Nigeria Consumer And The Cola Market, How Volume Is Winning
For many years, Coca-Cola and Pepsi, two of the world’s biggest carbonated soft drink manufacturers have been dominating the soda market in Nigeria with both sharing 50% and 40% market share respectively. Their fierce competition around the world led to what was later termed the “cola war”.
In Nigeria, Coca-Cola Company Limited and 7up Bottling Company, the makers of Pepsi have been major competitors in the soft drinks market. With their market dominance, they only left the consumers with alternatives rather than options. Either it’s Coca-Cola products or 7up products. In other words, the two giant soft drinks producers are always on the face of the consumers
However, there was a change of narrative around 2015 with the entrance of two cola brands in the Nigeria market, ready to disrupt the market from the two heavyweights which in the long-run splits the market share from both Coca Cola and Pepsi.
In 2015, Big Cola, a product of AJE group joined the cola market to give the older ‘colas’ a punch by introducing a 65cl pet bottle, a volume more than Coca-Cola’s 60cl and Pepsi’s 50cl SKUs at the time.
Also in 2016, Rite food limited an indigenous company came on the scene with the introduction of Bigi Cola to the market with variants such as Orange, Lemon and Apple.
The once duopolistic market has now become a fierce and competitive market, with the new entrants giving the big ones a run for their money.
Now that many “colas” have been presented to the consumers to make a choice, it now depends on availability, persuasion and price before you can sell to the consumers because to most of them, cola is cola except in few cases where some had already have their taste and favourite for a particular brand and this is actually a small portion of the larger consumers.
Price as a determining factor
Bigi Cola entered the market with a slash in price and larger volume than Coca-Cola and Pepsi. Coca-Cola at that time had increased the price of its 60cl to 150 NGN and Pepsi 50cl at 100 NGN. However, the chunks of the consumers are willing to pay less and get more. Nigerians are price sensitive; they are quick to switch to other products that satisfy their needs if the desired is not available especially when the products serve the same purpose. A bus conductor picking a Pepsi to quench his thirst in the sun is not necessarily because he prefers it, he probably picks it because it’s cold and can satisfy him at the moment. Most consumers of carbonated soft drinks don’t really care about your pedigree; all they want is to get maximum satisfaction with their money, besides, cola isn’t a luxury product that describes a class. With the Bigi pet bottle which is also “Big” as the name implies, they are able to capture the consumers who are ready to pay less and get more.
Visibility and Availability
In Nigeria if a product wants to sell more, the power of street hawkers or traffic hawkers in promoting the products cannot be underestimated. They most times own the product and advertise it to consumers, speaking to their subconscious mind and thereby gaining more customers for the brand. Both Big and Bigi Cola understand this strategy of getting more consumers that they made the product more available in parks, traffic, malls and on the street.
At entrance, Bigi Cola used this strategy well by making its products available in almost every nook and cranny, giving hawkers branded aprons that promote their brands, painting of retailers’ shops and most importantly producing variants to match Coca-Cola and 7up Bottling company products. It didn’t take long to see Bigi and its variants competing with Coke and Pepsi at social events such as weddings, official functions, church programmes and more.
Price as a winning factor
Price as mentioned is a major determinant factor in making a choice by consumers. They will rather pay less for maximum satisfaction than acting loyal to a brand that has alternatives or options which are regarded as competitive demand. Bigi and Big Cola maintained visibility in that market; target the market, especially with the different variants available for consumers.
In Nigeria, street hawkers are swift to present the available anytime consumers ask for a soft drink unless it’s well specified. That kiosk woman by the roadside is ready to pass Bigi as Coca-Cola to buyers because to her they are both “dark” perform the same functions.
In the South West, though Coca-Cola and Pepsi still maintain a good market share in Lagos and Ogun state as the price of cola is still pegged at 100 NGN, the odd is not the same in places like Oyo and Ekiti state. The price of Coca-Cola and Pepsi in Ibadan, Oyo state is 120 NGN each while in Ekiti state, it costs between 120-150 NGN based on how remote the location is. This has sprouted out a noticeable shift in demand from both Coca-Cola and Pepsi to Big and BigiCola in the states.
The cola war in Nigeria has shown that the market is big and able to accommodate new entrants; it’s just about getting the strategy right. As long as cola isn’t a luxury product that defines one’s status, a new entrant can ambush the market and get its share of the market but with the right strategy (volume and price) inclusive. Nothing sweets consumers like paying less and getting more.