Diageo Africa is a £1bn net sales value, £300m trading profit drinks business that operates in over 40 markets across Africa through various business models including publicly quoted companies, joint ventures and licensed brewing arrangements. In Nigeria it trades under the name Guinness Nigeria and will be referred to as such from this point. Over the past few years Africa has been Diageo’s most dynamic growth region, delivering the highest proportion of its global growth.
Guinness is by far Diageo’s largest brand in Africa accounting for over 30% of the region’s turnover and profits. Moreover in the last few years it has consistently delivered double digit growth. Nigeria overtook Ireland in 2007 as the second largest global market for Guinness, however beer volumes in Nigeria are in decline and measures need to be taken to strengthen its position. Guinness faces the challenge of competing with Diageo’s own local lagers as well as local and international competitors (both lagers and stouts). Guinness particularly needs to consolidate its position in Nigeria due to the entry of a new brewer to the market which is selling cheap beer.
“The two giants face a fresh threat — SABMiller, the biggest brewer on the continent, has now entered the fray, acquiring Pabod, a small Nigerian beer-maker, in a move it regards as “a toe in the water”. Reference point 1 Times
This is all against the backdrop of fast changing social, economic and political climates that prevail in Africa. This report will advise Diageo Africa on a XXX strategy for redefining its xxxx consumer xxx This report will appraise Diageo’s current strategy, which currently focuses on middle class consumers... It will review the changes within the Nigerian beer market and identify opportunities and challenges for Guinness Nigeria. By examining analysing the macro and micro environment, it will demonstrate how this may impact on the organisation and highlight how the new marketing plan will seek to exploit the opportunities presented whilst combating the threat of new sector entrants. The report will recommend how Guinness Nigeria may adapt its current XXX strategy in light of the changing market and emerging new competitors.
The first stage of the marketing planning process is the marketing audit. Marketing objectives, strategy and tactics for Guinness in Nigeria can only be established after a marketing audit. The marketing audit will include an evaluation of the macro factors (external market forces), using PESTLE; and the micro factors (internal market forces) examining the competitive position of the organisation within the Nigerian beer market as well as the threats it currently faces. The marketing audit will focus on the emergence of local and international competitors and their potential influence on Guinness’s market share. The marketing audit is ‘a systematic and periodic examination of a company’s environment, objectives, strategies and activities to determine problem areas and opportunities’ (Kotler, Armstrong, Saunders and Wong, 1999). The stages of the marketing planning process are defined in the illustration below:
Figure 1: The marketing planning process (Beamish and Ashford, 2006)
Macro Environmental Process
The macro environment analysis using the PESTLE (political, economic, social, technological, legal and environmental factors) framework examines the external factors that impact upon the company’s strategy. These external forces are outside the control of Diageo Africa but they will impact on their marketing objective and strategies for Guinness in Nigeria. Monitoring these factors can help predict their potential future impact on the marketing plan.
“Successful companies realise that the marketing environment presents a never ending series of opportunities and threats....marketing managers must be trend trackers and opportunity seekers” (Philip Kotler, Marketing Management the Millennium...