This is where the money is

Dar es Salaam. Businesses should target consumers aged 29 and below to maximise their earnings, according to a new study.

Findings by Every1Mobile point to a shift in country and global consumption trends whereby young people tend to be the main focus for most producers and suppliers. Every1Mobile is a mobile services and technology company which designs, builds and runs large digital social impact programmes across sub-Saharan Africa.

“The future consumers of Africa are young. In fact, they will be around half the age of consumers in Europe and North America,” the report says.

The overall optimism of African consumers is reflected in their eagerness to buy new things and the high levels of happiness they derive from their purchases.

Africa’s population, the fastest growing and youngest in the world, is concentrated in urban areas, but rural consumers are expected to catch up.

Another survey by Mckinsey & Company says, “This new class of consumers has a smaller family, is better educated and higher earning, and is digitally savvy.”

Currently, Africa is estimated to have at least 400 million young consumers aged below 29, who will drive demand for goods and services in the future.

This is much higher than Europe and North America combined, where there are only 208 million consumers of the same age.

The majority of young people aged 29 and below years are still dependent. However, when wealth improves, young people are much more willing to spend more on flashy cars, electronics, beauty and baby products, household appliances, mobile phones, clothing, spirits and certain foods.

Producers of fast moving consumer goods and mobile phones will benefit more due to growing demand.

The study further says that technology will have a profound influence on the growth of consumer markets in Africa, where many will abandon their traditional living models due to globalisation.

It is projected that the median age of consumers in Africa will rise, but will still be below 25 by 2050.

Based on the 2012 Census, it is estimated that 35 million of Tanzania’s 52 million people are below the age of 25.

The consumer class, with daily incomes of more than $4 (Sh8,800), comprised 165 million people in Africa in 2014.

In the next 15 years, the number of young consumers will explode worldwide, with Africa alone gaining nearly 100 million in a single decade. The cultural revolution will be swift and disruptive in major hubs such as Lagos, Johannesburg, Kinshasa and Abidjan.

If current projections hold, Africa will have over 1.1 billion consumers by 2020—more than the populations of Europe and North America combined.

With growing incomes, Africa will have twice as many affluent consumers as the UK by 2020.