE award for Women in Business in 2012 and has served as a judge at Cannes Lions and the Cristal Media Festival Awards.
She lives in Cape Town and is a mother to two teenagers and has been married 16 years.
“My life is my work and my family. I have no hobbies and no time for myself.  My family and my work are everything to me,” she says.

Dawn-Rowlands-standing

‘I Stick To My Guns’

For entrepreneur, Oresti Patricios, it was a long and tiring climb to the top from the very bottom. He knew struggle. His father went bust when he was 16.
“My dad had a laundry business and when he went insolvent, I remember him trying to give his clients their clothes when the shop was being locked up by the authorities. Seeing the love he had for his customers and the pain he was going through because he couldn’t service them made me swear I would never be in that situation,” recalls Patricios.
It was so bad his mother had to go to work as a seamstress to put food on the table. Patricios even applied for a study loan just to make ends meet.
“My father taught me how to work hard and I learned a lot about business sitting around the dinner table with my Jewish friends and speaking about business,” he says.
It was 1978. While still at university, Patricios waited tables in his hometown of Johannesburg, and juggled odd jobs for extra money. His great-grandparents had moved to South Africa from Greece. Life didn’t promise to be the immigrants’ dream, until one day, a piece of good luck came along.
“My friend’s cousin had a camera he had bought for leisure. The three of us started using it for a wedding video business. As jobs and money came in, we started investing some money back into the business. Eventually we bought a top of the range camera and we tried to keep up with our competitors.”
They named the business Ornico – a mix of their names – and it grew to make corporate videos, where the big money was.
“Your network is your net worth. We used our network and began to have more and more clients,” says Patricios.
The other two partners left Ornico for new ventures. Patricios roped in his brother.
“At this time, the camera we were using broke. My dad cashed in his life insurance policy to pay for fixing the camera and to buy a new one. A friend got us a gig to freelance edit videos for another company. When we got there, I asked the managing director if we could also edit our videos there. He agreed and that month we made more money than we had ever made because we didn’t have to rent edit suites anymore.”
It meant the years between 1984 and 1988 were boom time. Patricios says they took their competitor’s clients rapidly. They also saw the hunger for information. Ornico grew into a media monitoring business and expanded into five divisions.
“The company was doing well. We had property, advertising, production, TV commercials and web development divisions in the Ornico Group.”
Money was pouring in. But, it didn’t last. A few years later, Patricios and Ornico hit rock bottom. He was thrown in that dark hole he swore he would never see. The same hole his father suffered in. He didn’t know it yet, but his past had returned to haunt him. It meant the worst day of his life. It sprang from his company’s books.
“I had hired my friend from university as an accountant. After a while of him managing my books, I had a gut feeling as the numbers were not feeling right. I found out he wasn’t giving me the right reports. He was giving me creative accounting. From a group perspective, it looked like we were doing well when in actual fact he was shifting expenses across the businesses. Some businesses were not doing as well as others but the books didn’t show that,” says Patricios.
The fear of running his business into the ground made him panic.
“I felt very frustrated with myself as I should have picked it up sooner but also felt I should have been a lot closer to the numbers. I panicked, as we were not sure how we would handle it. How do we provide funds to stabilize the business? Which business do we close? Which ones will be able to trade out of the mess?”
He politely asked the accountant to leave, who took a third of the staff with him.
“We had to close some of the businesses and retrench people. It was the hardest decision I have ever had to make. The most painful thing is that it wasn’t their error but mine,” he says.
It bruised his ego. In 1997, he sold Ornico and worked for the company that bought him out. It was four painful years.
“That was definitely the worst time of my life. Even my family life suffered as I was really very unhappy. My wife’s positivity could not pull me through some of those dark days. I did not believe that the company was moving in the right direction strategically, the reporting lines were blurred and as an entrepreneur I did not have the autonomy I needed. I felt I was powerless to make a difference, I felt hamstrung, frustrated and demotivated,” says Patricios.
Being an employee frustrated him. He had to get his company back.
“I needed autonomy and freedom. It was not the money that drove me. The best day was when we bought [the company] back at a lower price than I sold it into the listed organization. It showed that they had no clue about the business but now I could start again in a business I was very passionate about,” he says.
Today, from his sunny office in Sandton, the richest square mile of Africa, Patricios runs Ornico, the business he bought back. The media, advertising and brand intelligence company has departments in South Africa, Nigeria, Ghana and Kenya. He employs 200 people. Capitec Bank, Hollard Insurance, Old Mutual, Revlon, South African Breweries and Wimpy are among his customers.
After two decades, he hasn’t forgotten his worst day. He might have fallen into a hole but he climbed out fitter, stronger and wiser.

