African immigrants are one of the fastest growing, still untapped consumer groups in the United States today.

The number of African immigrants in the US has grown exponentially from 34,355 to over 1.4 million between 1960 and 2007, with almost 80% of this immigration increase having taken place since 2000. The majority of those immigrants originate from Nigeria, Egypt, and Ethiopia, residing most commonly in urban areas such as New York, California, Texas, Maryland, and Virginia.

Despite their sizeable migration to the US, Africans are a relatively small population when viewed alongside other foreign immigrant groups. Unfortunately this leads to a dearth in national brands that recognize them as a valuable target market, a grave error on their part. While Africans have the lowest rate of naturalized US citizenship compared to immigrants from other countries, they are among the highest educated of the foreign-born populace and are highly proficient in spoken English. An impressive 42.5% of the 1.4 million African immigrants over 25 hold a bachelor’s degree or higher, compared to only 27% of 31.6 million other immigrant adults in the US. Furthermore, the African consumer purchasing power currently comes to $50 billion, a striking number by anyone’s standards.

Part of the issue regarding the current negligence towards the African niche market is that it is lumped together with the African-American populace. President of the US African Chamber of Commerce Martin Mohammed conducted a national study in 2009, examining the budding African consumer market. He states, ”Although in terms of skin color they look the same, the immigrant Africans have different consumer behavior and they do have different shopping habits and a different way of engaging one another.” Today’s national brands must take note of the specific needs of the African demographic so that they may capitalize on an increasingly viable consumer group.

Africans are sensible consumers who prefer quality to quantity, often waiting to make big purchases that truly add to their lifestyle. That is not so say that Africans are uninterested in high-end brands. Companies like Olay, Sony, MAC, Mercedes-Benz, and Land Rover already prove to have strong brand recognition and loyalty among African immigrants, according to Mohommed’s study. These brands and others like them would greatly benefit from the new business opportunities to be had. The money and, more importantly, the consumer awareness are already at hand in this community, so why not take advantage of both?

To learn more about how to tap into the purchasing power of Affluent Africans living in the United States, contact Andrea Hoffman at andrea@diversityaffluence.com.

Sources:
Aaron Terrazas, “African Immigrants in the United States.”
http://www.migrationinformation.org

Mya Frazier, “Nouveau Niche: Targeting African Immigrants in the US.”
http://www.brandchannel.com/

New American Dimensions and Dr. Bruce Corrie, Concordia University, “The U.S. African Consumer Segment”
http://www.reachingblackconsumers.com/

Photo credits: Afripop; De Beers; Motorvista; ymib.com

Though much has been made about the improved state of non-US economies within the past decade (Asia and India among the most frequently mentioned), one country whose economic prowess gains limited attention is Africa. Economic reporting on this country has focused on its homeless and starving rather than on its rapidly rising middle class.

But perhaps this will all change soon. In 2008, the number of households with disposable income was 85 million; by 2020 this number is expected to increase to 128 million. The meteoric rise of African consumer spending power over the past 10 years is only expected to persist, with consumer spending estimated to be $1.4 trillion by 2020.

This significant boost in the African consumer’s spending power is due in large part to the enhanced economic well-being of the continent. An intriguing article from online business journal How We Made It In Africa lays out five key reasons for which Africa is poised to become a main player on the economic stage. First and foremost, Africa’s expanding population enables it to support its economic growth, as it is projected to reach 2 billion by 2050. The middle class population alone has increased by 150 million since 1990. Secondly, the amount of Africans living in urban areas has swelled to a notable 40%. By 2050 countries like South Africa and Angola could see urbanization reach 80%.

A third factor in Africa’s growing economic potential is mounting acceptance of technology, which includes over 500 million people with cell phone contracts and 120 million internet users (a number that would be larger were it not for the internet’s extremely high costs). Africa’s newfound economic strength is also undoubtedly attributed to its unlimited potential in the agricultural and energy markets. Its natural gas and crude oil reserves as well as vast (and untapped) farmland gain more and more attention.

Finally, Africa’s augmenting financial prosperity has precipitated the need for an enlarged financial services sector (most notably in retail banking), which means new job creation as well as an increased amount of Africans in the global marketplace. This rapid economic growth presents an opportunity too big to be ignored. Corporations and organizations that consider seeking business partnerships on the continent could benefit exponentially from regarding Africa as a new power in the global economy.

To learn more about Diversity Affluence Global Growth Consultants with expertise in West Africa and South Africa, contact Andrea Hoffman at andrea@diverstityaffluence.com.

Sources:
World Bank, McKinsey Global Institute
Simon Freemantle, “Five Trends Driving Africa’s Economic Growth,” http://www.howwemadeitinafrica.com