Wednesday, 14 December 2016 08:55

KWV takes a Southern African gin to the British

It’s not quite selling snow to Eskimos, but South African liquor giant KWV is attempting something similar as it takes on the British market – the home of gin – with an African boutique gin brand. Cruxland Gin, a product that is infused with signature botanicals including Kalahari N’abbas, was launched this month in the UK and is being sold through major retail chains such as Morrisons, which has 400 outlets nationwide. N’abbas is a species of truffle indigenous to the Kalahari Desert and Namibia. They only grow for a short time after the first rains of the season and it is said that only a highly experienced ‘truffle hunter’ can find the right location to dig for them. “It is not something consumers will find in any other drink, anywhere in the world,” KWV claims in a media statement. The company adds that a product development team took three years to create the gin from botanicals typical to Southern Africa. This provides a distinctive point of appeal, notes Anneke Mackenzie, KWV’s Global Portfolio Manager for Spirits. “Experts say the gin revival has been sparked by unusual flavours and launches of small [product] batches, which are adding vitality to the category and the re-emergence of a cocktail culture.” Mackenzie claims Cruxland offers gin consumers something that is unique and, more importantly, something that has a ‘taste of origin’. “[In South Africa] the response has been phenomenal and we are happy to report that the introduction to the UK market is showing signs of equal interest.” The product was introduced to the UK liquor trade, media and other influencers through an event at the Whistling Stop, a trendy gin and cocktail bar in London.
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Thursday, 01 December 2016 07:58

The ethnic doll going from Nigeria to the world

Entrepreneur Taofick Okoya made headlines when his African dolls outsold the legendary Barbie in his native Nigeria. Now he is focused on the rest of the world, not least the huge North American toy market. ‘Strategic Marketing Africa’, the magazine of the African Marketing Confederation (AMC), reports in its latest issue that Okoya began the Queens of Africa doll collection in 2007 after he could not find a black doll for his niece. Today his company, FICO Solutions Nigeria, has two ranges: Queens of Africa is targeted at both the African and global markets; and the more competitively priced Naija Princesses, which is focused on the local Nigerian market. Apart from the dolls themselves, there are brand extensions such as books, comics, music and an animated series. In 2014, he began exporting to various countries with children of African heritage, and has also created an international online portal. Customers can buy the dolls from the Queens of Africa website, or through global online retailer Amazon in the US and in five other countries. He is also in talks with other e-commerce sites and the brand now has representatives in Senegal and Benin, as well as Europe and Australia. Okoya believes that, so far, Queens of Africa has only scratched the surface. “As people get to know more about our products through word of mouth, sales have grown. But significant future growth is dependent on securing new customers in other parts of the world.” He recently completed a roadshow in the US to meet with potential buyers in an effort to expand the brand footprint. It was, he says, largely driven by a desire to have a meet-and-greet with the dolls’ growing fan base. ‘Strategic Marketing Africa’ is published quarterly and distributed through AMC member organisations. It is also available in selected airline lounges.
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Thursday, 08 September 2016 08:36

Coffee shop chain plans African expansion

Vida e Caffè, the South African-owned coffee shop chain, has announced that it is looking to increase its footprint in other parts of Africa and build on the outlets that it already has in Mauritius, Kenya, Ghana and Namibia. To date it has 17 stores in those countries, with four more planned by the end of 2016. Mauritius and Ghana are proving to be the regions with the best growth opportunities and the most popular non-SA store is in the Mauritian capital of Port Louis. Outlining the Vida vision for further African expansion, Business Development Manager for International and Corporate, Craig Gravett, says the brand has “noted some significant opportunities with partners in Africa that had originally been based in South Africa”. All rest-of-Africa stores are franchises with a joint venture partner or master franchisee. “Understanding that each country and culture is unique is imperative,” says Gravett. “As an example, while coffee is traditionally perceived as a morning thing, in Ghana it’s an evening pastime – with the majority of stores trading to 10pm-11pm.” Referring to the planned expansion into other parts of Africa by giant US-based coffee chain Starbucks, Gravett notes: “[It’s] no secret that our environment is hotting up. But we have been strategically planning ahead for several years and our hard work is really coming to fruition. We have the first-mover advantage in a number of new business development areas.” In June, Starbucks’ founder Howard Schultz predicted the brand would move into other parts of the continent following its successful launch in South Africa in April. “I think Nigeria will be at some point an interesting opportunity for us … “I look at the opportunity here [in Africa], which is really unexploited, to significantly add to the revenue and gross margin of the company.”