Beware The Dark Pit And A Haunting Past

After a degree at the University of Cape Town, she lived in London for five years, starting her career in digital advertising, but didn’t find it too glamorous, so returned to South Africa, and with a little help from “a family member” (who she has to repay in five years), bought the Bloss &amp; Co business in 2014, turning entrepreneur at 30 and building it up.
Her “affordable luxury handbags” are available in tony boutiques in Parkhurst and Dainfern. They are also at her Parktown North showroom, and their USP, she says, is personalized service, the cappuccino and warm environment.
A company of three employees, including two other partners, they source the leather and metalware from markets in China. Going forward, there are plans afoot to manufacture in South Africa and collaborate with local talent, as they did most recently with South African botanical artist Kelly Higgs, who designed beach bags for them, showcasing South African fauna and flora.
Blackie’s structured posh totes in bright colors are the most sought-after.
“Our vision is bright colors and versatility – a backpack that can be used as a clutch and sling bag; a clutch that also turns into a cross-body bag. What we have found is that the SA market does not follow what happens in the catwalks of London and Paris. It comes down to practicality… They are bags that look luxurious but don’t cost R50,000 ($3,120).” A genuine leather Bloss &amp; Co bag would only set you back R2,499 ($156), so it’s worth a look.
Blackie married a commodities trader in December last year, but she has a busy year planned: to roll out a luxury range in Lagos, and a “sophisticated” Afro-chic line in London.

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The Millennials

It does not matter how amazing your business is, as long as customers don’t know about it, it is as good as a diamond buried deep under the earth.
Technology has led to radical changes in the market; traditional advertising is dying out, and the media companies’ revenue from this is declining. Yet, despite not investing much in advertising, the exposure of companies is at an all-time high.
Are we caught in a middle of a market evolution? Everyone is trying to predict what is going to happen. Reports by the likes of the World Economic Forum, McKinsey &amp; Company and PricewaterhouseCoopers are springing up everywhere. Some are correct, others are dismally wrong.
If you are an entrepreneur in Africa with a fervent drive to conquer a particular industry, whether or not you have a budget for advertising, you need to explore the most effective strategies to market yourself in a world where you can end up drowning amid the plethora of ads and messages in the media. It’s a mad show out there, all you have to do is take a walk along the street or browse the internet to realize this.
Let’s look at some of the effective ways to convert prospective customers to actual clients.
There is a model that many entrepreneurs don’t know about – the freemium model – which is one step below the paid for premium model. Freemium is where you offer your products and services for free and then make money on the other end. Facebook’s monetization strategy is selling advertising to other companies, on the back of the popularity of their service. Bear in mind that the high usage of their service is down to it being free.
Chinese ecommerce company, Alibaba, did the same thing to kill eBay when the American company tried to enter the Asian market half a decade ago. They invited eBay to follow their free model, knowing that the listed company’s shareholders would persecute its senior executives if it did so. Alibaba is now the king of the Asian ecommerce market, while eBay fizzled out.
You need to be creative to stretch a dollar in today’s economy, whether your company is big or small.
Referral is one of the most effective marketing tools for your business. It’s a form of trust transferred by another source you know and respect. Uber has used this method well. The taxi company offers free rides to their existing customers when they refer Uber. In this case, an incentive rewards existing customers for finding new customers.
There are products that go viral without monetary incentive. WhatsApp is the best example in this case. Existing customers were pushing the product themselves because they wanted to use WhatsApp to message everyone else in their phonebook. It helps that WhatsApp is cost effective as well.
Offering your product for potential customers to use over a trial period has been popular in recent years. Most anti-virus and software companies use this as a marketing strategy. It is not a new concept though. William, a young salesman in the 1930s, worked for a company that sold home appliances. He walked from door to door, allowing people to use particular products until he returned to collect them a week or so later. More often than not, when he returned, the majority of those people discovered that the items were useful and refused to give it back. They chose to pay him for the item instead. It led to him becoming the number one salesman in his company.
Some say print media advertising revenues are going down because many marketing campaigns are online. That cannot be the entire reason, only 9.8% of Africans are internet users.
Then internet is not the only answer to marketing these days. Many companies collaborate to leverage each other’s client base. Insurance, retail and healthcare based companies are good at this. Partner with a company that opens your business to hundreds, thousands, and even millions of clients; it could save you piles of money that would usually be spent on ineffective campaigns.

