By
Mark Ocitti Ongom who was appointed Uganda Breweries Limited (UBL) managing director in August 2016 has some homework to do.
The UBL brands are slowly losing demand. The UBL’s brands facing tough times in the market include; Bell Lager, Black Bell and Ngule Lager. UBL’s Spirits are also said to facing tough times. Meanwhile Nile Breweries Limited brands are enjoying the market.
Just like Coke is to Coca Cola, Bell Lager is to UBL.
Uganda Breweries’ other brands including Guinness, Tusker, Red Label, Smirnoff, Bailey’s, Alvaro and Malta are also slowly losing demand.
Industry reports indicate UBL market share has since dropped from a high 54 percent two years ago to below 40 percent currently. Part of the problem, according to industry analysts is that UBL brands are not recruiting new customers while old customers are running away for various reasons.
Nile Breweries, whose key brands include: Nile Special, Club, Castle Lager, Castle Lite, Eagle (Dark and Lager), Nile Gold, Chibuku and Redd’s have gained strong market momentum and are top sellers. NBL winning formula is using right communication channels. Nile Breweries Limited whose slogan is Above and Beyond is part of ABInBev.
A few years ago, UBL was a market leader in Uganda with a respectable market share compared to Nile Breweries.
The tables have since been turned around, Nile Breweries, despite going through management changes, restructuring and fraud, remains a king.
Why UBL is losing out
Bell Lager with the slogan, Live every Moment, is said to be losing her customers. Some of the customers who used to drink Bell Lager have either grown old, others could be financially broke, some are in the in the evening of their lives or for health reasons they don’t want to drink alcohol anymore. As all this happens, the once christened Uganda’s leading beer- is not recruiting as many new customers Vs those who are leaving the brand.
On the other hand, rival brands including Nile Special, Club, Chibuku are recruiting new customers, including university students hence the surge in market share. What is Juliana Kagwa, the marketing director at UBL doing?
Enter Black Bell
September last year, UBL launched a new beer called Black Bell. The new drink targeted the youth and trendy university students. At 5.8% ABV, the beer was classified as a strong beer rich and flavourful in taste.
The reviews from top brewers confirmed the beer would easily appeal to the palettes of millennials. The UBL went ahead to allocate huge marketing budget to attract the youth.
A year later, UBL management has noticed that perhaps the beer was not the right one for the target market. Sources say besides, the wrong marketing strategy, UBL depended largely on global research to produce Black Bell. Ugandans are said to be unique is many aspects- ask Shoprite, Heineken, Eco Bank Uganda among others. These brands came with a bang only to be ‘ignored’ by Ugandans.
A recent global research reveals that flavoured beer was trendy for the youth. Armed with this information, UBL went ahead to produce flavoured Black Bell.
However, the market refused the Beer. Market reports indicate the consumers complained that the taste was not good, forcing management to act.
We are yet to see if the recent change in the taste of Black Bell will be reflected in her sales. Otherwise, Black Bell was meant to fight off Club, the favourite beer for campus students. Meanwhile sales for Club are growing as Black Bell struggles.
Ngule beer
Reports indicate, the sales of ‘Kabaka’s beer’ Ngule Lager has suffered heavily in the recent past. This has made heads turn at UBL. Ngule is a Luganda word that means ‘Crown’ or ‘reward’. The beer was launched in January 2016. Produced under a partnership between UBL and the Buganda Kingdom, the partnership consists of a revenue sharing agreement.
Reports indicate, Ngule Beer has suffered at the hands of Nile Breweries’ Chibuku beer. This, sources say, recently forced UBL management to reduce the price of Ngule Lager from Ugx. 2000 to Ugx. 1500 under the disguise of commemorating the Kabaka’s coronation.
With the biting economy, it makes sense for the rural beer lovers to opt for Chibuku which is selling at Ugx. 1000 vs Ngule Lager, which goes for Ugx. 2,000. Ordinarily, you get two for one bottle of Ngule lager. While Chibuku has also affected the sales of Ngule, NBL is not bothered, since it owns both brands.
By launching Ngule Lager, UBL had somewhat managed to neutralize Nile Breweries’ Eagle beer, which was growing so fast and widening the gap between the two beer companies. The UBL’s Senator was no match.
UBL Spirits losing out
The UBL Spirits were at one time in a freewheel. Competition was almost not there. then came the Sackets spirits [ which are cheaper and go for as low as Ugx. 500] which have eroded their market share. UBL has tried to position her spirits as ‘refined’ and high quality, this has not helped matters. For example, in northern Uganda, UBL today, controls less than 1 percent of the spirits market. UBL’s lest priced Uganda Waragi goes for Ugx. 2,000
Not to be left out, UBL recently introduced a low value brand – Gabalana to take on the low brands eroding her market share. We wait to see how the market will react.
Last word
Speaking at the handover to Mr. Ociti, , the former UBL Managing Director said: It has been an exciting time for me in Uganda! This market [ Ugandan market] is full of potential and many opportunities yet to be tapped into! Ugandans are not afraid to have fun and celebrate life. I simply believe that we [UBL] have the best offering available today and I have enjoyed creating a range of products and shaping experiences that our Consumers can be proud of and enjoy thoroughly.’’
Could be that some of the competitors are using unethical practices? is it the wrong marketing strategies employed by UBL?, otherwise the market is there. if UBL cannot take advantage of NBL reorganization to take over the market, then it will never be market leader again. Well over to you Mr. Ocitti and entire UBL management.
read: Why the Baganda have abandoned Ngule Lager
read: Is Heineken beer about to exit Uganda? Company sacks nearly all employees
