Spending habits of Youth consumers in Sub-Sahara Africa
Youth consumers in Sub-Sahara Africa (SSA) are very image conscious and are spending over 50% of their earnings on personal care items, this is according to a recent GeoPoll rapid survey carried out among youth between the ages of 18 to 35 in Kenya, South Africa, Nigeria, Ghana, and Uganda. In an article on top ten trends in Africa in 2016 and beyond, beauty is listed as the number one trend with the hair industry estimated to be worth Ksh 620bn (US$6 Billion).
This is the second survey in a series on African Millennials in which GeoPoll seeks to understand just what makes the African Millennials tick, their aspirations, hopes, affinity and habits. The study also gets their thoughts on leadership, governance and their future in a digital age in the best way that they know how, using their mobile phones on a GeoPoll application.
According to a 2011 Africa Development Bank report, Close to 70 percent of Africa’s population now comprises of Millennials. Africans aged 16-34 account for 65 percent of the continent’s consumer spending (McKinsey 2013 report). The African millennials are vibrant, on the move, tech savvy and image conscious. They are upping their levels of education and are extremely optimistic about their future.
Among the countries that were part of this survey, Ghana has the highest rate of youth saving towards education at 46%. Many young Africans in SSA who took part in the survey have jobs (51%), however, a good number still depend on their parents for their upkeep at 32%.
On the commercial side, mobile and e-commerce exist but have not become part of everyday life for youth consumers in SSA. In East African countries where mobile payments are popular, youth consumers consider mobile payments as cash and prefer it to other modes of payment (71%) for daily purchases. It is only in South Africa where credit cards are popular but only second to cash payments.
In a GeoPoll survey conducted in 2016 just after Black Friday online sale on e-commerce in SSA, mobile payments and cash-on-delivery were still the most popular among youth consumers.
Interestingly, gambling is becoming popular among male African Millennials in SSA due to their high affinity to sports and the proliferation of local sports betting players. This is still a very nascent industry with 3% of youth consumers in SSA indicated that they spend part of their income on gambling.
There are knowledge gaps among African millennials in areas such as effective saving plans, wise investments, and financial management. When asked, many would like to better understand asset financing, entrepreneurship and investment opportunities available in their respective countries. This is proof that young Africans are striving for financial independence, prosperity and believe in their own ability to charter their own course with a strong belief in the adage “Education is the Key”.
This GeoPoll survey was conducted in January 2017 among 2,726 young Africans in Kenya, Uganda, South Africa, Ghana and Nigeria using the GeoPoll App.