Historically, the negative impact of elections on consumers is short lived – in 2017 consumer sentiment rebounded after 3 months. This is good news for brands especially as the election is so close to the start of the holiday season.
Elections in Kenya bring a lot of uncertainty. This has been attributed to the numerous cases of election rigging, especially at the presidential level. The 2017 general election in Kenya was not different; two elections were held. The first election was annulled by the Supreme Court led by Former Chief Justice David Maraga citing election irregularities. In October of the same year, new elections were held, and Uhuru Kenyatta of Jubilee’s party won by a landslide. This win was not taken well by the opposition party who went ahead to swear in Raila Odinga as the People’s President on the 28th of October 2017. These created animosity between citizens who supported the two leaders. During the period, consumer purchase intent declined, and brands recorded losses. It was not until the ‘handshake’ between the two principals in March 2018 that the country started recovering from the aftermath of these two elections.
Five years on, Kenyans are preparing for another general election. This period is filled with lots of speculation as politicians are seriously conducting campaigns to woo voters. Reports from Infotrak show that the most popular presidential candidates are Raila Odinga from Azimio Coalition and the current Deputy President William Ruto. Time will tell whether the upcoming elections will have an impact on consumer behavior. However, brands can pick a lesson or two from the 2017 elections.
Consumer Sentiment Decreases during uncertain times
The 2017 election had a negative impact on consumer sentiment. A tracker by Kasi Insight assessed the trend of consumer sentiment over the period January 2017 to June 2018.
During the 2017 campaign period, consumer sentiment ranged between 0-5. However, in July 2017 with just a month to the election, consumer sentiment dropped to -1, election jitters could be felt across the country. Interestingly, in August 2017, consumer sentiment improved by 7 points, which may be due to citizens’ excitement that the new leaders would try to implement whatever they promised to deliver in their manifestos.
No sooner had Kenyans recovered from the first election than the results were annulled in September the same year. This is evident from the drop in consumer sentiment during the months (September and October). The second election was a period of uncertainty as there was a rift between supporters of different leaders. It is worth noting that the sentiment was lowest in October 2017 (-8). In November, the sentiment started increasing steadily before declining again in February 2018. The handshake in March 2018 also proved to be a turning point for Kenyan brands as consumer sentiment increased during the period achieving its highest point in May 2018.
Discretionary spending most affected during uncertain times
With the uncertainties caused by the election, consumer spending was limited to necessities.
During the first election period, those who wanted to make large purchases slightly increased to 22%. Consequently, during the second election in October, those who wanted to make large purchases slightly decreased to 20%. This meant a reduction in sales made by brands in the discretionary space. Additionally, during the ‘handshake’ period in March 2018, the percentage of respondents who wanted to make large purchases slightly increased to 26%. The handshake opened the country to new opportunities especially for brands in the discretionary space who were able to leverage consumers.
What does this mean for brands?
Political events like elections have an impact on consumer sentiment and their purchase decisions.
Historically, the negative impact of elections on consumers is short lived – in 2017 consumer sentiment rebounded after 3 months. This is good news for brands especially as the election is so close to the start of the holiday season
Brands in the discretionary categories like entertainment, alcoholic beverages, travel are the most impacted by low consumer sentiment – consumers tend to cut discretionary spending first during period of uncertainty.
It's hard to predict the outcome of the elections but the current challenges (covid and rise cost of living) can have a neutral to positive impact on the elections. Brands should continue to monitor sentiment to determine what strategies to use to sway in consumers (promotion, engagement, or nothing at all)
Our data intelligence platform can help you track these trends in consumer behaviors in Africa over time. Kasi Insight has comprehensive data on this topic and can provide valuable insights to help your business make fast data-driven decisions.
Contact our team today to explore how our consumer intelligence can empower your decision-making process. Win with confidence with Kasi insights https://www.kasiinsight.com/thehub
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