A seismic shift in South Africa’s consumer landscape
In South Africa, marketers are contending with a seismic shift: the rapid rise and distinctive demands of black consumers, who are claiming the market space long denied to them. Already, there is a stark difference between the shopping experiences of black and white consumers, a recent McKinsey survey found—a difference that was even more marked among the most affluent respondents.1
For starters, simply getting to the shops is a much greater effort for black consumers: 44 percent of black respondents traveled more than 15 minutes on their most recent food-shopping trip, while just 10 percent of white South Africans did. The figure for black South Africans is also much higher than anything we saw when surveying shoppers in other emerging markets, such as Brazil (22 percent) and India (26 percent).
This finding suggests that the lingering effects of apartheid on access to shops is still apparent—yet the buying power of black consumers is fast increasing. The number of upper-income black households is growing at more than 20 percent annually; within the next few years black households will dominate the living-standards measure (LSM)2 9–10 band, which accounts for about a third of South Africa’s grocery and apparel spending. Black households are already by far the largest group in the middle-income (LSM 5–8) market, where their numbers continue to grow steadily.
Some marketers assume that as black consumers enter higher income bands, their shopping preferences and habits will become more like those of the white consumers already in them. In fact, our research has found the opposite to be true—with profound implications for both retailers and consumer goods companies.