The glam of social media and the evolution of digital photography are frequently considered the driving forces behind the surging demand for makeup in Kenya. Concerns about breakouts and recommendations from makeup artists mean that it’s not just any brand being used but some of the world’s most expensive, such as singer Rihanna’s Fenty Beauty, Maybelline, and L’Oréal.
However, in beauty industry circles, this phenomenon is interpreted as the “Lipstick Index’’—a concept that arises in times of recession and economic stresses. It suggests that women tend to indulge in discretionary purchases that provide an emotional uplift without breaking the budget, such as lipstick.
A recent study by consumer research firm Pierrine Consulting revealed that despite the rising cost of living, Kenyans may be indulging in expensive pleasures like alcohol and coffee. Interestingly, travel remains a priority, and consumers are willing to spend more in this area. Particularly, women are reluctant to forgo their skincare products, clothing, and accessories.
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“In spite of the current headwinds facing consumers, we observe the application of the lipstick effect, as the decline in spending does not apply to all product categories. Kenyan consumers have increased spending on local travels, beverages, beauty products, and skincare,” remarked Pierrine Consulting CEO Seyi Adeoye.
This is positive news for retailers who have struggled to generate sufficient sales throughout the year. They can now reposition their strategies to maximize sales even during these lean times.
On a global scale, as reported by digital agency Olbuz, holiday shoppers have already initiated their shopping sprees, with some starting as early as June. In this limited pre-December timeframe, understanding the nuances of micro-moments becomes crucial to maximizing sales.
In the weeks ahead, a surge in activity is anticipated for retailers, both online and offline. To navigate this critical end-of-year period successfully, consider the following key tips provided by Wunderman Thompson and BizCommunity on how to attract more business. As the world undergoes rapid digitization, redefining our perception of “the consumer” becomes pivotal.
Online vs offline shopping
In the next few weeks, retailers—both in the digital sphere and traditional brick-and-mortar premises—are gearing up for the festive season. Traditionally, this meant lighting up shop fronts and decorating cypress trees, but today, sales are mostly online, changing how businesses and consumers interact.
Across Kenya and the world, the competition between online and offline platforms has intensified considerably since the onset of the Covid-19 pandemic. Kenyans sought to avoid crowds in physical stores, turning online shopping into a mainstream activity.
Today, especially in urban areas, most Kenyans prefer shopping online due to the convenience of ordering in, the ability to shop outside business hours, and finding stocks that would otherwise be limited to the sizes of physical stores.
However, as pricing becomes one of the most important considerations in making purchases, consumers are being drawn online by the ability to compare prices across different stores and look out for discounts and promotions.
Kenyans seem to have tapped into the insights of the ‘Future Shopper Report 2023‘ from Wunderman Thompson which indicates that 60 percent prefer shopping with retailers or brands that maintain both digital and physical stores.
In Kenya, physical stores have swiftly adapted, establishing their presence both online and offline. In an industry landscape where the battle for customer attention unfolds across physical shops competing for footfall and virtual platforms running 24/7, the fight for market share has never been so intense. Currently, physical stores and diverse e-commerce platforms mirror each other in terms of price competitiveness, enticing consumer offers, and ample stock levels.
Brands need to satisfy consumers expressing a desire for seamless communication across both digital and physical channels. To optimize their earnings, retailers must ensure a seamless connection between their online and offline channels, recognizing that online activities often translate into offline sales.
Price determines the buying decision
Price is the number one factor when it comes to decision-making today. This means new product launches should be affordable, as consumers have become more pragmatic and are more inclined to buy products within their expected price range for a given category. While price holds significant importance, service is not far behind, and the top priority for consumers in online shopping is “faster delivery.”
For retailers, this season is about meeting customers wherever, whenever, and however, they prefer to shop, offering fresh and exciting avenues for their holiday shopping experience. When prioritizing service, ensure that returns are seamlessly integrated into the process, encompassing hassle-free return policies, transparent communication regarding updates, tracking information, and punctual delivery.
Service also translates to enhancing the in-store experience. The significance of sustainability, purpose, and ethics has never been greater, but it must be anchored by the right pricing and service in both online and offline segments.
From billboards to mobile phones
While the growth of digital stores has made the mobile phone a primary advertising channel, in practice marketing companies are expanding out-of-home (OOH) advertising like billboards and street signs.
