Latest news with #ZakHaeri
Zawya
10-07-2025
- Business
- Zawya
NIQ Consumer Tech Trends: The consumer's hunt for value reshapes the South African market
NielsenIQ (NIQ), a leading consumer intelligence company, has recently released its Consumer Tech Industry Trends 2025 report, forecasting global Consumer Tech & Durables (T&D) sales will reach $1.29tn – driven by emerging markets, replacement cycles, and premium innovation – in the year ahead. The value of the Middle East & Africa market is expected to rise around 2% to $68bn. Building on value growth of just 1.2% and unit growth of 3.5% for the first quarter, the South African T&D sector is expected to be shaped by volume-driven purchases and value-conscious buying for the rest of 2025. Zak Haeri, managing director for NIQ in South Africa 'Two dynamics are driving price pressures in the South African T&D market in 2025. On the one hand, disruptive Chinese brands are rapidly moving into the country with attractive products spanning entry level, mid-range and premium price points,' says Zak Haeri, managing director for South Africa at NIQ. 'On the other, consumer behaviour is shifting as South Africans continue to adopt a purpose-driven approach to spending that prioritises value. 'Value' includes durability, quality, and convenience, as well as personalisation, rich features, and affordability. Consumers need to be convinced of value for money before they upgrade or replace products.' Top 2025 Tech Trends in South Africa Consumers need compelling reasons to upgrade Many South African T&D segments are saturated, with consumers holding on to their televisions, computers, smartphones and appliances for longer. For consumers to justify replacing their existing products, they must be convinced of the enhanced performance and experience they'll get in return for their money. Brands need smart strategies to capitalise on the moment when a consumer is ready to upgrade or replace. Competition from Chinese brands heats up Chinese brands have scored impressive wins in the South African television and smartphone markets over the past few years, driving fierce price competition. They have captured market share by offering better specs and more feature-rich configurations at lower prices. The success of Chinese brands in TVs and smartphones is creating a brand halo effect that is spreading to categories, such as home appliances. This trend may accelerate as Chinese brands seek new markets for excess inventory due to tariff-related sales declines in the US. Promos and specials still move the needle In a price-sensitive market, major promotional events and opportunities matter. On a global level, a third of tech sales in 2024 occurred during seven key promotions, up from 29% in 2021. NIQ expect shoppers in 2025 to plan around seasonal deals more than ever. T&D sales in South Africa will remain dominated by a few events on the annual retail calendar, including Back to School, Winter Sales, Christmas, and, especially, Black Friday. Smartphones: Prepaid gains, postpaid pains The smartphone market is undergoing a structural shift in South Africa. The prepaid segment is growing, driven by value offerings and operator support. Postpaid is declining, especially in the premium segment, with inconsistent performance outside flagship launches. Consumers keeping their phones for longer may be one reason for the decline in postpaid contracts. Emerging players with competitive pricing and innovation are reshaping consumer preferences. Smartwatches: Sales shrink but entry-level grows Unlike the global wearables market, South Africa's smartwatch market is contracting, particularly in the R8,000–R12,000 mid-tier. Entry-level models are gaining traction, pulling demand from higher tiers. Promotions are driving short-term gains but not long-term stability. Panel TVs: Contraction and innovation The value of the panel television market is shrinking due to soft growth for QLED products and larger screen sizes. Competition from new brands, primarily Chinese companies, is heating up. Opportunities remain in select screen sizes (50–60") despite the overall contraction of the market. Gaming monitors are thriving, with the All rights reserved. © 2022. Provided by SyndiGate Media Inc. (
Zawya
25-04-2025
- Business
- Zawya
NIQ report reveals opportunities for private label FMCG growth in South Africa
According to NielsenIQ (NIQ) private labels generated sales value of more than R98bn in South Africa during 2024. The data shows that private labels grew sales value in South Africa by 7.5% in 2024 and accounted for around 18% of total FMCG sales value for the year.* These findings are drawn from NIQ's new report, Finding Harmony on the Shelf: 2025 Global Outlook on Private Label & Branded Products. The report offers an in-depth analysis of shifting global consumer attitudes around private label and branded products, catalysts driving these trends globally and regionally, and important insights retailers and consumer packaged goods (CPG) manufacturers can keep in mind to strategically reach consumers within a fast-moving macro-economic environment. According to the report, four in ten (39%) of South African respondents are likely to purchase more private label products than they were before, representing strong growth in a market where private labels have enjoyed a notable presence on most retailers' shelves for many years. Furthermore, nearly two thirds (65%) of South African consumers say they would buy more private label products if a larger variety were available. 