The Art Of The  War

Susan Napier’s sprawling office in Johannesburg is every inch the colorful and creative space it should be, with a large wooden desk, a collage of photographs, mostly of her two young daughters, and a balcony that boasts a panoramic view of the Wanderers Golf Club. In a white lace dress, this 41-year-old Marketing Director of Ireland/Davenport, one of South Africa’s biggest advertising agencies within the global WPP network, fits seamlessly into this setting. It’s easy to see she is in love: with her family and this job that is her world.
“I consider myself to be ridiculously fortunate,” says Napier. Growing up in Durban, she was taught the importance of values, ethics and hard work.
“Advertising is not for the faint-hearted. You need to have a tough skin…You have to have that ability to manage a million balls at the same time.” Ireland/Davenport works with high-profile brands such as BMW, Investec and Brand South Africa. Napier lets us peek into her world:
<img loading="lazy" decoding="async" class="size-medium wp-image-29910 alignleft" src="http://www.forbesafrica.com/app/uploads/2015/02/IMG_0953-227x300.jpg" alt="" width="227" height="300" srcset="https://cms.forbesafrica.com/wp-content/uploads/2015/02/IMG_0953-227x300.jpg 227w, https://cms.forbesafrica.com/wp-content/uploads/2015/02/IMG_0953-300x397.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2015/02/IMG_0953-600x795.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2015/02/IMG_0953.jpg 768w" sizes="auto, (max-width: 227px) 100vw, 227px" />
What thoughts have occupied your mind today?
We are in a strategic phase at Ireland/Davenport at the moment – it’s our 10th year of a business and while we have been incredibly fortunate to enjoy some wonderful success over the past decade, we want the next 10 years to be even more successful. So my thoughts are currently occupied with defining goals and objectives for the business for the immediate year ahead which will feed into a long-term strategy for the company. One that I hope will ensure Ireland/Davenport remains relevant, fresh and insightful both to our current and future clients. It’s all about future-proofing the agency and continuing to build on the solid foundations that have been laid over the past decade.
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What would utopia be to you?
Finding the ever-elusive balance between my work and my personal life, where I am completely fulfilled as a working woman and in myself, while having the quality time with my beautiful daughters and husband.
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Are women more creative than men?
Not at all! Creativity is innate and it manifests in so many different ways. I do however think women are more intuitive in general though which I believe does contribute enormously to exploring the many facets of creativity.
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Your most lavish holiday?
Benguerra Island in Mozambique in 2008 [for my honeymoon]; total luxury and privacy, magnificent food and the man I love.
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What do you fear?
Dying young and not being able to watch and help bring up my children.
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If you were given only one day to live, what would you do?
Without doubt I would spend it with my husband and children. The day would be simple, but we would eat the best food, drink the perfect wine, truly talk to one another and we would love&#8230;a lot!

Lucky And In Love

Digital media is poised for growth in 2015 as the industry consolidates its advertising market share.
According to the PricewaterhouseCoopers (PwC) report, South African Entertainment And Media Outlook: 2015-2018, digital revenue from advertising will hit 33% by 2018 from 14% in 2009. The report also posits that by 2018, internet advertising will overtake television as the largest segment.
Digital analyst Gerhard Muller says the online space is a medium no marketer can ignore, as even the lowest income markets and most remote places in Africa are connected.
“African digital marketers used to replicate strategies and techniques from Europe and the United States, however, it is now incredibly exciting to see African digital solutions and strategies emerge with some of the most original and exciting executions, often internationally acclaimed and recognized,” says Muller.
Going forward, all digital marketers will need to embrace a mobile-first approach to any solution. An online presence is non-negotiable.
“With millions of devices, touch-screens and computer keyboards in our country it has become harder and harder to find the people you want to talk to. Brands should therefore put effort into strategically utilizing the latest tech tools and methods to target accurately. Not only for the sake of being heard but more importantly, being relevant. To me, honest and relevant is what cuts through clutter,” he says.
Take South African banks for example. First National Bank (FNB) is regarded a pioneer not only in online marketing but for their digital offerings too.
“Internet and app banking have become a quintessential part of this brand and not just an additional service they serve on the side,” says Muller.
Another example he offers is of Heineken, and the remarkable work done in the social media space that’s relevant and well thought out. The main drivers of this kind of success are talented people, bold choices and the guts to pioneer something incredible no other brand has done before. The opportunities and technology are there for us to use, so often, it’s a matter of looking, giving some thought and connecting the dots.
Companies are working towards a more collaborative approach to all media, and print, radio, TV and online need to work together to meet marketing objectives.
“This synergy is important and it’s great to see how TV needs online support or how online needs radio. We consider all these mediums as our essential tools in the box of tricks that we use together to create advertising magic,” offers Muller.
Clearly, gone are the days when digital was an add-on towards the end of a great advertising concept. Quartz.com says it’s time to wake-up and make 2015 the year of radical – and concerted – solutions.

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Internet And Tech: Dot The I’s And  Cross The T’s