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Local consumers are showing an increased preference for rooibos tea over traditional tea (called black tea), according to the recent South African Tea Industry Landscape Report 2016. Ernest du Toit, spokesperson for the Rooibos Council, says although black tea still has a higher overall consumption than rooibos, it is experiencing a steady decline, whereas rooibos is showing growth both locally and globally. “The proportion of black tea consumers decreased between 2011 and 2015 – from 58,6% to 51,5%. However, the percentage of South African rooibos consumers increased from 29,4% in 2011 to 30,9% in 2015,” he says. Du Toit attributes this shift in consumption behaviour primarily to the health benefits of rooibos becoming better known. The product is especially high in antioxidants, which help to protect the body against ailments such as allergies, stomach cramps, colds and flu, as well as more serious illnesses like heart disease and diabetes. It can apparently also reduce the risk of contracting cancer. International demand for rooibos is also on the rise, strengthened by a recent agreement between the European Union and the 15 Southern African Development Community (SADC) states. Among other things, this gives increased access to European markets and improves trademark protection for rooibos as a product. In 2012, a French firm filed applications to register rooibos as a trademark in France. Subsequently, South Africa’s Department of Trade and Industry (DTI) countered with an objection and squared up for a legal battle, supported by the concerned local industry. SA currently exports rooibos tea to over 30 countries – including Germany, the Netherlands, Japan, UK and US. Germany by far still remains the biggest importer at 31%, with the Netherlands at 16% and Japan at 15%.
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Ethiopia is on track to become an African industrial powerhouse and, except for Rwanda, is the only country on the continent whose economic growth has been consistently high for more than a decade without relying on a natural resource boom. This is according to a report produced for the United Nations Economic Commission for Africa. “Between 2004 and 2014, per capita growth in Ethiopia was 8% per year. This was the highest on the continent during this period and is impressive by any standard,” say the study’s authors, Ha-Joon Chang, Jostein Løhr Hauge and Muhammad Irfan. In an article for ‘The Conversation Africa’ website, they note that growth has been attributed mainly to a construction boom and increased agricultural productivity. But manufacturing has also been vital. It has grown 11% annually and manufacturing exports increased more than 11-fold. This was largely due to the increasing export earnings of the footwear and apparel industries. The growth represents more than a doubling of manufactured exports’ share in total merchandise exports, which itself more than quintupled during the period. Nevertheless, manufacturing as a share of GDP in Ethiopia remains 5%, which is well below the African average of 10%. The country also scores below average on diversification, export competitiveness, productivity and technological upgrading. Despite this, the authors are upbeat. “It’s not a long-shot to predict that Ethiopia will catch up with countries like China and Vietnam in some low-tech manufacturing industries in the near future,” they write. “These are industries for which labour costs are very important. And right now you’d be hard pressed to find a country in the world that has cheaper labour than Ethiopia. Even beyond these obvious industries, there are reasons to believe that Ethiopia might be on the right track to catch up with more advanced economies.”
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Demand from Chinese consumers has led to increasing exports of South African wine to that country, with demand rising 30% in 2015 alone, according to figures from the local industry body.<>/b Reuters news agency says China has now become SA’s sixth largest wine export market, driven by increased interest from the country’s growing professional class. Charl Coetzee, Cellar Master for the Babylonstoren winery near Paarl, said in an interview with the news agency that Chinese drinkers tended to prefer red wines, although they would also purchase stronger whites such as certain chardonnays. In March, Babylonstoren sent its largest consignment yet to China – a container with around 13 000 bottles. The wine farm hopes to eventually be exporting one such container every month. But South Africa faces stiff market competition from France, which is the dominant player, as well as from exporters in Australia, New Zealand and Chile. “We realise that the challenge is to keep getting trade and consumers to trial South African wines and, more importantly, to retain customers to ensure repeat sales,” Michaela Stander, Asia Marketing Manager for Wines of South Africa, told Reuters. “If Chinese consumers are not well informed and not ready to accept our wines, the imports may soon die down again.” In an article published in late 2015, the ‘IMM Journal of Strategic Marketing’ reported that the La Motte winery, from Franschhoek, was another enjoying success. “We entered China three years ago in a joint venture with a Chinese firm. We created a special brand for the market, L'Huguenot, and are selling over 3-million litres annually,” CEO Hein Koeglenberg told the magazine.
