Mayo on bread

Top five South African consumer trends

By now South Africans are familiar with the market conditions we’re facing in 2016: a weak rand, the impacts of a drought, an energy crisis, and unemployment – a somewhat depressing picture of the year ahead. That said, there are still a number of interesting trends which are shaping consumer behaviour, and which smart brands should capitalise on.

Here, Louise Hefer, media strategist and implementation planner at The Mediashop, discusses five trends outlined in a new Euromonitor report, Consumer Lifestyles in South Africa, and they offer scope for food-drinks brands to adapt and prosper.

1. Low consumer confidence

Consumer confidence is low and, with less disposable income, consumers are having to make bigger tradeoffs in their decision making, says Hefer. It’s all about having to achieve more with less.

“Brands need to showcase other uses for their products which will show that they’re really worth it,” says Hefer.

She uses mayonnaise as an example. It could be seen as a luxury item, but aside from being a condiment, it can be added to foods such as stews, or used as a substitute for butter, thereby providing better value.

2. Mobile payments

The second trend is that of mobile payment methods. Their convenience and ease of use is making them an extremely popular choice as we move closer towards becoming a cashless society.

“This is apparent in the behaviour of higher LSM groups, who understand the technology around these apps,” says Hefer. She adds that FNB has reported 250m transactions a month on its mobile app and has revealed that mobile transactions are outpacing traditional ones. “This shows how much potential there is in the trend towards mobile payment.”

3. E-commerce

While e-commerce has been taking the rest of the world by storm for the past five years at least, this trend has been lagging in South Africa and penetration is still low by global standards. This is largely due to our lack of broadband coverage, in addition to a lack of trust when it comes to making online payments.

Hefer says online shopping is one of the greatest contributors to credit card fraud in South Africa. “E-commerce is a relatively new trend, so the learnings and precautions against online fraud are also new. Consumers don’t always understand which sites are safe and which to avoid.”

Retailers that create a versatile and user-friendly online platform will be in line to win when the trend hits.

4. Obesity

Obesity, which is fast becoming South Africa’s emerging health crisis, is another important consumer trend.

“South Africa is said to be the third fattest nation in the world,” says Hefer, adding that factors which contribute to this are poverty, unhealthy diets, cultural values and physical inactivity.

“Brands are feeling the pressure, from government and consumers, to promote healthier lifestyles and to ensure their products support this,” she says. “We saw this start a few years ago when food labelling regulations were enforced and the proposed sugar tax will increase this pressure.”

She adds that while higher LSM consumers move towards healthier lifestyles and choose products in line with this, the lower LSM market does not have this luxury.

5. Male grooming

Finally, says Hefer, “grooming is booming” – male grooming, that is. This trend has been seen predominantly in the black market, but traditional definitions surrounding men versus women have changed across all demographics, influenced by trends in overseas markets.

“It’s no longer considered unmanly to want to look and feel good. This is a hugely untapped market that is hungry for affection from brands,” she points out.

Source: Financial Mail