'Private label brands in South Africa are booming as consumers adapt their shopping habits to current market conditions. Local retailers and manufacturers have found creative ways to collaborate and address the evolving needs of the consumer with white label offerings that span from value products for price-conscious spenders to luxury offerings for premium customers. There is room for private labels to enter new categories like liquor and baby goods, as well as to continue refining their offerings to appeal to different income and generational groups,' said Zak Haeri, MD for NIQ in South Africa. Key trends shaping private label and branded product growth in South Africa Consumer perception of private label products and their quality has significantly improved, while global brands also see strong performance. Key trends driving growth of both private label and branded products in South Africa include: - Embracing value for money: South African consumers have a positive perception around the value for money and quality offered by private label brands, with 72% of respondents viewing them as good alternatives to name brands and 75% perceiving them as offering good value. - From stigma to status: Private label brands are no longer targeted solely at price-sensitive consumers in South Africa. Premium house brands from leading retailers are winning market share from named brands as consumers look for both quality and cost savings. - Divided opinions: Two thirds (66%) of South African consumers trust private label brands as they are endorsed by the retailers and 45% say store brand products are higher or equal quality than name brands. They are divided exactly 50/50 about whether name brand products are worth paying more for. - Premiumisation: Close to half of South African consumers (49%) say they are likely to treat themselves by upgrading to a premium-brand product, with younger generations — Millennials (62%) and Gen Z (58%) — exceeding that average. - Openness to explore: More than half (58%) of South African respondents say they're expanding their brand purchases across multiple categories, as well as across a wide range of price tiers and preferences. The same amount (58%) say that brand or store brand is irrelevant, choosing products based on necessity instead. - The quest for value: With 39% of South African consumers reporting that their household is worse off than a year ago and 53% reporting they have only enough money to cover the basics, affordability is the most important consideration in choosing a brand. Some 95% say that affordability and value for money is a top consideration in brand choices. - The loyalty lever: South African consumers leverage promotions and loyalty programmes to save money. Three quarters (74%) will spend more on a brand that rewards loyalty and 58% say they will pay more to get free bonuses such as complimentary delivery. 'There's never been a better time for organisations to rally together to find ways to grow the overall size of prize with consumers. Growth is attainable for many companies in this wildly diverse playing field. Retailers should maximise category traffic by balancing a strategic mix of both name-brand and private label products—and consider co-promotion programs to boost overall category growth. On the other hand, manufacturers need to safeguard and expand their market share by innovating with trade incentives, while working to preserve their brand's overall value proposition,' said Lauren Fernandes, vice president, Global Thought Leadership, NIQ. Harmonising success between private label and branded products Strategies retailers and manufacturers can use to create synergies for mutual growth include: - For private labels: - Brand halo effect: Proximity to name brands enhances private labels' appeal. Brands thrive on pride (30%), superiority (37%), and notoriety (48%). Trust in private labels grows when they match premium quality, boosting sales. - Price anchoring: Branded products are often sold at a 26% premium compared with private label products across CPG categories globally. A price gap can inspire a consumer to make a value-driven choice to try something new or comparable. - For branded products: - Market expansion: Private labels drive over half of global sales growth in categories like ready-to-drink coffee and snack bars, creating opportunities for all brands. Initially budget-friendly, they enhance category perceptions and boost name brand acceptance. Brands should focus on areas where private labels grow category opportunities. *Source: NIQ Retail Measurement Services, Total private label sales, Annual period ended Q4 2024 vs. year ago. About Finding Harmony on the Shelf: 2025 Global Outlook on Private Label & Branded Products Report This first-of-its-kind report focuses on trends driving global growth, assesses symbiotic/competitive dynamics between private label and branded products, and identifies opportunities for retailers and manufacturers to drive collaboration and growth. To understand how these trends are impacting your local market, download a free copy of the report. Research Methodology The NIQ 2025 Private Label & Branded Products report global survey was conducted between December 2024 and January 2025, polling over 17,000 online consumers in 25 countries throughout Asia Pacific, Europe, Latin America, the Middle East & Africa, and North America. The respondents include consumers who often make shopping decisions on behalf of their households and agreed to participate in this survey. The sample for each country incorporated age and gender quotas aligned with respective census data, while ensuring that each demographic group maintained a statistically reliable base size.
