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Marketing Report Of Nigerian Breweries Plc Commerce

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This study is set to discourse about the selling study of Nigerian Breweries Plc. It covers their history, the PEST analysis, their schemes and tactics. A good selling study is needed in an administration to cognize the position of the administration and to cognize where they are neglecting and wining so that they can rectify or keep the state of affairs. This paper would to the full explicate the selling study of Nigerian Breweries with a small recommendation.

Selling is the procedure of planning and put to deathing the construct, pricing, publicity and distribution of thoughts, goods and services to make exchanges that client and organisational aims.

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( Drucker, 2005 ) The construct of selling as a concern doctrine defines selling as a procedure that is intended to happen, satisfy and retain clients while concern makes a net income. But cardinal to all these definitions is the function of the client and his relationship to the merchandise.

A market research is imperative for a company to cognize what type of merchandises or services would be profitable to present in the market.

Besides with regard to its bing merchandises in the market, good market research enables a company to cognize if it has been able to fulfill client demands and whether any alterations need to be made in the packaging, bringing or the merchandise itself. ( Anonymous, 2009 )

Nigerian Breweries Plc ( NBPLC ) is the state ‘s innovator brewery. Incorporated in 1946, it commenced production in 1949. It started as a joint venture between the United African Company ( WAC ) International, UK and Heineken of Holland. Therefore, at origin, it was 100 per cent foreign owned. By the early 1950s, when it began runing to the full, some autochthonal bargainers already involved with its merchandises were invited to go stockholders. Under the indigenization policy of the early 1970s the foreign stockholders were forced to sell a important proportion of their retentions. Today, the company is 60 per cent Nigerian owned and 40 per cent foreign owned. The 60 per cent Nigerian interest is held by company employees and members of the populace, while the 40 per cent foreign ownership is split about every bit between CWA Holdings Limited ( for Unilever ) and Heineken Brouwerijen BV.

Its first bottle of beer, STAR Lager, rolled off the bottling lines of its Lagos Brewery in June 1949. Other breweries were later commissioned by the company, including Aba Brewery in 1957, Kaduna Brewery in 1963, and Ibadan Brewery in 1982. In September 1993, the company acquired its 5th brewery in Enugu province, and in October 2003, its 6th brewery, sited at Ama in Enugu. Ama Brewery is the largest brewery in Nigeria and one of the most modern worldwide. Operationss at Enugu brewery were discontinued in 2004, go forthing the company with five operational breweries.

The company has a portfolio of high-quality trade names, including Star Lager Beer ( launched in 1949 ) ; Gulder Lager Beer ( 1970 ) ; Maltina ( 1976 ) , which now has three assortments, viz. Maltina Classic, Maltina Strawberry, and Maltina with Pineapple ; Maltina Sip-it ( 2005 ) , which was packaged in Tetrapaks ; Legend Extra Stout ( 1992 ) ; and Amstel Malta ( 1994 ) . The company besides re-launched Heineken Lager into the Nigerian market in June 1998.

Nigerian Breweries is the most capitalized quoted company on the Nigerian Stock Exchange ( NSE ) , it is besides the first company in any sector to declare N12 billion in PBT and the first company in Nigerian history to declare dividend of N8 billion ( Vanguard, 2003 ) .

Nigerian Breweries operates many related companies, including beverage-related fabrication companies doing corks, labels, bottles, packing crates ; and a logistics web, including conveyance companies, warehousing companies and retail gross revenues direction.

THE MARKET ENVIRONMENT

Market Environment is the assorted external forces that can straight or indirectly affect the many activities of an organisation. This is an built-in portion of environmental scanning. These activities include acquisition of human resources, natural stuffs, fiscal resources, and development of goods and services. The selling environment includes forces such as: political, legal, regulative, economic, societal, technological, and competitory.

Nigerian Breweries Plc maps in two different market enviroment viz. the Macro and Micro which affects it externally and internally. ( Kotler, 2004 ) , the PEST analyses and the Porters Five Forces theoretical account of Nigerian Breweries would be discussed in this study.

Plague analysis stands for “ Political, Economic, Social, and Technological analysis ” and depict a model of macro-environmental factors used.

PEST_analysis

Political Analysis

Political analysis involves elections, employment jurisprudence, consumer protection, environmental ordinances, industry-specific ordinances, competitory ordinances, inter-country relationships/attitudes, war, terrorist act, political tendencies in the state where the company is based.

