Omo Detergent In Nigeria

Omo Detergent In NigeriaOmo is manufactured and distributed by Unilever Nigeria Plc, which is a subsidiary of the multinational food and vitality company, Unilever whose corporate rush is to add vitality to life. They atomic number 18 manufacturers and suppliers of consumer well-behaveds in the foods, home care and personal care divisions. Unilever Nigeria Plc was incorporated on 11th April, 1923 as the Lever Brothers (West Africa) Ltd (OceanicPearl 2009). The company began as a trading organisation founded by Lord Leverhulme in Nigeria and West Africa. It started as a soap manufacturing organisation and has remained over the years to become unrivaled of Nigerias oldest surviving manufacturing organisations. The company has over the years diversified into the manufacture of foods, personal care harvest-homes and non-soapy detersives. This was done through mergers and acquisitions, some of which include the acquisition of Lipton Nigeria Ltd in 1985 and Cheesebrough pocket billi ards Industries Ltd in 1988 (UnileverNigeria 2010a). In hunt with the other parts of the multinational group, the companys name was changed in 2001 to Unilever Nigeria Plc. It was listed on the Nigerian Stock Exchange in 1973 and 49% of its right are owned by Nigerians at the moment enchantment 51% is held by Unilever Overseas Holdings BV (OceanicPearl 2009).KEY MARKET SEGMENTS AND SIZE OF MARKETUnilever Nigeria Plc is involved in three main commercialize shares and they areFoodsThe greases of Unilever in this segment are Blue Band margarine, Lipton tea, Knorr and Royco food seasonings. Blue band margarine dominates the margarine market with only few strong competitors. Lipton tea is also the dominant brand in the Nigerian tea market, with relatively little disceptation from local manufacturers. However, the Nigerian tea consumption is real small callable to the hot climate and the fact that consumers prefer chocolate drinks to tea. Knorr and Royco are distinguishable bran ds of a glutamate-based food seasoning. Although they possess a considerable market share, they have very stiff competition from the Maggi brand of Nestl Nigeria which is the dominant seasoning brand in the market.Home careThis segment of the fast moving consumer goods market is dominated by multinational companies handle Unilever, Procter and Gamble and PZ Cussons although there is competition from other local manufacturers. This dominance is due to the largish amount of capital assigned to marketing by the multinationals, which most local manufacturers ignore each due to lack of capital or ignorance. The key Unilever brands in this segment are Omo and Key. Omo comes in a powder coordinate while Key is a green bar soap. The Omo purifying comes in various learn sizes while the bar soap come in two sizes. These harvest-homes are mainly produced for hand washing although Omo may be used for machine wash. in-person care divisionCurrently, Nigerian households spend US $5 billio n annually in the personal care category (Tura 2010). It is a very hawkish segment of the Nigerian market and boasts a lot of local manufacturers. Investors are drawn into this segment because of the low barriers to entry and exit. Also, government policies favour the establishment of belittled factories in this segment with tax incentives granted the organisations. However, multinational organisations such as Unilever and PZ Cussons still control wide-ranging portion of the segment. Unilevers brands in this segment include Lux, Pears and Sunsilk. Pears is a petroleum jelly brand while Lux and Sunsilk are brands that control body and hair care products although Sunsilk is cheaper and was created to cater for the low income segment of the Nigerian society. coat of marketBecause food, home care and personal care are essential to all humans, the market for most of Unilever Nigerias products including Omo can be seen as the entire community of the country. The household consumer go ods segment has been growing steadily due to the increased marketing by companies, stimulated by growing demand. Detergents for hand washing have not been left out. The unsteady power situation in Nigeria favour hand washing rather than machine washing and so most of the washing purifyings produced in the country are made for hand-wash applications. With a population of over 140million people and an annual population crop rate of 1.999% according to the 2009 estimates (Indexmundi 2009), Nigeria presents a full-size market for powder detergents. With an urban population percentage of 48% (2008 census) and 97% of the population below 65years (Indexmundi 2009), the market potentials are huge. The Nigerian population is made up of an upper wealthy furcate that only constitutes about 10% of the population. The middle and lower class make up the remaining 90% with the lower class having the lion share. The chart below shows the Living Standard Measure (LSM) of the adult population in 2008.The Living Standard Measure is a wealth delegate calculated based on the ownership of certain goods and degree of urbanization and ranges from 1 (indigent and campestral) to 10 (affluent and urban) (Ladipo 2008).PRODUCT DESCRIPTION AND KEY DATAOmo is a clean-living detergent powder that is used for washing clothes. It is produced specifically for hand washing although it can be used for machine washing