Global retail specialist Smollan, representing some of the world’s most loved FMCG and commerce brands, suggests four retail trends for 2022 in Africa where market possibilities and shifted behavioural patterns set a new trajectory for growth potential.

Despite time, new ways of doing things, adaptability, and innovation – COVID-19 will forever leave its mark having reshaped the consumer goods market across sub-Saharan Africa. Driving economies forward as life slowly finds a balance will have retailers needing to stay ahead of the turn and adopt an evolving mindset to strategize and execute to grow business and allow room to flourish in a post-pandemic world.


From a global perspective, analysts such as are suggesting that 2022 will be a year of investment and new partnerships, specifically referencing trends for retailer and brands around the circular economy – a logistically challenging offering and one that will become a must-have investment with 60% of online adults in France, 49% in the UK and 41% in the US preferring to buy environmentally sustainable products. Returns will become the next retail competitive service differentiator – originally seen as part of “boring but necessary” operations, returns will become a hot differentiator for retailers in 2022 with three out of five French, UK and US online adults preferring retailers that offer free return shipping. While partnerships of all kinds will be the key to growth – think established retailers partnering with direct-to-consumer brands – think also of retailers investing further in retail media networks.


Closer to home, with the focus on economic recovery in sub-Saharan Africa, the International Monetary Fund (IMF) recently released a report on the regional economic predicting that the region is expected to grow by 3.7% in 2021, the slowest recovery in the world. South Africa’s GDP outlook was revised from 4% to 5% but it’s unlikely that the country will be able to sustain this pace, with growth predicted to slow to 2.2% this year. suggests that retailing sales in this region was expected to grow by 7% last year however country specific recovery will vary due to the different impact of COVID-19 and unique local circumstances. Kenya and Nigeria’s retailing industries will recover the fastest, exceeding their 2019 market sizes by 2022, however South Africa’s retail industry will only return to its former value size by 2025.


In a recent BizCommunity article it was suggested that in order to stay competitive, mindful of the expected growth predictions, retail organisations will have to adapt to evolving change to stay ahead, with the following trends under the spotlight for this year –


Supply chain issues resolve slowly – for a variety of reasons 2021 was marked by global supply chain shortages. Fortunately, this year should see a return to some sort of normal with analysts saying that the world is now through the worst of it. It will take some time but retailers can a least reast easy in the knowledge that shipping costs should normalise.


Integration of online and offline experiences – as eCommerce continues to grow, people’s expectations of physical retail stores is changing. Consumers may go to places to experience goods before buying online. Retailers can play into this by creating a seamless experience between these two worlds. At the same time, retailers need to ensure that the store experiences are authentic and data driven.


eCommerce is expected to continue its robust growth trajectory registering double-digit growth over the long-term – most evident in South Africa, reaching more than 40% last year. eCommerce is heavily supported by mcommerce with regions throughout Africa using mobile phones as the primary means of internet connectivity, making these channels critical in any marketing mix. Consumers will continue to buy from traditional channels such as open markets as they meet shoppers need for value, convenience, and proximity. This is especially true for low-income consumers who typically buy small quantities of goods at a time.


Growth of retailers as financial service providers – in South Africa for example, various retailers such as Shoprite have offered financial services to one degree or another either as store credit, loans, or insurance. The amount of data retailers have on customers such as loyalty programmes, make this an ideal opportunity to launch finance services products. The products will have to be easy to use and genuinely useful as retailers won’t be able to compete on price alone.


“We’ve come so far both locally and globally in under two years in terms of shape shifting to meet a brief we were just not prepared for. In order to move forward, it’s now, all about finding the balance between seizing new opportunities to accelerate growth, development, innovation and ultimately making sure businesses prosper, matched with ensuring our communities have an increased quality of life; we work sustainably and we take big leaps into a more inclusive future that really cares about our planet and our people.” said Michael Smollan, Chief Growth and Innovation Officer, Smollan.


Having this clear path to purpose where business is transformed on the understanding that growth is not simply measured in economic returns but in the people it impacts, shifts the trend reach well beyond 2022. With many companies this has become a more entrenched business obligation and part of the bigger picture strategy while for others it serves as a reminder to quick step their approach. Focusing on education, empowerment and strengthening communities; making smarter moves to reduce our environmental footprint; creating meaningful employment and delivering pioneering services and sustainable solutions – is where it’s at in Africa and with an engaged, authentic approach will reap the rewards over time.


Predicting the future can be a costly mistake if you put all your eggs in one basket. When faced with adversity and change that comes quickly, an integrated, data-led approach with the customer experience at the centre of it all and an authentic commitment to sustainability, will certainly position Africa’s retailers well as the retail landscape of today, evolves tomorrow.