The political state of affairs in Nigeria has experienced a stable balance since the beginning of the democratic administration and this has impacted on Nigerian breweries plc in different ways.

Politically, Nigerian breweries was affected positively when the prohibition on importing of barley was lifted every bit good as puting a 20 % duty on both merchandises by the federal authorities on January 6 1998, this increased its options of natural stuffs for production as the company had been forced to do usage of local maize and sorghum for brewing in the yesteryear.

Gross saless in Nigerian Breweries have been on the rise as opposed to the manner in European and other developing markets partially because despite the single province authoritiess attempts by making Torahs to modulate the gross revenues and distribution of alcoholic merchandises it has non put in-place proper control mechanism to checkmate and command the phenomenon of alcoholic ingestion, this is due to the laxness in enforcement of Torahs in Nigeria and the high degree of corruptness in authorities ( Daily Trust, 11 September 2008 ) .

Economic Analysis

Economic Analysis involves the exchange rates and stableness of the host state, skill degree of work force, labour cost, and Economic degree of growing, unemployment rate, rising prices rate and involvement rate.

Nigeria is a turning economic system therefore it is less affected by the recent planetary economic fiscal crisis and this has a positive impact on the gross revenues of Nigerian breweries merchandises as people have disposable income and can pass more on imbibing of beer merchandises, this therefore is a positive development for the company ( Malandrakis, 2009 ) .

Besides, the unemployment rate in Nigeria is truly high and it makes a batch of people idle and they spend most of their clip at bars which helps increase the gross revenues of beers.

The Exchange rate in Nigeria is low comparing to the US dollar and it can impact the concern when the natural stuffs are being imported as it cost a batch of money.

Another economical issue which is impacting Nigerian Breweries negatively is based under the labor cost which is the deficiency of changeless electricity supply in Nigeria ; this has forced the company to do usage of alternate agencies of power supply such as generators were the company spends a immense budget on Diesel which has a changeless increasing monetary value.

SOCIAL ANALYSIS

Social Analysis involves the Demographics, Class Structure, Gender, and Age, Attitude ( wellness and environmental consciousness )

The production of recreational Centres in major metropoliss which have all been changed to imbibing articulations locally known as “ Joints ” ( Daily Trust, 11 September 2008 ) has changed imbibing of beer into a societal activity. It has observed that people prefer imbibing out with friends as imbibing of beer has become similar with jubilations such as nuptialss, parties, nines and other societal assemblages, among youths imbibing is done in order to belong. This societal imbibing wont is clearly apparent as it supports on trade gross revenues which dominates the Nigerian market with a market portion of 80 % gross revenues ( Malandrakis, 2009 ) .

In northern Nigeria, states like Zamfara, Kano, Kaduna and Sokoto ban beer imbibing because of their Sharia Law. A jurisprudence is passed around that people who drink any signifier of intoxicant or commit criminal conversation, larceny would be badly punished ( The Guardian, 2002 ) and this affects the gross revenues of beer in that part.

Nigerian breweries is besides involved in societal duty by patronizing events such as star pursuit which is aimed at detecting new musical Acts of the Apostless ( Nigerian Tribune, 8th June 2009 ) amongst other societal events and originative authorship workshop, a plan created to prepare the immature author ( Vanguard, 15 July 2009 ) .

Technological Analysis

This involves innovations, new finds, research, energy uses/sources/fuels, communications, and rates of obsolescence, wellness fabrication progresss, information engineering, cyberspace, and transit.

Technology has non been a major facet in Nigerian Breweries Plc but they have invested in the equipments used for beer production to do it hold its original gustatory sensation. They besides invest in generators for electricity because of the electricity issues in Nigeria.

The Social factors have the strongest consequence on the market power of Nigerian Breweries Plc as imbibing is a life style which has evolved over the old ages.

The Porters five forces apply new entrants, Buyer power, Supplier power, Substitute and Rivalry for analysis.

porter5forces3

POTENTIAL ENTRANTS

Potential Entrants are other administrations interested in come ining the industry.

Potential entrants seeking to come into the brewery industry in Nigeria find it really hard because of a batch of largely the Government policies, the cost of issue and entryway and this puts Nigerian breweries at a comfy place as market leaders and leaves the company with nil to worry approximately as respects new companies that may jump up. Other grounds why new companies find it hard to come into the industry is because the shift cost is truly high so any new company can non merely exchange or go forth the industry, trade name trueness is truly high because the populace is used to the merchandises of Nigeria Breweries.