It’s mid-September, and Volkswagen of America has a problem: It won’t have any new models coming out until the spring. Keeping VW front and ­center in consumers’ minds has drawn a group of marketing folks from the automaker and two of its ad agencies to Google’s BrandLab at its YouTube headquarters south of San Francisco. Dedicated to “evangelizing the art and science of brand-building,” the richly appointed meeting space is basically a man cave for ad creatives, complete with overstuffed couches, booze and the mother of all big screens, an assemblage of 32 flat-panel displays massed into 300 square feet of video overload.
In one corner of the BrandLab, Google’s Jeff Rozic goes to work running VW’s folks through a rapid-fire succession of video ad campaigns the BrandLab feels have worked. His earnest delivery is well-honed, courtesy of 100-plus similar “private workshops” held for potential advertisers from Coca-Cola to Toyota over the past year. VW has some catching up to do, a point Rozic makes intentionally or not by highlighting 13 travel vignettes produced by a rival, Nissan Mexico. His larger point: Don’t clutter a story with too blatant a call to action. “We shouldn’t apologize for trying to sell cars,” one VW exec protests. “Sure,” Rozic shoots back, “but you have to be careful to distinguish when you’re telling a story and when you’re selling.”
Fair point. Rozic is clearly selling—and it’s a product intended to change Google’s path. The king of the click is now lecturing one of the world’s most accomplished advertisers to forget those clicks and amp up the image ads. CEO Larry Page can go on as much as he wants about self-driving cars, wearable computers or any of the company’s other “moon shots.” But Google fundamentally remains the most disruptive advertising company of the past half-century. As its total advertising-revenue growth rate has halved in the past two years, from 29% to 15% (thanks in part to Facebook and Twitter), it’s now charging full-bore toward the biggest pot of advertising gold it doesn’t own: brand advertising, the image ads you see in glossy magazines and on television.
Most online ads—the banners that litter nearly every commercial website and, most notably, Google’s search ads—have failed to help marketers move the needle on classic advertising measures like brand awareness and intent to purchase. ­Instead, they mainly drive people to a product page to click the buy button. ­Direct marketing is lucrative: Search is still upwards of 60% of Google’s ad revenue, helping it earn an estimated 15.8% net margin in 2013—but image ads will come to dominate digital advertising in this decade.
Look at the numbers: Digital brand advertising is an $18 billion market this year, according to eMarketer. Its forecast implies that number will double by 2018, at which point it will have passed search and direct marketing, with plenty of room to grow.
Television advertising, comprising almost entirely image ads, is currently a $200 billion global market. And it’s a vulnerable one, as the medium’s iron grip on the bulk of ad spending looks a little less firm as younger people scatter to YouTube and Netflix when they aren’t Snapchatting or Instagramming on iPhones or skipping ads entirely on their DVRs. Some 75% of respondents to an Interactive Advertising Bureau poll of 5,000 ad execs expect to see some spending move from TV to digital video in the next year.
This explains the man cave. YouTube remains one of the greatest acquisitions of the Internet era. Larry and Sergey paid $1.65 billion in 2006 for a business that today would conservatively be worth $20 billion as a stand-alone. So what’s another $400 million or so to build out a brand ad business?
The return has been fairly quick: In October Publicis’ MediaVest, the ad agency for Coca-Cola, Honda and other big advertisers, inked a deal to spend tens of millions of dollars over the next year on Google video, display and mobile ads. It was Google’s first agreement with such an online partner to buy ads in advance, as agencies and marketers do on television. In November Publicis agencies DigitasLBi and Razorfish went bigger, committing to spend $100 million on YouTube and Google’s banner and mobile ad networks this year. “Google is one of the few players with a platform big and wide enough to attract these dollars,” says Razorfish CEO Pete Stein.
And Google sources insist that more of these “upfront” deals will be announced shortly, which has investors—who have driven the stock to a recent alltime high of over $1,150—feeling bullish. Tim Ghriskey, chief investment officer at the asset management firm Solaris Group, a Google investor, figures the company could capture about 6% of TV ad spending by 2020, or $20 billion a year. Given that Google’s total revenue this year will come in at around $60 billion, this is the growth the company needs to continue its dominance.
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Susan Wojcicki was Google’s 16th hire. Marissa Mayer came a few hires later, yet it was Mayer, now Yahoo’s CEO, who became the flashy female face of Google. No matter. Wojcicki (pronounced wo-JIT-ski), the senior vice president in charge of all Google ad products, plays the anti-Marissa. She favors jeans and hoodies around the office, displaying a self-deprecating plainness that one former employee says is reminiscent of Chance the gardener from the movie Being There. “She never felt she needed to be the smartest person in the room,” says another ex-colleague.
