Life & Work

How luxury brands are taking over Kenya


Women in the region according to the report cited luxury brands Louis Vuitton, Gucci and Prada as some of their favourite clothing and accessories labels. PHOTO | FILE

Move over Europe, the Americas and Asia.

Kenya is new the Mecca for luxury brands, say a majority of economic analysts and luxury brand makers.

The experts back their claims based on trends which show that Kenyan consumers are increasingly going for luxury brands as its middle class grows rapidly to previously unseen levels.

“There is a rapidly ‘’rising Middle Class’’ and it is internationalised in that holidays are taken abroad and aspirations are on par with cities like New York, London and Tokyo,” says Nairobi-based analyst Aly- Khan Satchu.

Mr Satchu adds that, in turn, luxury brands are outcompeting with each other to set up base in Kenya. In recent years big luxury brands, especially in the fashion sector, motor vehicle, accessories have set up base in Kenya and other regional states.

“What has happened is that International Brands are now seeking to serve these folks in their home markets - Shopping Malls and Urbanisation has created density which is making it easier and cheaper for Brands to come to our doorstep,” says Khan.


According to University of Nairobi Economics lecturer Michael Chege, conspicuous consumption marked by--spending heavily on high end luxury goods “(like the Jaguars and Maserati cars, and the Sh100,000 per bottle whiskeys) so that you get noticed” is the new normal in Kenya.

“This will happen in any rapidly-growing economy with inequalities and newly-rich that wants to flaunt its wealth. In China recently the ruling communist party warned against the habit and wants to curb it because the poor resent it, making it a political liability. 

In Kenya huge new wealth has been created in real estate, ICT, finance and international trade.  Kenya needs that wealth, it is flaunting it among the many poor that offends. 

The average income of the richest 10 per cent of Kenyans is 15 times bigger than that of the bottom 10 per cent,” notes Prof Chege.

Their views appear to be confirmed by new report by PricewaterhouseCoopers on consumer trends released last week which says changes in consumer lifestyles and ambitions are influencing purchasing behaviour and patterns, according to leading retailers.

Consequently consumers in Kenya and other Sub Saharan Countries have become more “aspirational and brand-conscious” opting to shop only branded goods in sleek modern retail chains, says the study.

In short they do not just shop, but opt for some of the most expensive luxury items on offer.

According to the 2016 Knight Frank Wealth Report the number of dollar millionaires in Kenya rose from 8,760 in 2014 to 8,962 in 2015.

Indeed, according to figures from the Kenya Motor Industry Association, KMI, the local demand for luxury cars has shot up significantly in recent years contributing to an increase in the overall number of cars sold in the Kenyan market.

A total of 19,524 new vehicles were sold last year up from 17,296 vehicles in 2014, says the association.

Luxury cars, which include BMW, Porsche and Mercedes Benz, were among those bought by Kenyans highlighting the huge unserved demand according to analysts for top of the range brands.

D. T. Dobie, which holds the distributor rights to the lucrative Mercedes Benz franchise for instance, reported that the sale of Mercedes Benz units jumped by 75 per cent to stand at 598 units up from the 342 units sold in 2014.

The auto dealer recently launched a new version of the Mercedes S Class which sells from Sh16 million and is popular among corporate executives.

According to a 2015 report by New World Wealth, which tracks the rise of high net worth individuals across the world Kenya witnessed a 124 per cent increase in the number of millionaires since 2000 which left the country with more than 8,000 high net worth individuals.

The report cited leading clothing and accessory brand among men as Ermenegildo Zegna, the Italian fashion house.

Women in the region according to the report cited luxury brands Louis Vuitton, Gucci and Prada as some of their favourite clothing and accessories labels.

The report further cited the rapid rise of the super-luxury watch market in the region flooded by popular brands including Breguet and Ulysse Nardin whose watches fetch around Sh1 million ($10,000) apiece.

Luxury car Porsche is understood to also be a high selling car in Kenya.

To capitalize on the huge demand for its luxury cars the German luxury car maker recently opened up offices in Kenya at Sameer Park along Nairobi-Mombasa road.

Porsche sold 102 units last year compared to 51 BMWs sold in same period. The BMW models, including the X3, X5, and X6 sell at between Sh8 million and Sh18 million, it sold 44 units in 2014, according to the KMI report.

The rush by luxury brand giants to set up shop in Kenya is highlighted by a Standard Chartered study, titled the Emerging Affluence Report 2015 which claimed Kenya’s emerging middle class is wealthier than peers in developed economies such as Britain and the United States.

However, Prof Chege offers that vast income disparities are not conducive to sustained quality growth.

“Kenya needs a strong middle class and we are seeing evidence of it even as discontent is voiced against conspicuous consumption, in a country that needs to save and invest more of its GDP,” he says.  

The CEO of The Luxury Network Kenya, a private consortium of luxury brands which work together for mutual business and client development, Michael Mwai, says: “The growth into luxury buying in Kenya is a clear indication of an awareness by spenders locally.

The Luxury Network, recently launched in Nairobi and in London in early 2007, covers all areas of the top-end market including: marine, finance, motoring, concierge, health and beauty, aviation, property, travel, golf, events, jewellery and watches, entertainment and fashion etc.

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