Appraising Northern Market and its Spending Habits

Raheem Akingbolu reviews a recent report by Pierrine Consulting,which gives insight into the consumption pattern in the northern market, transaction method and how the breakdown would guide businesses and investments

One of the major factors that lead businesses to success is market understanding. This informs why companies invest more in strategic market research at the beginning. Equipped with valuable information about its target market, a company can develop products and create marketing campaigns that appeal directly to consumers. And the benefits don’t stop there. A brand owner can leverage the data procured through market research to propel his company to success in a variety of ways.

It’s believed that if a brand owner is not taking full advantage of market research to make data-driven decisions, he should start considering the ways it could help his company grow.

Marketers are therefore in constant search for consumer needs and always attempt to understand consumer behavioural changes in order to satisfy the customer expectation, achieve brand loyalty and deliver sustainable business success.

Any opportunity therefore that presents prospects and gives understanding of the consumer is always appreciated by marketers who are often under intense pressure to keep the company going.

Overview of Northern Market

The recent market report on Northern Nigeria covering the entire 19 states under the northern market cluster conducted by Pierrine Consulting therefore comes handy for brand owners who want to penetrate the Northern market. Any report on a segment of Nigeria society becomes vital for brand owners as Nigeria is emerging and has a vast economy with a consumer population of over 200 million, the largest population in Africa with dynamic consumer behaviour.

The Pierrine report which studied Northern region consumers provides insight on that market which affords marketers the opportunity to create special products and messages tailored to the Northern consumers as no single message will appeal to whole Nigerians with its varying cultures and population ages.

Speaking to THISDAY on what informed the report, the Chief Executive Officer at Pierrine Consulting, Seyi Adeoye, said the report was aimed at providing an informed view of the northern market opportunity. Adeoye also pointed out that the survey had shown that the Northern market is an exciting and profitable one for brands and businesses seeking growth at a time like this and beyond.

“It is significant that the value and dynamics of the Northern market as espoused in this research by Pierrine Consulting will benefit marketers and brand owners in their further efforts for growth and consumer satisfaction. Reports on other regions are encouraged for not only marketers’ benefit but the Nigerian economy,” the CEO said.

There was clear understanding from the report that the Northern consumer is unique in every way, characterised by a culture-influenced lifestyle, the importance of religion in daily choices and respect for social-cultural religious institutions and roles. “The Northern region accounts for 71 percent of total land mass of Nigeria, 54 per cent of total population and about 30 percent of the national GDP”, the report stated.

As pointed out by the report, the Northern market, with its size and preferences, cannot be ignored by any discerning brand owner or business leader in Nigeria. According to the report, “The region is known as a leading market for seasoning, spices, malt, CSD, and dairy products. The report therefore dimensioned some of the opportunity.”

Behavioral Dynamics

The report which provided an informed view of the northern market opportunity from consumers’ behavioral dynamics revealed that the residents of Northern Nigeria spend N322 billion monthly on personal care products. This big revelation is already an attraction to players in the personal care segment.

The report which examined the Northern market opportunities for marketers further gave an insight by providing the items the amount was spent on. It showed that the N322 billion amount was spent monthly on top seven personal care products such as toothpaste, beauty soap, perfume, body lotion, sanitary pads, deodorants and antibacterial soaps.

Though the report used Kano, one of the largest and commercial cities in the North and Nigeria as a proxy, it however gives the idea of the whole Northern consumer behaviour and preferences.

Dimensioning the monthly spend, the report also discovered that residents of the region spend N163 billion monthly on carbonated drinks.

Spending on Foods and Drinks

Providing a breakdown of the spend on drinks, the report said “53% of northern consumers consume some form of non-alcoholic drinks several times every single week, 66 per cent currently consume CSDs, 45 per cent consume Malt drinks, 24 per cent consume fruit-based drinks, 5 per cent take wine products and 15% are consumers of Energy drink products. Over 60 per cent have Zobo and unbranded milk products within their repertoire of drinks.”

According to the report, Northerners also spend big on branded breakfast, as monthly expenditure on cocoa-based drinks, tea, cornflakes, coffee, oats, custard and Golden Morn is about N223 billion.

As a necessity, food and food-related items constitute 55 per cent of northern consumers’ monthly household expenditure. Additionally, 10 per cent is typically spent on utilities, seven per cent on personal care products, seven per cent on clothing and accessories, six per cent on airtime, 5 per cent on transport, five per cent on medical health, three per cent on baby care products, and 2 per cent on electronics.

Digital Interpretation

While 58 per cent of Northern consumers have internet access, the report showed that cash transactions remain King in the region, with 91 per cent usage level. The report however discovered a considerable on-going use of USSD transactions which it put at 31 per cent.

The Pierrine report also said branded powdered milk was the most consumed of all dairy products, at 89 per cent incidence level. Evaporated milk was next at 8 per cent, sweetened yoghurt at 35 per cent and Butter at 30% usage levels. In all, Northern consumers spend N151 billion monthly on branded milk powder, N36.9 billion on evaporated milk, N35 billion on sweetened yogurt, N28.6 billion on butter, N20.7 billion on Mayonnaise, N5 billion on condensed milk.

In addition, N102 billion was spent monthly on spices, N156b on laundry, and N146 billion on baby care products.

The report also found that open markets and seven neighborhood stores remain preferred shopping points in the region, with 65% of customers making their purchases via this channel.

Other findings from the report indicate that cash is king at 91 per cent usage level amongst Northern consumers, although there is considerable on-going use of digital platforms.

“Daily use of alternative means to cash is still growing as 31 per cent of Northern consumers currently use the USSD platform and about 20 per cent make use of mobile banking apps of different financial brands, but cash is more used for daily transactions at 91 per cent.” The report said 36 per cent of consumers who are not currently using digital platforms are open to using it.

It also discovered that 65 per cent of Northern consumers patronise open markets and neigbourhood stores.

According to the report, 58 per cent of Northern consumers have access to the internet connection on their mobile devices.

“Access to internet connection is skewed more towards upper socio-economic class males. 46 percent of the semi-skilled and unskilled, unemployed and lowest grade individuals have access to some form of internet connection. 98 percent connect to the internet via their mobile phones and the top online platforms currently used are Facebook, (82 per cent), WhatsApp (78 per cent). Youtube (23 per cent), Instagram (26 per cent), Google (13 per cent), ”the report stated.

Appraising Northern Market

A recent report by Pierrine Consulting,gives insight into the consumption pattern in the northern market, transaction method and how the breakdown would guide businesses and investments.

It’s believed that if a brand owner is not taking full advantage of market research to make data-driven decisions, he should start considering the ways it could help his company grow.

Any opportunity therefore that presents prospects and gives understanding of the consumer is always appreciated by marketers who are often under intense pressure to keep the company going.