Winning in Nigeria’s evolving food market
The size of Nigeria’s population inevitably saddles it with a huge food bill. According to the National Bureau of Statistics (NBS), the country’s over 28.9 million households expended circa N15.67 trillion on food in 2009/10 alone.
By 2012, Nigeria imported food worth N2.3 trillion, though the minister of agriculture said the amount spent on food import dropped by N0.91 billion early this year.
As expenditure on food continues to grow, the five classes of food in Nigeria – milk and milk products; meats and fish; nuts, beans, cereals and grains; roots, starchy fruits, and tubers, and fruits/vegetables – have received the unalloyed attention of manufacturers, market research analysts, retailers, etc.
Packaged food and drinks have been at the core of these enquires. This is also true of alcoholic and non-alcoholic drinks.
As expected, this emphasis is partially driven by a desire to profit more from the enormous resources Nigerians commit to consumption across social divides. Most of the researches have focused on the best way to price, package, distribute, and the changing tastes and preferences of consumers. We at the BusinessDay Research and Intelligence Unit (BRIU) have made some enquires.
What is really changing?
In the developing world, as is the case with Nigeria, a number of factors traditionally influence the choice of food and drinks, chief among which are, price and religious orientation (in one of our mixed method surveys, a respondent indicated that the words HALA should be labeled on Beef Sausage Rolls to indicate that only beef was used in making them).
But apart from these traditional factors, our research shows that, such factors as ‘perceived long-term health implications’ of consuming particular food (especially package food and drinks influence consumption patterns.
We also discovered through several surveys that there is the craving for more natural consumables across the population. So even if food is manufactured, consumers stick to brands which pride themselves as being natural.
The growing trend
Currently in the developed world, there is a conscious shift towards safer food. For instance, in the United States, Michelle Obama’s “Let’s Move” initiative is all about healthy eating, and there are many such initiatives.
Our research further shows that more Nigerians, especially those in the middle-class and the elite, care about nutritional labels on processed food, healthy eating, and the impact of fat, cholesterol, sodas and sugary drinks on their health and wellbeing. Therefore, they tend to buy with this in mind.
In a nationwide survey we conducted in 2012, we asked respondents the question – “Do you examine the nutritional labels of processed food/drinks?” Sixty-eight percent of them said “yes,” which indicates that perhaps, more than half of Nigerian are conscious about the health implications of the content of what they eat or drink.
But that is not all; we asked the same respondents if they “understand the content of the food labels,” and half of them said they understand in part, while 36 percent said they fully understand. Only 14 percent of them said they do not understand at all.
Another survey, which we conducted to determine preferences for non-alcoholic beverages, showed that there is overwhelming distaste for sugary sodas. We discovered that there is clear preference for low-sugar brands, across age and gender. In terms of proportions, a higher percentage of older citizens prefers low-sugar brands or variants (even though they are sceptical about the sweeteners used to sweeten them) compared to the younger class.
Almost half, 42 percent, of those we sampled across the states, prefer low-sugar variants, even though they are generally more expensive. As expected, they cited health reasons as the primary basis of their choice.
One point that was made clear to us is that Nigeria might be steadily inching towards a society of more discerning consumers.
Winning strategies for a changing market
We believe that discerning food and drink manufacturers, restaurateurs, advertisers and vendors can use this information to their advantage. Firstly, manufacturers who will get more market share must bow to this aspiration of consumers by making products more natural.
More than this, advertisers and PR companies must work to communicate these changes to consumers. Some brands have worked on this already.
Brands like Nestle’s Pure Life Premium drinking water, Amstel Malt, Power Vegetable Oil, the products of Fumman Agricultural Product Industries, among many others, have a clear history of using some or all of these insights we have pointed out. But the extent to which their advertising strategy has communicated with the man on the street is another question.
Generally, we believe that adverts that play up health benefits of manufactured food and underscore how natural they are compared with their competitors will determine who controls the market in the future. Restaurateurs can also deploy this strategy.
The consumer is becoming more discerning; therefore the manufacturer and PR companies should be steps ahead.