Soft Drinks - Nigeria

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

Customer preferences: Nigerian consumers have shown a strong preference for soft drinks, making it a popular beverage choice across the country. This can be attributed to several factors, including the hot climate in many parts of Nigeria, which increases the demand for refreshing and hydrating beverages. Additionally, soft drinks are often seen as a convenient and affordable option for quenching thirst, especially in urban areas where access to clean drinking water may be limited.

Trends in the market: One of the key trends in the Soft Drinks market in Nigeria is the increasing demand for healthier and more natural options. As consumers become more health-conscious, there has been a shift towards beverages that are low in sugar and free from artificial additives. This trend has led to the introduction of a wide range of low-sugar and sugar-free soft drinks in the Nigerian market, catering to the growing demand for healthier alternatives. Another trend in the market is the rise of local brands and flavors. Nigerian consumers have shown a preference for locally-produced soft drinks, as they are often seen as more authentic and reflective of local tastes and preferences. This has led to the emergence of several Nigerian soft drink brands that offer unique flavors and formulations, catering to the specific preferences of Nigerian consumers.

Local special circumstances: Nigeria's large and growing population is a key factor driving the growth of the Soft Drinks market in the country. With a population of over 200 million people, Nigeria offers a significant consumer base for soft drink manufacturers. Additionally, the country's urbanization rate is increasing rapidly, leading to a higher concentration of potential customers in urban areas. This urbanization trend has further fueled the demand for soft drinks, as urban dwellers often have higher disposable incomes and greater access to modern retail channels.

Underlying macroeconomic factors: Nigeria's improving economic conditions have also contributed to the growth of the Soft Drinks market. The country has experienced steady economic growth in recent years, which has led to an increase in disposable incomes and consumer spending power. As a result, more consumers are able to afford soft drinks on a regular basis, driving up demand in the market. Furthermore, the expanding middle class in Nigeria has also played a significant role in the growth of the Soft Drinks market. As more Nigerians move into the middle-income bracket, they have more disposable income to spend on discretionary items such as soft drinks. This has created a larger consumer base for soft drink manufacturers to target and has contributed to the overall growth of the market. In conclusion, the Soft Drinks market in Nigeria is experiencing significant growth due to customer preferences for convenient and refreshing beverages, the increasing demand for healthier options, the rise of local brands and flavors, the country's large and urbanizing population, as well as improving macroeconomic conditions. These factors are likely to continue driving the growth of the market in the coming years.

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 Non-Alcoholic Drinks, 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 Non-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. The market is updated twice a year.