Smart Nigerian entrepreneurs are taking position in the fast growing Africa luxury market by creating and producing exclusive luxury products using the continent’s abundant natural resources and the skills of local artisans.
Already Nigerian made luxury brands are making inroads into high end stores both in Nigeria, Namibia and South Africa, which has a largest luxury market on the continent and globally.
A 2013 report by Bain & Co puts value of the Africa luxury market at over $1.5 billion with the global luxury industry estimated at $295 billion, growing at 6 percent per year. Bain & Co also forecasts that spending on Luxury goods in Africa will rise by 11 percent in 2013.
Popular luxury brand products made by Nigerian entrepreneurs include; fragranced liquefied local black soap, shea butter soap, shea butter and coconut oil, which have made inroads into the luxury skin care markets pushing back against the globally known luxury brands which are also settling down to exploit the fast emerging African luxury market.
Nigerian entrepreneurs are also making top end products in the home and accessories collections market such as homeware, spoons, home fragrances and jewellery, and furniture, all made with bespoke African craftsmanship and materials from Ile-Ife and Osogbo in Osun state.
Funmi Onajide, founder, Regalo, a luxury shop based at The Centro Mall, Lekki Phase One, Lagos, which stocks largely made in NigeriaLuxury brands says the Nigerian luxury brands market is still an emerging one.
“Most Nigerians still are still largely consumers of European and American luxury brands. But the Nigerian luxury brands are catching up gradually,” she said.
“The fashion end of the luxury market is actually the only fully developed segment of the local luxury market and is competing well against the international brands,” she explained.
Tomi Pearse, who manufactures a line of luxury liquefied black and sheabutter soap, called Aweni Organics range, says that the Nigerian luxury market holds huge potential.
“I believe the Nigerian luxury market is growing very fast. There are people who have seen the Aweni range and couldn’t believe it is locally manufactured because of its quality, standard and presentation. We are interested in talking to hotels to include it their list of toiletries for their guests.”
A luxury goods consumer, who is familiar with the Aweni Organics range says she has been impressed with the growth of the local luxury market. She said the quality of production and packaging of luxury products manufactured in Nigeria will qualify some of them to be showcased and sold at luxury stores like Harrods in London.
Ubong Nsebot, public relations and marketing manager, Southern Sun, Ikoyi, Lagos said as a global brand, Southern Sun has been a part of the growing African luxury market.
However, a source at a top luxury brand hotel franchise in Nigeria revealed they currently get all their skin care products from South Africa and have not considered including any Nigerian line. This indicates that the upcoming Nigerian makers of this luxury skin care products may have to look for ways to break into this supply chain.
The increasing wealth among Nigerians and Africans generally is said to be fueling the growth in the luxury end market on the continent. Lagos is estimated to hosts more than 10,000 dollar millionaires according to a recent report by African business magazine.
Nigerians are said to be the third- highest non-EU spenders in London in 2012,” according to the World Wealth Report 2014 WealthInsight forecasts that the number of ultra-wealthy individuals in Nigeria will nearly double over the next 10 years. Ultra wealthy individuals are individuals with a networth in excess of $30 million (N4.85 billion).
More than 200 Nigerians are currently estimated to be worth more than this amount. Increasing wealth on the African continent is also fueling the African luxury market. The number of Africans with US$30m (N4.85 billion) in assets is set to grow by 53 percent to 2,858 by 2023, far outstripping the average pace of growth across the rest of the world, according to the Wealth Report 2014.
South Africa is said to have one of the world’s strongest growth market for luxury cosmetics, and Nigeria the world’s second fastest growing market for champagne and other luxury products over the period 2006-2011.