French cosmetics giant L’Oréal Group believes African consumers are worth it. The Paris-based company is expanding its presence on the continent as demand surges for international brands from an emerging and established middle class.
In its quest to reach the “next one billion consumers”, L’Oréal has added subsidiaries in Nigeria, Egypt and Kenya over the past two years. It also has hubs in SA, Ghana and Morocco.
The Economist Intelligence Unit predicts that by 2030, Africa’s top 18 cities could have a combined spending power of US$1,3trillion, making the continent a target for companies seeking growth outside developed countries.
One of the main forces behind Africa’s growth spurt is the increasing pace of urbanisation and consumerisation.
"As Africans flock to the cities, and disposable incomes rise, their demand for modern goods and services … will accelerate," the unit’s "Africa: Open for Business" report says.