Two years after the start of the pandemic, consumers are still looking at price and quality when purchasing products in Africa. A consensus amongst 14 markets
The new normal is here but how do retailers adjust to the changing consumer behavior
Two years after the start of the pandemic, consumer confidence is rising in Africa. Last December, the index of consumer sentiment reached an all-time high and while the holiday festivity was a factor, the reality is that Africa is bouncing back from the pandemic.
While this is good news for retailers going into 2022, it is important for them to realize that consumers' habits have changed a lot since the start of the pandemic. The competition from new entrants is heating up with the world looking at Africa as the new growth opportunity.
In a fast-changing market like Africa, getting access to consumer data like purchase decision drivers at scale and aggregate is a must to remain competitive. Kasi Retail in Africa Tracker is conducted every year in December and can assist business leaders with the planning and execution of their marketing, sales, and experience strategy. The poll of 5,507 respondents from 12 countries in Africa, provides an understanding of consumer preferences, behavior, and purchasing patterns of the typical household basket of goods.
Retailers should focus on quality and price to win consumers
When asked about what factors they considered when choosing the brands to purchase from, 70% of the respondents choose quality and price. There is a consensus amongst countries around quality and price as the top considerations when choosing a brand. Overall the top 5 considerations are quality, price, durability, convenience, and familiarity.
For retailers, the picture is not that simple and it is worth noting some country-specific differences.
South Africa where consumers top considerations are quality, convenience, and familiarity. Price comes in 5th place.
Cameroon where consumers top considerations are quality, price, and product ingredients. Tunisia where consumers top considerations are price, quality, and love for the brand. Nigeria where consumers' top considerations are quality, price, and ingredients.
It is interesting that in a world where product origin and ingredients are becoming key concerns for consumers, Africans don't seem to worry about that when making purchase decisions except for consumers in Nigeria, Tanzania, and Cameroon.
A challenging environment for retailers in a context of rising costs due to supply chain disruption
Two years into the pandemic, the world is still recovering and the massive disruption in the supply chain means costs have increased for businesses and retailers. In fact, brands like Heineken NV have signaled its longer-term outlook has become cloudier as the brewer raises prices to pass higher costs on to consumers, which may weigh on beer consumption.
Rising prices mean consumer optimism may be short-lived as retailers pass on these rising costs to end consumers which may dampen demand and sales.
Our data shows that retailers should continue to watch consumer purchasing power and adjust prices accordingly. They must also be creative and seek to diversify their supply chain by sourcing locally. The disruption brought by COVID-19 and its impact on consumers' habits may actually push retailers and businesses to look for more sustainable supply chains.
Our data intelligence platform can help you track these trends in consumer behaviors in Africa over time. This provides you with valuable insights that can help you or your business make fast data-driven decisions.
Contact us to see how we can help your business today!