Business is synonymous to a game where only the best players win. The best players are not those who start the game but those who swim with the tides of change and develop different strategies as the game gets fiercer. Like the outcome of a game is unpredictable, so is the same for the Nigerian market.
With the swinging economy, the Nigerian market has never been more unpredictable in terms of purchasing power that over time has affected disposable income. Both individuals and businesses have felt the weight of the economic challenges. Though the burden is lighter on others, everyone shares in the consequences of an unstable economy.
This has led to reduced patronage for many businesses because not everyone can afford too many products at once and they continue to look for cheaper alternatives. While many customers can no longer afford to buy in bulk, companies have devise means of still reaching customers at the bottom of the pyramid.
Observing the change amongst consumers, businesses have developed a new approach to retain their relevance and increase their customer base. Most companies have resolved to produce their products in smaller quantities, in this case in sachets. This new strategy is what Tunji Andrews, Lead Economist at Time, Trade and Commodities (TTAC), calls “sachetization”.
In a Twitter post, Tunji indicated that those unwilling to flow with the trend will be at risk of running out of business. This post could be linked to the sachet approach a major brand, Dettol, had employed to reach and retain more customers. Even though this could be considered a clever move, many of his followers connected this strategy to the unfavourable Nigerian economy.
Prior to this time other major brands such as Kellogg, Power Oil, and even tomatoes paste brands had been making their products available in sachet which has been advantageous to them as regards patronage. This is to ensure that both upper and lower class can afford the products. There is no doubt that these brands must have studied and analysed their industry to discover the best approach to tackle the economic barriers. As it seems, this strategy obviously seem to be working for them and has increased their revenue.
We can never overemphasize the need of knowing your market thoroughly. In our previous post sometime ago, we emphasized on the importance of studying your target market as an entrepreneur. Staying abreast with the latest wind of change and keenly observing the solution other brands are engaging and modifying it to suit your business, always keeps you on track.
With more brands embracing “sachetization”, we wonder what new strategies would unfold if it ever gets tougher. Yet again, what can we say, ‘when the going gets tough, the tough gets INNOVATIVE’.
Written by Jennifer Chioma Amadi
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