Substitutes

From Porter ‘s Model, replacement merchandises refer to merchandises in other industries. To the economic expert, a menace of replacements occurs when a merchandise ‘s demand is affected by the monetary value alteration of a utility merchandise.

Finding a replacement for beer in Nigeria is practically impossible because imbibing beer in Nigeria has become portion of societal activity and besides with the low-cost monetary value for the mean and low earners ( a bottle of star larger beer costs N140 which is less than a lb and is cheaper compared to vinos, brandy ‘s and other bottled alcoholic drink ) it has the monetary value has a competitory advantage over the type drink like vino and brandy. The lone major rival within the industry that Nigerian breweries has in beer merchandises is Guinness Nigeria Plc and both companies have between them 77 % market portion ( WW8 ) therefore it would merely take a particular trade name to replace either of these trade names.

BUYER POWER

Buyer power can be explained as the impact that clients have on a bring forthing industry. This occurs when there are many providers and one purchaser. In Nigeria Breweries, the purchaser power is really small as they are the major provider in the industry and the clients have small option but to acquire merchandises from Nigeria Breweries. Buyer power can besides explained by exchanging cost which is expensive due to the high monetary values of replacements like vinos and brandy. Besides, Nigerian Breweries have grown so good that consumers have really strong trade name trueness on their merchandises such as Gulder, Star.

SUPPLIER POWER

This can merely be explained as when there are many purchasers and merely one or small provider.

Nigerian breweries has a really high provider power because the usage of local maize and sorghum for fabrication of beer has a high market value because of the limited handiness of barley and other replacements for brewing of beer, the husbandmans and providers of this natural stuffs have the power to raise their monetary values as they wish, go forthing Nigerian Breweries at their clemency.

Competition

The Nigerian beer industry has merely 2 major companies in the industry which are Nigerian breweries and Guinness Nigeria Plc and this gives Nigerian Breweries less competition but high competition because there is low exchanging cost since the cost of a beer from Guinness Nigeria is about the same monetary value. Competition could besides low because there are merely two companies in the industry so it has adequate market for both of them and it can pitch its schemes against merely one major rival ( Oyeyinka, 2002 ) .

THE COMPETITION OF NIGERIAN BREWERIES

The major rival for Nigeria Breweries is Guinness limited Nigeria, it manufactures beer in the trade name mane of “ Harp ‘ in Nigeria. Harp Lager Brewery is located in Ikeja, Nigeria. This Nigerian brewery belonging to Tony Joyce started production in 1981. The one-year production of beer is about 1,500,000 hectoliter.

The other beer production units of Guinness Nigeria Limited are located in Agbara, Benin, Aba in Imo. The other small breweries include Benue breweries, Olympic breweries, Sona Breweries and Consolidated Breweries. In general, competition for Nigerian Breweries is minimum as its lone major rival is Guinness Nigeria limited.

Nigerian Breweries has the border over these rivals majorly because of its trade name trueness and because of the fact that it has being bring forthing beer for over 60 old ages. It besides has a batch of subdivisions all over Nigeria so as to make the client ‘s demands.

Selling Scheme

A selling scheme is a procedure or theoretical account to let a company or administration to concentrate limited resources on the best chances to increase gross revenues and thereby accomplish a sustainable competitory advantage. ( Ulrich et Al, 2002 )

Nigerian Breweries Plc uses Marketing scheme to keep competitory advantage. It uses the market cleavage, aiming and positioning as a agency of carving out its ain portion of the market and providing for their demands.

Cleavage

Market Cleavage can be defined as spliting a market into distinguishable groups with distinguishable demands, features, or behaviors that might necessitate separate merchandises or selling mix. ( Anonymous, 2002 )

Cleavage refers to persons and administrations with similar features holding important deductions for the finding of market scheme ( Jobber, 2007 ) ,

Cleavage can be broken down into Geographic cleavage, Demographic cleavage, Psychographic cleavage, Lifestyle, societal category, and personality-based cleavage Behavioural cleavage.

Nigerian breweries Plc cleavage is in relation to its consumers which serves all categories and ages of legal drinkers. In Nigeria, imbibing beer is seen as a societal event of celebration and because of its low-cost monetary value, it can be seen amongst the high, in-between and lower category earners. The advertisement manner of life which the company has built up over the old ages to appeal to all age groups and social position types has besides helped hike their market gross revenues. Nigerian Breweries have advertised their major beer merchandise ( Star ) as a drink that delivers superior enjoyment and brightens all societal occasions this is so because the drink is seen as a key to happiness and jubilation by its consumers.

