Getting consumers to hum along to your commercials and mistake your jingle for their national anthem is the dream of all marketing directors working in foreign markets. This is effectively what Gallina Blanca was able to do in Africa, thanks to a carefully conceived marketing effort adapted to local tastes. Granted, it took over three decades of hard work to arrive at the point where the Spanish producer of bouillon, instant soups and pasta had managed to achieve a successful commercial presence in 18 African countries.

Gallina Blanca first began exporting its products to Africa in 1972. In order for its bouillon to gain acceptance in the African market, the company had to make a number of adaptations, starting with the brand name itself.

The name, Gallina Blanca, which means “white hen” in Spanish, was changed to Jumbo, which is shorter and easier to pronounce in both English and French, the two lingua francas for most of the continent.

Its main competitor, Nestlé’s Maggi, sold its bouillon in 4-gram cubes. Jumbo sold its bouillon in larger, 10-gram rectangles, priced at the equivalent of two 4-gram Maggi cubes, so consumers were getting a bit more bouillon for their money.

In addition, the company made sure the tastes and colors of its products were in keeping with the preferences of the African palate.

These actions were supported by smart advertising campaigns, which were extremely respectful of each country’s indigenous languages, customs and traditions, often featuring members of the local population in its commercials.

Over time, the use of Jumbo bouillon became ingrained in African culinary traditions. With just a bit of bouillon, a handful of rice or pasta, and a few vegetables, any mother could fix her family a tasty, nutritious meal on a shoestring.

New Challenges Brewing
However, with success came capacity issues. These were solved by manufacturing the premixes or powders in Spain and then exporting them in bulk to Africa. Gallina Blanca then got local importers and distributors to set up factories outfitted with compression and packaging machines. This boosted local economies by creating jobs and generating tax revenue for local governments. It also strengthened Jumbo’s reputation as a locally produced product, with a Western image of quality.

By 2005, the company was facing new challenges: trying to differentiate itself not only from its direct competitor, Maggi, but from new local entrants and Chinese generic brands as well. Consumers, too, were growing more sophisticated and demanding, expressing greater concerns over food health issues.

At the time, the World Health Organization and other NGOs were promoting programs for fortifying foods in Africa, though no one had ever mentioned bouillon cubes specifically. Within this climate, Jumbo’s marketing and R&D executives began exploring the possibility of enriching its bouillon with nutrients. They leaned toward vitamin A, which helps people develop and maintain healthy eyesight, teeth, bones and soft tissue, and is recommended for reproduction and breastfeeding.

The R&D process cost around 150,000 euros. Adding vitamin A to the product would drive up the manufacturing cost by around 10 percent, putting the manufacturing price of each bouillon cube up by a CFA franc. If Gallina Blanca didn’t increase the retail price of its products, the ex-factory gross margin would drop by 12.5 percent. However, the suggested retail price would have to be increased from 25 to 30 CFA francs, representing a 20 percent markup on the existing selling price.

Gallina Blanca’s executives were reluctant to raise prices. African consumers have low purchasing power, and any price increase could seriously hurt sales volumes. What’s more, both Gallina Blanca and its competitor, Maggi, had gone years without raising their prices, so a change like this could cause major fluctuations in their respective market shares. In the end, a price hike was considered unfeasible.

Yet the questions facing Gallina Blanca’s executives remained: Should they go ahead and launch a new, vitamin-enriched product? If so, what would be the most appropriate business strategy to follow?

According to surveys, African consumers had indicated they might welcome such a product. Even so, it was not easy to project the potential market share of the new offer. What would happen if the new product had a negative impact on sales of its long-established Jumbo favorite? Some considered that Gallina Blanca should do it anyway, regardless of any negative consequences, gaining satisfaction instead from the knowledge that the company was helping to improve the health and wellbeing of African consumers, and that was enough of a return.

Please note: The figures cited in this case have been modified to protect the company’s privacy.