Instead, she’s become the most powerful person—male or female—in advertising. She manages effectively without drama and thus has been Page’s go-to exec for wins such as the introduction of AdSense, which pays other sites to run Google ads (now a $13 billion business), and the acquisitions of DoubleClick, an ad-serving pioneer, and YouTube. “She only works on big problems, not small ones,” says ShareThis CEO Kurt Abrahamson, who worked for her a decade ago.
Her vision of the future of advertising (and hence Google)? Since content is flowing across so many digital devices—a trend Google is trying to accelerate with such initiatives as its Chromecast device for streaming online video to TVs and its flurry of Android smartphones and tablets—she sees nearly all advertising eventually going digital, too, putting it squarely in Google’s wheelhouse.
“Advertisers will have to go where the users go,” says Wojcicki, sitting outside her office at the Googleplex, sipping a “detox” lemonade with maple syrup and a dash of cayenne. “A big chunk of dollars will follow.”
Wojcicki envisions an operating system for advertising that can connect search, display, YouTube and branded content, and bundle it all up into campaigns that span computers, smartphones, tablets, connected TVs and—who knows?—maybe Google Glass. Some marketers are moving quickly in that direction. For the recent launch of its D Rose 4 sneakers, Adidas ran ads on YouTube and the Google Display Network, a partnership of some 2 million sites, backed up by mobile ads for a second-screen experience and search ads to catch those who want to buy them right away.
For some time Wojcicki has talked about the “perfect ad,” the one that people see at precisely the time they want to know about a product or are ready to buy it. Search ads now approach that ideal for direct sales, but Wojcicki pictures image ads, supplemented by data on personal preferences and behavior, that can plant the seed for brand or product preference just as well. It’s an advertising axiom that people are more receptive to messages when they’re leaning back on the couch watching TV than when engaged in online activities. Wojcicki contends the potential is for just the opposite. “If users are engaging with something, they’re choosing to see it,” she says, and Google can use that overt choice to serve even more relevant ads.
So how would a Web display ad—largely, the vilified banner—engage?
Upstairs at Google’s display-ad headquarters off the main campus in Mountain View, Calif. scrawled equations blanket a wall-size whiteboard. The equations are a scrap of the impossibly complex mathematical formulas that power its $12.5 billion display network business. “They turn into beautiful rich-media ads,” Neal Mohan, Google’s vice president of display advertising, explains dreamily as we walk by.
When Larry Page took over as CEO in 2011, he told Mohan to “revolutionize” display ads so they’re just as useful as Google’s obscenely profitable search ads. Mohan, a veteran of pre-Google DoubleClick, is a true believer. (With a reported $100 million in stock grants to keep the likes of Facebook and Twitter at bay, he isn’t driven by the need for more money.) He has bought or built what even rivals concede is the broadest set of software needed by advertisers and publishers to sell and place ads, including a state-of-the-art ad exchange that sells space as fluidly as the Nasdaq sells stock.
Mohan, who likes to decry the 40% of “spray and pray” TV advertising he says is wasted on indifferent audiences, offers a vision of the future in which Google can marry its data about individual consumers with the reach of TV and measure the results, too.
Google can generate that reach with its display network, which ­ranges from tiny outfits to the New York Times and USA Today. It serves ads on those websites for a cut of revenue. (Tellingly, even NBC partakes, though Google has put a big, fat target on its back.) The network ­reaches 90% of the Web’s population and serves impressions to a billion people worldwide a month. It was tough sledding early on, as ads began showing up on dodgy niche sites, but an ongoing cleanup campaign has big brand advertisers increasingly interested. The number of advertisers booking space months ahead—an option chiefly used by big marketers looking to influence brand consideration—has quadrupled from a year ago, but Google isn’t offering specifics.
Still, the banner ads have been losing out to “native” ads, which use content rather than a boring banner to attract people’s attention. “Facebook is a bigger bet for us right now than YouTube,” says Laurent Fa­racci, the U.S. chief marketing officer for Reckitt Benckiser, owner of brands such as Lysol and Clearasil. Instead, Mohan has bet on rich “engagement ads” for the display network. For instance, one might expand to play videos, games or apps when hovered over for two seconds. Samsung recently ran millions of them to play a live video stream of a new smartphone and smartwatch. In June Burberry ran display and mobile ads through Google that prompted people to snap a photo of their own puckered-up lips and send the digital imprint of the kiss to a loved one.
They’re starting to work. Now used in about 1,000 campaigns daily, engagement ads command around double the price of standard banners, which vary wildly but average around $3 per thousand viewers reached. That’s partly because advertisers can choose not to pay unless someone actually views those ads—like those who pay for clicks rather than views in the banner world—so they’re more valuable. Still, branding remains a challenge for a company whose success so far derives from cold mathematics. Back at the BrandLab, there’s an elegant arrangement of two dozen digital photo frames mounted on a pedestal, all playing videos of flames. “Great stories are told around the campfire,” a Google project manager explains. Cute. Except this campfire gives off no heat. For that, Google needs some of the sizzle of Hollywood.
