Last week, William Attwell, Senior Analyst for Sub-Saharan Africa, wrote an article titled, 3 Things Multinationals Don’t Understand About Africa’s Middle Class, that was featured in the Harvard Business Review. The piece provides an analysis of the Sub-Saharan African consumer opportunity by separating fact from fiction, featuring in-depth on the ground research that sheds light on the true potential of SSA’s consumer market.
While the region is home to some of the fastest-growing economies in the world, and while consumer spending power in Africa has risen (from US$ 470 billion in 2000 to over $1.1 trillion in 2016), some MNCs are finding that their business in the region is underperforming.
Findings from our flagship report, Capturing SSA’s Consumer Class, shows that MNCs are making three key mistakes in Africa:
- Companies set unrealistic targets due to misunderstanding the drivers of consumer spending power.
- Companies underestimate the extent to which local factors determine how, where, and why consumers make purchasing decisions.
- Companies are not considering how the consumer class (which we define as those living on US$ 3.90 and above per day, the point at which people can spend beyond mere survival) is changing across the region.
To learn more about how MNCs can learn from these mistakes and “win” in SSA, read our HBR feature here.
Clients can access the full report, Capturing SSA’s Consumer Class, on FrontierView.