Shreya Karia started SHK Consulting in Nairobi, Kenya because she saw a need for a local consulting house that ‘gets’ luxury. SHK’s team of youthful, energetic, lively thinkers and high-achievers has an extensive background in public relations, marketing, brand strategy and event conceptualisation and experience from Australia, Europe and Africa.
SHK Consulting conceptualizes events that offer a distinct experience and a contacts book of top influencers from across all industries to an enviable list of premium brands looking to set up shop in the country.
Shreya speaks to Footprint to Africa about doing business in that segment:
You describe yourself as a local company that ‘gets’ luxury, what is the luxury and premium segment?
Well if we take it in the strictest, narrowest definition than a premium product or service is one that increases in desirability as income increases. Unlike essential necessities of everyday lives the offering here plays to your emotional needs- it makes you feel good, it makes you look good, if you will it is a status symbol of success.
Within this segment, you have variances from premium and high-end to luxury and prestige. And naturally the conversation around marketing a premium brand to that around a ‘prestige’ one can differ dramatically. In this segment, there is most certainly not a ‘one-size fits all approach’.
Does the same apply in the Kenyan context?
Locally, high-net-worth earners in the market represent close to 4 per cent and the upper middle class between 10-12 per cent. These are people that are actively consuming, engaging with and desiring differentiated experience and products (statistics show that 88 per cent do not mind paying a premium for this).
And this is reflected in the growth of our market in the past few years. Premium now extends to cars, fine spirits, and wine, private banking, real estate, hospitality and more. All of which are highly active in the local market.
It is important to contextualize this because we have yet to reach the luxury segment where top tier brands have a market presence in Kenya. However, this does not mean that well-to do Kenyans are not purchasing these abroad.
What inspired the founding of SHK Consulting and what experience do you bring to the table?
Well, my own personal background has always been in the true luxury market across a number of countries including Australia and the UK. I have worked in brand development and PR for some of the world’s leading brands such as Louis Vuitton and Stella McCartney. When you work in this segment of the market you learn very quickly that attention to detail across every single consumer touch point is paramount. The little things are key to making a complete experience. You also learn how to think quick on your feet and to always find a solution. For this demographic, no is not an acceptable answer.
In Kenya whilst these brands do not necessarily exist, the same principles exist. Attention to detail, personalized marketing, thinking outside-of-the-box are very applicable to our premium segment. And when we started SHK Consulting, no-one else was specifically speaking to this audience. We had a skillset that we knew we could apply, an understanding of our demographic and how to speak to them. I also believe that if you focus on a clear proposition you can deliver it exceptionally. The beauty of what we do is that we can leverage a lot of synergy across our clients because they ultimately want to speak to the same audience which benefits them and the audience.
How is business done in this market?
It is highly personal. Anytime you are asking someone to enter into a transaction that involves a little more money it is imperative that they believe there is an associated value with what they are paying for. And this is all set the tone of how you communicate from the outset. If I take the time to engage with you personally, understand what interests you and why my brand fits your lifestyle then you are more likely to buy into what I have to offer.
So any marketing interaction has to be highly personable whether it is through direct marketing such as calls or newsletters, social media, and experiential events.
What is the target audience and what are they looking for?
Well, it is that 15 per cent of the market I defined in the second question. We are speaking by and large to that audience. And they are looking for distinct experience or products. If it is a product, it is one that will have been crafted with more detail and attention using finer materials than your average product. If it is an experience then it is one that is specifically crafted to their interests and personalized to their preferences from beginning to end.
People are paying more because they want something that is on some exclusive level and is a signal that they have ‘earned it’ through their hard work.
But I would like to challenge this perception. Obviously, the definition of Kenyan middle class is currently extremely broad. And there tends to be a vast gap within it. But assuming that our middle class is growing, most middle class may not be ‘luxury consumers’ but they are consumers of luxury. Even if it is once in a year for a celebration like a birthday, a wedding or a promotion. And this demographic is everywhere. And local companies need to start paying attention to them.
How do they consume information?
The most influential means for any premium brand to connect with this audience is through ‘word-of-mouth’. Credibility and referrals from people in their own circles have the highest conversation rate. But that being said bespoke marketing activities work extremely well including bespoke experiences where they can almost ‘network, learn and sample these brands and services first hand’. It’s less about the mass advertising here.
Of course in the heavily digital world, social media is also a huge influence and so how the brand represents itself in this space MUST reflect its target audience if it is to appeal and attract. We also tend to find that this audience is very much to-do date with global trends and are knowledgeable.
What services does SHK offer and how do you market your work?
We focus on PR and Communications, Marketing and Experiential as our core offering. However, within each one there is very much a 360-degree approach looking at the brand first and foremost- its company objectives and its audience. How the two can align on a common note. It is imperative for us to take the time to understand the companies we work with, who they want to attract and why. Without understanding that we cannot do our job well.
How do we market our work? We’re only as good as our last project. So we let our work speak for itself. Our clients come through word-of-mouth because they have heard of what we do through other partners and or they have experienced our work first-hand. I genuinely believe this is the best form of marketing particularly when you are promoting yourself and your service. We are very cautious about over extending ourselves and then not being able to deliver.
Which notable campaigns have you been involved in and the brands you have worked with so far?
Brands we have worked with in the Kenyan market extend from Moet-Hennessy to PernodRicard (Chivas, GH MUMM, Jameson), Fairmont, Sankara Nairobi, Marriott, Knight Frank, DT Dobie, CNBC, Taste Awards and Artcaffe Group to name a few.
One of the notable ones for me personally was the Forbes Africa Person of the Year Awards where AlikoDangote was awarded- a personal high note.
How do luxury market trends across the region and in other markets such as South Africa and Nigeria compare with global trends in the segment?
In a recent Deloitte report Nigerians are among the top global spenders of tax-free spending in the UK. This is reflected by their high-propensity to spend on consumer luxury goods, that too on a level that far exceeds our local market. They have a much broader high-networth demographic and so their luxury market is far more developed than our. Top-tier brands such as Gucci, Cartier, Hublot and Rolex are available in Lagos already through authorised retailers. Culturally, Nigerians are also much more status and brand conscious than we are in Kenya so what they buy is very much a societal indicator. One statistic claims that between 2007-2012, 750million bottles of champagne were purchased in Nigeria.
When it comes to South Africa, for the longest time it was and still is the go-to destination for sub-Saharan African to indulge in ‘retail therapy’. Despite the low growth in their overall GDP the luxury market continues to grow. It is particularly attractive for premium and luxury brands wanting to enter the African market with it’s already established and reliable retail segment.
What is your forecast of the African luxury market?
If we read all the international reports coming out, ‘Africa is the next frontier in luxury’ and luxury brands must absolutely invest for long-term benefit on the continent. And yes whilst the Nigerian and South African market have both a larger top-end audience and appetite for these brands, we in Kenya are still a fair way off to competing on this scale. Our consumption of luxury and premium offerings continues to grow no-doubt but our market is relatively small for larger luxury brands to be attracted to directly enter into. In addition, our retail structure still needs to be developed significantly. We need to get the basics right first. That being said we will see more luxury brands in alcohol, cars, hotel brands, restaurant franchises and watch brands come into the market in Kenya I believe. Experiences that people can enjoy as ‘consumers of luxury’ are the items I would put my money on locally.