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The warren of studios and soundstages southwest of Hollywood is strewn with cameras, lights, toolboxes and half-empty coffee cups. One stage features stock horror-movie sets, like the hotel hall from The Shining. In another studio, three women, one of them with scissors in hand, are preparing to film a video on how to cut your own bangs. Once a hangar where Hughes Aircraft built the Spruce Goose in the 1940s, this 41,000-square-foot building is now YouTube Space LA, possibly the world’s largest production facility dedicated to online video.
It’s YouTube’s latest bid to shed its dog-on-a-skateboard-video image and make the site a cleaner, more well-lit place for big TV marketers. That bid began a couple of years ago with YouTube’s $300 million drive to create some 200 TV-like channels from the likes of Shaquille O’Neal and Amy Poehler. While they don’t have TV networks quaking just yet, YouTube has been able to command higher ad prices closer to those of TV than Web display ads. YouTube gross ad revenue jumped 51% in 2013 to $5.6 billion, netting $2 billion after payments to content and ad partners, according to eMarketer.
Here’s the funny thing, though: It turns out that some of the most popular channels are not network wannabes. They’re from producers such as PewDiePie and Jenna Marbles, invisible to those over 30. Likewise, some of the most popular ads on YouTube don’t even look like the TV ads that Google has hoped to capture. It’s dawning on big marketers from American Express to General Electric that to take advantage of the social and interactive nature of online they need to forge a new sensibility, not simply rerun TV commercials.
In a new take on its long-running Campaign for Real Beauty, for instance, Dove launched a video on YouTube in April that featured an FBI-trained forensic artist sketching two portraits of women. One was based on their own descriptions and another on a stranger’s, which produced more attractive images. By May the Unilever brand’s touching three-minute video had drawn more than 114 million views worldwide, becoming the most-viewed online video ad ever. “It’s not just 30-second ads,” says Jamie Byrne, YouTube’s director of content strategy. “It’s creating something that people want to engage with and share with friends.”
So now it’s up to Byrne, whose previous job was head of YouTube’s original programming push, to make it easy for big brands to reach YouTube’s 1 billion monthly viewers.
Similar to Rozic’s ad-campaign boot camps in the BrandLab, Byrne brings companies such as PepsiCo and Johnson &amp; Johnson to YouTube LA for a four-day workshop on creating compelling stories, videos and YouTube channels. He’s aiming to get more than 100 advertisers into the program this year, both at YouTube LA and in a new combo studio and BrandLab being built in New York.
If Byrne has his way, the new world of brand marketing online will look a lot like a shoot at an unassuming neo-eclectic house in Anaheim Hills, 45 minutes southeast of Los Angeles. In the living room a crew of six is filming the sixth episode of Grace’s Faces, on Bobbi Brown Cosmetics’ I love makeup channel on YouTube. It features Grace Helbig, a 28-year-old YouTube star whose own self-produced channel, Daily Grace, draws more than 2 million subscribers to her wacky takes on life. For this new show, Helbig shows up at the doors of fellow YouTube stars to do a makeover.
Her subject this day is Rebecca Black, the 16-year-old who became an instant star in early 2011 for her self-produced monotonous pop hit, “Friday,” that year’s most-watched video on YouTube. Marc Reagan, manager of artistry at Bobbi Brown, is showing Black how to apply various kinds of makeup. Dull barks from a dog banished to the garage only add to the authenticity, apparently. Helbig jumps into the frame, bubbling with a whiff of irony, “You look like an angel!” For a companion show, Touching Your Stuff, Helbig prowls the house rifling through personal effects. “In this medium you can get your Idol moment without paying $20 million,” says Reza Izad, whose Collective Digital Studio produces I love makeup and more than 200 other channels, such as the Annoying Orange—a piece of talking citrus that heckles other fruit until they get sliced with a knife.
It’s all pretty nutty, but there’s nothing amateur about Grace’s Faces. Or even overtly commercial. Bobbi Brown isn’t mentioned anywhere in Grace’s Faces despite the use of its cosmetics. Still, the company says it’s happy with the 300,000 views the channel got the first week and the 70,000 channel subscriptions it drew in the next two weeks. “We felt like comedic programming would be in line with our brand personality and would resonate with a younger audience,” says Bobbi Brown President Maureen Case. Marketers don’t pay YouTube to run the shows, but they do pay to run lots of ads to drive people to watch them.
Google will ultimately win this race for a simple reason: Video ads perform better than TV spots, says David Cohen, Universal McCann’s chief investment officer, based on multiple studies his agency has done. “But TV advertising is a frictionless system,” he adds, “a well-oiled machine.” Google can play around with Larry Page’s moon shots, one of which might eventually land, but what will pay for those flights of fancy? Making digital display just as free of friction, something Google knows how to do. It’s just a matter of time.

