As I get more and more entrenched into the industry I am frequently surprised by how the luxury industry in Africa is evolving, and how it has changed over the last five years.
I can’t say I didn’t predict some of it but it is still gratifying to witness. When I started my luxury brand public relations and marketing agency, exactly five-and-a-half years ago, I saw a real need in the market to offer proper luxury brand expertise in South Africa and on the continent. And as a luxury brand consumer, I also had a somewhat selfish interest to see more luxury brands coming to our shores, so that we as consumers could finally have more choice when shopping. We have been starved of luxury brands for the last 20 years
We live on an exciting, vibrant continent, with many different luxury brand consumers at various levels of maturity. Some have been consuming luxury brands for years while travelling to Europe; others have only recently entered the market. For some, status is still very important. For others, quality and heritage is the draw card.
The country’s economic landscape is shifting and with this change many opportunities are availing themselves, explains Anina Malherbe, CEO of Vivid Luxury
In this time of global economic crisis, emerging countries are driving growth in the luxury sector, and Africa is suddenly being noticed as a strong contender, which makes us as Africans feel like we’re finally becoming part of the global luxury industry.
Seven of the ten fastest-growing economies in the world are in Africa after all, with a forecast for growth of 5.5% for sub-Saharan Africa in 2013. Africa has had the fastest-growing HNWIs (high net worth individuals) in the world between 2009 and 2010 – 11.1%, against the world average of 8.3%, which is pretty exciting. Over the next 10 years, Africa’s number of billionaires is expected to increase by 117%. This is the second-fastest growth in the world after Asia in this category (119%), and can only mean that we will see more and more luxury brands coming to our shores.
For decades, the African continent has been perceived in a negative light, be it due to war, starvation or corruption. But for the first time in a long while, Africa is receiving the attention of global luxury powerhouses. It’s official: Africa is open for business and able to compete effectively in the global luxury goods market.
It has also become more obvious than ever just how significant a country’s luxury industry is to its national identity (not to mention its economy). So for South Africa and Africa to start developing our own luxury industry is of vital importance. Having our own luxury industry and not just being a market for international luxury brands to enter, allows us to showcase the best we has to offer. And with so many rich resources, it shouldn’t be that difficult for Africans. I think it’s more the confidence that is sometimes lacking.
As Africans we sometimes feel that international brands are better than our own. This, although sometimes true, is actually a misconception. It’s true that we might still lack the know-how and skill as we don’t have the long history in manufacturing, for example, that Europe has.But as far as creativity goes, we are up there with the best. Perhaps now, as the world starts taking notice of us as a luxury market with great potential, we will finally see more confident African ideas and brands coming to the fore as well.
Another interesting trend is the return of skilled young Africans to their roots, leaving behind their high-flying Fortune 500 positions in Europe to start giving back to Africa. Leading business schools in the West are joining the game.
The London Business School even held an “Africa Day”, appropriately named, “Africa: Taking Ownership”. INSEAD, one of the world’s largest and most prestigious graduate business schools, based in France, has an Africa Club listing former management consultants and investment bankers wanting to move back to the continent because, says one, they see an “opportunity to work at a senior level with relatively little experience”. For them, Africa is like India and China ten years ago. These young Africans have the appetite and means to be part of the luxury industry from a consumer and a manufacturing point of view.
For me, and many others, these developements in the luxury industry give us a great sense of pride. For those of us that never left, we suddenly feel empowered and important and, who knows where the luxury industry in Africa will evolve to next? All I can say is that there are exciting times ahead for us.