Title: Cosmetic firm MAC to open 20 stores in Africa
ALONG with its aggressive expansion in South Africa, Make-up Art Cosmetics (MAC) is to open 20 stores in the rest of sub-Saharan Africa during the next five years.
The NYSE-listed Estée Lauder-owned make-up label is eyeing fast-growing emerging markets, including Brazil, India and Turkey.
Dubbed the next consumer hot spot, sub-Saharan Africa is experiencing the second-fastest economic growth in the world, behind Asia-Pacific, and is home to 821-million consumers. According to Euromonitor International, in 2020, sub-Saharan Africa is expected to be a $2-trillion economy, the same size as Russia today.
"Despite some notable challenges within the region, Africa is benefiting from its wealth of natural resources, a new era of stability, inward investment and economic development.
"This is laying the foundations for an increasingly important consumer market and, with it, huge opportunities for companies with the right goods and services and an appropriate strategy," Euromonitor International said.
MAC has operated in South Africa since 2000 and has 24 stores in eight cities across the country.
MAC global brand president Karen Buglisi said the company would double its presence in South Africa in the next three years.
The brand, whose credo is All Ages, All Races, All Sexes, has appealed to brand-savvy Nigerian consumers and the company opened two stores in the region this year.
Brand presence will be extended to Botswana and Zambia before the end of the year.
"Emerging markets represent 15% of the global business at MAC, which will grow exponentially in the next 10-20 years — this is where our future growth will come from," Ms Buglisi said.
It was only a matter of time before the company entered the rest of sub-Saharan Africa, she said.
"In Nigeria, we had to wait for the retail infrastructure. The consumer knew us already — we have a big following and demand from Nigerians in Saint-Denis, Paris," Ms Buglisi said.
Nigeria, whose economy has grown by an average annual rate of 7% in the past five years, has seen a slew of international brands set up shop this year, including Ermenegildo Zegna, Porsche and Hugo Boss. Nigeria is one of the top 10 biggest markets in the world for LVMH’s Hennessy cognac.
One of the main forces behind Africa’s growth spurt is the increasing pace of urbanisation, which is improving living standards and growing consumer expenditure.
Among the advantages Africa holds is its young and growing demographic profile, particularly in the context of global ageing — 70% of the population in sub-Saharan Africa is under the age of 30, according to Euromonitor International.
"The stores in Nigeria are exceeding our expectations. We are excited about the potential for Africa … but we know this is a slow build. "We will be there as trailblazers," Ms Buglisi said.
MAC, famed for its collaboration with personalities like Rihanna and Lady Gaga, has earmarked Kenya, Ghana, Cote d’Ivoire and Mozambique as potential markets.
Estée Lauder, which has a market capitalisation of about $20bn, is present in Ghana through its Tom Ford, DKNY and Michael Kors fragrances, and intends to introduce Clinique, its third-biggest brand, to the Nigerian and Mozambican markets this year.
According to Roze Phillips, a senior managing executive at Accenture, the spending power of cosmopolitan professionals and the affluent in Africa translates into a significant opportunity for luxury products and services.
"As the African economy continues to mature, these segments are likely to grow more rapidly," she said. This month, MAC launched its e-commerce platform in South Africa.
"E-commerce is one of the fastest-growing channels we have around the world. In South Africa, it will be a little bit slower, but we are patient … we don’t have high expectations for revenue immediately, but we can use it to raise awareness of the brand in Africa," Ms Buglisi said.
MAC was founded in Toronto in 1984 by Frank Toskan and Frank Angelo. A 51% stake in the brand was bought by Estée Lauder in 1994. The US giant acquired the remaining interest in 1998.
Paulina says: Lets be honest here.... we have all shipped stuff back home... We've all been called in the middle of the night by Adjoa A and Abena B asking for sooo and sooo and a tube of Elizabeth Arden's 8 Hour Cream, Estee Lauder's Advanced Night Repair Serum and the latest copy of Vogue, and while you can now buy and subscribe the aforementioned in Marina Mall and SyTris Bookshop/Silverbird Lifestyle Store in Accra, there are still some bits n bobs including: Benefit's Badgal Mascara, Guerlain Terracotta Moisturising Bronzing Powder and Mac's Studio Fix Powder Plus Foundation in NW45 to name but a few that we all buy in bulk and travel back to Ghana with and its not on is it?
I'm also fed-up ....with all those happily ensconced in the sun, no longer payers of Council Tax-ers asking me to buy sooo and sooo ---and give it to Missy soo and soo and brother soo and sooo ---sooo that they can pay excess duty (???) and drag said coveted beauty gems back to Ghana....
I know that many also get around this lack by buying to order in Ghana, paying for it via transfer (Barclays bank) and Ama J ships goods to Esi B -but as someone who used to wait for time wasters to pay for their goods, then find out much later that they travelled to Dubai to buy the goods in the end -know that this type of transaction --doesn't work.
Still that costly annual trip to Dubai by Ghana's style Elite to stock up on their beauty must-haves is crazy...and all a bit much -no? Thus it would be good to have at least one Mac store in the Accra Metropolis in the very near future!!!!!
Note, if infrastructure was once an issue, the likes of Estee Lauder, the owner of Mac, need to check out Marina Mall (they already stock perfumes from various brands owned by Estee Lauder) or check out the 5 Star Kempinski Gold Coast City Hotel due to open in the heart of Accra, Ghana next year for retail space... I truly hope Mac is coming to Ghana soon, it would be fabulous and convenient...