Blog post

Is Africa hotter than we thought?

 

Forgive the pun, but in September last year I wrote a blog post based on conversations with my clients, and feedback from our drinks industry survey. My conclusion was that the beer market in Africa was hot, and was set to get hotter. 44% of respondents to our survey felt that Africa was the region of the world that would see most growth in the 12 months to July 2016, and if anything it’s starting to look like we might have underestimated the potential of the market there.

Heineken had a particularly strong Q1 in the region, with a 4.6% rise in sales there. Looking a little more closely at the numbers, it seems that a particularly strong performance in Ethiopia and Nigeria has offset some weaker results elsewhere, but the overall trend is still very much on the up.

At the same time it seems that securing dominance of the African market was one of the driving strategic aims behind the AB InBev /SAB merger. Even though they’ve been forced to divest Chinese lager Snow, the world’s biggest-selling beer, the newly-merged business is now #1 or #2 player in pretty much every regional market in the world. It’s easy to ignore how important some of those areas have been in pushing that merger through, but SAB’s position in Africa was definitely one of the key factors.

65 million people in Africa will reach the legal drinking age by 2023, so we fully expect this market to become even more of a strategic priority for our drinks clients over the next few years.

 

 

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