as well. Omo is a chemical-based detergent with excellent stain removal properties. It comes in 35 and 50grams sachets and also in 200, 400 and 900grams packs. Because of the relatively low income level of the average Nigerian family, the small product sachets have been favoured over the years. Omos brand works are white, gentle and red, with the word Omo written in blue and as uppercase characters on the packaging, which carries the brands colours. Omo is one of the oldest brand names in the household care category in Nigeria. For a long cartridge holder, Omo was the gener ic name for non-soap detergents, in most parts of Nigeria. However, increased competition has changed this.MARKETING DATA OF OMOThe turnover for the powder detergents segment and Omos market share are given in the table below. NGN represents the currency of Nigeria, the Nigerian naira.The overall gross sales volume/turnover decrease from 2008 to 2009 was due to fall in demand caused by a high inflation rate. The increase in sales revalue is as a result of higher product prices rather than an increase in sales volume. However, though there was a decrease in sales volume of powder detergents in 2009, turnover has increased greatly over figures from the early 90s due to the introduction of the more affordable thriftiness- coat sachets of product and improvements in avenue network across the country which made rural markets more accessible. The turnover for Omo has experienced a gradual decline over the years as consumers now see it as an old and ineffective product and hence prefe r the competitions products.The volume and value share of Omo also decreased over the year due to the wrong perception of the product by the consumers and very stiff competition in the segment with several(prenominal) players like Eko Resources Ltd., introducing cheaper alternatives into the market.Main competitorsThe ability to constantly introduce and make exciting offers to customers is a very important attribute needed to survive and excel in a competitive market (Jobber 1998) like the Nigerian detergent market. Detergents obtain has a low level of involvement and so consumers are quick to try something they perceive better. There are several products that make do in this market segment, their large numbers being due to the low barriers to entry and exit for this market segment. Of the many brands that exist, the three main competitors of Omo areSo Klin washing powderThis is a leader in the mass market category of the powder detergents market. It is manufactured by Eko Suprem e Resources Ltd., jointly owned by Nigerian and Asian investors and was introduced into the market in 1995. The manufacturers spotted a gap in the market since prior to this time, Omo and the other detergents did not come in economy packs (products came in packs of at least 200grams) and were beyond the reach of the greater populace. They introduced sachets of 15grams and 30grams to cater for the low income earners. This caused them to obtain over much of the competitors market share. Also, on entry, the white colour of the powder strengthened its claim to provide superiorior cleansing with just small amounts, at a time when the other players including Omo still came as blue powders. After gaining grounds with its economy-sized products, it also ventured into the realm of the existing main players of the industry by introducing products in 200g, 400g and 900g packs to cater for high-end customers. At the end of the 2008 retail year, So Klin emerged sanction in the powder deterge nt category mainly the 13 to 35kg segments but still undisputedly remain the first in the sachet (15 and 30grams) segment, which accounts for 50% of the powder detergent business in Nigeria (The Nation 2009).Ariel washing powderThis product is manufactured by Procter Gamble Nigeria, which started operations in Nigeria in 1992. It also comes in the form of a white powder and occupies a sizeable share of the detergent market although it is a sort of premium detergent. It was introduced in comparatively large sized packs and cost on the average more than its other competitors for same-sized products. This greater price premium was perceived by most of the AB and C1 groups (using British social potpourri as given by White (2000)) as a sign of higher quality and became popular especially among Nigerians who knew of their operations outside the country. Procter Gamble Nigeria undertakes strong-growing advertising and has over time gradually increased its market share. With the introdu ction of their economy sized products (15 and 30grams), their customer base increased making them the second study competitor of Omo.Elephant detergentThis detergent is manufactured by PZ Cussons Nigeria, a company that commenced business in Nigeria as a West African merchant. Elephant detergent is the third gear major competitor of Omo in the detergents category. Prior to the entry of the Procter Gamble brand Ariel, it was the main competitor of Omo and together with Omo, occupied more than 40% of the detergents category. Elephant detergent over the years has grown into an umbrella brand that has several detergent products under it such as the Elephant Gold and Elephant colour. It started out as a blue detergent packaged in 200g packs but has transformed into a white detergent following the change in the Nigerian consumer