This is the second of the three-series on the Africa consumer landscape. In the first part we highlighted the challenge of defining the African consumer. While the territory, with over 1.2 billion people presents massive opportunities, can one define the African consumer, given the various micro and macro factors? How can that happen in a continent with 54 independent nations, varied culture and practices?
Indeed any marketer will face an insurmountable task in defining the African consumer, and faces two main risks – simplifying the definition (read generalizing) or run into analysis paralysis.
Simplifying the definition arises in a number of assumptions. Some of the areas and statements I have come across include:
- Africa is a large territory, but only by distance. Generally consumers are African across the continent
- The African consumer faces almost similar challenges across countries.
- Low income per capita across most countries is an indication almost similar buying patterns
- The level of sophistication is not as high as in other continent, or developed world.
There are many other statements, but these are some of the common ones. Taking such statements at face value is a key risk in addressing any given market across the continent. A key example to the above is the much-talked issue of the rising middle class across the continent. While it’s a fact incomes across the continent are rising, such a generalization can be disastrous since there are many other factors that impact the African consumer in making a decision.
On the other hand, over analyzing respective markets is not only expensive, but also takes time. Identifying the addressable base of consumers is then not only important, but also a continuous process. Due to differences in regulatory practices, my opinion is always to consider each market within the continent independently first before looking at the continent as a whole.
At a macro level, various enabling factors are coming in place, and these will help to address some of the challenges. Enabling intra-Africa movement is a game changer in evolving the definition of the African consumer. As people move more freely across the continent, there will be a better understanding of markets. Now, you may wonder how this impact the consumer market across the continent! It addresses a key element of the marketing mix – Place. It will enable marketers move products to the right places, with less bureaucracy, time efficiencies and less waste. In other words, consumers will access variety of products at the right places. One can work out prices and promotions from a centralized location. You can also have centralized manufacturing. E.g. Egypt is a manufacturing hub for a number of consumer goods to the continent. However, enabling the Place factor is a (re)defining factor. We could also add a 5th P – People.
Key macro factors within the continent that will impact such intra-Africa movement, and eventually the consumer landscape, which are important to consider would include:
- The push for the Tripartite Agreement across North, East and Southern Africa countries. This will obviously have a great impact on the channel and subsequent impact on the variety, quality and quantity of products that consumers can access.
- The Africa passport. While the AU is still mainly on governance / policy issues, such a travel document will add cream to the issue of intra-Africa movement.
However, the question, if more movement within the continent will re-define the African consumer, remains to be addressed. This is a continuous process, which we will learn as time goes by. Consumer behaviors, practices and perceptions across the continent will continue to vary.
Markets will continue to have their own peculiarities. However, sectors such as tourism, ICT, banking & Finance, agriculture, health, consumer goods, real estate, construction and education will push the intra-Africa view. They will shape the emerging landscape as people share ideas, learn and seek regional solutions. They will help to understand as well as break any underlying barriers and perceptions. Lastly, they will help in developing innovative and customized solutions to the needs of the African consumer.
