With sluggish economic growth and low morale leading to reduced spending among consumers in many markets across the world, businesses are looking for opportunities for expansion in high growth African markets. Yet countless examples have shown that few marketers have a deep understanding of African markets, and are truly able to harness opportunities for brand reach and relevance.
It is a vastly complex and diverse continent, requiring a unique approach. Moreover, building powerful and lasting brands requires deep insight into people’s needs and motivations. Achieving traction goes far beyond understanding economic status or demographic data – which is where many marketers [mistakenly] focus when considering African markets.
Here are the 5 things marketers should be doing differently:
1. Ditch the idea of “the African consumer”
The term “African consumer” is bandied about as the enticing new target of global brands, but it is essentially meaningless. Africa is arguably the most diverse continent on earth; with more than a billion people in fifty-five countries speaking hundreds of languages, subscribing to numerous religions and living in vastly different contexts that range from shanty-towns to subsistence farming to expensive high-rise apartment blocks. It is of little to no value to generalise to a continental level and of little value to generalise at a country level. Attitudinal segments with an economic lens provide the best steer for marketers.
2. Don’t just play the numbers game
With 60% of the continent still living below the poverty line, marketers tend to approach Africa with a numbers mindset: selling the highest quantities at the lowest prices. Yet this ‘bottom-of-the-pyramid’ thinking does nothing to grow the market or create new wealth for consumer spending. This is a ‘sick magic trick’ as there is usually no disposable income and displacement of spending from basic needs like bread, gas or airtime is not helpful for growth. The brands that really succeed in Africa are those that partner with the locals and offer opportunities for income generation rather than only product consumption.
3. Treat consumers with respect
African consumers have indicated that brands entering their markets treat the consumer like an idiot. For example, they have to tolerate advertising that has been “dumbed down”, and from our primary research they see businesses trying to dump sub-par products or past sell-by-date products into their markets. Marketers need to realise that only the brands that treat their customers with respect will survive.
4. Beware of the Term ‘Middle Class’
It is important to note that every country defines “middle class” in its own terms. Indeed, it is a relative term within a country, based on a number of factors such as income, lifestyle and assets – and denotes those who are roughly in the middle of a country’s socio-economic spectrum. Yet “middle class” is often used as if it has universal meaning. The African Development Bank estimates that 123m Africans are “middle class” in that they earn between $1440 and $7200 a year – with 10% of those consumers in Nigeria, the continent’s largest economy. In the USA, the middle class is defined as having an annual monthly household income of between $50000 and $600000. A completely different picture that should not be compared.
5. Think Beyond Status
There is a persisting [and unfair] generalisation that the emerging middle classes across Africa are only motivated by status. Admittedly, it is common for newly wealthy consumers worldwide to enjoy conspicuous consumption and flash their wealth around town. While there certainly is plenty of that in Africa, studies have revealed that there is a distinct community-mindedness on the continent that persists – even amongst the newly middle class. Consumers have an interdependent multi-dimensional relationship with their communities and are never entirely inner-directed and selfish about their status.
ORIGINAL SOURCE: FINWEEK