preference. On the wake of the So Klin revolution, brands like Omo tried to quickly reposition while Elephant dawdled resulting in a severe loss of market shar e. It now comes in economy packs although its strongholds lie in the large sized packs (200grams and above).LIFECYCLE OF OMO WASHING POWDEROmo detergent powder is in its mature phase at the moment. It was introduced over 40 years ago and its early tier was marked with great acceptance as the market had very few players predominantly Elephant detergent. This established the brand and led to a very rapid growth phase through the 80s and early 90s. By the late 90s, the product entered its mature phase. Its market share has since been fairly constant with slight increases or decreases yearly depending on marketing activities. This is evidenced by the gradual fall in market share (from 17.4percent in 2008 to 16.3percent in 2009) as seen in Table 1. Unilever Nigeria constantly undertakes several activities to ex be the life of the product. These include repackaging, resizing of packs, introduction of improved formulas and constant advertising.SWOT ANALYSIS FOR OMO DETERGENTStrengthsWeakn essesOpportunitiesThreatsStrong customer awareness of the brandCrowded and very competitive marketGovernment vision 20/20 developmental policiesEntrance of cheaper substitutes like Bonux (by Procter Gamble Nigeria) and Good Mama detergent (by Eko Supreme Resources Nigeria Ltd.) into the market. thumping skilled marketing forcePrice sensitivity of productImproved road network in rural areasRe-launch of Ariel Enzymax as Ariel Prozim by Procter Gamble Nigeria Plc (M2weekly 2010) entrance fee to home companys resources/technologySmall brand product range offering specific advantages to different customer segmentsIncreasing income of middle classDifficulty in accessing credit from local banks in the light the restructuring of the banking domain and global financial crisis.A large number of loyal nationwide distributorsImproved electricity tag on reducing production costs.Fall in local raw materials productionLarge local production capacityGrowing population and market increment in im port duties on imported raw materialsWide product packaging size rangeHigh inflation rate(12 per cent in declination 2009) (FreshPlaza 2010)Clear brand positioningLow entry barriers into businessFUTURE TRENDS IN THE MARKETNigerian consumers increasingly involve more variety, freedom, quality and want to remove the hassle from washing and save time. With an annual population growth rate of 1.999% from 2009 estimates (Indexmundi 2009), the market for household care products is growing. In 2008, the Fast Moving Consumer Goods sector in Nigeria of which detergents are a large share grew by over 15% to a market size of around 130 billionNGN (552 million) (TradeInvestNigeria 2009).Also, with the increase in the income of the middle class and the percentage of the population that constitute this class, the average disposable income per family is increasing at a steady pace. Therefore, over the next few decades, there will be a shift of demand from economy sized goods (15 and 30grams) to family sized goods (200grams and above) as the younger, more educated portion of the population, which form a greater part of the population, with a median age of 19years (Indexmundi 2009) grow older and establish families.Although infrastructural development (especially power supply) is slow on the average, it is quite faster in urban areas like Lagos, Port Harcourt and Kano. These cities make up a large portion of the entire market. In addition, a larger dimension of married women now take up jobs in the private and public sectors, leaving very little time for activities like hand washing. For these reasons, there is a gradual growth in the market for machine wash powders and this is expected to continue over the next two decades.Finally, with government rigorously executing various projects and making policies in line with its plan for Nigeria to be among the first 20 economies in the world by the year 2020, a rapid growth in the infrastructural development especially rural road s is opening up the rural market thereby adding to market growth.ADVERTISING PHILOSOPHYOmo is advertised with a catch phrase Dirt is good, built around the belief that allowing children explore their environments ensures they grow and develop properly. The advertising of Omo is focused on the mother as the derriere considering she is the main decision maker for the purchase of household care products like detergents. From personal communication with Unilever Nigeria (February 2010), the primary target consumer description is given below.She is a mother in LSM 5 8, aged 23 45yrs.Her children are central to her world and she wants them to develop and explore the world.Laundry is an important part of her life she takes great pride in seeing her family looking good and wearing clean clothes.She cares about great laundry results and her childs developmentShe lives in the urban and semi-urban parts of the country.Unilever Nigeria employs the television, posters and radio advertising to market Omo, each media used to a different degree.TelevisionOmos main advertising is done on television since their target audience always watch television especially in the evenings. The adverts are run during a soap opera and a family breakfast show which