[I recently mentioned Richard Branson’s African Renaissance and his entry into the South African market with cell phones and homeloans. I mentioned that he will of course have to fight the existing, established businesses here.

At my work, the management of various companies in the group are already rocking to try to fight for what market share they can before Richard Branson enters the market.

A co-worker was telling me about a dumb idea to get home loans to the blacks at the bottom end of the market. I will not reveal what this is. It is just a new bit of marketing hype from another angle.

A similar idea was tried some time back by the company and it was a complete flop! (But remember, the company I work for controls over 20% of the homeloan market).

The new idea looks like it will similarly be a big flop – but the senior management are ready to give it everything they’ve got… they’re going in agressively…

The point is not that their idea will flop. Their idea is pretty creative and out of the box. They think it stands a chance – some of us think it is a waste of time. But that is not the point.

The point is… that these are established businesses, and they’ve hunted high and low for homeloans customers… including among blacks at the low end of the market. By the time Branson arrives… he will be competing against companies who have scrounged around heavily for customers.

He can come in with a lot of capital and a lot of high-end advertising… but it will be interesting to see how much money, if any he ends up making after this glitzy entry, or whether, like MacDonalds, he will fizzle out eventually. Jan]