The demand for non-essential products like luxury goods on the continent is on the rise, even as an increasing number of individuals continue to experience noticeable improvements in their financial status (i.e. the rise of the middle class). If economic trends are sustained, the luxury goods sector is expected to grow exponentially over the next decade, with countries like Angola, Egypt, Ethiopia, Ghana, Kenya, Morocco and Nigeria showing the most potential for luxury goods demand expansion. While it appears that many are enjoying the good life, Africa is relatively lagging behind other emerging markets in Asia and Latin America in its scale of market offerings. While there are many local operators in the market who provide luxury products and services, there still remains a substantial number of Africans who travel to other countries to buy their expensive accoutrements or patronize stores that offer more established multinational brands in country. So what gives? Well, it may all boil down to learning how to bring added value to their target consumer. ?There are a few ways to do so, but they all impact the way small business owners create and offer their products and services.
Partnerships with more established brands
Visibility in the market is important, especially when trying to attract the attention of larger brands that will provide the platform you will need to bring your products or services to scale. Trying to reach this mark though, is like trying to play the chicken and egg game ? you have to be sizable enough to be recognized by more established brands, but you also need these same brands to take the chance to help increase your capacity. Small businesses must learn the dance, particularly those that are ambitious and seek to grow, and engage multinational companies or larger brands who have the complementary resources and capabilities that can lead to innovative product offerings in the market.
Skills in design + Business savvy = Viable opportunity
A viable opportunity in the luxury good market, particularly in the growth and sale of merchandise exists where there is a reasonable merge between talent and business acumen. Beyond imagination and creativity, creating value in your given market or segment is necessary. From sourcing materials to marketing and finances, various touch points along the value chain ultimately affect your final product(s) and the way each customer receives them. Designers need to understand how their enterprises can provide an added benefit to their consumers at each step.
Quality, Quality, Quality
Many argue for and against the ?Made in Africa? rhetoric, where one should purchase goods just because they were made from and by local resources on the continent. The bottom line is that regardless of where a product is made or a service is delivered, a distinct quality that is on par with standards is of relevance. In today?s market, consumers with disposable income are becoming increasingly demanding about their choices. If a product or service does not meet or rise above their expectations, it will be very difficult to sustain their engagement over a long period of time. Tear jerking stories are great, but only for a moment. The shoes or bags that you sell might be made by precious hands in a village smack dab in the middle of nowhere, but if they fall apart after the first wear, you?re probably not going to gain repeat customers.
Establish the case for luxury in the local market
Most of us, whether we?re from the continent or from other countries have come to Africa and had an outfit or two made a local tailor. This is such a norm because it is much cheaper to have a skilled tailor transform your fabric of choice into a splitting replica of an outfit that is way out of your price range. It is also easier to control the look and feel of your outfit, adapting it to your specific tastes. While local tailors get to benefit from this type of demand, small business owners who specialize in creating luxury products are marginalized as they see, dare we say, cheap imitations of their brands around them. ?There is one way to address this, and it all goes back to creating value for your end user. Build a strong association between your product and your potential customer?s needs, giving them a reason to invest in your product. Market research may inform these needs as well as staying up to date on the latest information that affects your market. In other words, know your market.
Brand engineering your product
Africans love their brands. Defining your own brand so that it stands out and is on par with more established and renowned brands around the world is necessary to attract buyers. A step beyond defining your brand is having a unique name or design element that is tied to a quality that ultimately attracts consumers to high end brands. Identify tastemakers and other individuals of note who will try and test your product and ultimately become the face of your brand. Successful endorsements encourage image building and product marketing, which will go a long way in building your brand.