The advertising industry in Uganda is witnessing a dramatic confrontation as global advertising giant M&C Saatchi Group faces accusations of sidelining a local agency, CTA Space Ltd, in a bid for a substantial advertising contract with MTN Uganda.
This conflict, involving one of the continent’s largest telecommunications companies, underscores the challenges faced by local firms in competing against multinational agencies with far-reaching influence and resources.
The Significance of the MTN Uganda Contract
MTN Uganda, a subsidiary of the MTN Group, commands a dominant position in the Ugandan telecommunications market, boasting a vast customer base and an extensive range of services.
The company’s advertising account is highly coveted, representing one of the most significant and lucrative opportunities in the African advertising sector.
The contract is not only financially rewarding but also offers substantial prestige and influence within the industry.
The MTN Uganda account, which provides a retainer revenue of up to UGX 300 million (approximately USD 80,000) per month, is the largest of its kind in Africa.
The stakes are high, as securing such a contract could elevate an advertising agency’s profile and open doors to further opportunities across the continent.
In 2023, MTN Uganda launched a thematic campaign titled “Together, We’re Unstoppable,” designed to celebrate the resilience, creativity, and innovation of Ugandans.
The campaign aimed to provide a platform for Ugandans to showcase their skills and talents, resonating deeply with local audiences.
For CTA Space Ltd, a Ugandan-owned advertising agency founded by Twaha Kakaire, this campaign was perfectly aligned with their mission to support brands and businesses in creating lasting connections with consumers.
Strategic Partnership and Initial Success
Recognizing the significance of the MTN Uganda contract, CTA Space Ltd sought to enhance its competitive edge by partnering with M&C Saatchi Abel, a South African branch of the global M&C Saatchi Group.
This collaboration was formalized through a Memorandum of Understanding (MOU) signed on September 8, 2023, outlining the terms of engagement for the pitch process.
Under this agreement, CTA Space Ltd would serve as the local partner responsible for managing MTN’s advertising needs in Uganda, should the bid be successful.
The MOU represented a strategic alliance between the local expertise of CTA Space Ltd and the global reach and experience of M&C Saatchi Abel.
The collaboration aimed to leverage the strengths of both agencies to secure the MTN account, with the understanding that CTA Space Ltd would be directly contracted by MTN Uganda as the local affiliate.
The pitch process was a significant undertaking, with M&C Saatchi Abel and its affiliated agencies, including CTA Space Ltd, pooling their resources to present a compelling case to MTN Group.
Their efforts paid off when, on April 22, 2024, M&C Saatchi Abel informed CTA Space Ltd that they had been appointed as the marketing services partner for MTN across all its African operations, effective January 1, 2025.
This success initially appeared to secure CTA Space Ltd’s role in managing MTN Uganda’s advertising account, a development that promised to be a turning point for the local agency.
Unforeseen Reversal and Disputed Justifications
However, the optimism surrounding this collaboration was short-lived. Despite the initial success, M&C Saatchi Abel soon communicated a startling decision: CTA Space Ltd would not be managing the MTN Uganda account.
Instead, M&C Saatchi Abel announced the appointment of CreateAbuzz Communications, another agency, to handle MTN Uganda’s advertising needs.
This decision came as a shock to CTA Space Ltd, which had been led to believe that their involvement was integral to the success of the pitch.
M&C Saatchi Abel justified this decision by claiming that CTA Space Ltd had been rejected by MTN Uganda’s procurement department.
According to an email dated June 28, 2024, from Nival Maharaj, M&C Saatchi Abel’s new business project director, MTN Uganda had raised concerns about CTA Space Ltd’s capacity to deliver on the account’s demands.
The email cited issues such as the scale of CTA Space Ltd’s operations and the agency’s perceived ability to manage the comprehensive marketing needs of a company as large as MTN.
M&C Saatchi Abel further claimed that despite their efforts to present CTA Space Ltd in the best possible light, MTN Uganda ultimately preferred a more established agency with a proven track record in managing large-scale advertising campaigns.
This explanation, however, was met with skepticism by CTA Space Ltd and others within the industry.
