Analysis of the Soft Drinks Industry in Uganda: Beyond the Soda Revolution (Pepsi, Cocacola, Riham, Britania) - Africa Nxt Gen Foundation
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Analysis of the Soft Drinks Industry in Uganda: Beyond the Soda Revolution (Pepsi, Cocacola, Riham, Britania)
By Philippa Nantamu & Ian Ortega
Audio Summary:
The Soft Drinks Industry in Uganda is experiencing significant growth, driven by market dynamics, consumer behaviours and emerging trends. The soft drinks market in Uganda is projected to grow by 11.52% from 2025 to 2029, reaching a market volume of approximately USD 214.70k in 2029 (Statista, 2024).
In 2024, the industry experienced strong retail volume growth, aided by rapid population growth (current Ugandan population is 45.9 million), urbanisation, and economic stability, even as inflation remained high, the prices of these beverages remained relatively stable, with consumers being extremely price sensitive when it comes to consuming non-alcoholic beverages, forcing players to hold off on raising their prices or risk losing out on volume sales (Euromonitor, 2024). The industry thus remains volume-driven and a space for cost-leadership strategies even as the players combat with the major macros of interest rates (current Central Bank Rate, CBR is 9.75%) and the foreign exchange fluctuations (the shilling continues to face off with stronger foreign currencies).
Overall, the soft drinks industry is on the watchout for the below challenges:
The industry relies heavily on several key infrastructure for its operations:
In Uganda, the Soft Drinks industry is dominated by a few major players; international players Coca-Cola and PepsiCo (often plagued by unfavourable foreign exchange) as well as local players such as Riham and Britania.
Coca-Cola Beverages Uganda (CCBU)
Crown Beverages Limited (CBL)
Harris International Limited
A Brief History on the Riham’s Disruptive Entry
In 2013, Harris International launched a disruptive soda brand – Riham Cola. It was launched in a plastic PET bottle borrowing some of the features of Coca Cola bottled by CCBU. CCBU would rush to court seeking to place a permanent injunction on Riham Cola over what it termed as trademark infringement. Upon learning this, Riham Cola proceeded to make slight adjustments to its labels to shift from any obvious features in relation to Coca Cola. The commercial court recommended mediation for both parties and the dispute was settled, with both parties choosing not to pursue the case any further.
Coca Cola then chose to take the battle to the market front choosing to engage in direct Price Wars with the other players. In December 2013, coca-cola reduced the prices for most of its products by almost 50%, in response to Riham that had set their prices slightly below coca cola’s. The cheapest coca -cola went for Ugx. 800. Riham, Pepsi and other players had to follow suit by reducing further the cost for their drinks.
However, in choosing to engage in price wars, Coca Cola had committed the mistake of incumbency, playing on the terms of a new player. Pepsi and Coca Cola soon realized these mistakes and took back price upwards thus leaving the value-soda segment to Riham Cola.
Riham Cola was not done, it set out to introduce new sodas such as Lavita as an attack on CCBU’s Novida. It would then later also launch Oner Juice further solidifying its brand base.
CCBU then had a massive innovation response with the Coca Cola Ka-Mini. The Ka-Mini exerted instant blows on Riham Cola and almost wiped it out of the industry. And then for some reason, Coca Cola Ka-Mini became scarce. One couldn’t understand whether Coca Cola had deliberately held off Ka-Mini, but it was out of stock. And during this time, Riham Cola re-energized and the rest is now history. It was a lesson that with a new entrant on the market, differentiation is usually the best strategy for the incumbents and not an outright price war.
Britania Allied Industries
Over the years, the industry has witnessed various approaches to maintain competitiveness in reaching consumers and growing their market share in the country.
Price: Previously the carbonated drinks companies used to engage in price wars by lowering market prices in a means to attract consumers from the competition. With the expansion into similar size pack options (300ml, 330ml, 500ml) at similar retail prices per SKU, consumers have been able to choose whichever option they desire without a limit to price.