In general, Nigerian Breweries focuses on all the section of market and has produced different types of merchandises which covers all the section of market in Nigeria

TARGETING

Market Targeting can be defined as the choice of a peculiar market section toward which all selling attempt is directed. Market aiming enables the features of the chosen section to be taken into history when explicating a merchandise or service and its advertisement. ( Keegan, 2001 )

Nigerian breweries have targeted their beers towards different market sections utilizing a differentiated targeting scheme and they have two major beer merchandises that target different categories and age groups. The “ Star ” beer merchandise targets the young person, this is apparent from most of its advertizements and sponsorship plans which is normally directed toward the younger coevals while the “ Gulder ” beer merchandise targets the older and higher fiscal category of people, this is besides apparent in its ain type of advertisement methods and sponsorships.

Placement

It could besides be defined as the topographic point the merchandise occupies in consumer ‘s heads relative to viing merchandises. ( Anonymous, 2002 )

Market positioning depends much on how rivals place themselves, a manufacturer can be said to be successful if he can accomplish the mental place which he/she is seeking to do in the head of the consumer.

Nigerian breweries Plc have two major beer trade names, Star and Gulder which severally for the younger celebrating coevals and for the more sophisticated and older coevals of drinkers. , This stigmatizations falls in line with the clients perceptual experiences of the two merchandises as more of the younger coevals identify with the Star trade name which is non as bitter in gustatory sensation as the Gulder trade name which is more expensive in monetary value than the Star trade name.

THE Selling MIX

The term selling mix refers to the primary elements that must be attended to in order to properly market a merchandise or service. Besides known as the 4 Ps of selling which are Price, Promotion, Product and Place.

Monetary value

The monetary value you set for your merchandise or service plays a big function in its marketability. Pricing for merchandises or services that are more normally available in the market is more elastic, intending that unit gross revenues will travel up or down more responsively in response to monetary value alterations. ( Jones, 2007 )

Monetary value can be stated as the existent or rated value of a valuable merchandise which is up for exchange ; some define it as sum of money paid for merchandise ( Kotler et al, 2005 )

The monetary value of the merchandises ( Star beer ) produced by Nigerian Breweries is low-cost for all the consumers in the market because it is produced from local maize and sorghum which is cheap so they make their net income and fulfill the clients which are largely the young person and since most of their gross revenues are largely made from young person, the monetary value would ever stay low-cost so as non to lose clients and cut down gross revenues.

Merchandise

Kotler et Al, 2005 defined Product as anything that can be offered to a market for attending, acquisition, usage or ingestion that might fulfill a privation or necessitate

Nigerian Breweries has two chief beer merchandises and they can be described as the nucleus merchandises of the administration i.e. they serve their existent intent for which it is bought by the client which is for the extinction of thirst. However Gulder trade name can be described as a luxury merchandise meant for the sophisticated person, these merchandises are classified as consumer merchandise because they are bought by the consumer to really devour and non for other intents. Nigerian Breweries has more than adequate merchandises for every type of consumers. They produce bottled H2O for thirst, Star beer for the young person, Maltina for the consumers that do non take intoxicant.

Topographic point

This term truly refers to any manner that the client can obtain a merchandise or have a service. ( Jones, 2007 )

Nigerian Breweries Plc has a broad distribution channel and makes usage of external companies for distribution of its merchandises countrywide ; Nigerian Breweries use other transit companies to help administer their goods nationally. This system of distribution aids make the merchandise more available to the consumers but this nevertheless limits the direct contact between manufacturer and consumers which reduces feed-back clip for the manufacturers.

Promotion

Promotion is concerned with any vehicle you employ for acquiring people to cognize more about your merchandise or service. Advertising, public dealingss, point-of-sale shows, and viva-voce publicity are all traditional ways for advancing a merchandise. Promotion can be seen as a manner of shuting the information spread between manque Sellerss and manque purchasers. ( Jones, 2007 )

Nigerian Breweries Plc carry out gross revenues publicity in two ways viz. Consumer gross revenues publicity targeted at the ultimate consumer market and trade gross revenues publicity targeted at the members of the selling channel, such as jobbers and retail merchants, benefits of gross revenues publicities include increased net income devising. Examples of Nigerian Breweries gross revenues publicity are “ Star Xmas Carnival ” which was targeted at the company ‘s retail merchants and consumers were awards like bags of rice, DVD Players and other points were won by consumers each twenty-four hours for 21 yearss ( Ekeh, 2009 ) , Gulder ultimate hunt were the victor took place 3 million naira hard currency award ( Ajayi, 2004 ) .

