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There are currently 10 important trends in Nigeria that interest me in my work right now:
1. Polarisation of market segments with premiumisation at one end and value at the other
Nigeria is an interesting paradox in many areas. One that fascinates me right now is the increasing polarisation of value segments, with the highest international premium and lowest savings segments growing quite rapidly at the same time.
Two sub-trends appear to be driving this. With more economic growth (Nigeria is one of the world’s fastest growing economies), more wealth is being created. This wealth is being conspicuously consumed in some super premium categories such as in alcohol and electronics. Nigeria is reputed to be fastest growing and largest champagne market outside France.
The second is that while more wealth is being created, this wealth is increasingly concentrated in just a few hands so that a large segment of the population remain affordability challenged, thus driving the growth of the value category.
2. It’s no longer about affordability at any cost, value is truly king at last
There was a time in Nigeria, when consumers at the lower end of the spectrum would take any quality given, no matter how bad, as long as the brand was cheap enough. No more.
While this group is more affordability challenged than ever, people are increasingly aware of the quality spectrum and are unwilling to go below a certain point. Brands are as much a reflection of the aspiration of our consumers as they are of their current lifestyle. So for instance, international premium beers are consumed mostly by the DE socioeconomic grouping.
3. Off-trade is the new on-trade
With the rise in modern retail, the off-trade channel is growing quite rapidly, albeit from a small base. The number-one retail chain in Nigeria is Shoprite from South Africa, and they are opening branches pan Nigeria at quite a fast rate.
Traditionally off-trade sales were effected in big, smelly, open markets which many people would like to avoid, given half the chance. So the growth of modern retail is a most welcome development for consumers across all socio-economic groupings.
What I notice is that the difference between more and less affluent consumers of modern retail is in the frequency and size of purchase. There is a democratisation of the shopping experience, where rich and poor shop side by side, with equal access to the same products, although that access is limited by the size of the pocket.
4. The Emerging Middle Class
Over the past decade or so, the middle class in Nigeria has been growing in leaps and bounds, predicated on economic upswing and societal liberalisation from the switch to democracy.
Bars are filled to the brim with the Gen Y consumer, looking for every opportunity to spend money they can ill afford. We show up and we show off!
This EMC group is championing a shift in consumer sensibilities. They are driving aspiration in the minds of the less affluent. Everyone believes that "it could be me next".
One area where the impact of the EMC is being felt, is in the restaurant and bar business in urban areas. Never before has eating out been such good business in Nigeria. A lot of new international franchises, such as KFC, Nando’s, Steer’s Burger, Cold Stone Creamery, Domino’s Pizza, Debonair’s Pizza, Johnny Rocket, have come in, and consumers are flocking there for their dose of deliciously served, but unhealthy foods.
Bars are filled to the brim with the Gen Y (18-30) consumer, looking for every opportunity to spend money they can ill afford. We show up and we show off! Enjoying life all the way.
5. The new retail experience
Retail is shifting away from the basic neighbourhood type shops to more sophisticated and premium retail experiences. Brand names such as Zara, Nike, Puma, Adidas, Woolworths, Swatch, and Wrangler are well represented by franchises around town. More and more malls are springing up, with a mixture of foreign and homegrown hypermarkets.
These organised retail experiences are a contrast to the chaotic outside world of busy urban areas. "Mall surfing" is a form of entertainment on its own, both for young people and families.
6. Online shopping grows more and more popular
One thing you might not know is that most Nigerians are obsessed with their phones. I guess it stems from the fact that we love to talk, to connect, to socialise. The growth of the GSM industry was rapid and massive.
Nigerians are emotionally and psychologically addicted to expressions of connection. Very prevalent at the moment are digital forms of connection. In 2013, Nigeria overtook South Africa, recording the highest number of sub-Saharan African users on Facebook. Young and old alike are more digitally connected than they have ever been.
A couple I know, aged 80 and 90 respectively, are very active on Facebook, chatting to their kids, grandkids and anyone else they can waylay online.
