It is right to believe that there are reasons why the three major record labels are battling for contents in Africa.
African music is a handful of her culture, lifestyle, and history. Its musical notations, sound recordings, motion pictures, and illustrations project the African story in rhymes and rhythm.
Musical sounds from Africa are getting so much traction around the globe for so many reasons. Having undergone frequent, decisive, and strategic changes over time, music from the African continent is now in demand.
The African music industry is currently booming. According to Statista, the music industry revenue in Nigeria alone recorded about a 30.8% increase from 2014 to 2018. There is also a projection of generating up to 44 million dollars in revenue in 2023. IFPI reported that Africa & Middle East in 2020 recorded a music revenue increase of 8.4%. Streaming revenue dominated by 36.4%.
In reality, this means that Africans are consuming more music than ever before. The streaming culture in the continent has shown rapid growth in the last decade. Before the pandemic, Afrobeats had already caught the attention of the world. Music streaming platforms like Apple Music and Spotify both launched new playlists to curate the biggest songs from the continent. The UK launched an Afrobeats chart in 2021.
The three major labels; Warner Music, Sony Music, and Universal Music Group have been on the continent for years now. They recognize the continent not only as a market but also as a source of innovation and talent. In Africa, we have Universal Music Nigeria, Universal Music Africa, Sony Music Africa, Sony Music West Africa, and Warner Music South Africa competing for African dominance.
Recently, other international music companies have spotlighted the opportunities in the African music industry. Warner Music acquired Africori. Empire Music penned down joint venture deals with YBNL, Penthauze, and numerous indie artists. Universal Music France sealed a partnership deal with Aristokrat Records and more.
The sneaked-up interest in African music is deliberate and guided by the drive to maximize returns. In this article, we highlighted the reasons why music companies are heavily investing in Africa.
- Youthful and growing population
The impact of demographic trends on economic performance cannot be overemphasized. Demographic trends are usually monitored as a business strategy for any consumer goods or services company.
Africa's population is equivalent to 16.72% of the total world population according to Worldmeters. The continent's population is around 1.3 billion with a yearly change of about 2.5%. The number of youths is equally growing rapidly. The median age in Africa is 19.7years. Youths constitute about 70% of the African population—the largest youth population in the world.
In 2015, 226 million youth aged 15-24 lived in Africa according to UN. That is about 19% of the global youth population.
Popular music is usually aimed at the general public but mostly at the youth market. Hence why Africa is leading the conversation on emerging markets for music investment.
The larger market, in the sense of a larger youth population, leads to more varieties of sounds and genres being produced, implying a more crowded product space, and more substitution between genres.
Although the impact of the population is also regulated by average salary and salary structure which limits revenue generation from ticketing, streams, and merchandise sales, the role of Africa's youth population density cannot be undermined. The youth population density of a geographical area, has a well-known and positive effect on brand and endorsement deals. Fast Moving Consumer Goods, Finance, and other industries look to tap into the influence of music icons to raise consciousness for their brands.
- Rising internet penetration
The rising internet population in Africa is another point to note. Africans on the internet grew from 2.1% in 2005 to 24% by 2018 according to QZ—the highest growth rate globally. Internet use in Ghana, Nigeria, Senegal, South Africa, and other African countries has skyrocketed in recent years compared to internet use among many world's advanced economies. Smartphone ownership is also on the rise in Africa. Smartphone sales in Africa made up 6.6% of the global smartphone market in 2019 as reported by FD Iintelligence.
The rise in internet use in Africa is an opportunity these music companies identify. Music streaming platforms and major record labels are aware of the impacts of growing internet use on digital music sales and general music consumption. Hence, they try to position themselves so that the rise in internet use profits them.
- High social impact
Africa is an extremely musical continent, with genres like Afrobeats, Amapiano, Bongo, Reggae, Hip-Hop, R&B, etc. African culture is incomplete without its music. Traditional and cultural events get spiced up with music and dance. The impact is phenomenal.
According to a report from Statista, around 50% of surveyed South Africans listen to music 3 hours or more per day. The music consumption frequency in Africa is on the rise due to the social impact of the music industry. The industry directly influences automobile sales, fashion trends, nightlife, etc. This potential and more is attracting international music companies to Africa.
- First-mover advantage
Even though revenue generation from African music is not as blaring as the Western world, the first-mover advantage is a major concern for these music companies that have identified the potential and future of African music. Coming into the growing industry in Africa typically enables these companies to establish strong brand recognition and customer loyalty before competitors enter the arena.
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