Women Responsible for South Africa’s Booming Luxury Good Market
Women in South Africa are driving continued and steady growth within the luxury goods market, according to a new report.
In contrast to the slow growth being seen in the economy overall, the 2015 Global Powers of Luxury Goods Report from Deloitte predicts that the local luxury goods market will continue to see steady growth, with women being the driving force.
Capitalising on Currency
Accompanied by fellow sub-Saharan consumers, tourists and the growing number of middle-class buyers, South African women are making the most of the weak rand and value for money on commodities to satisfy a strong appetite for luxury goods on a continent saturated by international brands and home-grown luxury retail opportunities.
The Deloitte report follows on from the ‘Passport: Luxury Goods in South Africa’ Euromonitor report, which showed that there was a 65.2 per cent growth seen in the luxury goods market locally from 2009 to 2014 – a trend that looks set to continue into the future.
The Euromonitor study attributes some of this growth to the embracing of global fashion trends by South African females, spurred on by the media and the internet. Another factor is the increasing numbers of women in well-paid jobs and playing an active role within the economy.
International and Domestic Brands
Global luxury brands have certainly seen the potential in the area, with many flooding the market in recent years in order to take full advantage of the growing number of black middle-class consumers in South Africa.
A report from the African Development Bank last year revealed that the middle-class of Africa accounted for 34 per cent – the equivalent of 370 million people – of the population. This number is also predicted to grow, reaching 42 per cent by 2060.
South Africa also has its own home-grown luxury goods, and the market is supported by the prevalence of quality shopping malls and the number of boutiques – the premium choice when it comes to the sale of luxury goods.
Millennial consumers look increasingly likely to be active within the South African luxury goods market, employing alternatives to the traditional shopping methods. This is a generation as likely to go online in search of luxury goods as to spend the day trawling the malls.
This group is likely to use mobile technology and social media, as well as the internet as a whole, to access both the luxury goods themselves and information about them. This is why luxury goods companies in South Africa must embrace new technologies and take full advantage of the avenues that already exist.
This is likely to facilitate the continued growth of the market, even at a time of relative economic stagnancy, given that the Deloitte report shows that almost 60 per cent of all millennial consumers use the internet, with 31 per cent accessing social media to research and gather information about luxury items.