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They love their barbecues in the American South, but are they likely to take to meat braaied in the South African tradition? Chesa Nyama, the fast-food franchise that specialises in serving grilled meat that appeals to South African palates, is betting that Americans will like the concept and is now in the process of planning its first US outlet in the southern state of Tennessee. Gold Brands, the SA master franchisee, will own 30% of a US-based holding company set up to market Chesa Nyama in the United States. The remaining 70% will be split between two US investment partners, Red Hornbill and The White Family Partnership. The first outlet is likely to open in October this year. Gold Brands will not provide capital, but will give strategic and logistical support for the development of the product lines, branding and menu. Chesa Nyama takes its name from ‘shisha nyama’, which is Zulu for ‘burnt meat’. In South Africa the brand has more 300 franchise outlets and also has a presence in neighbouring countries such as Namibia, Zimbabwe and Mozambique. Gold Brands this year listed on the Johannesburg Stock Exchange. “We have long had a dream of taking Chesa Nyama beyond the borders of Africa. The idea has always been to bring our iconic South African braai culture to America,” Gold Brands Chief Executive, Stelio Nathanael, said in a statement. Dr Ray White, representing The White Family Partnership‚ noted in his own statement: “As an African-American with a great love of Africa and having done so much work in and made investments in Africa‚ I love the South African braai culture and we are very excited to bring a brand such as Chesa Nyama to the USA. It truly is a South African success story due to its traditional menu and great value for money offer.”
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Ethiopia’s SoleRebels shoe brand is turning out to be a remarkable international success story. The company, which has its roots in one of the most impoverished areas of the capital city of Addis Ababa, currently has18 stand-alone retail outlets in prime retail markets around the world and expects to produce 100 000 pairs of shoes by the end of 2015. This production figure should treble by 2017 and the 2018-19 forecast is to produce one million pairs of shoes for worldwide sale through retail outlets and online. “Currently our top markets are the US, Taiwan, Canada, Germany, the UK, Spain, Austria, Switzerland and Australia,” SoleRebels founder Bethlehem Tilahun Alemu says in an interview published in the 4th Quarter 2015 issue of ‘Strategic Marketing Africa’, the publication of the African Marketing Confederation (AMC). “By 2018 we would like to have 150 stores open, generating US$250-million. By 2022 our forecast is to have over 500 stores globally, generating an income in excess of US$1-billion.” She continues: “SoleRebels is one of world’s fastest-growing footwear brands. We are also the only globally branded multi-channel retail chain from a developing country. This is a crucial set of achievements as it demonstrates that a grassroots African company can build a successful global powerhouse business literally from the ground up.” The world’s first fair trade green footwear firm – as certified by the World Fair Trade Organization (WFTO) – it uses Ethiopian artisans to create colourful shoes made from recycled materials, including car tyres. SoleRebels has also more recently expanded into handmade leather garments through its Republic of Leather range As the brand expands into more markets, Alemu says it is using a combination of business models, including licensing and joint ventures. “In some markets we license the store brand and in others we are a joint venture partner. It depends on the market, the partner and our collective aims and objectives,” she tells ‘Strategic Marketing Africa’. “We will continue to pursue this flexible model as we feel it’s the best way to maximise everyone’s interests.”
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While China tops the list of the world’s shoe exporters, African countries are emerging in the sector as they maximise the potential offered by the growing leather industry and develop the talents of skilled shoemakers. According to figures released by the International Trade Centre, Ethiopia is one of the fastest-growing exporters of footwear, with international sales increasing by 289% between 2010 and 2014. “The emerging shoe cluster in the capital, Addis Ababa, seems to have benefited from the availability of raw materials, entrepreneurs’ experience and skills in shoemaking, and their ability and willingness to innovate, especially to improve quality,” reports the website ‘African Economic Outlook’. Considering that Chinese manufacturers began to dominate African shoe markets in the early 2000s, the recovery of Ethiopia’s shoe industry is arguably a testament to the abilities and determination of those who work in it. “In contrast with its neighbours, Ethiopia regained control of the domestic market and established itself as a credible exporter of leather shoes to Europe and North America,” notes ‘African Economic Outlook’. Tapping into the wealth of available leather offered by Ethiopia’s burgeoning livestock industry, those brands and home-grown shoe manufacturers that emerged soon turned their focus to ensuring a similar level of craftsmanship to that of the Chinese imports. Speaking to the website ‘Africa Review’ in 2014, Mulugeta Megenas, owner and manager of Duka Leather Products, an Ethiopian brand which produces, sells and exports leather shoes, said: “Today it is difficult for people to differentiate between genuine local leather shoes and those imported from China or elsewhere. In fact, some of us are now bold enough to label our products ‘Made in Ethiopia’ under our trademark. For the first time this year, we exported 50 000 pairs of shoes to East African countries and we plan to introduce our brand to the world soon.” Collaboration has also provided a boost for the country’s shoe manufacturing sector in recent years, with Chinese shoe manufacturers Huajian basing its factory in Ethiopia. This was largely motivated by the low cost of labour, which is 10 times less than that in China. While this provides an economic boost for the country, many worry that workers are largely underpaid. Seeking to maximise the potential of Ethiopia’s raw materials and skills, while at the same time championing worker’s rights, Canadian-owned shoe manufacturers Oliberté is the world’s first Fair Trade Certified footwear manufacturing facility. This, among other requirements, means paying workers more than double the minimum wage required in Ethiopia. “When I want people to think of Africa [and] manufacturing footwear, I don’t want them looking at it as another low-cost producer,” Tal Dehtiar, the founder of Oliberté, told broadcaster CNN. “If you want quality footwear; if you want to pay people right; if you want to treat them with respect [and] use good product, then come to Africa.” Overall, the growing shoe sector in Ethiopia has created a large number of jobs, with exports bringing in US$31-million last year (excluding foreign brands with factories in Ethiopia). But this is still drastically below the government’s 2015 target of US$360-million. Despite these challenges, professional services firm Ernst & Young predicts that Ethiopia will become one of Africa’s top four manufacturing hubs by 2025.
