Few people would assume that a popular medicated soap brand sold in West Africa has its origins in Southeast Asia. This, however, is the case of Delta Soap, a leading personal care brand owned by Orange Group, a large, diversified fast moving consumer goods (FMCG) group in West Africa.
Founded by Nigerian entrepreneur Sir Anthony Ezenna, Orange Group has supported the entry of several Indonesian companies into the African market. The group is present in West Africa across four key segments: pharmaceuticals, beverages, personal care and lighting. It counts some of Indonesia’s largest family businesses among its partners, including Kalbe Farma, the country’s largest pharmaceutical company, as well as Tempo Scan Pacific, Dexa Medica and Mensa Group.
As a result of these relationships, Orange has gained valuable insights from studying how its partners compete in Southeast Asia’s dynamic consumer markets. Some of these lessons were applied to the successful launch of Delta Soap in Nigeria.
Spotting an Opportunity
In the 1980s, Reckitt Benckiser launched its Dettol brand in Nigeria and proceeded to build the medicated soap market in the region. The benefit of protection from germs made medicated soaps an instant success in Nigeria, which struggles with sanitation issues and access to clean water. Dettol was so successful that it began to threaten the already established beauty-soap segment.
By 1993, Sir Ezenna saw an opportunity to establish a competing brand that could deliver the same benefits at an affordable price. At that time, Dettol was produced in Europe and exported to Nigeria, which was experiencing a currency crisis and had highly price-sensitive consumers. The key to Orange Group’s strategy was to source soaps competitively from either Malaysia or Indonesia, which have a global comparative advantage in producing palm-based products such as toilet soap.
Delta Soap was rolled out to the Nigerian market in 1994 as a more affordable alternative to Dettol. Although sales were brisk initially, its brand equity paled in comparison with Dettol. Sir Ezenna’s foray into the personal care business demanded that he learn more about brand building and guerrilla marketing. Orange Group began developing TV campaigns to market Delta Soap, and differentiate it from Dettol’s highly successful branding campaign that featured doctors.
As many new consumers of medicated soap were former beauty soap users, Delta’s TV commercials focused on the more aesthetic benefits of using medicated soaps. The product was positioned as providing protection from germs while also delivering the moisturizing and “skin glowing” benefits of beauty soaps. Commercials featuring pop music and young trendsetters became synonymous with the Delta brand and were a hit with the target audience. The branding campaign was a success and Delta Soap would go on to become a market leader in the medicated soap segment.
In 2005, the Nigerian government banned the importation of finished soaps, and this drove Sir Ezenna to invest US$23 million in the construction of a 20,000-square-meter production site in the eastern city of Onitsha, Nigeria. The investment paid off; by 2007 Delta Soap realized US$12 million peak in annual sales.
Declining Market Share
In the following years, Orange Group witnessed a series of management changes, which involved Sir Ezenna stepping down from day-to-day operations. However, the new management team had little sales and marketing expertise, which meant that little attention was given to brand building and improving the company’s route-to-market. The team also made some unpopular changes to Delta, such as switching its composition from mainly palm oil to tallow.
As a result of these and other misguided strategic decisions, Delta Soap lost significant market share over the next decade. By January 2017, the product had dropped to No. 4 in the segment with 12% market share. Dettol, meanwhile, had regained its market leadership.
Refreshing the Brand
As Delta approached its 25th anniversary, the company embarked on an aggressive relaunch that included changing the product’s packaging and formula while introducing it to a younger market segment that was not as familiar with the brand.
Under the new management team lead by second-generation Ezenna family members, Orange Group adopted a “back to the core” approach to sales and marketing. “We simply decided to go back to doing what worked and made commercial sense. Nothing fancy or complex. We had to go back to the basics,” says Ernest Ezenna, who currently serves as the group’s Business Development Director and is part of the second-generation Ezenna family management team.
First, the team decided to launch a “new” Delta Soap with a modern look and shape, and revert back to the original palm oil-based formula. This new formula enriched the soap fragrance, which was found to be a key driver for purchase in consumer studies. Second, the sales team focused on primary markets and channels in the traditional trade segment that would allow the soap to be distributed more effectively among small retailers. Nigeria currently generates 95% of its retail sales from traditional trade.
Finally, the team developed a campaign to relaunch Delta to appeal to a younger audience, similar to the campaign used at the brand’s inception. But this time around, the campaign would be driven by social media.
Inspired by a trip to Jakarta, Ernest witnessed first-hand the potential of social media and leveraging the influence of online celebrities. “All you have to do is open Instagram or YouTube in Jakarta, and you are bombarded with multiple ads targeted at young consumers by companies like Unilever Indonesia and, of course, our partners like Kalbe and Tempo Scan,” says Ernest.
Using this insight, the management team developed a social media commercial in the form of a music video to appeal to the music-loving, social media-savvy Nigerian millennials. Since the launch, the music video has generated more than 14 million views across Instagram and Facebook.
Because of the campaign’s success, social media has become the cornerstone of the team’s marketing plans. “It’s all about interacting with the younger generation of Nigerian consumers. Through social media, we are able to engage with them directly and this gives them a voice to feel that their individual needs are being met by the brand. We plan to build on the success of Delta’s relaunch, and increase our digital investments for other brands,” says Uchenna Ezenna-Gboneme, another second-generation Ezenna family member who oversees Media Relations for the group.
Brand Extensions With Asian Partners
The successful relaunch of the Delta brand has led to plans to diversify the group’s personal care offerings. This includes introducing a shaving line, with razors sourced from China, and a moisturizing cream lotion, possibly sourced from Indonesia. With its strong distribution network, fully integrated logistics, and warehousing and sales operations, Orange Group is confident that it will be able to leverage its insights and partnerships from Asia to explore the vast potential of the FMCG market across Africa.
“The Delta experience shows us that there is a lot we can still learn and leverage from our Asian partners,” says Ernest. “Africa is next, and we believe that the explosive growth that happened in Asia in the early 2000s will occur in Africa soon. We are very excited about the future and are investing aggressively to ensure that we are adequately prepared to take advantage of that growth.”