{UAH} War of detergents

War of detergents

SUNDAY, 08 MARCH 2015 21:50 BY JULIUS BUSINGE

A collection of detergents in a shop. INDEPENDENT JIMMY SIYAWill Magic, Mama wrest market share from old timers Omo, Sunlight?

Barely ten years ago, the vast majority of Ugandans knew no other laundry detergent but Omo, the blue powder first manufactured by Unilever in 1954. Indeed, the brand has enjoyed so much success over the past 60 years that it has become almost synonymous with powder soap. However, the more than half a century love affair appears to be threatened by new kids on the block. Over the last few years, several new brands have emerged to give Omo a good run for its money.

The fight for market share is now on in earnest. Omo must contend with locally-produced Mama – manufactured by Mukwano Group, and Magic – produced by cooking oil manufacturers Bidco.

These new comers are determined to gnaw away at the market share until recently enjoyed by Nomi, also produced by Mukwano Industries, and Omo, Ariel, Sunlight, Persil, and Ushindi - all of which are imported from other countries. In earlier times, bar soap was the only alternative to Omo as most households had to use it to do their laundry and bathe.  But as house-hold incomes have continued to improve, consumers have realized that powder detergents are better than bar soap when it comes to removing stains. Also, many cheaper toilet soap alternatives have emerged to further dislodge bar soap off the shopping lists of many families. For example, students who used to take bar soap to boarding schools are now taking detergents and toilet soap.

Companies such as Bidco and Mukwano Group, which had become market leaders on the laundry bar soap segment, have now seen their products being edged out by detergents. They had no choice but to bolster their detergent segment.Suvrajit Ghosh, the general manager at Bidco, said the launch of Magic was informed by demand from the public and the need to diversify their product portfolio. Apart from cooking oil and bar soap, Bidco also produces curry powder.

Not surprisingly, Mukwano, the producers of Nomi detergent, decided to supplement it with the launch of Mama at the end of last year.  Is Omo and Sunlight feeling the pinch?Diana Nabukenya, Unilever's customer marketing manager, told The Independent that consumers are at the heart of their business so their quality products will always win the loyalty of their customers.

"We understand that consumer needs are dynamic and fast-changing and that is why we use the latest technology and innovations in making products that make people look good, feel good and get more out of life," she said. She said the creation of Omo Fast Action was as a result of a lot of work put into research and development coupled by latest innovations so as to meet consumers' needs. However, she admits that the detergent market is getting more competitive, which means they have to be at the cutting edge of innovation. "Consumers are being given a wide range of choices," she said, which she said calls for a lot of innovation not only in product quality but also in the marketing mix.

Battle lines drawn

Branding analysts argue that Ugandan consumers have a tendency to get hooked onto their old brands with very few going for newer ones. Many consumers are reluctant to start with new products though some also try them with the recommendation of friends.

For example, Peter Kusiima says after using older brands for many years, a friend recently encouraged him to try Magic. "I found it a really nice product," said Kusiima, "I like the scent and I didn't need to use a lot of powder in the water like the other detergents I had used before." Ghosh, the Bidco boss, also admitted that the competition is stiff in a small local market, which has forced them to spend massively on marketing, and to look to external markets such as Burundi, DR Congo, South Sudan, and Rwanda. The company has put aside Shs 3bn to market the new product in 2015.

The Mukwano Group says the detergent market is very dynamic, which inevitably calls for continuous improvement to keep pace with the ever-changing consumer needs. But luckily for locally produced detergents, the government has just passed a policy dubbed; "Buy Uganda Build Uganda" with a view to encourage consumption of local products. The policy ultimately aims at giving prominence to locally produced goods over imported ones, more so where the government is the customer.  That means the government would be more inclined to buy locally produced detergents such as Magic, Nomi and Mama than imported brands, which is expected to give them a sharp edge in addition to supporting growth for the local industries and ultimately economic growth.

Also, with almost no difference in terms of quality, price is likely to be the new frontier in the war of detergents. Indeed, in all packet sizes, the new products appear to be priced lower than the older brands, which is forcing them to reduce prices too and expand their marketing budgets.

- See more at: http://www.independent.co.ug/business/business-news/9774-war-of-detergents#sthash.yXxOMzTm.dpuf

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Gwokto La'Kitgum

"Even a small dog can piss on a tall Building", Jim Hightower

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