Breaking News
Translate

Makers of alcoholic drinks raise stakes with sachet packaging

By  Princewill Ekwujuru

Producers of alcoholic drinks are increasingly adopting sachet packaging to deepen market share for their products.

The shift to sachet packaging is prompted by combination of socio-economic factors including lower purchasing power due to inflation.

This product segmentation strategy is designed to enhance customer patronage for their brands, as it makes the product easily affordable.

In addition to these, increasing urbanization and the rising number of female alcohol drinkers, especially in large cities, such as Lagos, Port Harcourt, and Abuja have also offered expansion opportunities for the alcoholic drinks market.

The favourable demographics, with a populous and vibrant youth and growing middle class also contributed to the growth fac-tor witnessed in the sector. These favoura-ble market scenarios have lured various multinationals to strengthen their foothold in the market by adopting the sachet packs.

The availability of a variety of brands across different price ranges for consumers to choose from helped the sachet alcoholic drinks market to perform creditably well. Vanguard Companies and Markets, C&M findings revealed that another factor helping the market is the absence of stringent policies or measures regarding production and marketing of alcoholic drinks in sachet pack.

These developments have however  heightened  competition and quest for market share among major local sachet alcoholic drink producers.

The local alcoholic producers are Diageo, parent company of Guinness Nigeria Plc, producers of Smirnoff, Intercontinental Distillers Limited, IDL, makers of Eagle Schnapps, Chelsea Dry Gin and Squadron, Grand Oak Limited, marketers of the Lord’s Dry Gin and Regal Dry Gin, Euro Global Foods and Distillers Limited, producers of  Sabrina.

Findings by C&M show that drinking is widely considered a part of social life in Nigeria; therefore on-trade outlets dominate alcoholic sales.

Bulk of spirits (alcohol) is sold through off-trade outlets, such as drinks specialists and independent grocery retailers.

C&M   also discovered that growing visibility and lower prices at open markets have helped on-trade outlets grow faster than off-trade volume sales.

The recession in 2015 and 2018, according to some distributors affected the performance of off-trade channels and boosted on-trade sales, since prices are generally cheaper through on-trade channels, even though consumers shifted their purchases to smaller pack sizes, thereby increasing on-trade sales volume.

Findings by C&M showed that majority of the purchases made by consumers was through the smaller pack sizes, aided by the population growth – particularly of young people and women.

C&M findings also showed that the marketing communication materials deployed by some of the alcohol beverages brands portray these drinks as vitality enhancing beverage, thus facilitating patronage from youths.

Consumers’ responses

Consumers that spoke to C&M expressed preference for Smirn off, Chelsea Dry Gin, Squadron, Sabrina and Lord’s Dry Gin.

Ellas Oludayo, a brick layer prefers Smirnoff because of its alcoholic content which he says is good for his body metabolism. “Its aroma, smoothness in the mouth and its hotness from the throat to the stomach endeared it to me”, he said.

Kingsley Igbonekwu, a civil servant also prefers Smirnoff because of the name behind the brand.  “I see Smirnoff as a trusted brand. I also take Smirnoff when I feel like lifting my soul, he said”.

Distributors’ responses

Distributors were optimistic that the sachet alcoholic drinks market is expected to see good performance in 2018.

Managing Director, Heavyman Enterprises, Fidelis Anokwuru, said:   ”Sachet alcoholic drinks are expected to see much improved volume sales in 2018, as the various categories recover from the relatively weak performance seen in 2016 and 2017 caused by the economic recession.”

Another distributor at Oke-arin market, Lagos Island, who pleaded anonymity confirmed that Smirnoff, Chelsea Dry Gin and Squadron are doing creditably well in his sales book.

All rights reserved. This material and any other digital content on this platform may not be reproduced, published, broadcast, written or distributed in full or in part, without written permission from VANGUARD NEWS.

Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.