Zawya
13-03-2025
- Business
- Zawya
NIQ State of Retail: South African consumers shift to value as economic pressures persist
NIQ South Africa has released its latest State of the Retail Nation analysis for the last quarter and full year calendar year of 2024, showing moderate increases in retail sales despite a strong festive season finish. South African consumers spent nearly R637 billion on fast-moving consumer goods (FMCG) through traditional and modern trade channels during the year. This represents year-over-year growth of just 3.4%, with the increases mostly driven by price increases rather than increased consumption. The Technology & Durables (T&D) market, meanwhile, experienced flat growth, with sales value increasing just 1.8% to R90 billion. Overall performance was dragged down by a 2% decline in sales value in telecoms, the biggest T&D category representing more than half of the T&D market's value. Washing machines were one of the star performers of the year – growing sales every month and overall achieving 16% growth in sales value and units. Says Zak Haeri, Managing Director for NIQ in South Africa: 'Despite much-improved consumer sentiment off the back of lower levels of load shedding, social grant increases and slower price increases, retail recorded only moderate gains in sales during 2024. High unemployment and rising living costs continue to challenge many households, with consumers seeking value when they shop. Fiercer price competition and aggressive discounting continue to suppress growth in the FMCG and T&D segments alike.' Festive season cheer for the FMCG sector For the full year of 2024, South Africans spent R359 billion on food and liquor as well as R278 billion on other goods, including non-alcoholic beverages, personal and healthcare products, snacks, home and pet supplies, baby food and care, and tobacco. Private label brands dominated, achieving 7.1% sales value growth and reaching R98.7 billion in total sales value for 2024 – outpacing the growth of the overall market. Growth in private label sales is being driven by its broad cross-category reach, easier access to shelf space, and consumers' increasing focus on cost savings. The fourth quarter saw 4.8% year-over-year growth, translating to R177 billion in value and a sales value change of R8 billion. Liquor, personal care and ambient foods experienced the most notable growth. December was a strong month, with R78 billion in retail spending – up 9% in sales value from the previous year. Food and liquor accounted for 58% (R45 billion) of overall sales during the festive period, as consumers continued a trend towards at-home activities. 'Consumers are still focusing on essential spending and taking advantage of loyalty programmes, private label brands and promotions to stretch their rand further,' says Haeri. 'Macroeconomic conditions are steering households toward perceived value, with the term 'discount' now encompassing more than mere price reductions. Depending on their cash flow, consumers are buying large packages to take advantage of lower bulk costs or buying small packages to reduce immediate spending. On the flip side, we also see healthy growth in super-premium segments, indicating that some consumers are not feeling the pinch.' T&D sector takes a hit from smartphone saturation A surge in Black Friday spending wasn't enough to turn around a disappointing year for the T&D sector. Although the IT segment (up 7%), major domestic appliances (up 10%) and small domestic appliance (up 9%) segments showed strong growth, they could not compensate for the negative growth in the telecoms segment. This category, which represents 53% of the total sales value in the South African T&D market, showed negative growth (down 2%) due to market saturation and slower smartphone upgrade cycles. Consumer electronics (including TVs) was flat. The telecom market experienced negative growth in value and flat growth in units as 3G phones continued to be phased out. The market is still stratified, with 5G phones 55 times more expensive than 2G phones. 4G phones are now the standard, making up over 60% of unit sales. Prices decreased by 9% compared to the previous year during the fourth quarter, with consumers benefitting from wider discounting and aggressive competition from emerging Chinese brands. On the upside, the T&D market enjoyed its biggest Black Friday to date. Consumers took advantage of discounts, with prices down by around 5%, unit sales up 12%, and sales value up 7% compared to Black Friday 2023. Discounts were lower but more widespread than in previous years. In 2022 and 2023, 28% and 31% of unit sales, respectively, were discounted by more than 15%, but in 2024 this dropped to 18%. TVs, coffee machines, fridges, and cooking appliances performed best against sales for the first few months of the year. Thomas Woods, Market Intelligence Lead for NIQ in South Africa, says: 'The introduction of the two-pot retirement saving system may have contributed to higher sales during the fourth quarter, with SARS reporting R35 billion in withdrawals. Online T&D sales grew 9% for the year, outpacing the broader market, as consumers increasingly sought better deals online.' Looking ahead Haeri concludes: 'While consumer sentiment has improved over the past year, potential headwinds remain – such as a possible VAT increase and how global trade volatility affects South Africa. However, we anticipate that mainstream consumers will remain adaptable as macroeconomic conditions change. Retailers that strike the right balance – offering value through rewards and promotions to the mainstream market while taking advantage of the opportunities in the premium segment – will be best positioned to thrive in the year ahead.' 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