The 2022 Township CX Report shows residents trust local brands and distrust influencers

Get your ‘kicks’ in the kasi; the 2022 annual Township CX Report is out, showing township residents don’t easily support outsider brands – and more than ever, they are guided by price and community.

The 2022 Township CX Report shows residents trust local brands and distrust influencers

Homegrown and proudly so. Customers in South Africa’s townships are increasingly viewing local fashion brands as premium and would buy more local products – if the goods were more easily attainable.  

They don’t trust influencers or “community leaders”, prefer to spend their money within their communities, are using food delivery services that offer traditional street foods, and when they do purchase from brick and mortar stores, cash remains king. 

However, they are still highly amenable to store credit.

They also much prefer stokvels over banks to make their money work for them and a growing number are looking at index-tracking funds for investment opportunities. 


The 2022 Township CX Report, released on Wednesday, 22 June, reveals how the kasi economy is largely a self-sustaining ecosystem, where consumers are picky about their brands being homegrown.

Based on a survey of more than 1,400 respondents, mostly from black townships across the country, the report was compiled by digital agency Rogerwilco in partnership with consumer intelligence platform Survey54. 

About 10% of the respondents were residents of informal settlements but most were from Alexandra, Katlehong, and Soweto in Gauteng and Khayelitsha, Gugulethu, Langa, Masiphumelele, Delft and Elsies River in the Cape.

Worth billions

Geospatial specialist, David Schwabe, director of AfricaScope, says the fast-moving consumer goods (FMCG) market in SA comprises between 280,000 and 370,000 outlets, including informal and formal businesses in 16 major product categories. The “township economy” is worth billions of rands, with the informal retail market estimated at R157-billion, which is about a third of the FMCG market. 

These “unseen”, mostly cash-operated informal businesses do not typically pay taxes, but they are essential to the fiscus as they pay VAT and provide employment for about 2.5 million (non-agricultural) workers, which constitutes roughly 17% of total employment, according to Stats SA.

Informal businesses include hair salons, fast food outlets, fruit and vegetable vendors, bakeries, shebeens, minibus taxi operators and mechanics, servicing the needs of their communities. 

Down to business

The CX report has observed “phenomenal growth” of homegrown brands such as Bathu and Drip, with 29% and 25% of respondents showing a liking for these brands respectively. Seventy-four percent said they are more likely to buy local fashion brands – using clothing accounts – if these brands were readily available in stores where they shop. Women also preferred to buy on credit, with 59% of those aged 25 to 34 more likely to do so.

“Township residents seem to identify more with local fashion brands and the more these brands make the news, the more likely they are to succeed,” the report notes. “The success story of these brands is deeply entwined with the story of many South Africans who see a part of themselves in the stories of people who overcome business challenges to grow and succeed.”

Spaza shops, eateries and delivery services are capitalising on local trust and seizing opportunities in communities that big brands have historically underserved. Greater access to home Wi-Fi and cheaper data have also helped stimulate ecommerce in townships and customers are increasingly utilising food delivery services, especially to order from small, independent and local outlets that offer traditional street food, such as kotas, smileys and walkies.

Twenty-nine percent of respondents said they had ordered online from small independent food outlets – most of which were set up during the Covid pandemic. Mr D and Uber Eats have limited success, with customers preferring to buy directly from food outlets.

When they do purchase from brick-and-mortar retailers, cash remains king, as borne out by last year’s inaugural report, with bank debit cards again in second place. However, more customers are choosing mobile payments over store accounts in 2022.

Citing a Nielsen report, which estimated there were 150,000 spaza shops across the country, the report noted that many supermarkets benefit from their proximity to South African Social Security Agency (Sassa) offices or their location in or near large shopping centres. “With transportation costs being a large factor, many grantees use their trip to Sassa as an opportunity to do their monthly shopping as well. 

With many respondents “specials watching”, loyalty cards were popular, with Pick n Pay Smart Shopper dominating by 43.6% over its nearest rival, the Clicks ClubCard (21%).

Herein lies an opportunity for spaza shops and other retailers: there is an overwhelming consensus (90%) that spaza loyalty programmes would be welcomed but none seem to exist. Citing the e-Kasi bucks programme which operated in 10 townships, the “business went quiet in 2018”, the report notes, suggesting such loyalty concepts may require partnerships with experienced retailers.

This year, 58% of township residents said they participated in at least one stokvel, while 19% of those contribute to four stokvels each month. These savings clubs range from burial societies to cash savings, cattle and even property.

Seventy percent of respondents (particularly the youth) also admitted to making online purchases, with Takealot being a favourite with 23% of respondents having used the service in the past six months – which is higher than the national average of 22%. 

Where it comes to trust factors, the report found family and friends’ recommendations made the biggest difference for 98% of respondents. Newspaper inserts take second place (86% this year), while TV (79%) has been trumped by social media ads and recommendations (84%) from Facebook and WhatsApp. TikTok’s star, though, is ascending.

YOUKNOW chief growth officer Don Packett, who was on the expert panel, commented that when deciding on which platforms to use for brand messaging: “Consumers now have the power to play where they want to play, which means brands need to be available everywhere. The brands who are truly listening to their customers across all those channels, getting a single voice of the customer, are going to win in the end.” BM/DM

Published on Daily Maverick