African markets are complex – but could bring big rewards

By Caroline SCOTT-THOMAS contact

- Last updated on GMT

Related tags: Africa

African markets are diverse, and buying power is growing among consumers across the continent
African markets are diverse, and buying power is growing among consumers across the continent
African markets present huge opportunities for companies that understand their complexity, according to Nielsen.

The market research organisation says that African consumers’ buying power is growing, and reaching them is most effective when companies combine market-specific product development and innovation with the right messages and media mix. Its research has found that products specifically designed with African consumers in mind have a success rate of 40%, well above the average 10%.

“Understanding behaviours, attitudes and influences is essential to tap into Africa’s diverse set of consumers,”​ Nielsen said. “Nigerian consumers in urban centres, for example, may share some commonalities with urban consumers in Angola, but they’re certainly not identical—this is why brand owners and marketers who want to successfully connect with consumers in Africa should shy away from a one-size-fits-all approach.”

According to Nielsen’s Emerging Market Insights research, 83% of African consumers are aware of television advertising, but only 19% are aware of online advertising.

When it comes to how advertising motivates consumers, 38% said that promotional activities, like in-store displays and special offers, motivated them to buy more of a particular product. In the continent overall, more than a third (34%) said they bought more of products that they knew had corporate social responsibility programmes. This rose to 53% of Rwandan consumers, who said CSR influenced their purchasing decisions.

The FAO has acknowledged that food sector investment in African countries has the potential to enrich developing economies, if done with sustainability in mind.Food companies and ingredient producers increasingly have been eyeing African countries as potential future markets and production centres, and many multinational companies have adopted a business model that integrates small-scale farmers into their supply chains.

“Many business leaders, economists and investors believe the African continent will continue to post impressive organic growth in the coming years,”​ Nielsen said. “Leading that growth will surely be the companies that invest in developing programmes, products and plans that keep the diverse set of Africa’s consumers as their beacon.”

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