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Despite formidable competition from top international brands, African fashion designers and retailers are using the limited means at their disposal to grow their brands beyond the continent’s shores. In its new Third Quarter 2015 issue, ‘Strategic Marketing Africa’ magazine, the publication of the African Marketing Confederation, notes that the continent’s fast-growing middle-class has encouraged major global fashion brands to steadily pursue a stronger presence in African markets – among them Hugo Boss, Mango and Zegna. These brands have the benefit of heritage, financial muscle, proven supply chain expertise and forceful marketing and public relations machines to drive awareness and push sales. But Africa’s fashion industry is fighting back and taking the battle to the home territories of their international competitors. And although the continent’s designers and boutique fashion houses lack marketing and financial power, they have one significant advantage. In the age of social media, giant personal brands and digital influencers, individual designers and small labels can wield their digital and social media prowess to pursue non-traditional and often market-disrupting avenues as they seek to build their brands across the globe. Indeed, says Strategic Marketing Africa’, several fashion designers of African origin have already gained notable international followings via marketing strategies that are underpinned by social media, digital outreach and strong community engagement. These include London-based fashion label Eki Orleans, founded by the charismatic Hazel Eki Aggrey-Orleans who was raised in Nigeria; Ethiopian designer Fikirte Addis of the Yefiker label; and Cameroonian Anna Ngann Yonn, who is behind the popular Kreyann brand. Aggrey-Orleans says social media is key to the label’s marketing strategy. “The great thing about social media is that you can instantly communicate with your followers with the click of a button. But you do have to understand what they want, because as quickly as you can gain followers, you can also lose them,” she says. “We try to use the different platforms to target different followers. Instagram is the most fun because we feel we can be most playful with our communication there. This is the one platform where we completely let loose and invite the world into our Eki Orleans existence.” She continues: “Once you get people interested and they like the brand, they in return talk about it through reposting, re-tweeting etc. They have their own followers and we get exposed to them.” Fikirte Addis of Yefiker concurs with the social media-intensive approach and says the brand markets itself on Twitter, Instagram, Pinterest and Facebook. “There is always room for improvement and we are focusing on exploiting and upgrading our usage of digital media,” she says. “We have customers that place orders through Facebook and our online shopping [portal] is in the process of being launched” Addis highlights that, as a traditional Ethiopian designer, “not only do we want to sell these 100% Ethiopian products, we also aspire to share our cultural knowledge and pertinent topics with the world. Thus, we plan to extend our social media coverage to the likes of Tumbler as well.” The Cameroonian designer Anna Ngann Yann, mastermind behind the Kreyann brand, says social networks allow Kreyann to reach a wider audience beyond Africa in order to showcase its products. “But most important is the ability for us to collect feedback from both existing and potential customers,” she tells Strategic Marketing Africa. She adds that word of mouth remains critical in the marketing mix. “There is nothing as powerful as happy customers advocating for your brand ... Indeed, following our strong community involvement in mentorship and development initiatives offered to young designers in Cameroon, the brand enjoys a high level of awareness and is now listed in the directories and guidebooks of Cameroon.” More information on how Africa’s fashion brands are marketing themselves to the world can be found in the Third Quarter 2015 issue of ‘Strategic Marketing Africa’, the publication of the African Marketing Confederation (AMC). The magazine is published on a quarterly basis and distributed to members of marketing associations in Ghana, Kenya, Morocco, Nigeria, South Africa, Zambia and Zimbabwe.
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