Evaluation OF STRATEGY AND TACTICS

Nigerian Breweries has been one of the major companies in the brewery industry for more than 60 old ages so it is just to state that their scheme and tactics over the old ages have been near to descry on.

In response to competition, Nigerian Breweries has been involved in several re-branding, merchandise development and variegation attempts in the last 5 old ages. In 2006, the company launched its Guilder Max trade name which was a darker, richer version of the successful Guilder Lager. In an effort to come in the soft drink market, NB launched the Farouz trade name of soft drinks ( Ananas comosus and pear spirit ) . Recently, they repackaged the Maltina trade name by presenting a larger sized bottle while keeping the monetary value of the former bottle. The Star trade name which is the flagship merchandise of the company was besides rebranded and has achieved immense success since so.

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RECOMMENDATION FOR FUTURE DEVELOPMENT

Nigerian Breweries is already a major force in Nigeria but it is still non internationally recognised like other International companies in the industry so the major recommendation for Nigerian Breweries would to spread out their merchandises internationally or at least spread out it within Africa. They could besides construct new refineries in different topographic points in Africa to assist spread out their administration. Since the distribution of their goods is done by other companies, they could venture into that concern so they could proper feedback from their clients and be able to fulfill them more efficaciously.

They could besides venture into production of new trade names of merchandises so as to broaden their market. Investing in engineering can besides assist with the growing of their administration. Constructing peddling machines can besides assist with the effectual distribution of their merchandise.

Decision

Nigerian Breweries would stay one of the major brewery companies in Nigeria and this selling study that shows their schemes and tactics have tried to explicate the grounds why they are such a major force in the brewery industry in Nigeria. It is obvious that there is room for betterment by them spread outing their market and concern into new states but the of import thing is that they are able to fulfill their clients in their place land.

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Ajayi Samuel, 16 October 2004, Gulder ; After the hunt, what next? Thisday News paper.

Bennett Linda A. , Ph.D, Carlos Campillo, M.D, C.R. Chandrashekar, M.D and Oye Gureje, M.B.B.S. , Ph.D. , FRANCZP, 1998, Alcoholic Beverage Consumption in India, Mexico, and Nigeria, A Cross-Cultural Comparison.

Ekeh Desmond, 3 January 2009 ; 2008 Brand reappraisal: Consumer publicity as cardinal driver, The Guardian Newspaper

Kotler Philip et Al, 2002, Principles of selling. Fourth European edition 4th European edition.

Essential Guide to Marketing Planning / Marian Burk Wood.

Jobber David, 2007, Principles and Practice of Marketing, 5th edition ; Maidenhead McGraw-hill Education.

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Vanguard, 5 June 2003, Nigeria Breweries Consolidates Corporate Leadership ; Africa News: Accessed from: hypertext transfer protocol: //www.lexisnexis.com/uk/nexis/results/docview/docview.do? docLinkInd=true & A ; risb=21_T7049513890 & A ; format=GNBFI & A ; sort=RELEVANCE & A ; startDocNo=1 & A ; resultsUrlKey=29_T7049513893 & A ; cisb=22_T7049513892 & A ; treeMax=true & A ; treeWidth=0 & A ; csi=8320 & A ; docNo=15.

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hypertext transfer protocol: //www.nbplc.com/homepage.php ( ww1 )

hypertext transfer protocol: //www.heinekeninternational.com/nigerian02.aspx ( ww2 )

hypertext transfer protocol: //web.ebscohost.com/ ( ww3 )

hypertext transfer protocol: //allafrica.com/stories/200809110416.html ( ww4 )

hypertext transfer protocol: //www.ias.org.uk/resources/publications/theglobe/globe200202/gl200202_p6.html ( ww5 )

hypertext transfer protocol: //www.fas.usda.gov/grain/circular/1998/98-02/dtricks.htm ( ww6 )

hypertext transfer protocol: //research.afrinvestwa.com:8080/GetDownload.aspx? dwlID=74 ( ww7 )

hypertext transfer protocol: //www.euromonitor.com/Alcoholic_Drinks_in_Nigeria ( ww8 )

Cite this Marketing Report Of Nigerian Breweries Plc Commerce

Marketing Report Of Nigerian Breweries Plc Commerce. (2017, Jul 14). Retrieved from https://graduateway.com/marketing-report-of-nigerian-breweries-plc-commerce-essay-essay/

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