E-Malt.com News article: Nigeria: Major brewers increase marketing expenditure by 23 percent in January-September

Nigeria’s major brewers increased marketing expenditure by 23 percent to N207 billion in the nine months to September 2026, outpacing revenue growth as manufacturers intensify efforts to retain consumers amid weakening purchasing power and changing drinking preferences, Business Day reported on November 10.

The rising expenditure by Nigerian Breweries Plc, Guinness Nigeria Plc, International Breweries Plc, and Champion Breweries Plc highlights the growing cost of competing in a beer market where higher product prices, inflation, and squeezed household incomes are making consumers more cautious about discretionary spending.

An analysis of the companies’ nine-month financial results shows that their combined marketing and related expenses increased from N168 billion in the corresponding period of 2025, while revenue grew by just 8.41 percent to N2.03 trillion from N1.87 trillion.

The disparity suggests that brewers are committing significantly more resources to stimulate demand and protect brand loyalty without achieving a corresponding increase in sales growth.

International Breweries recorded the highest marketing expenditure relative to revenue, allocating approximately 14 percent of its revenue to marketing activities. Nigerian Breweries followed at 9.6 percent, while Guinness Nigeria and Champion Breweries recorded 6.7 percent and 5.88 percent, respectively.

Champion Breweries recorded the fastest growth in marketing expenditure, with spending increasing by 200 percent, followed by International Breweries at 29.1 percent, Nigerian Breweries at 19 percent, and Guinness Nigeria at 17.4 percent.

The increase reflects an increasingly competitive operating environment in which manufacturers must invest more heavily in brand visibility, promotions, and consumer engagement to maintain their positions in the market.

However, the effectiveness of these investments is being tested by declining household purchasing power.

The Central Bank of Nigeria’s September 2026 Household Expectations Survey showed that consumer sentiment deteriorated to -18.7 points from -9.9 points in August, reflecting growing pessimism about household finances and economic conditions.

The family financial situation index stood at -23.9 points, while the family income sentiment index was -10.5 points.

Households identified food as their biggest expenditure priority, followed by transportation, household goods, education, and electricity and water, indicating that consumers are increasingly prioritising essential purchases over discretionary products such as alcoholic beverages.

The National Bureau of Statistics also reported that inflation for alcoholic beverages increased to 132.7 percent in September from 132 percent in August, adding to the cost pressures facing both manufacturers and consumers.

For brewers, this creates a difficult commercial equation. Raising prices to protect margins risks discouraging consumption, while maintaining prices amid rising operating costs could weaken profitability.

The pressure is particularly evident in International Breweries’ latest quarterly performance.

The company’s third-quarter revenue declined 14 percent quarter-on-quarter to N140.54 billion from N163.36 billion in the second quarter, even as operating expenses increased 30.1 percent to N45.63 billion from N35.09 billion.

Its operating expense-to-revenue ratio consequently increased to 32.5 percent from 21.5 percent.

CSL Research attributed part of the increase in operating expenses to higher marketing expenditure aimed at protecting sales volumes in a weak-demand environment.

“The increase partly reflects higher marketing spend to defend volumes in the weak-demand environment,” the research firm said.

The research firm also linked subdued revenue growth to weak consumer demand, pressured purchasing power, and low wage growth, which continue to constrain discretionary spending on beverages.

Paul Uzum, executive director of Halo Capital Management Limited, said weak consumer demand was affecting several consumer goods companies, particularly manufacturers of products that households could reduce or eliminate when disposable incomes come under pressure.

He also identified repeated changes in excise duties on beer, stout, wine and spirits as additional pressures on breweries’ operating costs and profitability.

The combination of weaker demand and higher fiscal obligations, he said, has increased pressure on margins and made brewery stocks less attractive to investors compared with companies recording stronger earnings growth.

Beyond the immediate economic challenges, Nigeria’s brewers are confronting changing consumption patterns, particularly among younger consumers who represent an important market for future industry growth.

Beer has traditionally enjoyed a strong position in Nigeria’s social and entertainment culture, featuring prominently in celebrations, sporting events, nightlife and social gatherings. However, changing lifestyles and preferences are creating additional competition from wine, spirits and other alcoholic beverage categories.

The accompanying market analysis points to growing interest in more curated social experiences and alternative alcoholic beverages among younger consumers.

Guinness Nigeria appears to be responding to this shift through advertising campaigns featuring younger models and lifestyles designed to connect with Generation Z audiences.

Recent commercials aired during English Premier League matches have incorporated imagery and messaging associated with younger consumers, suggesting an effort to strengthen the brand’s relevance among a generation with different consumption habits.

In season 11 of Big Brother Naija, the brand returned as a gold sponsor, continuing its association with one of Africa’s biggest television entertainment platforms.

As a programme that continues to command audiences across Nigeria and beyond, Big Brother Naija provides another opportunity for Guinness to engage consumers through entertainment and shared experiences that reflect the brand’s long-standing spirit of originality.

Similarly, International Breweries Plc, part of AB InBev, has reaffirmed its commitment to promoting responsible alcohol consumption through its Cheers to Moderation campaign, an extensive awareness initiative held simultaneously across Lagos, Abuja, Onitsha, Ilesa, Sagamu, and Port Harcourt.

The nationwide drive, Cheers to Moderation, themed “Chop Life Like a Boss,” builds on International Breweries’ celebration of Global Beer Responsible Day (GBRD), a global moment dedicated to promoting moderation, smart drinking, and community impact.

The challenge for breweries is that attracting younger consumers requires more than increasing advertising visibility. Brands must understand evolving consumer preferences, affordability concerns, and the social experiences influencing purchasing decisions.

Despite the rising commercial expenditure, the four breweries recorded varying profitability outcomes during the nine-month period.

Nigerian Breweries’ profit after tax increased 33.4 percent to N114.10 billion, supported partly by a 77.7 percent reduction in net finance expenses to N7.50 billion.

Guinness Nigeria’s profit after tax rose 53.1 percent to N40.69 billion, while Champion Breweries recorded an increase to N2.17 billion from N2.04 billion.

International Breweries, however, recorded a 5.7 percent decline in profit after tax to N54.51 billion, partly reflecting a 119.2 percent increase in tax expenses to N35.93 billion.

A survey of 1229 alcohol consumers across six states (Lagos, Abuja, Port Harcourt, Anambra, and Kaduna) in the first quarter of 2024 found that 76 percent of alcohol consumers were drinking more beer in a week relative to other alcoholic beverage types, signalling its dominance in the Nigerian market.

The industry is selling far fewer bottles than the financial numbers suggest. The inflation and foreign exchange debacle Nigeria found itself in occasioned situations in which money represented far-depreciating values by the passing of the day. The average cost of a bottle of beer today is a lot higher than it was a year or two ago.


11 November, 2026