Consumers demand shape Nigeria’s juice market

As Nigerians face the challenge of shrinking purchasing power, sales in the juice market space are being squeezed by consumers who shop for dual values in terms of price and nutritional benefits.

The Coca-Cola Company stylised juice brand ‘5 Alive’ and ‘Chivita 100%’ by Chi Limited are the two major dominants in Nigeria’s juice market.

BusinessDay retail survey in some Lagos stores revealed consumers increasing demand for 5 Alive outweighing that of its rival Chivita.

BusinessDay survey at St Paul Shop, Apapa GRA showed consumers increasing demand for 5Alive than Chivita. At this store, despite that both juice products are sold at N250, most consumers still refer to the nutritional benefits of the former such as its low sugar contents.

At Caleb & Joshua Stores, Chivita is retailed at N270 and 5Alive at N250. “The price difference is because of logistics, we have to bear the cost of transportation. Most of our customers ask for 5Alive and its pulpy orange fruit. Chivita and 5Alive are all unique in their own ways”, a retail attendant at Caleb &Joshua stores told BusinessDay.

The demand swing in favour of 5Alive did not change in Nkylink Shop as BusinessDay gathered from the attendant that, “People request for 5Alive more and Chivita. It is better because it contains low sugar”.

“They (customers) complain that Chivita is too sugary but sometimes people still ask for Chivita. Chivita is expensive when compared to 5Alive and I don’t know why. 5Alive is N250 but Chivita is between N270 and N300,” he said.

Another survey at GIG Supermarket, Ajao Estate revealed consumers demand for 5Alive exceeds that of Chivita. At this supermarket, Chivita is sold for N270 and 5Alive for N250.

The demand for both 5Alive and Chivita was equal at Gooddeal stores as BusinessDay learnt from the attendant.

“Customers ask for Chivita and 5Alive, I can’t say the one they demand for more than the other. Chivita Active is N250, same price as 5Alive but Chivita 100% juice is N300”, she explained.

The Coca-Cola Company and Tropical General Investments Group– the holding company of Chi Limited recently disclosed a binding agreement for Coca-Cola to acquire an initial minority equity shareholding in Chi Limited.

The agreement creates a strategic relationship between the two beverage industry leaders within Africa’s largest economy that together serve Nigeria’s most popular sparkling soft drinks, juices, value-added dairy and water beverage brands.

Within the agreement, Coca-Cola has made an initial 40 percent equity investment in Chi Ltd. and intends to increase ownership to 100 percent within three years, subject to regulatory approvals, while working on other long-term commercial structures.

“Coca-Cola’s acquisition of an initial 40% stake in Chi, with plans to increase its ownership to 100 percent over the next three years pending regulatory approval is positive for both parties”, said Efemena Esalomi, consumer analyst at Vetiva Capital Management Limited, in an emailed response to BusinessDay.

“This merger, which effectively would reduce the competition between both brands somewhat, should also be margin accretive the long-term whilst also providing Coca-cola entry in the diary segment, through the Hollandia brand,” she added.

CHINWE AGBEZE