CTA Space Ltd’s Pursuit of Redress
Unconvinced by the rationale provided, Twaha Kakaire, the founder and managing director of CTA Space Ltd, sought clarification directly from Jacques Burger, the CEO of M&C Saatchi Abel. In response, Burger reiterated that the MOU did not constitute a binding contract and did not guarantee any financial commitment or contractual obligation towards CTA Space Ltd.
He also asserted that CTA Space Ltd’s contribution to the pitch process was minimal, limited to the submission of a rate card and a credentials document, neither of which, according to Burger, played a significant role in securing the account.
Burger further emphasized that M&C Saatchi Abel had thoroughly reviewed CTA Space Ltd’s credentials and found them lacking when compared to the requirements of MTN Uganda.
He stated that M&C Saatchi Abel’s decision was aligned with MTN Uganda’s assessment, which deemed CTA Space Ltd unsuitable as a partner for the Ugandan market.
Despite these assertions, CTA Space Ltd remained resolute in its belief that M&C Saatchi Abel’s decision was unjust and potentially influenced by external factors.
Independent investigations revealed that CreateAbuzz Communications, the agency ultimately chosen to manage the MTN Uganda account, had connections to David Case, a businessman with significant ties to the Ugandan advertising industry.
CreateAbuzz Communications, formerly known as Lime Light Limited, had a history of managing the MTN account under the TBWA Uganda banner, further fueling suspicions of preferential treatment.
Faced with what it perceived as a grave injustice, CTA Space Ltd initiated legal action against M&C Saatchi Abel.
The local agency sought compensation for the costs incurred during the pitch process, anticipated earnings from the MTN Uganda account, and injunctive relief to prevent M&C Saatchi Abel and MTN Uganda from formalizing their arrangement with CreateAbuzz Communications.
In its legal communications, CTA Space Ltd also appealed directly to MTN Uganda, both at the group and local levels, requesting a deferral of any formal agreements with M&C Saatchi Abel and the newly appointed agency until the matter was resolved.
CTA Space Ltd argued that proceeding with the contract under these circumstances would not only undermine their legal and ethical standing but also set a troubling precedent for the treatment of local agencies in Uganda and across Africa.
Broader Implications for the Ugandan Advertising Industry
The dispute between CTA Space Ltd and M&C Saatchi Abel has broader implications for the Ugandan advertising industry and, by extension, the African market as a whole.
The case highlights the challenges faced by local agencies in competing against multinational firms that often have the advantage of extensive resources, global networks, and established reputations.
For many local agencies, the struggle is not just about winning contracts but about gaining recognition and respect within an industry dominated by global players.
The situation faced by CTA Space Ltd underscores the need for greater transparency and fairness in procurement processes, particularly when dealing with significant accounts that can have a transformative impact on local businesses.
Twaha Kakaire has been vocal about the broader issues at stake, noting that local agencies are often sidelined in favor of multinational firms, even when they have the capacity and potential to deliver high-quality work.
He argues that this trend stifles the growth of local businesses and deprives the Ugandan economy of the benefits that come from supporting homegrown enterprises.
The outcome of this legal battle will be closely watched by stakeholders within the advertising industry and beyond. Should CTA Space Ltd succeed in its legal challenge, it could pave the way for a more level playing field, where local agencies are given a fair chance to compete for and secure major contracts.
On the other hand, if M&C Saatchi Abel and CreateAbuzz Communications prevail, it may reinforce the dominance of global agencies in the African market, further marginalizing local players.
Conclusion
The conflict between CTA Space Ltd and M&C Saatchi Abel over the MTN Uganda account is more than just a business dispute; it is a reflection of the broader challenges faced by local agencies in an increasingly globalized industry.
As the legal proceedings unfold, the case will likely continue to spark discussions about fairness, transparency, and the role of local businesses in shaping the future of the African advertising landscape.
For CTA Space Ltd, the battle is not just about securing a contract; it is about asserting their right to participate on equal footing in an industry where the odds are often stacked against them.
The outcome of this case could have far-reaching implications for the Ugandan market and beyond, potentially reshaping the dynamics of competition between local and global agencies in Africa.