Forum addresses changing face of African consumer

August 16, 2011

The changing face of the African consumer was the focus of a conference hosted recently in South Africa by TBWA, an international advertising agency. In his presentation, according to Bizcommunity, online industry news, TBWA's head of strategic planning Mariska Oosthuizen, focused on market and consumer trends in a rapidly evolving and changing Africa.

In the next 30 years, a significant chunk of the world's workforce will be exported from Africa, the youngest and fastest growing population on the planet. By 2040, Africa will churn out a formidable workforce of 1.1 billion, which will surpass the world's current number one workforce, China.

"With 40 percent of the African population being under the age of 14, Africa's populace is much younger than others around the world. In a couple of decades, we will see young professional Africans making up a significant proportion of the global workforce," Oosthuizen told members at the conference.

"There's a big emerging middle class in Africa," Oosthuizen was reported as saying, "According to the McKinsey "Lions on the move" report, in 2008 consumer spending on the continent amounted to $860 billion and it's predicted to rise to $1.4 trillion in the next nine years."

The good news is that 50 percent of African households will have disposable income, with 90 percent of the population spending 50 percent of this on food and consumer goods. These positive predictions make Africa a very desirable market for local and international brands that will be vying for the African consumer who will become more demanding and sophisticated because they will have buying power and so much more to choose from.

However, because of daily stresses and pressures, the African consumer is constantly "in pursuit of happiness" and they are drawn to brands that bring fun and cheer to their lives. People are becoming more optimistic and attracted to feel good brands such as Coca Cola, which has successfully tapped into this market with its "Open Happiness" ad campaign stated Oosthuizen.

Globally, Coca Cola has taken this a step further by sending branded trucks to the streets. These trucks dispense Cokes, soccer balls and even balloons, which put a smile on people's faces on the street. "By giving things away for free, consumers feel they are getting more from their favourite brands all the time," she added.

Oosthuizen also stressed that African women were becoming increasingly powerful, as they control a lot of consumer spend and make most of the household purchase decisions. Women still see themselves as the primary caretaker, although a lot more men are now also taking on more responsibilities in the home.

Women are more empowered and educated (38% of sub-Saharan African women enrolled at tertiary institutions in 2005), but this means that they also experience more pressure and they have less time on their hands.
There are presently a lot more women in parliament across Africa.

Half of the Rwandan parliament consists of women, Nigeria now has about 30 percent, Mozambique has 35 percent of women in parliament and 33 percent in South Africa compared with only 17 percent in the US.
Interestingly, 85 percent of brand purchases are made by women. Brands are developing products specifically for women, but only 3 percent of advertising agency creative directors are women.

According to trendwatching.com, as quoted by Bizcommunity, consumers and brands in emerging markets like Africa are "rapidly getting wealthier, more sophisticated, more mobile and more educated, which leads to an abundance of confidence, enthusiasm, creativity and entrepreneurialism." Trendwatching says that trends in emerging markets are not that different from what's happening globally.

There are a lot of similarities in trends and everything's connected because of globalisation of the internet. Some discovered the web on a desktop in its infancy and now most have access to it via mobile phones. Africa had 316 million new mobile subscribers in 2000, and the number is rising.

Mobile penetration on the continent is 37 percent, while 11.4 percent of the population is internet users. There's an off the mark perception in the international arena that the adoption of technology is lagging, but the opposite is true especially in countries like Nigeria. And brands that are behind the times will struggle to keep abreast with Africa's new wealthy, educated and techno savvy/digital consumers.

Even though there is sustained economic growth on the continent, poverty is still a factor for many with 61 percent of Africans living on less than $2 a day. "Poverty is a reality but also an opportunity," stated Oosthuizen. "Consumers at the base of the pyramid represent great potential and should not be viewed by brands as poor or cases for charity.

These are valuable consumers who should be respected and treated with dignity. Marketers and brands need to woo them and develop innovative ways to engage and communicate with them." TBWA's Africa Conference, which was previously held in locations such as Durban and Lagos, aims to update and provide training for the company's 38 offices on the African continent on global tools and new methods among other things in the African and global advertising, marketing, branding and PR networks. It's an opportunity for the different managing directors and creative directors to be brought up to date with what's going on in the industry in Africa and around the world.

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