The middle class is an important strata of any society as they are often hailed as drivers of economic productivity, vessels of a country’s cultural & political ethos and most importantly vectors of social change. For many, Kenya is viewed as one of the few success stories of the ‘Africa Rising’ narrative, as according to the African Development Bank some 40% of the Kenyan population have escaped poverty, with 17% belonging to the middle class.
The rise of the middle class in Kenya has had a profound impact on the country, particularly in regards to the emergence of certain sectors, industries and markets gaining more prominence due to the increased prevalence of household disposable income. Of particular interest is the Beauty and Personal market, whose emergence has provided not only strong investment in the country, but has also allowed a whole generation of Kenyans to open up businesses to capitalise on this new trend:
KPMG estimated that the Kenyan beauty and personal care products market grew from around Sh26billion (Kenyan Shilling) in 2011 to Sh100billion in 2015. This strong market growth has seen the emergence of major international players such as P&G, L’Oreal, Yves Saint Laurent and Estee Lauder to set up in the bustling malls of Kenya. The growth of the industry is down to the strong economic performance and a favourable demographic, which has subsequently amplified the gains made by these market players.
However, entering the market has not been without its challenges. Geoff Skingsley, former Zone Director for the Middle East-Africa zone, highlighted the need for specialist products which were specifically designed for African consumers. One of their concerns was adapting their product range due to differences in African hair & skin. Furthermore, the success of companies such as L’Oreal cannot solely be based on their product range, much rather it is to do with their understanding on how consumers work. One strategy is to look at how local brands & products have gained prominence and success. For example, L’Oreal’s acquisition of Interconsumer Products Ltd, a large local manufacturer of beauty products, whose products are targeted not only at the middle class but other emerging classes, allowed them to meet the needs of a variety of Kenyan consumers.
With over 1 billion or close to 15% of the world’s population, it is clear that Africa will become an increasingly important aspect of international corporate ventures in the near future, and perhaps stands as a sign of the ‘Age of the African Consumer’.