The number of African consumers is expected to reach 1.1 billion within five years, “more than Europe and North America combined,” according to a new report released Tuesday by Boston Consulting Group (BCG) .
BCG conducted a survey of 11,127 consumers in 11 African countries, particularly in countries with the “most promising short and medium terms” such as Nigeria, Ivory Coast, Egypt, or Ethiopia, which has experienced a record growth rate of 10.5% in 2015.
Across the continent, the firm said it has met consumers “who are optimistic and who want to spend.”
According to BCG, rural areas and Ethiopia are two emerging markets with growing potential.
In Africa, consumption is stimulated by stabilizing incomes and also a strong confidence in the future, 88% of respondents in these countries, more than double the inhabitants of “mature” economies (48%) said in their response.
The study noted that distribution networks of goods and services was improving through the development of modern stores and access to telecommunications and the internet.
The online business has emerged in recent years and although it is still low, it offers “many business opportunities”, according to the study titled African Consumer Sentiment 2016.
Taking the example of the Nigerian Jumia platform, which offers a huge range of home deliverables and became the first shopping website online in five African countries, BCG demonstrates that innovations provide access to these new markets bypassing the chronic problems of distribution on the continent.
The study calls for investors to “rethink the way they market and distribute their products” in Africa. Access to banking services by mobile phone can, in this sense, represent a strong potential market since BCG estimates that “by 2019, 250 million Africans who are not integrated into the banking system will possess a mobile phone and an income of at least $500 per month.”
While obviously concentrating in urban areas, BCG encourages companies to innovate to reach a new market of consumers -the African rural population – who in the past have been neglected due to economic concerns.