In the peak shopping seasons (holidays such as Valentines, Easter, Eid, Independence Day, Christmas) and back to school periods, products are often discounted in stores to drive sales using “Buy One Get One”, Bundle Packs, etc.
The push into PET packaging and smaller pack sizes has driven affordability and trial to the different consumers regardless of their socioeconomic income status.
Promotions: Crown Beverage’s “Twangula”, Coca-Cola’s “Under the Crown” promotions are some of the mass engagement promotions that have run countrywide whereby consumers are given the opportunity to win instant prizes from purchases made of the products increasing sales in the short run and driving brand engagement in the long run.
Sponsorships & Events: Partnerships with musicians, sports (Copa Coca-Cola football tournament), entertainment talent shows (Riham’s Yolesa Ekitone)
Health & Lifestyle Positioning: Due to the growing health concerns, companies have introduced low-sugar and diet versions (e.g., Coca-Cola Zero Sugar).
Marketing of fruit-based and vitamin-infused drinks like Splash, Minute Maid, Riham’s Oner Apple Drink highlighting the ratio of freshness of the ingredients. Recycling campaigns and community clean-up drive
Digital Marketing: The aforementioned four beverage companies are heavily driving their presence on the different social media platforms. When compared to other neighboring African countries’ social media accounts in the same industry, we realise there is a huge disconnect and massive confusion in the ways these companies are approaching the digital marketing aspect in Uganda. Be it on TikTok, Instagram, the way they are sharing content does clearly engage with the consumers.
For example, the Coca-Cola instagram account is mainly filled with corporate content instead of focusing on their main product “Coca-Cola” and the lifestyle of the target consumer, something the Kenya and South African Coca-Cola accounts are doing well in.
Riham social media content is saturated with their various brands but still has no synergy across the different platforms.
Britania has an easier message and content to follow on social media, focusing on their main product “Splash” and pushing their promotions through product pack bundling, discounts and holiday offers. Even though it does not highlight the lifestyle or consumption occasions for the products, the fact that it seems to push a focused similar message throughout shows an ideal digital marketing strategy in Uganda. It is no surprise that up to now, Britania products are still sought out and purchased often more than any other companies during back-to-school shopping periods.
We made an assessment of the current brand activity online, and there’s a missing link. All the soft drinks brands seem disconnected from their target consumers. When you look at the Instagram pages, the brands are speaking at their consumers, instead of having a lovely playful conversation with them. Instagram and TikTok are the Gen.Z locations, they are meant to show the soul of the brand, that spirit form of the brand.
Part of the confusion could be coming from the conflicting worlds of brand managers and corporate communications managers. It calls for an integrated and synthesized communication approach. For example, why should Coca Cola post an advert for distributors on Instagram? Why should it be so formal and tight on instagram? Then there’s Britannia that comes off as shouting, doing too much. Pepsi tries on Instagram and on TikTok, but still, you can say, the brands are drowning, they are lost, they don’t know how to show up in the places where it matters most – Instagram and TikTok.
The future of the Soft Drinks Industry in Uganda is going to be defined by the ‘Beyond-Hydration’ trend. Consumers are not just looking to hydrate, but to hydrate right, to hydrate better, to hydrate in a way that defines their identity. It’s hydration that brings about better nutrition, better gut health, better body functionality, more energy, faster recovery. All these concerns are registering high on the Ugandan consumer. It’s also coinciding with the growing demand for functional waters thus a need for soft drinks players to rethink their product portfolios.
Whereas the soft drinks industry in Uganda is growing due to the emerging local players, Uganda imports and exports have significantly declined from 2023 to 2024(indexbox.io).
Conclusion
The Ugandan soft drinks industry is dynamic and poised for further growth, but it is also navigating several challenges and evolving consumer preferences. Companies that innovate, adapt to changing trends, and address consumer health and environmental concerns will be best positioned for success. There is a great opportunity for players who can connect with consumers meaningfully on social media, leverage radio effectively, and implement efficient distribution models. The move towards functional beverages and low/no sugar options, plus opportunities in the growing YIS trend, are all key areas for consideration. The industry is primed for significant shifts in the coming years.
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