run on Thursday (8-10pm) and Saturday mornings (9-10am) respectively weekly. These shows are almost religiously watched by most families and so have a great impact rate for the target audience.PostersThese are the other most used media for advertising Omo. Posters are placed on billboards in markets and major roads all over the country. Since the target audience is the woman, and women are the ones who go to markets to do the family shopping, this is a highly effective method. Markets tend to be centralised and most women go shopping at least weekly and so are always exposed to the advert each time they go there. Using posters offers three main advantages for the marketing of this product. Firstly, since power is not constant in the country, posters present an ever visible advert, always present foreign television adverts that will not be seen if there is no power supply during the time when the advert is supposed to run. Secondly, posters also allow the message of the product to be passed to consumers who do not own television sets considering this is the case in certain parts of the country. Thirdly, posters are also made in the major languages of the different states in the country as Nigeria has over 200 indigenous languages. This is a very big advantage of using posters, as it reduces the cost of advertising which would be ridiculously high if TV commercials of the different languages were to be made. It ensures that the message of the advertising is effectively communicated to the consumers even if they are not very good in position language.RadioLocal radio is also sedulous in the advertisement of Omo. However, it is used to a much lower extent than television and posters. It is mainly employe d in the semi-urban and rural areas where most consumers do not watch much television but own radio sets. The adverts are made in either face language, Pidgin English or the major language of the region.The print media is normally not employed in the advertisement of Omo because very few of the women who are the target audience regularly read the dailies and magazines.ADVERTISING PLANCurrent consumer perception of brandMost consumerssee Omo as an old school (outdated and ineffective) product.believe detergents powders reduce the colours of clothes.Advertising objectivesTo alter perceptions about Omo.To reassure customers of product quality.To raise impulsive brand awareness from 75 percent to 85 percent.To raise the proportion of consumers describing the brand as effective and value for money to 75 percent.Selected media Posters (on billboards because of its high perception-altering potential via repetition).Poster advert descriptionThe poster will carry a picture of a smiling wom an (30-35years old) in brightly coloured Nigerian uprise (attire will be changed to match the cultural and religious attire of women in different regions so as to cause the consumers in the region to identify with the advert) on a white background, carrying the brand colours (red, blue and white) on the left portion of the picture. Brand colours will be bold on poster to enable easy identification of the brand even in the first place seeing its name. The right side of the poster will contain a picture of a large amount of colourful clean clothing folded in a stack (wide range of bright colours to be chosen to emphasize colour caring and preserving qualities of Omo). The woman in the picture will be holding an Omo 15grams sachet in her right hand next to the stack of folded clothing (to emphasize that a small amount can clean many clothes) while the products in their different sized packs are displayed at the bottom left of the poster (to show the customer the range of choices avai lable). The brand name Omo will be placed in the poster in large print, second in size only to the phrase Brilliant results always (to highlight the excellent cleaning and colour-preserving ability of Omo)which will run across the centre of a major part of the poster (but does not overlap the clothes).Response/what we want them to believeOmo has super stain removing ability,A small amount washes a large quantity of clothesOmo does not deteriorate coloursLanguages to be used in advertsEnglish, Pidgin English and the three main national languages (Hausa, Yoruba and Igbo).Where adverts will be displayedState capital city centres, major markets and roads in the cities and select towns.TimingSix months.Media planPeriodic over six months.Results expectedBrand to come first in their mind when they think washingTo establish the brand and position it in the market as the best for washingCriteria by which success will be judgedChange in market share and turnover.BudgetA cypher of 250million NGN (1.07million) is proposed for this advert. This is justified by the increase in revenue the advert will generate. A 10% increase in revenue (which is 969.2millionNGN from Table 1) will cover the advert and marketing costs and give a reasonable profit.CONCLUSIONOmos strong brand presence has kept it over the years. However, a selling fancy rather than a marketing concept has been employed for Omo over the years resulting in loss of market share. Constant research should be carried out to detention up with changes in consumer needs. With new emphasis on what consumers want from the product, effective marketing and product promotion, a turnaround can be expected.