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Uganda. Brand-building driving competition in beer sector

The increasing competition for market share in the local brewing industry has forced players to repackage their brands in a bid to appeal to a wider market.
Uganda Breweries Limited, an affiliate of the East African Breweries yesterday launched a new look of its Bell Lager brand in a long neck bottle, a move it says reinforces the premium quality that the brand has been associated with.
Speaking to journalists, Ms Marion Adengo Muyobo, EABL head of marketing said UBL found it inevitable to refurbish the packaging to match the ever changing consumer preferences, lifestyles and trends.
Last year, EABL launched a similar long neck bottle for its Pilsner Lager brand.
Nile Breweries was the first brewer to repackage its brands in the long-neck bottle.
Nile Breweries, a subsidiary of South African Breweries (SABMiller) dragged UBL to court in 2009 for allegedly using the long neck bottle, which it claimed to have legally protected by registering it as its trade mark.
The Court issued a temporary injunction, restraining UBL from selling its products in the bottle on December 17.
However, when UBL on December 22, applied for the interim order to be set aside, the High Court lifted the injunction on December 22.
Nile Breweries (NBL), according to a survey by Kestrel Capital, a Kenyan investment bank which polled beer consumers in the East African region in May 2010, dominates the Ugandan market with a 55 per cent market share with UBL coming second.
EABL, however, is the market leader in Kenya with over 70 per cent market share.
EABL also acquired a 51 per cent stake in Tanzania’s largest brewing company - Serengeti Breweries in October last year at an approximated cost of $60.4 million, a move that is expected to boost its competitive edge in the East African region.
Uganda’s alcohol consumption per capita is 6 litres, meaning that the market has momentum for volume growth in beer.
Ms Mayobo, however, identified poor road infrastructure and higher operating costs due to rising fuel and raw material prices as challenges facing the industry.

11 Feb. 2011

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