By Conrad Onyango, bird
While Africa’s rapidly growing super-rich want to satisfy their desire for the finer things, their tastes and preferences are building one of the continent’s fastest growing business segments: luxury.
According to Africa Wealth Report 2021.
The rapid rise in the number of cash-rich Africans is resulting in continent-wide splurges on high-end cars, bespoke clothing and accessory brands as this group lives and dines in some of the best hotels, resorts, clubs and lounges.
In doing so, they are growing the continent’s luxury market – a market which, although dominated by international brands, is seeing more and more African brands.
The African luxury sector was valued at $6.1 billion in 2018 and is expected to grow rapidly, making it attractive to a wide range of luxury brands and experience providers.
“With a growing young population coupled with rapid urbanization and rapidly growing consumer spending, Africa offers exciting opportunities for entities wishing to expand into new frontier markets,” says research firm Euromonitor International.
Total wealth held by Africans is expected to increase by 30% over the next decade, reaching $2.6 trillion by 2030 according to Africa Wealth Report 2021offering wealthy individuals greater purchasing power to splurge on luxury.
Tourist destinations are where wealthy Africans spend most of their wealth, pushing investment in the hospitality industry to new heights, with hotel brands built to international standards now dotting most parts of the continent. This sector also attracts wealthy individuals from abroad, helping to ensure that high-end luxury experiences are available to Africans who can afford premium prices.
“The luxury hospitality sector is one of the most important sectors in Africa as it brings a large amount of foreign exchange spending to the continent,” the report states.
Wilderness Safaris, Red Carnation, &Beyond, Sanctuary Retreats, Belmond, Virgin Limited Edition, The Royal Portfolio and Singita are some of the popular hotel groups for high net worth individuals in Africa.
According to the report, the main luxury tourist destinations on the continent are Cape Town, Umhlanga, Franschhoek and Kruger Park, all in South Africa.
Rich Africans are not just buying any car, they are going to have a spectacular experience in the most luxurious cars. In South Africa, you’ll find more premium car brands than anywhere else on the continent, including Porsche, Bentley, Ferrari, Aston Martin, Rolls-Royce, Lamborghini and McLaren.
Of the approximately 2,000 cars that Porsche sells on the continent each year, 1,200 units are sold in South Africa through a local dealership arrangement, according to the report.
The second and third largest luxury markets, Kenya and Morocco, also have local dealerships for these high-end car models, as wealthy locals opt for the best frequent fliers money can buy. Porsche, Bentley and Ferrari now have dealerships in Morocco, while Kenya enjoys similar access to Porsche and Bentley car brands.
Sport utility vehicles have also grown in popularity due to their generous cargo space and rugged styling. “The Rolls-Royce Cullinan, Bentley Bentayga, Aston Martin DBX and Lamborghini Urus are currently the most expensive SUVs on the market,” according to New World Wealth, the report’s authors.
Africa’s millionaires and billionaires have also revamped their wardrobes. It is now easier to spot wealthy Africans adorned with high-end global brands like Zegna, Louis Vuitton, Paul Smith, Gucci, Jimmy Choo and Dolce & Gabbana. Most of these brands have exclusive stores in Nigeria, South Africa, Egypt and Morocco. In other mainland markets, local stores stock these premium brands as stockists.