Spirits - Nigeria

The Spirits market in Nigeria has been experiencing significant growth in recent years.

Customer preferences: Nigerian consumers have shown a growing interest in spirits, particularly premium and imported brands. This can be attributed to the increasing disposable income and changing consumer tastes. Nigerian consumers are becoming more sophisticated in their alcohol choices and are willing to experiment with different types of spirits. Whiskey and vodka are among the most popular spirits in Nigeria, with consumers seeking out high-quality and unique flavors.

Trends in the market: One of the key trends in the Nigerian spirits market is the rise of local craft distilleries. These distilleries are producing small-batch spirits using traditional methods and locally sourced ingredients. This trend reflects the growing demand for artisanal and authentic products among Nigerian consumers. Local craft spirits are often seen as a symbol of national pride and are favored by consumers who value supporting local businesses. Another trend in the Nigerian spirits market is the increasing popularity of cocktail culture. As the urban population grows and more Nigerians are exposed to international influences, the demand for cocktails has risen. This trend has led to a surge in the consumption of spirits used in cocktails, such as gin and rum. Nigerian consumers are embracing the art of mixology and are seeking out premium spirits to create their own signature cocktails.

Local special circumstances: Nigeria has a large and youthful population, which presents both opportunities and challenges for the spirits market. On one hand, the young population is more open to trying new products and flavors, driving the demand for spirits. On the other hand, the legal drinking age in Nigeria is 18, which means that spirits companies need to be mindful of marketing their products responsibly and targeting the right age group. Furthermore, Nigeria has a diverse cultural landscape with different regions having their own unique drinking traditions. This diversity presents an opportunity for spirits companies to tailor their products and marketing strategies to specific regions. For example, in the southern part of Nigeria, palm wine is a traditional alcoholic beverage that holds cultural significance. Spirits companies can tap into this market by offering palm wine-infused spirits or promoting their products as a modern twist on traditional drinks.

Underlying macroeconomic factors: The growth of the spirits market in Nigeria is closely linked to the country's economic development. As the Nigerian economy continues to grow, more people are entering the middle class and have higher disposable incomes. This has led to an increase in consumer spending on luxury goods, including premium spirits. Additionally, the urbanization of Nigeria has created a more cosmopolitan and affluent consumer base, further driving the demand for spirits. In conclusion, the Spirits market in Nigeria is experiencing growth due to changing consumer preferences, the rise of local craft distilleries, the increasing popularity of cocktails, and the country's economic development. Spirits companies that understand and cater to these trends and local special circumstances have the opportunity to capitalize on the growing demand for spirits in Nigeria.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.