FMCG: Competition Develops the Market But Only the Strong Survives - 2008-06-02

Mr. Keith Richard has marketed Truck soap in Aba, sold Guinness brands across Nigeria and now as the Managing Director of Promasidor is on the verge of taking company’s  brands such as Cowbell, Loya, Onga and Top Tea to the next level . In this interview, speaks with Goddie Ofose on issues concerning global food crisis, the animation industry in Nigeria as well as his experience with Truck Soap, Guinness and Cowbell.

What is new in Promasidor at the moment?

We are building new facilities and it will also take a few months to bring in the equipment. I am sure that it is all in perfect condition. And also, we are obviously a good corporate citizen. So at the same time as we are doing that, we are ensuring that we are after the very best standards of environmental treatment, waste treatment and also health and safety for our employees. At the end of this year, we will have the opportunity to launch a new brand; and for our existing brands, we are looking at opportunities for extension. But then, we are opening them on the basis of being close to the consumers and building our activities on consumer insights.

It is true, both brands are from us. Both Cowbell and Loya are applied in the milk market and secondary in their own high rocket to ride milk market. Loya is strong in its own sector. We need to do more to develop its personality and characteristics as a brand. So you will see a lot more activities, but not the same kind of activity as Cowbell and Onga, because we want to differentiate it in different channels and sectors of the consumer market. But you will see a lot more of activities on this brand as well.

Looking at the global food crisis and as a food specialist. what is your standpoint on the government's decision over rice importation and your advice?

Well, I think it is right that Nigeria should develop its own ability to feed its citizens. You know, I have worked in a number of sectors, so I know the impact of the failure of palm oil in this country and also Cocoa. So I think we need to redevelop our traditional agricultural bases and in addition to that, as you have said, we do not need to go out and import rice, the solution is to grow rice here. We have huge tariffs on rice, sometimes 100%. But as we know, the borders are porous; maybe 60% of rice consumed in this market comes in through illegitimate means. So, if we develop our own productive capabilities and persuade people to invest in food production in Nigeria, maybe we give them tax rebate or perhaps tax holiday and that will give them exporting processing support. We encourage small and medium sized businesses; we encourage cooperatives, that kind of things to develop the private sector to produce the food that is required here. I think that will give the Nigerian economy strength to fight off this kind of shocks. And it will also ensure that there will be good quality food for the indigenous people at the right price.

You are a prominent member in Promasidor, which incidentally is a member of the Organized Private Sector (OPS). Do you think there is any role that OPS can play in this regard?

Yes, I believe OPS has a lotof role to play. And one of the things that I can say about Yar'Adua's administration is the spirit of dialogue. You know we are here in Lagos and our own governor is willing to dialogue and partner with the private sector too. So I was at the Lagos State Economic Summit and I, for example, chaired the session with Prof. Pat Utomi.The Commissioner of Health, Lagos State, was there as well as the head of the  Ford Foundation. So that is an example, that is the government looking to bring in talents and experience from the private sector to talk about the issues and developments. And you know, we explored the cost of developing Lagos; Lagos State needs about $50billion in the next five to ten years to develop infrastructure. And I think there is the willingness to talk creatively and sensibly to the private sector. But the private sector needs infrastructure, we need power, we need transportation and we need the ports to be sorted out, so we can be truly competitive to help in the engine of growth of the Nigerian economy.

It is reported that the only CSR you engage in is the National Mathematic Competition. After the competition, Promasidor seems to distance itself from the students. What are your comments on this?

Well, it is very difficult. When you look at it, there are thousands of children that enter the competition across the federation, and there are representatives from every state. We had the finals in Abuja recently. But you know we cannot replace the education system in Nigeria. The challenge is too high. We have spent something close to or even above N60 Million on the mathematics competition all the way through. That is a lot of money. But of course, we do not stop there. We are also working to carry the winners to the All African Maths Ccompetition which is happening in Egypt this year. We are also going to use the vehicle of NASMAG to sponsor the Nigerian student to a new leadership school for the less privileged. The economy has been built in South Africa unlike in Nigeria. And then we do lots of things as well. Recently, I was at an event where we sponsored a football tournament and handball for the people who have disabilityin their legs in their own court. We see them struggling to make a living by begging on the streets. We are involved in the programme and sponsored that tournament in the Sports Centre in Yaba. We do things with Marvelous Babies. So, we have a wider programme that cuts across everybody that comes in contact with our products.

You are one of those companies that actually pioneered the animated commercials in Nigeria when animation was not popular. Now that we have some South African companies and other foreign firms moving in to establish in Nigeria, we gathered you are now moving away animated commercials to real human commercials. What is the major reason for this?

Well, I think there are a number of things there. We are not moving away from animation totally and in fact if you see most of these TV ads,they still have connection to the Mama Onga and the Cowbell family at the end. You will also see in future adverts that we will be doing more to combine both. But if you look at the industry, technically, the Nigerian industry is still a bit behind in terms of its ability to create first world level of animation. I have been to some presentations recently and there are some young men in the studio who are developing that credibility and I personally give them time, we have been talking to them. We will continue to support them and work with them as they develop. But at the same time, there is a call to encourage not just Nollywood but to encourage development of other aspects of Nigerian media. So that is why, you know, Kate Henshaw is the face of Onga, but we have seen other girls that are on the brands in the English and Hausa languages and we used Nigerian technicians in Nigerian studio. So, we are fully committed to supporting the Nigerian media industry.

It was gathered that about N100million has been spent on your recent commercial. If you had used animation, would the cost have been that much?

Well, we have not placed the figure. We do not talk about how much a campaign cost, but actually, animation in some cases is more expensive per minute than filming live. So the decision is not based on money, it is based on quality of communication and the delivery of the message.

Why is it that Promasidor does not see a place for print media in its media budget?

There will be some. In fact, I think this week, we have taken full page adverts for Onga, congratulating Kate for winning actress of the year at the recently concluded UBA/AMAA Award in Abuja. So we have done some this week and you will continue to see them in the coming weeks and months. But also, we have to focus right across all the media. But you will see in some print media activities in line with this as well.

As a marketing person, you marketed Lager under Guinness and now you are with Promasidor on milk brands. What is your experience?

Well, my experience is to align width Nigerian consumers and I am not talking about the “aje butters”, that is the affluent in Victoria Island , Ikoyi and Lekki. I am talking about the ordinary Nigerians who struggle to get up early in the morning and catch okada or bus and then get home late at night. And that kind of Nigerians are the people that have been functional enough to serve, whether it is Truck Soap in Aba or Guinness or now Cowbell, Onga, Top Tea, and Promasidor brands, they all have one thing in common and it is working to bring quality product at a reasonable price for the ordinary Nigerian families.

Now, lots of companies have actually imitated you by manufacturing sachet milk. However, it seems you no longer have good control of the market. Are there any threats?

Well, it is true a lot of people have come in and we do not have the market share like we did. But when you develop something as we have done with the sachet milk, you find that it grows the whole market. So even if we do not have the same 100% share of the sachet milk market, you find our size of the market in value and volume terms is far greater than what it was when we invented that particular market. But competition is an opportunity. Competition is good for the consumer, it develops the market. It encourages new entrants, it encourages the growth in value and you know, only the strong will survive. So the challenge for Promasidor is to continue to be strong and to grow and develop. So we welcome competition. It is good for the Nigerian economy and so it is good for us.