La Casera Apple Drink Remains Best in Apple CSD Market – MD, La Casera Company
Roland Ebelt is the Managing Director of La Casera Company Plc. A versatile and consummate player in Nigeria’s fast-moving consumer goods sector, Ebelt, had in the past headed the Nigerian Bottling Company Plc, Reckitt Benckiser Nigeria Ltd. and Procter & Gamble Nigeria Ltd. In this interview with AZEEZ DISU, Ebelt spoke on the company’s relaunch of its flagship brand, La Casera Apple Drink, into the market, the fresh new look campaign and other matters. Excerpts:
What prompted the Fresh New Look launch and how has the reception in the carbonated soft drink market been?
La Casera has been around since 2001. In the life time of a brand one needs to renovate, relaunch occasionally to make sure that consumers get the best using the latest of technology to enhance product quality. Looking at the brand history, we decided last year it was about time to give the brand a Fresh New Look.
We consulted with our consumers, did consumer research, went to our product research people and we came up with a new recipe; a new formula for La Casera Apple Drink which we then embarked on testing. We found it to be preferred nationwide, hence, the new La Casera Apple Drink.
It is good news for consumers, dealers, trade partners and our employees; they are very happy that we are engaging and bringing something new to the market.
How has the reception been since you relaunched the brand?
We kicked off the national launch in Lagos and then took the news all over Nigeria through regional events during the months of May and June.
We presented the product to about 1,500 distributors nationwide, our sales staff as well as some regional and local communications platforms. The reception has been very good. The awareness of La Casera Apple Drink is about 90 per cent in Nigeria. Our distribution is also strong and among the highest alongside the big players in the industry. We are hoping the relaunch will give the brand more momentum.
What are the different features between the new and the old looks and the motives behind the differentiation?
The main differences are the look and what the product inside the bottle is like. On the look, the packaging and graphics now contain real apples depicted on the label and inside you have a product which has more real apple juice than before, and this is what we have communicated on the label.
La Casera has been certified by the Standards Organisation of Nigeria, National Agency for Food and Drug Administration and Control and Manufacturing Association of Nigeria to meet all relevant standards. What brought about such confidence and affirmations from these agencies?
Every food product needs to be certified by NAFDAC. That is the legal necessity and that is what we call regulatory requirement. Ever since La Casera was introduced, we have had that certification from NAFDAC, otherwise, we would not have been allowed to sell the product in Nigeria.
In addition, we have certification from SON. That means SON comes regularly to our plants to make sure that our production processes and standards conform to the standard it prescribes.
In that sense, we had no problem getting the new product certified because already our old product had been certified for more than 16 years.
We make sure that NAFDAC comes regularly to see our production processes. They check the water quality, good manufacturing practice, hygiene standard, education of the workers, equipment and the tools workers use.
They have not been any changes in the way we have been producing La Casera Apple Drink in the past versus how we produce the new La Casera Apple Drink.
How has your company been able to retain the old price for La Casera in spite of the meltdown which has necessitated the increase in prices of many products?
La Casera is the original apple drink in the market and one of the first products to be sold in plastic (PET) bottles, which makes it much easier to carry along in the traffic. The price has always been a little better than that of other big players in the market. We do not go to retail shops and tell them to sell at this price. As a manufacturer, we only set the price for the trade and the retailers decide what the consumer pays. La Casera Apple Drink has been selling for N100 for so many years.
Inflation in Nigeria has risen and the Naira has depreciated. Hence, the prices of input materials have gone up. Unfortunately, some of these materials have to be imported, particularly apple concentrate, which is not available in Nigeria. Therefore, costs have really gone up.
Cost pressures were the same for all soft drink manufacturers, thus, the industry gradually increased prices to the trade which then led to increases in consumer prices.
We are still competitive to the other big players in the industry, a little bit lower in price here in Lagos but when you go outside of Lagos, our pricing is about the same as the others.
We do not want to create a price war and there is no point creating a price war. We want to differentiate ourselves based on the uniqueness of this apple product, which is really the only one out of the major brands that has real apple juice.
What things are you doing new?
We are now spreading widely the story of La Casera Apple Drink to consumers. This is important because we have not been advertising very much over past years. Now, the re-launch is giving us the leverage, it is giving us the opportunity to really spread the message that we are still the original and the real apple drink in the market.
What is the secret behind your 16 years consistent quality product and numerous awards?
There are really three reasons. The number one reason is, one needs to invest in the right equipment. Right from the start, the company invested heavily into the best equipment. The equipment is from Krones, the world number one supplier of beverage production equipment in Germany. We invested an estimated N10bn over the years.
