A discussion on Institutionalism relating to the South African Market – created: 2007 This is not complete, any feedback would be appreciated.

1. Return to institutionalism
Introduction
This discussion is based around the current social situation within South Africa, more
specifically the so-called emerging “black diamonds”, and relates specifically to how
marketing, communication and brands are able to leverage this phenomenon.
As our political, economic, social, and international environment evolves it brings
individual and group changes that effect how this group generally views the world,
although only communication, marketing, branding and general consumer behavioral
effects will be looked at.
Institutionalism has various fields of study, which may change depending on the
geographic region; it has also changed over time to what we know today, and although
they have specific themes, these themes do not specifically relate to the topic of return to
institutionalism. A brief overview on these definitions will be discussed along with
relevant case studies. The mindset of the individuals and more broadly the groups
concerned is changing, and it is therefore important from any business, particularly in
communications, point of view how to interact with them and develop products and
services to meet their needs.
Changes
There have been significant changes in South Africa’s social, economic and political
system, which is changing the way consumers interact amongst themselves and with the
products that they buy and use. It is evident that changes are happening is society, this
can be mainly attributed to the so called “Black Diamonds” and although this term may
be daunting it is just a name given to a group of every-day black South African that have
moved into the middle class status.

2. The biggest change is the amount of spending power that this group has when compared
to the rest of South Africa, they have already exceeded the buying power of white South
Africans and are set to be a major market and influence in many arenas.
There are now many ways for these new black diamonds to spend their money and
opportunities and offerings are becoming more abundant and personalized.
Institutionalism
The way we make decisions and see the world around us is different depending on the
worldview we predominantly find ourselves in. We can also change depending on our
situations, for example at work a person would be in a different worldview to that when
he is at home with a family.
There are five worldviews, Affiliative where the person has a need to belong and
connects with traditional and custom group knowledge. Egocentric worldview which is
individualistic, people are power driven and require personal recognition of their
achievements. Autonomous worldview is individualistic and people are entrepreneurial
driven and thrive on materialistic, exploitative and elitist positions. Humanistic view is
group based and involves having a consensual approach being driven to have a harmony
with all living things. Finally the Institutional worldview is group based and is about an
ordered affiliation, it is order driven, which means people are interested in following the
correct and proper ways in doing things. They have strict morals and believe in
sacrificing their present situation for rewards at a later stage.
The Institutional worldview can be placed on the following axis, sitting in where the
standard middle class would sit, with the majority having a group affiliation and a more
inner and mature sense.

3. Looking at the way people move through the phases of being black diamonds, we can
correlate it to how people move into an institutional worldview and ultimately see what
kind of products and services they will buy and use.
Research Consumer Model
These new consumers have more money than ever before and wish to spend it on objects
to make their lives better, this is happening because of the previous situations where they
may not have had the opportunity or been held back. It is evident they are well educated
and have the understanding and access to purchase, a sophistication of purchase.
Exclusive brands such as Mercedes would now appeal to them when buying a car. There
are new media publications such as The Afropolitan, which is facilitating these
relationships and buying purchases.
Research Black diamonds
Changes
These people are however not keeping their purchases as they grow through the black
diamond “life cycle”. It is important for them to have what their parents did not and
therefore other things become more important. This means investing money in property
for themselves and secondly as an investment would be more important than having to
pay off a vehicle. There is a greater need for something more permanent, secure and
stable than a vehicle, which will be old in a few years and with a lower value.
The new National Credit Act is also posing some restrictions on consumers to help
benefit people without a good financial knowledge, this is helping a large portion of the
population to live in a stable manner and looking at it broadly has some element of
institutionalism. There are more systems being put into place and it is to secure and
stabilize the future.

