Brands
Cola wars: RC cola fights for elbow room as prices of traditional brands rise
By OBINNA EZUGWU
When in 2018, RC Cola International entered Nigeria’s ever competitive and vast soft -carbonated, Chapman, fruit – drinks market, with Lagos as its starting point, it got bloody a nose, failing to compete with existing brands, and in no time, disappeared from stalls.
But as retail prices of more established brands, such as Pepsi and Coca-Cola soar to N150, RC Cola is making a gradual inroad into Nigeria’s commercial capital, and the reception this time, is a lot more positive.
“People buy RC Cola now, unlike before,” said Iya Oropo, a retailer Oke Alafia Street, Ojodu. “It came that time, but people were not buying it. Initially, we were selling it for N50, later N80 before N100, but it did not move well. Before you know, we did not see it again to buy. But now it has come back and people are buying.”
RC’s reception this time is a reversal of fortune, a vast improvement from the cruel fate it suffered at the first time of attempting. Coming into a market then dominated by leading indigenous brand, Bigi Cola, a product of Rite Food Limited; 7Up’s Pepsi; Coca-Cola, and Ajeast Nigeria’s Big Cola, it stood little chance, given that it offered less volume, 50cl for same N100 retail amount as Bigi Cola and other which had 60cl bottles, at a time 60cl was the rave of the moment.
Soon, unable to offset their stock, retailers began to stay away from the product and in no time, it practically disappeared from stalls in Lagos and other South West markets and headed eastwards where it eventually found a niche market in Nigeria’s Southeast and the adjoining South South, taking advantage of the absence of the brands such as Bigi and Big Cola, and the slightly higher prices of Coca-Cola and Pepsi, sold then for N150 and N120 respectively, to establish huge presence.
Indeed, for a period, beginning from around early 2019, RC Cola suddenly became the dominant cola brand in the Southeast, displacing, again, Coca-Cola and 7Up.
But the ever dynamic market has continued changing, with new products introduced, and some old giving way to more competitive ones. RC has remained competitive in the East and South South, but longer holds the dominance status in some states as feedback suggests.
“RC is still doing well in Awka here, said Mr. Chidi Nwafor,” a shop owner in the Anambra capital. “But people are also patronising other brands.
In Amechi, Enugu, a retailer, Joseph Ogbonna, has a slightly different opinion, even as he says RC’s price in Enugu has matched those Coca-Cola and Pepsi at N150 per bottle.
“RC is still doing well, but Coca-Cola and Pepsi are doing a bit better,” he said. “Here we sell N150 per bottle, same price Coca-Cola and Pepsi.
Competitive pricing was the magic behind RC’s breakthrough in the region. At N100 per bottle at the time, N50 and N20 lower than the price of Coca-Cola and Pepsi respectively it quickly broke into the market and soon emerged quite dominant.
The market has since witnessed changes. Increased cost has forced retail price adjustments. RC has gone from N100 to N120, same price as Bigi and Big Cola, and as much as N150 in some places, just like Pepsi and Coca-Cola both of which have adjusted to N150. Still, RC’s ability to offer same volume at lower price, for the most part, than Coke and 7Up, means that it continues to enjoy good patronage.
“RC is moving well here,” said Amara Joy a retailer in Benin City, Edo State. “Most people here now use it for occasions because it is less expensive than Malt which is now N200.”
RC ‘Returns’ to Lagos
Having largely stayed away from Nigeria’s commercial capital for long periods, RC is back. This time, better equipped for the competition.
The 60cl war has since ended, with brands such as Big Cola, Coca Cola, Lacasera – for its Smoov Chapman and Bold Ginger – and Pepsi cutting volume down to 50cl, amid worsening economic realities. Bigi remains the only brand sticking with 60cl, but even that has not helped its fortunes, as it has since lost the dominant position it once held to Pepsi and Coca-Cola. But it remains competitive regardless.
Volume, from available feedback, is no longer much of a factor, as all brands, with exception of Bigi, now offer 50cl bottles, and RC looks set to use the level playing field to its advantage.
“RC is doing better now,” said Uche Nwanna, a wholesaler and proprietor of Uche Ventures, at Yakoyo, Ojodu. “And for retailers it pays them well because we sell N1000 per carton of 12 to retailers, and they sell N120, which means they make more gain from it than other products, though the price keeps changing these days.”
