NEW DELHI: Women in Africa have got India Inc by its short and curlies. Their desire for straight long hair has metamorphosed into a billion-dollar business for domestic hair care companies.
Afro-textured hair is notorious for its fragility and coarseness. 'This forces African women to spend a higher proportion of their money on hair care than women in other parts of the world,' says Adi Godrej, chairman of the $3.3-billion Godrej Industries.
Godrej Consumer Products Ltd (GCPL) snapped up stakes in companies in the Africa region, such as, the Darling Group and Kinky Group that specialize in hair care products like wigs, sprays, gels and hair extensions. Out of the four acquisitions by GCPL in Africa, three were in the hair care business. The move seems to have worked. 'The hair-care business in Africa has been very good for us,' says Godrej. The company's hair care portfolio fuelled a 53% growth in Africa sales in July-September 2013 quarter.
According to various hair experts, African women are extremely touchy about their hair. The Internet is teeming with websites that boast advice on how to deal with afro-textured hair. 'Afro hair breaks easily because every twist in curly hair represents a potential stress point. The kinkier the hair, the more prone it is to breakage. It's difficult for African women to comb their hair,' says hair expert Jawed Habib.
Indian FMCG major Dabur that acquired US-based personal care company Namaste Group in 2011 has come up with a range of offerings, such as, relaxers, styling products, hair dresses, shampoos, conditioners and hair restoration products, specifically developed for the African population. 'These products were traditionally manufactured in America and were being shipped to Africa, making it accessible to only a small percentage of the affluent population in the continent. We are now in the process of locally producing them in Africa,' says P D Narang, group director, Dabur India. The company is establishing a second unit in Egypt to cater to the growing demand for its personal care products in the region. 'Today, Africa is among the key growth drivers for our overseas business with the Egypt business reporting a strong 23% growth in Q2 of 2013-14,' says Narang.
The market for hair extensions, relaxers and after care categories of ethnic hair care in Africa is pegged at nearly $2 billion, according to industry experts.
'It's an exciting proposition for Indian consumer goods firms,' says Keshav Mishra, partner-FMCG at Baring Private Equity Partners India.
Apart from Godrej and Dabur, companies like Marico and VLCC are also betting big on the African hair care market. Says Saugata Gupta, CEO, Marico: 'We believe Africa has long term potential. However, there are challenges and we will go about expanding in a methodical manner to build a sustainable and profitable business.'
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