Google Wants It All

Out-of-home advertising, such as billboards, is big business worldwide and is growing each day. The figure sits at $26.4 billion—an increase of 8.3%—in 2011 alone. Pinto saw a gap in the market when he watched thousands of unbranded delivery trucks sitting in traffic: why not use their perfectly unmarked platforms as a moving billboard?
Most trucks have Global Positioning Systems (GPS) that track their routes and location, which is the perfect tool for targeting local and national consumers.
“We have GPS units in all our advertising trucks so we know where they are at any time. Every month we produce an operational report that provides details of all the travel times of the advertisement on the truck.”
Pinto said that the advantage of this medium is that companies can choose which areas they wish to target such as the East Rand specifically or a road such as the M1 between Johannesburg and Pretoria or the whole city. Advertisers can choose the area they want to target and later move the same signage to another area, which allows them to monitor any change in consumer behavior. He points out that South African retailer Woolworths has taken advantage of their national distribution to brand themselves.
In South Africa, billboards dominate the outdoor advertising landscape. Primedia Outdoor, a leading South African media group, owns 15,000 advertising panels across the country and claims that motorists and commuters spend around 30-45 minutes daily, in weekday traffic and weekly peak hour traffic volume is as high as 277,726 commuters. This is a large market.
Pinto researched the outdoor advertising market in countries such as the United States and the United Kingdom and discovered a gap for the African advertising landscape.
Securing the rights to prime spots for billboard advertising is expensive. But trucks on the road are already using the routes and he believes that commuters will be drawn to an eye-catching billboard on the move.
“We have a large, varied fleet available, so whether the customer needs a print space of six meters wide or 15 meters wide we have three different size options for them to choose from,” he says.
“They are billboards without a fixed steel infrastructure and are very cost effective at about a third of the traditional cost of fixed billboard advertising,” says Pinto.
While street pole advertising can also be effective, Pinto said that it is becoming another piece of “street furniture” that is severely cluttered.
The concept doesn’t add to a carbon footprint as the trucks he uses are already on the road for commercial carriers.
“Given that trucks are already on the move, one may as well make use of them. They go everywhere,” he says.
He lists the advantages of truck-side advertising after conducting market research:
<ul>
<li>85% more reach and 20% more frequency than conventional media</li>
<li>91% of people report that they notice fleet branding</li>
<li>52% successfully record the adverts</li>
</ul>
Although the business is just getting off the ground—it was launched on September 1—advertising agencies have expressed interest and he has signed a number of business agreements with them and trucking logistics companies. For the trucking companies, it is another source of revenue and means little down time as the boards can be fitted within a few hours.
The key to managing the operation is the ease of construction and safety features. It takes two to three hours to fit the trucks with the tension frame that holds the signage.
“A truck can travel at 160 kilometers an hour with an 18 meter panel and it won’t come off,” says Pinto.
These can be fitted over the weekend when most trucks are not being used. It takes only an hour to switch one panel for another on a fitted truck. The panels are manufactured by local printers. The advantage is that the panels can be removed and displayed at different locations or routes depending on the needs of the campaign. The client also retains ownership of the panel as opposed to painted signs on trucks.
As for the threat from social media platforms, Pinto believes that the way to go is to integrate OOM advertising with social media platforms such as Facebook and Twitter to enhance the product offering rather than seeing them as competitors.
“We plan to work with those platforms. Their success is our success.”
He has agreements with companies in Johannesburg and Cape Town but says that within a year he will be offering the service in three cities using at least 100 trucks. Pinto admits that starting a new venture is difficult.
“Starting anything is really difficult but if you believe in your product, and you can get another 100 people to also believe in it, then success will come.”
Although born in Johannesburg of Portuguese decent, Pinto speaks with an American accent and has visited 22 countries after studying business management and philosophy at the University of Pretoria.
“I guess I just watched too much TV when I was young,” he says.
He is a firm believer in global entrepreneur Richard Branson and is an enthusiastic member of his Centre of Entrepreneurship in Johannesburg. He quotes Branson as saying: “Do good, have fun and the money will come.”

