Losing focus in The hunt for Market share: The Guldermax Story
“I WANT A GULDER” SAYS THE CUSTOMER
“WHICH ONE?” ASKS THE BARMAN.
Despite the insistence of marketing experts like Al Ries that extensions weaken brands while contraction strengthens them, many brand owners refuse to see why they should not ‘capitalize on their brand’s success to increase their market share’. But the case of Nigerian Breweries’ Gulder Max, a line extension of Gulder – the ultimate, has proved, once again, that though extensions may actually increase sales on the short term, it usually turns out to be a misadventure in the long run. O’Lekan Babatunde and Elcee McEdwards examine the case of Gulder Max, as NB Plc pulls the plug on the young but underperforming brand.
Gulder Max, a line extension of Gulder – the Ultimate, produced by Nigerian Breweries, has fallen like a pack of cards. Nigerian breweries Plc., owners of the brand have finally thrown in the towel, and this is authoritative. M2 examines the story that once again confirms that nine out of every 10 line extensions are doomed to fail.
Organisations, specifically successful Fast Moving Consumer Goods companies, are frequently confronted with the temptation of “hacking” into their successful brand portfolio in a bid to use the name of the successful brand to drive another product.
The aim is usually to explore the investment already sunk into the name. Sometimes, it works. But most of the time it results in brand carnage for the main brand. Yet, some other times, the new brand is left to groan under the heavy yoke of the well established senior member of the family. This is particularly the scenario when the extended products fall within the same product category. It creates an unnecessary and avoidable competition for the brand which eventually decimates the market further.
As a foremost player in the lager market, Nigerian Breweries parades a number of successful brands such as Gulder and Star. Nigerian Breweries also has a dominant presence in the non-alcoholic drink market with brands like Maltina, Amstel and Fayrous. It also has presence in the stout market with Legend Extra Stout. Each of these brands has been re-launched several times with heavy marketing communications investment to bring them to their current equity status.
Today, Nigeria Breweries has two successful brands – Maltina and Amstel, in the Malt drinks segment of the market. Analysts believe these brands enjoy their prime status because of their independence in name and brand positioning in the market.
With over 30 years history and massive investments in amassing equity for the brand, Nigerian Breweries’ Gulder has crystallized as a formidable brand in its segment. The brand now runs with the ubiquitous and powerful pay-off – Gulder the Ultimate.
Many keen market observers were therefore taken aback, when the Nigerian Breweries marketing egg-heads decided to create a brand extension out of Gulder christening their invention or rather new product – Gulder Max – The beer for real men.
From the media launch to the public presentation at The Expo Hall of the Eko Hotel & Suites at Victoria Island, Lagos, sometime in September 2006, the question that agitated the minds of even the unschooled in marketing was: Is this new Gulder meant to replace the Ultimate? If Gulder Max was for the real man, perhaps the classic Gulder is for the ordinary man. Either way, it was a cul de sac. If the brand did well, it would demoralize the successful Gulder classic, if the old Gulder drinkers rejected it, it would go the way of other quixotic adventures.
The then marketing director of Nigerian Breweries Plc, Mr. Wouter Fijnaut, while introducing the new drink, had explained that the journey that culminated in the launch of Gulder Max was informed by the result of a series research that “showed that consumers wanted a beer that would give them maximum satisfaction; a beer with a unique bitter taste, and a beer that would be strong enough to meet the taste of the modern man.”
He had explained that the research proved that “there is a desire by consumers for a beer that would stand out from the others in terms of strength and bitterness.”
“We were able to come up with the ingredients and formula that make Gulder Max strong, dark, and with a unique taste. Nigerians ain’t seen nothing yet,” he had boasted, promising that in the coming months, beer consumers would come to appreciate the unique benefits that Gulder Max offers. But that was not to be. Two and a half years down the line, the company, from all indications, has swallowed their words.
Usually, because the brand was coming from the powerful stable of Nigerian Breweries, with multimillions of naira devoted to marketing the brand, there was an instant euphoria for the line extension. This tendency was rightly acknowledged by internationally renowned marketing guru, Al Ries, in his book, Positioning, the Battle for your Mind. He noted that because “the line extension is related to the original name, it achieves an instant flash of understanding. It also generates an instant flash of sales.”
However, that is on the short run. After the initial recognition of a line extension, the prospect is never quite sure there is such a product. Al Ries and his colleague, Jack Trout, described a line extension situation as “Easy come, easy go”. According to the authors, line extension names are forgettable because they have no independent position in the consumer’s mind.
The only contribution of a line extension is to blur the position occupied by the original brand name. Most of the times, it leaves behind a catastrophic result. Millions go down the drain and corporate egos are wounded. Brands are buried quietly, in stark contrast to their usually earthshaking launches.
Confused Personality
To the consumers, the confusing personality of the brand is of essence in purchase decision. Lagers in this clime are anything but dark in colour. Dark is Stout and Ale drinks. The rested brand was promoted as none of these two. This was a minus for the brand. A dark beer in Nigeria, for now, will remain unpopular, it seems.
Would Ale have sold better? Not quite impossible. Ale is a genre between lager and Stout. There appears to be a vacuum here, especially among the leading breweries. Sona Breweries’ Wilfort used to be the only ale in the Nigerian market. Much longer after the introduction of the Gulder Max dark beer, Consolidated Breweries introduced its Turbor King Dark ale. Now the less than a year old brand appears to be in an upswing, at least for now. Analysts’ reason that an Ale under the name will have done better; but an Ale under a different name by Nigeria Breweries would have been a clincher.
Me-Too Sins
Apart from its name, Gulder Max was packaged under the shadow of the main Gulder. This, from the on-set, attached some ‘me-too’ characteristics to the product. From brand colours, to label designs, logos and other motifs, the Gulder brand was loudly super imposed on the extension. Described as a Strong, Dark and High Gravity Brew for men, an independently created and named brand would have connected more vividly with the “real men” target market, since a real man will detest living under the shadow of another.
Indeed, one of the baggages of a line extension is the rampant question trailing line extension products in the same category. For instance a consumer in a pub had to answer the question: Which Gulder – the Utimate or Max? This was a minus for the brand because the brand will be loosing on its unique positioning in the mind of the consumer. If that continued, the two brands will lose out on the positioning game as their equities gradually ebb.
Some of Nigerian Breweries’ plans, as espoused by Fijnaut, was to re-position the brand through Gulder Max, strengthen the brand’s hold on the beer market with better brand options and further enlarge its market share. However, two and a half years down the line, it is obvious that Gulder Max has failed to meet these objectives. It is also evident that the product has failed to secure a place in the mind of the consumers. Market surveys reveal that the product is not moving from the shelves or warehouses, and there are strong indications that the manufacturer has realized her mistake and decided to discontinue with the Gulder Max adventure.