The number two reason is the quality of the product itself. The way the apple product has been researched and made to the highest possible specifications has not changed. How have we done that? We have continued to work with our Nigerian and expatriate staff; we ensure they are properly trained in order to get the best possible beverage into the market.
The third reason is marketing. We have a dedicated sales team and they are working very closely with all major beverage dealers that exist in Nigeria. There are about 1,500 major beverage dealers in Nigeria. Through these beverage dealers we are able to bring our product into more than 600,000 retail outlets. If we are able to have presence in 600,000 retail outlets, then, it means La Casera is everywhere in the country. We rely on these dealers to help us bring our product into the market and they are not failing because La Casera is a recognised and unique product. There were times when La Casera was the number one and the leader in traffic. You could see it on every bus. It is not anymore because there is a lot competition. But we will get back to the top over time despite the competition.
What is your general assessment of the CSD market?
The beverage market in Nigeria has been growing very fast. The main driving force behind the growth of the beverage and food markets is the growth of the national Gross Domestic Product. GDP in Nigeria has been growing impressively since the onset of democratic rule under former President Olusegun Obasanjo in 1999. However, everything changed in 2015/16 following the oil price collapse.
Since 1999, the beverage market has been growing consistently between 5 and 10 per cent. That has brought a lot of investment into the private sector and also a lot of competition with new players coming into the market, all trying to get a share of the pie.
Since the end of 2015, the environment has become a lot tougher. In 2016, for the first time, the market did not grow and manufacturers suffered huge financial losses. That was what brought about the increase in prices of products.
But overall, it is a very promising market and this is why we are very optimistic about the long term future of the beverage market and the food market in general in Nigeria. How will we get a larger piece of that pie?
We want to strengthen our core brand, which is La Casera Apple Drink, and then expand our portfolio with more beverage offerings, as we have already done with Smoov, the Chapman product, which we introduced three years ago and the bitter lemon product called Bold. We have a range of mixers under the Nirvana brand and we have Nirvana water. There is so much room to expand in the beverage market, and there is no limit to the innovations we can bring to this market.
We recall that your company went from producing 100 bottles per minute into 2,000BPM; was this inspired by the Fresh New Look adventure?
When you enter with a new product into the market, you start small. This is what we did back in 2001. La Casera started with a production line making 100 bottles per minute, a low capacity. Since then, our capacity has grown to 2,000 bottles per minute. This is enough for more than 500 million bottles per year.
We have continuously invested into our production capacity because we are so confident that the beverage market will continue to grow. Not only because of the growing population, but also because we believe that the economy will recover. We have witnessed recessions in Nigeria before, it is not a permanent feature; it will go. Nigeria will always be a challenging market but also one with rich rewards.
What are the challenges in the industry and your advice to improve the industry?
The challenges our industry is facing are the same challenges other manufacturers in Nigeria have. We rely on imported materials; the plastic bottles, juice concentrate and the sugar are imported. Thus, we are facing the same issues every manufacturer is facing. Without access to forex, we are unable to produce and if we do not produce we cannot provide employment for people.
However, access to forex now is much easier than it was last year; also the naira is stabilising. The recession affected consumers’ purchasing power. The solution is to make sure that Nigerians are gainfully employed.
And I know that the Manufacturers Association of Nigeria is lobbying the government for incentives to expand production for companies; these are the things that can help our industry grow. Other than that, let competition run its course; competition will trigger innovative products.
What are your expansion plans for this market and other West African markets?
West Africa has an economic free trade zone called Economic Community of West African States. Within ECOWAS, products can move without attracting duties.
ECOWAS stretches from Nigeria all the way to Senegal. ECOWAS has about 320 million people out of which Nigeria alone has two-thirds of that population. Hence, the incentive to go abroad is low. Why would I invest a lot of money to get to two million people in a country when I have two million people on Lagos Island, waiting for my product? Yes, we are working to get to more countries; we are in Ghana, but it is not a major focus. The focus is Nigeria; this is where we have our base and where we have our consumers.
Apart from publicity, what other marketing strategies are you engaging towards increased awareness and patronage?
The number one priority, right now, is to create as much awareness for this new apple product as we can and we are employing radio, outdoor, point of sales materials, and a lot of social media. We decided not to invest in TV advertising because our target consumers are mainly from the B/C/D economic class that spends greater time at work, in the buses and taxis during the day. Radio and outdoor advertising are very important in this regard. Together with our dealers and the POS materials, we believe we can get to our target consumers through these media. These are the things we are doing right now and we will continue for the next six months to attract more consumers to our new La Casera Apple brand.
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