- Title: NIGERIA: Hugo Boss eyes Nigeria's emerging luxury market.
- Date: 20th February 2013
- Summary: LAGOS, NIGERIA (RECENT) (REUTERS) (SOUNDBITE) (English) BISMARCK REWANE, CHIEF EXECUTIVE OFFICER, FINANCIAL DERIVATIVES COMPANY SAYING: "The luxury goods people go where the money is, the money goes where the celebrity endorsements are, it's a good sign that we are starting but we are way way behind the rest of the emerging markets in terms of positioning ourselves as a luxury goods market in the world." VARIOUS OF BOSS MERCHANDISE IN STORE
- Embargoed: 7th March 2013 12:00
- Keywords:
- Location: Nigeria
- Country: Nigeria
- Topics: Economy
- Reuters ID: LVA2NMVHYFEKBDCF7L32AQWR4C5H
- Story Text: German fashion house Hugo Boss opens retail store in Lagos, Nigeria making it the first international luxury brand to foray into retail shopping in Africa's most populous nation. Analysts say investors are beginning to see great potential in African market where wealthy buyers are ready to spend big on luxury items in or outside the country.
At an average of 1000 US dollars apiece, a suit at Hugo Boss carries a price tag that would bewilder a majority of Nigerians. But the German fashion house is here, in the country's commercial capital, Lagos and it is open for business.
Located in the city's affluent Lekki area, Hugo Boss is targeting the upper and middle class with a penchant for fine things.
The official store opening in February was a star studded event co-sponsored by luxury champagne brand, Moet and Chandon and attended by Nigeria's top celebrities, including international super model Oluchi Orlandi Onweagba.
Hugo Boss is known internationally for its clean European styles of men's suits but also tailors women's wear and accessories for both sexes and is available in 124 countries.
The Lagos store is the designer's first in Nigeria.
"I'm just happy that they are here now, and I'm sure, I'm pretty confident that Hugo Boss will do well in Nigeria so fairplay to them," said Olugbemi Omotehinwa, an IT consultant shopping at the newly opened store.
Hugo Boss is currently experiencing its fastest growth in the United States, where affluent professionals are snapping up Boss suits and sales are expected to triple by 2015 in China, according to company officials.
But concerns that luxury demand was waning in Europe due to the Euro zone crisis has hit sales for several top brands across the globe.
Hugo Boss' Lagos store manager, Mohammad Ayyoub says the decision to come to Nigeria was mostly based on Nigerians' reputation abroad for spending freely on luxury items.
"Nigeria is big market and it's very huge market for retail and there's no much retail and boutiques here, so it was our idea to come to Lagos and Nigeria for Hugo Boss because I was working in Dubai, nine years for Hugo Boss and I have a lot of Nigerian customers there, a lot," he said.
"We didn't do any advertising, we didn't do anything outside we just opened the shop and start business, so the people here they are like wow, Boss is here, so they are hungry for brands," Ayyoub added.
Lagos embraces some of Africa's most expensive real estate alongside some of its most crowded slums.
The oil wealth of Africa's biggest producer has made multi-millionaires of its elite in the past few decades, even while absolute poverty has increased to 60 percent of the population.
High-end goods producers are increasingly targeting sub-Saharan Africa, as its economic growth starts to dwarf other continents and rich Western countries face a slowdown.
Bismarck Rewane, a market analyst and Chief Executive Officer of Financial Derivatives Company in Lagos, says luxury brands are intrigued by Nigeria's shopping trends and the potential they present for higher sales.
"Nigerians are destination shoppers rather than shopping at home, right, so I will say that 90 percent of the elite in Nigeria buy their consumables or their luxury brands outside of Nigeria. The transition from being destination shoppers to being origin shoppers is just going to start, so in terms of affordability, in terms of market share, what Boss and the luxury good providers are looking at in this country are trends. We are the fastest growing market in the world, China, for example, Gucci has 42 stores in China and they have only one store in the whole of Africa, which is in Sandton, in South Africa," he said.
Other luxury brands have already made it big in Nigeria. Porsche recently opened a showroom in Lagos selling some of the German carmaker's latest releases.
Nigeria is also a significant African market for LVMH, the French multinational luxury goods conglomerate responsible for Louis Vuitton, Moet and Hennesy. Paris-based magazine Jeune Afrique in 2011 placed Nigeria at the top of Africa's champagne consumers.
But compared to the international multibillion dollar-luxury industry, Rewane says Nigeria is still a very young member of the club, especially because it doesn't have any world-renowned exclusive brands of its own to offer just yet.
"The luxury goods people go where the money is, the money goes where the celebrity endorsements are, its a good sign that we are starting but we are way way behind the rest of the emerging markets in terms of positioning ourselves in the luxury good market in the world," said Rewane.
Nigeria's Hugo Boss retail store manager says sales have been high since the launch in February and there are plans to expand into other major cities. - Copyright Holder: REUTERS
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