The luxury market in Kenya generated Sh50 billion ($500 million) in revenues last year representing a 20 per cent growth compared to Sh40 billion realised during the same period in 2015.
The 2017 Afrasia Bank New World Wealth survey released a fortnight ago places Kenya as the second largest luxury market by revenue in the continent after South Africa which accounted for Sh230 billion ($2.3 billion).
Kenya was also the only market that attained growth in the sector as revenues from other key markets of South Africa, Nigeria, Angola, Egypt and Morocco plunged.
South Africa dropped by 10 per cent, Nigeria fell by a third to Sh40 billion while Angola and Egypt plunged by same rate to Sh20 billion each. Morocco revenues remained unchanged at Sh20 billion.
“South Africa, Nigeria, Egypt and Angola all experienced drops in luxury sales in 2016, whilst luxury sales in Kenya were up…Kenya was above Nigeria mainly due to the large luxury tourism industry there,” said the report.
The growth in luxury expenditure in Kenya is attributed to expanding club of the super rich, with a growing taste for high-end products.
The Wealth Report published by Knight Frank a month ago says that the number of Kenya’s super rich grew by eight per cent, the fastest in the region, to 9,400 dollar millionaires. These are individuals classified as having assets worth more than $1 million (Sh103 million), excluding primary residences.
The super rich numbers have over the recent years attracted world famous luxury car brands to Kenya including the Bentley, Porsche, Jaguar, Range Rover Autobiography, Mercedes-Maybach and S-Class with prices of up to Sh40 million.
The taste for luxury products has also led to the development of world class hotels and lodges like Finch Hattons in Tsavo West National Park and Mahali Mzuri owned by Virgin Atlantic billionaire Richard Branson. It also led to the opening of local franchise shops of luxury brands like Swiss-made Rado Watches, which recently opened the first store in Africa at the Westgate Mall in Nairobi.
“We estimate that the African luxury sector generated approximately $5.9 billion in revenue in 2016. The main components of this were luxury cars, yachts, private jets, personal luxury goods (which include watches, clothing, accessories and jewelry) and luxury hotels and lodges,” the report said.