State of the War
The entrance of Ajeast Nigeria’s Big Cola in 2015, and the subsequent emergence of Rite Food’s Bigi in 2016, changed the dynamics of Cola market.
With simpler organisational structure and less encumbrances, the minnows – Bigi Cola and Big Cola – used bigger 60cl bottle sold at N100 to break into, and indeed dominate the South West segment of the cola market, leaving Coca-Cola and 7Up gasping for breath. Both companies would eventually de-list from the Nigerian Stock Market in a move observers say was to avoid public scrutiny of their no- longer-so impressive books.
Coca-Cola’s 50cl Big Coke sold at N150 couldn’t compete as a result of its higher price. Its 35cl Small Coke sold at N100 was no match for 60cl Bigi and Big Cola sold at the same price, especially in low and middle end markets where the most buyers are. Only the company’s 60cl Zero Coke sold at N100 maintained a presence, albeit as a fringe player. Coca-Cola appeared, at some point, to have abandoned the South West market to competition altogether.
Big Cola, Lemanode, Masafi Lite
Bigi would subsequently cash in on Ajeast forex challenges which encumbered its production at some point, to emerge clear leader of the market.
But soon the big brands fought back with big bottles of their own, and evened things out. 7Up was the first to react. The company introduced 60cl Pepsi plastic bottle nicknamed Longer Throat. It proved effective, subsequently becoming the second most selling brand behind Bigi Cola as shown by BusinessHallmark research. It has since taken first spot.
Coca-Cola also introduced 60cl Sprite, Fanta and Limca bottles at N100, and subsequently 50cl Coke bottle for the same price.
Amid the 60CL warfare that peaked between 2018 and 2019, India owned Lacasera Company, re-branded and reintroduced its Lacasera beverage, hoping to perhaps replicate its success with Smoov Chapman, introduced first in 2014, which caught attention within this period, re-establishing the company’s presence among elite competitors in the beverage market. But Lacasera failed to do the magic, and has now largely suffered similar fate as its progenitor.
“People say Lacasera is too strong,” Iya Oropo said. “That’s why they stopped buying, it’s not been doing well.”
Smoov Chapman has however, remained in the market as the leader in that category, having successfully fought off competition from Bigi Chapman, and the company has indeed introduced Bold Ginger to boot.
Gradually, the traditional brands like Coca-Cola and 7Up took back the market before subsequently returning to 50cl bottles as harsh economic conditions took a toll.
But, while the revert to 50cl had no noticeable impact on the traditional brands, with Pepsi maintaining its position as most sough-after brand, the decision of Big Cola to take same route may have proved costly.
“People were buying Big Cola yellow cover a lot before, but since they reduced their bottle, most don’t buy it anymore,” Iya Oropo explained. “E no dey move market again.”
Pepsi now top spot, but recent price adjustments may change status quo
Interactions with wholesalers and retailers suggest that Pepsi has since emerged the most preferred of cola brand, but recent price increases which has seen the product go from N100 to N150 per bottle could yet alter its fortunes.
“Pepsi has been the most selling brand,” Nwanna said, “It sells like sachet water. The next is Coke, but I don’t know what effect recent price changes will have.”
Indeed, the market is now undergoing another major adjustments, forced on it by price changes, and RC, which remains slightly cheaper, will be looking to take advantage to establish itself as a brand of reckon in a market segment that it couldn’t initially compete, while still remaining competitive in its existing niche market.
“I bought RC for N1000 the last time, and I’m selling N120 per bottle,” said Iya Oropo, but you never know what will happen tomorrow. Each time you go to buy products, you will notice that prices have increased, and sometimes products are scarce. That’s the problem.”
Other products like Lemonade lemon juice packaged by Akanbi Ventures Limited, Masafi Lite Fruit Drink and Pepsi Max by 7Up, have since joined the competition fray, with the former which has been around for some time, doing well in the market. Pepsi Max has, meanwhile, continued to struggle.
In terms of prices, a survey by our correspondents showed that Coke, Fanta, Sprite, made by Coca-Cola Company, as well as Pepsi, 7Up, Mirinda, Teem – produced by 7Up Bottling Company, presently go for between N1, 300 and N1,350 per carton of 12 bottles, while retail price is uniform at N150.
On the other hand, RC Cola is presently sold between N950 and N1100; Bold Ginger, N1200; Bigi Cola N1200; Big Cola N1,250; Lemonade N1200; Pepsi between N950 and N1200 and Lipton Lemon N1250, with retail price mostly N120 per bottle.
