“THE rich are always complaining,” goes a Zulu proverb, and a new report by Deloitte seems to confirm this “law of diminishing returns”– young consumers in faster-growing (but relatively poorer in per capita terms) Nigeria and Kenya are more optimistic about their personal financial situation and that of their country, than the relatively richer South Africa and Egypt.
The survey interviewed 2,000 young people in the four countries to gauge consumer attitudes on brands, fashion and spending behaviour, and it turns out that young people in the four countries have very distinct attitudes towards money and the happiness it can buy.
Counter-intuitively, it also seems the richer a country is, the less swayed young people are by the latest fashion brands, and the more frugal and financially prudent they tend to become.
Africa’s consumer markets have become the darling of international investors everywhere – Africa is a “priority” market for investment in the next 12 months, say European consumer businesses in the report, and is expected to become the biggest market for investment by 2017, behind the EU itself.
Looking at the four countries, Kenya has the lowest per capita income at the moment by purchasing power parity at $2,180, Nigeria is second at $5,120, Egypt is at $10,600, and South Africa is the richest, at $11,970.
But Kenyan youth, it seems, are the most image-conscious, consumerist and “shallow” of them all, who even run the risk of falling into debt just to keep up with the latest trends, with one in three saying that “buying well known brands makes me feel good” – at 32%, the highest of the four countries surveyed.
They also report the highest percentage agreeing with the statement “I would spend a bit extra to keep up with the latest fashion”, at 25%.
But only 21% say they can afford the latest gadgets in the first place.
Young people in Nigeria emerge as the ones who seem to be living within their means, as those who say they gain emotional rewards from spending on well-known brands (23%), and those who say they wouldn’t mind splurging a bit to keep up with the latest trends (21%) are about the same percentage as those who say they can afford to do so (21%).
South African young people, on the other hand, seem to be price-conscious and less dazzled by fancy items, even though the per capita income in the country is relatively high.
Less consumerist than their counterparts in Kenya, 25% of South African youth say buying well-known brands makes them feel good. Just 15% say they would spend a bit extra to keep up with the latest fashion, although a higher percentage say they can afford to (20%).
But it is Egyptian young people who emerge as the most frugal of the four countries surveyed. At 20%, they report the smallest percentage of those saying they feel good buying fancy items, and only 15% say they would splurge to keep up with the latest fashion, even though 22% say they can afford to do so.
The recent political troubles in Egypt have definitely contributed to the more pessimistic outlook in the country, with less than one in four (23%) of Egyptian youth saying the economy is better off today than five years ago.
But South Africans come out as the gloomiest of them all – just 22% say that things are better than in 2009 – curious because the country has not experienced the kind of upheavals that have been suffered up north in Egypt.
Nigeria has posted the highest cumulative growth over the past decade and a half, at 18%, and a third of young people surveyed said the economy is better today than five years ago.
But it is Kenyan youth who seem to have the rosiest outlook of the country’s economy, or who are most likely to “believe the hype” about their country’s rising prospects, with nearly half (45%) saying the economy is better than it was five years ago, even though the cumulative growth over the past decade and a half has been 11%, lower than Nigeria’s.