Last week we acknowledged newfound interest in Africa from global businesses.
And we suggested that a weighty knowledge toll has to be paid. Africa takes some understanding, and no inkling of the diversity of African consumers is to be found in any financial analysts report.
Fortunately marketers have access to a much stronger market research resource in Africa than ever before. For example, the Nielsen who has just published a strong piece of work entitled ‘The diverse peoples of Africa’ (www.nielsen.com). Helpfully, Nielsen begins by talking about similarities.
‘While diversity defines the African consumer, traditional attitudes and beliefs centered on family, affordability, loyalty, history and planning for the future are core themes that permeate the lifeblood of the African consumer and strongly influence buy and watch behaviors,’ says the study
Nielsen goes on to profile three tiers of customers who marketers will have to get to know. They looked at how people in these tiers consume packages, goods and how that relates to their monthly income and expenditure.
Nielsen calls these groups:
Tier 1: Trendy Aspirants and Progressive Affluent. These are the wealthy, urban, well-educated Africans with high income and CPG category spends. They drive modern trade, print and online penetration and are more open to expensive and new brands.
Tier 2: Balanced Seniors and Struggling Traditionals are middle aged; mid-income Africans with average CPG category spend. They are heads of households, shop for their family and are focused on affordability.
Tier 3: Evolving Juniors, Wannabe Bachelors and Female Conservatives are Africa’s biggest tier, comprised of consumers who spend much less than average on CPG categories. Primarily young and lower class, they are otherwise a diverse group comprised of consumers from increasingly modern students to conservative housewives.
Nielsen suggests that Tier 1 consumers represent higher-class African consumers, spending and earning more than other segments. They estimate that this segment represents just 28 per cent of the population, but control 47 per cent of the income and 40 per cent of expenditure on packaged goods. They are well educated and predominately urban. They are more likely to shop at modern supermarkets and have high media usage, especially across the Internet and social media. Tier 1 consumers also have the highest usage of Internet-based activities on the mobile phone and over half of them have more than one mobile line.
Nielsen’s Tier 2 consumers are older and more traditional. They, too, account for 28 per cent of the population, and the same percentage of expenditure on packaged goods. Common beliefs and attitudes are centered on strong family and religious orientations, respect for elders, and a keen focus on affordability. Balanced seniours and struggling traditionals shop at traditional trade stores and are average consumers of mass media like TV and radio.
Balanced seniours are focused both on affordability and trust. While they spend the same amount as struggling traditionals, they earn considerably more. Marketers have to build a relationship of trust to move them up the product chain to more expensive and discretionary goods.
In the third and largest group, wannabe bachelors (11 per cent), evolving juniors (24 per cent) and female conservatives (10 per cent) are low-income consumers. Collectively, they make up 45 per cent of the population. Yet they contribute only 32 per cent of the total CPG category spending. These consumers are receptive to audiovisual media like TV and radio, but score low on print and Internet penetration. However, in spite of their low income and concern for affordability they are likely to own a mobile phone, which they use primarily for text messaging.
Despite the low income and low CPG spend of Tier 3 consumers, the sheer size of this group makes them an important consideration. They exhibit a high degree of brand loyalty. This, combined with the young age and large size of these groups provide an opportunity to build lasting brand relationships that can yield long-term returns as their budgets and family responsibilities grow with age.
All consumer models are designed to help the marketer view human beings in a different, and hopefully clearer, light. What never fails to amaze me is how similar all these models are.
The Nielsen categorization is no different. It reflects the seminal work done by Maslow on the hierarchy of needs in primate communities. This showed that once basic needs like shelter, water and food are taken care of, societies could progress to higher thinking and more altruistic values. So, what Nielsen really shows is that Africans are just like everyone else. And that there are no real surprises in the human condition - wherever you choose to study it. That’s quite reassuring in a way. Until of course, some boffin discovers a particle that changes everything!
Chris Harrison Chairman Young & Rubicam Group Africa
To comment on this article, visit www.chrisharrison.biz