4. Not only are these people putting systems into place to benefit them in the future they are
also trying to help their own communities by spending money on other black owned and
run businesses which benefit their own and their communities needs.
Research Black Money
What has happened is that these people have found that money does not buy them what
they want in the long term, something more firm to validate who they are, this includes a
house, strong family base and to be able to contribute to a system that works.
Case Studies
In Soweto there is a new taxi rank, which follows very institutional and structured
architecture, which is a large change from many current older and potentially informal
taxi ranks. The structure is based
Additional Thoughts
• What is return to institutionalism?
 Although there are various paradigms of institutionalism, the
themes of each will not be discussed, only the general theme of
supporting a form of social organisation and the structure put in
place in society to reduce uncertainty
 Where the idea came from – South Africa is changing and the
evolution of consumers is happening at a faster rate not only
nationally but internationally.
 People have much greater and easier access to information than
before and have the knowledge and resources to act and ultimately
change the environment in which they work, play, and ultimately
live in.

5.  Looking at the trend of black diamonds from UCT Unilever institute
we can propose that they are closely related and have a close
pattern and effects.
 Institutionalism involves a type of person or group of people that
are concerned for their lives and are taking what they are building
in their lives and standing up for it to ensure it will be there in the
future.
 Return to Institutionalism is about people
 Disruptions and “loopholes” in the so-called system of society either
have not been effectively established to an optimal level.
 These people feel secure and happy about rules and regulations in
society to help protect their lives with something to fall back on if
there are problems.
 They are not rebellious.
• Industrial & French revolution – similarities
♦ Industrial revolution, people were emancipated by increasing
distributed power and access greater access to the products and
services that only the rich could previously afford
♦ The same is true of the current markets only the markets are
putting themselves in a position to increase their standard of living
• Trends
♦ Political
 Since the end of Apartheid and substantially into a
somewhat solid democratic system, people are starting to
get involved with local politics.
 Issues surrounding political leaders are discussed more and
more and it is no longer a fight for freedom anymore.
♦ Economic

6.  As people are becoming more financially aware and earning
more, they want to ensure they have an equal opportunity
and that their money and investments are properly,
efficiently and securely handled.
 Financial institutions and the NCA are making it easier to
understand and transact while protecting consumers from
falling into traps where they don’t have enough money.
♦ Social
 The biggest place to see social interactions worldwide is on
the internet, with new social interactions happening
everyday. Although the internet is an evolution of previous
technological developments, it has had the biggest effect.
 There are not many local social facilitations on the internet,
but it is growing as telecommunications gets cheaper and
easier to access.
• Case studies
♦ Soweto taxi rank. Taxi ranks in South Africa have always been
known to be quite chaotic and unstructured. The new taxi rank in
Soweto is an example of the return to institutionalism, with ordered
queuing facilities and easily understandable architecture.
♦ Jabulani Mall in Soweto is easily comparable to any other mall in
northern suburbs in Johannesburg. Instead of random shops lining
the streets, there is now an easier, cleaner and overall more
accessible way to shop. Many retailers are tailoring their offerings
to this market, one such example is Ginger Mary, which sells ethnic
clothing and is a division of Truworths.
• Influences
♦ Media – look at magazines like the afropolitan which was recently
launched, aimed at black diamonds, and talks about everything an

7. “afropolitan” may need to know. Including politics around the ANC,
Affirmative action and even the scenarios around living in a
township and moving to the “suburbs”
♦ Crime and Strikes are big talking points in South Africa, in the past
the current black diamonds would have supported a teachers
strike, now this is not an option to help build South Africa, they
would now condem this action.
♦ By-laws?
♦ Generations – The next generation that is graduating from high
school and
♦ Mindsets are changing and this affects what products and services
these consumers use, people are thinking more in the long term.
They would rather buy and pay off a house than have an expensive
vehicle and not be able to have a house.
♦ Get opinions from State, Churches, media etc. that correlate.
♦ Globally businesses are trying to become responsible in many areas
including charity and especially more recently the environment.
While this trend follows a similar pattern to RTI, and involves
regaining control it, RTI in this sense is very different and is gaining
momentum from the bottom and working up, generally with
organisations following.
• So what?
♦ This affects how advertisers speak to consumers, are they looking
for more conservative, founded approach
♦ Many South Africans are still unable to even see “how the other
half live”
♦ Brand choices are changing as people move, they are also
becoming more of an integrated community and are buying and

8. acting with the “group”. This means that status will not necessarily
come first when buying.