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BUSINESS STRATEGY

Three common errors by international brands entering the continent

By our News Team | 2022

Three common errors by international brands entering the continent

International brands and their marketing teams tend to make three common mistakes when entering African retail markets for the first time. 

International brands and their marketing teams tend to make three common mistakes when entering African retail markets for the first time. 

Mirabell Mayack, a consultant with African Investment Intelligence who specialises in the Francophone countries, has highlighted them in a recent post:

  1. Companies set unrealistic goals as they misunderstand the drivers of consumer purchasing power.
  2. They underestimate the extent to which local factors determine how, where and why consumers make purchasing decisions.
  3. Businesses fail to consider how the consumer class is changing as the region changes.
Business Strategy

Photo by Dbmpictures via Wikimedia Commons

She advises decision-makers not rely solely on economic-indicator headlines. “Corporate estimates of consumer opportunities in Africa are typically based on GDP and demographic growth data. These are misleading because they don’t reflect how wealth seeps through the economy,” Mayack explains.

In many of Africa’s fastest-growing markets, average spending power is very low as economic growth has not resulted in high-paying jobs, instead creating a small elite and a large population with low spending power.

A better measure of purchasing power, Mayack believes, is the Consumer Class Conditions Index (CCCI), which ranks markets based on how easily wealth is filtered through society. This indicates whether a wider range of consumers are able to make purchases on a regular basis.

According to African Investment Intelligence, sub-Saharan French-speaking Africa offers virgin markets and opportunities. However, these markets remain hard to access from the outside without customised due diligence and a deep knowledge of each market.

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    Dr Kin Kariisa

    Group CEO - Next Media

    Dr. Kin Kariisa is an extraordinary force at the helm of Next Media Services, a conglomerate encompassing NBS TV, Nile Post, Sanyuka TV, Next Radio, Salam TV, Next Communication, Next Productions, and an array of other influential enterprises. His dynamic role as Chief Executive Officer exemplifies his unwavering commitment to shaping media, business, and community landscapes.
    With an esteemed academic journey, Dr. Kariisa’s accolades include an Honorary PhD in exemplary community service from the United Graduate College inTexas, an MBA from United States International University in Nairobi, Kenya, a Master’s degree in Computer Engineering from Huazong University in China, and a Bachelor’s degree in Statistics from Makerere University.
    Dr. Kariisa pursued PhD research in Computer Security and Identity Management at Security of Systems Group, Radboud University in Nijmegen, Netherlands. As a dynamic educator, he has shared his expertise as a lecturer of e-Government and Information Security at both Makerere University and Radboud University.

    Dr Kin did his PhD research in Computer Security and Identity Management at Security of Systems Group, Radbond University in Nigmegen, Netherlands. He previously served as a lecturer of e-Government and Information Security at Makerere University in Kampala, Uganda and Radbond University in Netherlands.

    Dr Kin did his postgraduate courses in Strategic Business Management, Strategic Leadership Communication and Strategies for Leading Successful Change Initiatives at Harvard University, Boston USA.

    • Other current and previous roles played by Dr Kin Kariisa:
    • Lecturer of e-Government and Information Security to graduate students at Makerere University, Kampala and Radbond University in the Netherlands
    • Director of Eco Bank Uganda Limited, one of the largest banks in Africa
    • Chairman of the National Association of Broadcasters, an umbrella industry association for all Television, Radio and online broadcasters in Uganda.
    • Chairman of Board of Directors of Nile Hotel International, that owns the leading hotel in Uganda, Kampala Serena Hotel.
    • Chairman of Board of Directors of Soliton Telmec Uganda, the leading telecom company in Optic fibre business managing over 80% of optic fibre in Uganda.