The African Cosmetic market: A potential Trillion Dollar Industry
The African cosmetic market is a booming force that has been expanding for thousands of years. With the global healthcare industry valued at more than 400 billion dollars, the cosmetic industry has had a massive surge, as it has become an inclusive product for almost all middle and high-class female consumers in the world.
Africa is one of the fastest-growing continents in regards to the growth of the cosmetics industry due to the growing middle class, technological developments, and an increase in health and wellness awareness.
This trade is witnessing a massive surge recently, as more consumers are becoming more aware of their beauty routine, cosmetic preferences, and adopting a healthy lifestyle.
Even though Africa has more than 50 countries, the largest skincare markets are only located in Sub-Saharan Africa as other parts have an understandably low demand for the cosmetic market.
The cosmetics sector in Sub-Saharan Africa is expected to witness immense growth over the next two years.
Overall, the African beauty and personal care market was estimated at €9.2 billion in 2017 and it currently increases between 8% and 10% per year against a global market growth rate of close to 4%. It is expected to reach €12 billion in 2020 when the continent’s total population, the fastest growing in the world, will reach 1.4 billion inhabitants.
South Africa is the largest and more developed among other countries’ markets currently. the professional cosmetic market in the country is expected to top $839 million by 2023, (according to Mordor intelligence.)
With South Africa leading, they are closely followed by Nigeria, Kenya, Ethiopia, Tanzania, Ghana, and Cameroon.
International manufacturers and brands from across the world have noticed this enticing data, as they begin to discover ways to infiltrate, capitalize and dominate the African market.
One notable way these industries are involving themselves is by establishing African bases in countries with profitable customer markets. This is the case with international brands like L’Oréal and BASF, as they each have developed a presence within the country.
As of now, the African market represents only 3% of the total revenue generated from the cosmetic industry globally. This is only the tip of the iceberg in concerns about the potential the African market can reach.
How are African Entrepreneurs capitalizing on this expanding market of the African Cosmetic Market?
This data also shows the massive expansion could also entice more global healthcare brands to invest in Sub-Saharan Africa. This will in turn provide immense opportunities, as they will require the African workforce to drive the industry in Africa.
With the growing market, some African Brands have developed and seized the opportunity to produce and supply to the increasing demand of the African consumers. Some of these companies include Nokware Skincare from Ghana, Skoon Skin in South Africa, and Arami Essentials from Nigeria.
These young, niches, traditionally rooted, and sustainability-focused domestic brands are priced competitively and are catering to the request for indigenous, local, better, and healthier alternatives with community empowerment and sustainable practices.
Most of these brands pride themselves on taking advantage of natural homegrown ingredients in their formulations and predominantly making use of ingredients familiar to their local consumers.
The dawn of new media and technology produced better advertising mediums. This resulted in a record-breaking number of Africans choosing to become their bosses and starting up their production and distribution of cosmetic products.
This has led to more opportunities for smaller brands to join the African cosmetic market and are slowly gaining wider market recognition.
Competing and leading the African cosmetic market are also multinational industries. These brands have infiltrated the African Market for quite some time. Some of the predominant one’s are Unilever, Avon, Procter & Gamble, Colgate-Palmolive, L’Oréal and Beiersdorf.
Though there are locally produced products with proven potential, Some Africans seem to trust foreign skincare products better than locally made ones.
This belief can be attributed to the idea that ‘foreign’ would possess or have access to better knowledge, materials, technology, and equipment in production.
There is also a reverse case of this, as some Africans distrust foreign healthcare products. This could be caused by the fear of such products whitening their skin (bleaching) or causing hyperpigmentation.
Overall, the African cosmetic market in Sub-Sahara Africa is just a fraction of what it could be. As it is known that the demand for cosmetics will on increase over time, it would be smart to involve and invest in the niche while it is still just a portion of what it could be.