In a recent analysis conducted by data firm Reelanalytics, an interesting standout in the Out-of-Home (OOH) advertising segment was Coke Real Magic, which emerged as the dominant brand, spearheading an impressive 56 campaigns.
Breaking down the distribution of advertising spending channels, television claimed the majority at 61 percent, a trend attributed to its relatively higher rate cards compared to radio at 38 percent and print at 1 percent.
However, a new trend is emerging with the increasing use of smartphones, tablets, and smart TVs. Digital screens in retail outlets, on footbridges, roundabouts, and building lobbies are becoming the “in” thing. Digital screens, which currently occupy just 1 percent of marketing space, are increasing at an incredible rate.
The advertising landscape in Kenya has witnessed a notable uptick, showing an overall expenditure increase of two percent compared to the second half of 2022 led by betting and gambling companies at 28.8 percent, followed closely by media at 27 percent, finance at 13 percent, and communications at 8.4 percent.
Within the beverage sector, East African Breweries Limited (EABL) notably held the lion’s share of advertising space, contributing significantly to the sector’s overall growth. As one of the big movers during the festive season, there was a noteworthy 4 percent increase in advertising expenditure compared to the second half of 2022.
Sell like Coca-Cola
Marketing experts advise small retailers to understand the gap between themselves and global multinational advertising to realize that product sales are not just based on quality, but a connection with the consumer.
Great marketing should seek to tap into an experience the customer can relate to. The focus should shift to introducing innovative ways for consumers to explore, purchase, enjoy a bargain, and save as the festive season gets underway.
Standing out will require businesses to embrace entertaining content to capture attention, such as using TikTok to engage with cultural or seasonal moments. At the same time, there is an opportunity to maximize engagement within communities where content is co-created with people, emphasizing collaboration rather than creating content solely for them.
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Pierrine Consulting suggests that brand engagement should focus on lightheartedness and creating happy memories. Advertising that exudes positive vibes, humor, celebrates everyday moments, and leverages the relationships in the lives of Kenyan consumers is likely to resonate well.
Mike Smollan, the Chief Growth Officer at Smollan, a family business and global retail specialist, underscores the significance of creating memorable experiences. He examines the impact of this season on retailers, emphasizing the importance of integrating these insights into both online and offline shopping experiences.
Globally, the pandemic accelerated the shift towards online shopping and influenced the way retailers prioritized contactless fulfillment option and digital engagement strategies. Putting the spotlight on creating captivating, cohesive, memorable omnichannel shopping experiences. As retailers up the ante and become more innovative, agile and customer-centric when it comes to preparations for this full-on frenzied time.
Moreover, www.AdvertisingWeek.com recently tapped into the insights of various marketing leaders, shedding light on how retailers and brands can captivate this year’s holiday shoppers.
This involves coming up with memorable experiential moments, simplifying the shopping process across all channels, embracing authenticity with a positive touch, and optimizing value while rewarding loyalty.
Engage content creators
For most businesses new to the digital experience, the assumption that just any video will convert into sales often receives a reality check. Content creation is as complicated as figuring out how to hold a camera in landscape or portrait and truly understanding how your consumer will interact with your product.
For example, businesses have built desktop-friendly websites even though up to 32 percent of all online spending occurs through mobile phones, according to the ‘Future Shopper Report 2023.’ This means that marketplaces continue to hold the top spot as the leading online channel.
For business owners, this might involve ensuring a mobile browser-compatible website, maintaining an up-to-the-minute social media presence, or even exploring the potential of engaging influencers to spearhead campaigns centered around specific products and services.
Online sales conversations are also rich data points for expanding consumer offerings by making complimentary offers or tracking trends like birthdays to nudge purchases. This includes anticipating rising demand by analyzing data from the previous season, monitoring competitors’ prices and offerings, and adapting marketing strategies to connect with mobile shoppers.
The success of this festive season ultimately hinges on the adaptability of retailers, their embrace of new approaches, and the evolution of marketing strategies across both online and offline platforms. The key lies in innovative solutions that offer fresh perspectives and introduce novel approaches to integrated, omnichannel, personalized, and digital experiences.
These solutions aim to align with service excellence, catering to the expectations of the new-age consumers who demand more than in previous years.