THE RISING COST OF LIVING CRIPPLES CONSUMER OPTIMISM ACROSS ALL INCOME LEVELS
Nairobi, Kenya – 6th June 2024 – Kenyan mobile payment brand M-PESA has for the third year been voted Kenya’s leading SUPERBRAND, ahead of parent company Safaricom, which placed second, once again.
This further solidifies the platform’s positioning as being integral and essential to the functioning of small and medium-sized enterprises (SMEs). This comes at a time when the global economic downturn is filtering through to the Kenyan economy.
Notably, the highest gainer was M-KOPA; climbing up from the 36th to 6th position from 2022 to 2024, respectively. This can be attributed to the rising cost of living experienced over the past two years which has seen consumers gravitate more towards flexible lending policies without steep penalties; and also seen households move away from electricity to solar energy due to high and rising electricity prices.
New entrants into the Top 10 list are Citizen TV, Supa Loaf, M-Kopa, Radio Citizen FM, and The Daily Nation.
The results are derived entirely from a comprehensive survey administered to urban Kenyan consumers (selected at random) and undertaken by Kantar in Nairobi, Mombasa, and Kisumu.
David Ogara, Associate Account Director, Kantar observes, “With challenging economic times, it’s been interesting to understand how consumer perception and brand value offerings have evolved. Inflation has divided brands and products between ‘must haves’ and ‘nice to have,’ creating a clear distinction when purchase decisions are being made. The survey brings to light great insight for brands navigating value offering.”
| RANK (2024) | BRAND | CATEGORY |
| 1 | M-PESA | General Financial – Mobile Money |
| 2 | Safaricom | Telecommunications, Broadband & Software |
| 3 | The Kenya Red Cross | Relief Organizations |
| 4 | Citizen TV | Media – TV Stations |
| 5 | Supa Loaf | Food – Bread and bread Products |
| 6 | M-KOPA | Buy Now Pay Later |
| 7 | Radio Citizen FM | Media – Radio Stations |
| 8 | Kenpoly | Household – Plastic Products |
| 9 | The Daily Nation | Media – Newspapers & Magazines |
| 10 | Bamburi Cement | Cement |
Key takeaways from 2024:
1. The level of consumer optimism has dropped to a new low of 50% (down from 70% in 2019), according to the Kantar Africa Life Report 2023. Consumers are being more cautious of their expenditures and are making calculated moves to:
· Buy fewer items
· Reduce purchase frequency
· Only buy critical items
· Opt for cheaper alternatives
· Look for cheaper purchase channels
· Change how they interact with financial institutions and services – including relying more on micro-lending solutions and turning to informal banking for easier access to money.
2. Kenya Red Cross maintained popularity in the Top 3 due to immediate action taken in response to the El Niño floods in 2023. Consumers are seeing and appreciating their efforts in high-risk zones to help people in need.
3. Supa Loaf jumped to Rank 5 from Rank 13 in 2022. It is the only food brand within the listing this year. Its popularity can be inferred from its strong heritage, having been around for over 50 years; and also, as bread remains a staple for low-income Kenyan households.
4. M-KOPA rose from Rank 36 in 2022 to Rank 6 (greatest gainer) in this year’s survey. The products and flexible services M-KOPA offers are fitting into the prudent low-income consumer mindset: cautiously spending to manage expenses and allowing more flexible payment options.
5. 3 media channels appeared in the Top 10 listing for the first time ever: Citizen TV, Radio Citizen, and The Daily Nation. In February 2024, Forbes reported that subscriptions to streaming services halved in 2023, pointing to the growing worldwide trend where consumers are engaging less with brands they have to pay for. This can be seen locally as well, where consumers are moving from spending on ‘nice to have’ products and services, and generally engaging more with free content-based services and platforms like Media (internet, radio, TV, newspapers).
6. Kenpoly remained in the Top 10. Kenpoly makes disposable cups, which were common at informal social meetups for quick consumption of alcohol and other beverages.
7. Bamburi Cement also stayed put in the Top 10 due to Kenya’s growing population and urbanization.
8. With the increased adoption of e-commerce, consumers are now increasingly researching about products before they make their purchase decisions. Some consumers are starting to place emphasis on differentiation, and punishing brands that are more premium or value, but not differentiated from the low-priced mainstream brands.
9. With difficult economic times, some brands cease to be as relevant as they were. Consumers no longer have the luxury of spending disposable incomes on betting for instance. This year no betting companies feature in the top 10 ranking.
Most notably for 2024, consumers were asked about the impact the Superbrands seal had on their decision-making process. 8 out of 10 respondents were more likely to go with a brand that featured the seal. Consumers believed Superbrands affiliation to help build a company’s reputation and help them stand out from the competition. This remained consistent from the previous study conducted in 2022.
Jawad Jaffer, Project Manager, Superbrands East Africa said, “Once again, the study has emerged as a barometer for changing consumer needs and preferences. Brands must strive to provide value to climb the ranks as consumers prioritize needs over wants.”
