by Seyi Lawal
By 2020, Nigeria’s commercial capital Lagos, along with four other of Africa’s largest cities, will each have consumer spending of $25 billion or more. That’s comparable to spending in India’s business hub of Mumbai, according to a McKinsey & Co. report.
According to the Associated Press, the reason for this is that the wealthy elite in Nigeria — upstart business owners, oil industry executives and corrupt politicians that have a healthy appetite for top-shelf brands but previously had to shop for them in Dubai, London and Paris can now through, sellers of luxury goods opening stores in Nigeria, buy them within the country instead. From glittering sapphire necklaces, designer suits, to the taste of freshly popped Champagne and the roar of a speeding Porsche are just a few of goods and services luxury brands are trying to introduce to tap directly into the country’s market. T
These luxury brands include LVMH Moet Hennessy Louis Vuitton SA, one of the world’s largest luxury brand groups; Amrapali Jewels Pvt. Ltd., which makes jewels for Hollywood and Bollywood stars; and Porsche AG. Those businesses often work with partners already established in Nigeria’s difficult businesses environment, where there are no dedicated luxury shopping areas. Luxury companies can run small operations, get little competition and have markups that make the profits high.
“I feel that with some real infrastructure development and opportunity to create luxury environments for luxury brands to come in, this market has enormous potential to become a key luxury capital of Africa,” said Ozwald Boateng, a top British fashion designer born to Ghanaian parents who recently showed a collection at Arise Magazine Fashion Week in Lagos. “I have some very good clients here but I want to have more,” said Boateng, who has a flagship store on London’s prestigious Savile Row, where bespoke suits start at around $6,500
“Nigeria is the largest market in Africa and the Middle East for Moet Hennessy,” said the company’s Nigeria marketing manager, Tokini Peterside. “For Hennessy cognac, Nigeria ranks among the Top 10 consuming countries in the world.”
Indian jewelers Amrapali sold a $37,000 necklace in Nigeria that set a diamond in 22-karat gold with blue, yellow and red sapphires and hope to sell others at the store they stock in Nigeria.
Such spending draws criticism from social commentators, especially as a recent government report showed more than 100 million people in Nigeria live in poverty, subsisting on less than $2 a day yet some people can afford to buy a Porsche that goes from zero to 60 miles per hour in four seconds to drive on poorly maintained roads riddled with potholes.
To this, Folarin Gbadebo-Smith, the director of the Centre for Public Policy Alternatives in Lagos said there is a sense of opportunity in Lagos.” People believe ‘my turn will come. Whereas in many other places there’s that sense that where you find yourself in society could be permanent, here everybody is rich in waiting,” he said.