Consumer taste takes back seat
Among many Nigerian consumers, taste does not matter anymore, at least in the meantime as recession bites. Instead of over-spending on certain items, what is now important for consumers is making choices based on the availability of funds.
Those who spoke to BusinessDay acknowledged that the current economic decline has forced them to check what they spend on and it has led to drastic changes to their lifestyles. Most of the people interviewed said their taste has changed since recession set in as prices now determine what goods or service to go for.
The focal point for consumers is to have something to eat as consumers do not mind the taste distortion, says Roy, director at Millward Brown. “Consumers now go for the basics/what is required and not swayed by adverts or attractiveness of packaging”.
For instance, many parents have withdrawn their children from private schools to public schools due to high fees and they have cut other extras that consume money as their income affected by inflation can no longer meet their needs.
Taste is no longer the driving force as hike in prices is pushing people to make choices based on availability of funds said Hadijat Ijaduola, a marketer who pulled her children from an expensive school to a private day school. When asked if recession informed her choice, she said “I would say yes it has affected my taste very well. My daughters used to attend boarding school in Isehin, Oyo State; we had to pull them out for a private school here in Lagos because of the cost of keeping both kids in a boarding school. Like you know, prices of food stuffs are daily going up; we took the decision in order to cut down on the family expenses”.
For Tosin Adekunle, a banker, the recession has affected more than her taste. “Truth is that you can’t buy much like you used to buy before”. According to her, weave-on for ladies attachment hair is now so expensive that she has decided to grow her natural hair.
Mama Oyin, a trader on ladies hair accessories at Festac Town says people are no longer buying weave-on. “We are in Christmas period and still people are not buying weave-on instead they prefer to use the old one they have at home. I have not sold the expensive types of weave-on in the last 6 months. Even for me, what I used last year is what I am going to re-use this year” she said.
Ijeoma Obiokala, a travel agent said generally things are expensive; prices are just going up every day. “For my clients, those who fly economy still fly economy while those who fly business still fly business but because of the recession most people would rather stay back than travel. The business is really slow”.
Grace Amedu says she has been out of job for over a year. According to her, recession has affected her taste because “I lost my job within the year, and it is really difficult to operate on the same level like it used to. Maybe things would have been different if am gainfully employed but, all I can say now is that things are pretty hard”.
BusinessDay reported recently that the hardest hit sector due to the economic recession is the Fast Consumer Goods Firms (FMCG). This is because firms operating in the sector are not moving inventories off the shelves to consumers as a weak consumer spending caused by rising inflation and spiraling unemployment undermined the demand for products.
John Chukwu, managing director and chief executive officer of Cowry Asset Management Limited told BusinessDay recently that because the economic confidence is very low, it is difficult for people to continue to buy goods as they used to as inflation has eaten deep into their wallets. “And this has affected the inventories of consumer goods firms,” said Chukwu
“Consumer are staying away of consumption and that is expected in a period of recession,” Chukwu further said.
Mid this year, Lampe Omoyele, CEO of Nielsen, a global consumer research firm identified rise in inflation presently at 18.3 %, decline in foreign investment, decline in total capital import, dwindling crude oil price, decline in foreign reserve and weakened naira have combined to lower consumer disposable income.
Daniel Obi & Seyi John Salau