This has been the best possible time to launch online shopping. New online retailers such as Konga and Jumia are having a field day. People love the fact that they can access shopping (another Nigerian passion) easily on their phones. And then the sheer joy of having it delivered right to your doorstep.
Normally in Nigeria, nothing comes to you unless you are rich and powerful. You have to go to seek out and reach out to make things happen. So I think that the online shopping experience will grow from strength to strength.
What a relief for the ordinary Nigerian to command something to themselves for a change. A welcome reprieve from our stressful urban lives!
7. The Spirit of Naija lives on
One major trend that has been hot for a few years is the growth of national pride, as expressed by the term, "Naija".
Naija is an affectionate expression of pride in things Nigerian. This is most vehemently represented by young people, particularly in the film, music and fashion realms.
Gone are the days where nightclubs were dominated by American urban music. These days, you will rock the house down to DBanj, Davido, Olamide, Tuface, Tiwa Savage and the like.
Nigerians are proud of the dramatic expression of Nollywood, our self-styled largest film industry in the world. Our Nollywood stars are the superstars of Africa. Omotola Jalade Ekeinde, Genevieve Nnaji, Aki & Paw get mobbed anywhere they go in Africa. We are still at the quantity over quality phase of development but we are proud that we developed this industry spontaneously and we are evolving in the right direction.
We love the fact that Americans are borrowing from us – recently I saw Beyonce on a music video dancing 'azonto', a popular local dance
Our fashion industry has developed so dramatically in recent years. We have a style all of our own and we wear it proudly. Our designers are represented in international fashion shows and are blazing the trail for fashionable expression across Africa. We love the fact that Americans are borrowing from us – recently I saw Beyonce on a music video dancing "azonto", a popular local dance. I’ve seen many an African-American star wear our Ankara cloth on their music videos. Cultural hegemony across Africa is ours for the taking.
8. The Celebration Channel is here to stay
It isn’t news that Nigerians love to party. In that respect, the culture of the Yoruba tribe has become the culture of the wider country. It is reputed that the dictionary definition of the Yoruba people is "a merry-making Coastal people".
Merry-making is an important expression of Nigerian life. No weekend is complete without numerous weddings, burials, book launches, engagements, introductions, birthday parties to attend. People will go many hours across the country to attend a two-hour event. It is an expression of our familial ties, a mark of respect for those you want to honour.
It is particularly relevant for beverage manufacturers to find new ways to prioritise their brands in these events. This channel represents a significant and increasingly larger portion of off-trade.
9. Lagos is no longer the center of the Nigerian universe!
Traditionally the bulk of consumption of packaged goods took place in Lagos, which headquarters virtually all the key FMCG companies. With the rise of democracy - which has dispersed economic activity away from Lagos and capital of Abuja into the 36 state capitals - migration into the state urban centres (from Lagos and Abuja and also from rural areas) has increased significantly.
So marketing in Nigeria is no longer about winning only in Lagos and maybe Abuja and Port-Harcourt. To win in Nigeria, you must win across many many cities.
10. But maybe Nigeria is (one of) the centre(s) of the multinational universe…
When I started my marketing career in the late 1990s, marketers had no choice but to build long and steady careers in stable multinationals. Rising through the ranks of one organisation was the only way to get ahead.
The marketing landscape in Nigeria has changed significantly in the past 10 years. There is a lot more competition, with new entrants stirring up many industry segments.
With the downturn in Europe and America, many multinationals have turned the spotlight on Africa. As a result, many more marketing job opportunities are available, and a small group of marketers are able to move from job to job, organisation to organisation, advancing their careers faster in the process.
But with these benefits, comes more pressure. Organisations are spotlighting performance in Nigeria. Expectations are higher than ever before.
The story of marketing in Nigeria mirrors the story of Nigeria. Never before have expectations been so high for our industry and our beloved country. The trends are generally positive and winning is ours for the taking!