By Ian Ortega
I recently paid a visit to one of my mothers. She’s the only person I know that has successfully run a retail shop and for the longest duration possible. But that will be a story for another today. While at her place, I started to notice that people kept desiring a certain format and brand of mineral water.
It was ‘Ice Spring Water’. It comes in both a 600ml format (sold at UGX 500) and in a 1.5 litre pack (sold at UGX 1000). People kept desiring the 1.5 litre pack. It’s then that I noticed that it had come in at the right price point. And with the current heat wave in Uganda, this made the case even better. First, having the right format and the right pricing. I was impressed by what I kept witnessing.
They have performed so well, that I suspect a competitor has started spreading a myth that they’re owned by Prophet Kakande. Uganda is a mythical society, so such myths can always be used to destroy, distort or slow down a competitor. It’s a myth that they must investigate and burst.
While at the retail shop, I noticed another irony. There’s the 200ml pack of Bond-7 both in PET plastic and in glass. They were both on the shelf with the PET going for UGX 6000 while the Glass went for UGX 12000. It defeated common-sense for me. First, why are they both playing in the same space? Secondly, Bond-7 is a mainstream spirit, so it’s not like someone will get the glass pack just to communicate a premium identity. Again, I thought the pricing was screwed here.
The second irony was the pricing for Tusker Cider. It shares a bottle with some of the other Tusker brands. But it’s priced at UGX 5000. The beers are priced at UGX 4000. Again, I wondered, what’s the motivation for someone to go for Cider at UGX 5000? What’s in it for them?
We are now in times where that Pricing component in the 8Ps of marketing should be commanded by the marketers not just the finance people. If a brand can’t come in at the right price point in the market, it shouldn’t be pushed into the market.
As a person obsessed about distribution, I have now added another obsession -pricing. The right pricing will facilitate its own distribution stream. What I witnessed with Ice Spring Water was crazy, retailers kept going to the stockist and distributor’s location to acquire the product, they didn’t wait for the distributor’s trucks or vans.
Brands must revisit their prices and formats in this season, it’s the easiest innovation to pull off. The goal is to price right for the audience you seek.