Moving  The Message

Nostalgia is a thing of the future as far as one of the newest old radio stations in Africa is concerned. The breezy sound of LM Radio in Mozambique is back with a vengeance, with plans to broadcast across the whole of Southern Africa.
LM Radio was about the dream as much as the sound. Hopeful songs of love and laughter from LM, Lourenco Marques—as Maputo was known in those days—the city of palm trees, prawns, piri piri, sunshine and sand. The Monte Carlo of Southern Africa where smart yellow taxis ferried holidaymakers through the wide pristine streets of the city to the aroma of ground coffee and fresh bread.
This was the Mozambique of the 1960s and 70s where LM Radio made its name. There is a generation of boardroom executives in Southern Africa who grew up listening to LM Radio, under the bed sheets or in a boarding school dormitory. LM Radio had that allure of the underground as it played records the national broadcasters of neighboring countries refused to touch. Out of the African night came the sound of the Beatles—banned in South Africa after John Lennon said they were bigger than Jesus—The Who, Herman’s Hermits, Pink Floyd with a sprinkling of home-grown pop. Many who were youngsters in that era can’t remember exactly what the national broadcasters were playing, but recall it was difficult to dance to.
<div id="attachment_656" style="width: 228px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-656" class="wp-image-656 size-medium" src="/wp-content/uploads/2017/04/Gerry-Wilmot-in-Office-during-seige-218x300.jpg" alt="" width="218" height="300" />Gerry Wilmot with a shrivelled orange in the wake of the seige</div>
It was this frustration with the establishment that led to the birth of LM Radio in 1936. Advertising man, GJ McHarry, from Durban in South Africa, wanted to hear jazz on the radio. The South African Broadcasting Corporation refused to touch it, so McHarry headed north to set up a station at Radio Clube de Moçambique.
The new station hosted big band music and variety shows before studio audiences. It brought the sparkle of tinsel town, with Latin dash, into the dowdy farms, barrack rooms and mining camps of Southern Africa. It prospered in the 1950s and became hip in the 1960s and 70s. Heavens, even young Cliff Richard paid a visit to the station that played his records. By 1969, it was estimated nearly nine million people, in South Africa alone, were tuning in.
A symbol of its success was that, in 1972, the SABC bought LM Radio for a massive R60 million—a fortune back then. The National Party government was twitchy about independent radio stations broadcasting from outside South Africa’s borders. The station struggled on through the turmoil of Mozambique’s painful independence before it closed on October 12, 1975 with a simple announcement on air saying: “For us it has been 39 happy years.”  The new government in Mozambique took over the station to air educational broadcasts.
Fast forward to September 21, 2010 and radio engineer, Chris Turner, and his team were putting the finishing touches to a radio transmitter fixed to the top of a 10-story concrete block in Maputo, ahead of the first full broadcast of the revived LM Radio.
The tiny studio was also in the tower block, but has since moved to small offices in the basement of Hotel Cardoso.
“The lifts in the tower block didn’t work very well,” says Turner.
LM Radio is Turner’s dream and radio is his life. He grew up in Cape Town with one ear fixed to the radio and was an avid fan of LM Radio.
“They played Elvis, the Beatles, the Beach Boys, the Rolling Stones and you didn’t hear it anywhere else. Everyone in my age group has a memory,” he says.
Turner started a pirate radio station from his bedroom by the time he was 12. The police came to his home and closed down the station three times, but that didn’t deter Turner who grew up to train as a radio engineer.
To follow his dream, Turner and his wife sold property to raise the $3 million capital to open the station. It wasn’t easy; there were hours spent poring over Mozambique’s often pedantic bureaucracy.
The reward was that LM Radio is expected to break even in its first year, ahead of forecasts. The target is to achieve R12 million ($1.5 million) turnover in five years. It is taking advertising from South African supermarket chains to corner shops.
“We are about quarter of the way there,” smiles Turner.
LM Radio is banking on a large English-speaking population in Mozambique, largely South Africans; plus it broadcasts on medium wave in Lesotho, the Free State and in Johannesburg through community station Radio 2000. The station claims between 55,000 and 75,000 listeners a week, with a target of 125,000. Turner plans to apply to broadcast in Zimbabwe and Zambia, followed by the rest of Southern Africa where he thinks there is an even bigger pool of people who want to listen to Elton John and Abba.
“I think there is something in the music of the 1970s. It is feel good music, happy music. A lot of people write and tell us that our music lifts them up,” says Turner.
When LM Radio was reborn, in keeping with the theme of the station, there were blasts from the past. DJs, who were veterans of the original station, went back on air as if it where yesterday, rather than the last century, that they signed off. Reg de Beer, a veteran presenter who died in January, came back as did Nick Megens, a Dutch national, who had got into broadcasting at Radio Clube while working at his father’s company in Maputo.
Megens, who lives in Johannesburg, survived one of the most fraught chapters in the LM Radio story. It all began one spring morning with a frantic phone call from station manager, Gerry Wilmot, telling him to come into Radio Clube as soon as possible.
Megens was living on Catembe Island, just off the coast, and took the ferry over to Maputo. As he jumped into a taxi he knew this was no ordinary day as thousands of people running in panic through the streets of the capital buffeted the vehicle. This was September 7, 1974. I Shot the Sheriff by Eric Clapton was number one on the day Portugal signed the Lusaka Accord handing the liberation movement, FRELIMO, control of Mozambique within a year. It was a shock to many of the white Portuguese after more than four centuries of colonial rule.
“People were giving away the keys of their houses on the streets and later that day I saw people at the airport, holding one suitcase, weeping,” says Megens.
When Megens got to Radio Clube he found it bristling with guns. Armed white militia had taken over the radio station because they feared the Portuguese, or FRELIMO, may use it for propaganda. The show went on; for 10 days Megens broadcast with a couple of gun-toting militia men at his back.
“All I could think of was, ‘what happens if one of these guys goes to sleep and his gun goes off, the bullets are going to fly around the room?’”
The militia brought in supplies to their prisoners on air. The only problem was that it was just oranges and cigarettes and Megens didn’t smoke. His stomach rumbled while cartons of cigarettes piled up against his wall. Station manager, Wilmot, demanded the newspaper photograph him holding a shriveled orange in protest.
When the Portuguese Army ended the occupation by storming the radio station they lobbed in a couple of hand grenades.
“It is not a nice sound,” says Megens.
Nearly 40 years on, LM Radio is a nice sound and that is maybe why it has overcome closure, political chaos, civil war and scores of desperate men with guns.

Tag: Advertising

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