Application of Product Innovation as a Tool for the Growth of Guinness Malt in Nigeria



This study looked into the impact of product innovation on the growth of a firm, with special reference to Guinness Nigeria Plc Aba. In this study, the researcher addressed a central issue in innovation studies, namely the effect of innovation in a firm performance. Does it pay off to become involved in innovation activity. What does the benefits of innovation takes? Does innovation enhance short term profitability or does it contribute to a firm growth or both. The answer to the following questions were answered in this study. This study is a guide effort of organized research to present five main chapters. Chapter one introduces the topic which embrace the general description of the areas of study, problems, objectives, research questions, scope of the study, significance and references. Chapter two deals with the reviews of related literature, while chapter three shows research methodology and chapter four shows data presentation analysis and discussion of findings. Chapter five contains summary, conclusion and recommendations. 




          The term product innovation can be seen as the application of the scientific method of inquiry in helping marketers to better understand and define problems and find appropriate solution to them. It is also the systematic and objective, collection, recording, analysis, interpretation and reporting of data needed for solving specific market problems. It involves collecting and analyzing environmental information systematically that market opportunities would be recognized and marketing problem solved. Companies use product innovation in a wide variety of situations. For example, product innovation is helpful when it comes to ascertaining the state of demands among customers in the market. It can equally help marketers to understand customer satisfaction and purchase behaviour, provide variable information to management for problem solving, help in assessing market potential and market share, help in measuring the effectiveness of pricing, distribution and promotion activities. Some large companies have their own innovations department that work with market managers on good product innovation projects.

          Good product innovation does not only involved ordinary technical strategic marketing tools.

It requires cooperation between innovations and managers. Good marketing innovation must focus attention towards marketing management and marketing innovation, and be sure that their innovation focus on real problems. Broad principles or laws putting it another way, innovation is a planned process of conduction investigation actions in order to achieve a pre-determined objectives. The objectives is usually a solution to one or more specific problems or an addition to current knowledge in a particular field.


          The firm Guinness Nigeria PLc came into existence in year 1950 with the sole aim of importing and distributing Guinness stout from Dublin for eventual sales in Nigeria. Due to the success of product in the country. It gave rise to a decision to establish a small brewery in the year 1962. The foundation stone of Guinness was laid at Ikeja on the 31st January, 1962 by Arthur Benjamin Francis Guinness (Lord Elueden) now the Earl of Irish to which titles he succeeded on his grandfather’s death until 1967 in active service during the 2nd World War. Bringing the total of Guinness Stout Brewery to three in the whole world.

Guinness decided in conjunction with UAC to build a brewery costing 2.4 million naira at Ikeja, in 1965, Guinness Nigeria Limited became a public company and was one of the first companies to be quoted in Nigeria stock exchange with shares being offered to Nigerian shareholders, 1200 Nigerian held 20% of the equity. The historicalGuinness Stout Brewery is located at OBA AKRAN in Ikeja, Lagos.

          In 1971, a decision was taken to build a new brewery at Benin at a cost of 12 million to brewery larger beer, this was biggest brewery ever built in Nigeria. Guinness establish an eye clinic at Kaduna and later developed it into a hospital with opthalmogical unit in 1972. In 1974, 4,000,000 more shares were sold to Nigerians, thus a total of 40% of equity was in the hands of 14,000 Nigerian shareholders. The Benin Brewery was commissioned and later launched in the market in 1975, work began on expansion programme to the Harp larger brewery at Benin at a cost of 3 million naira designed to increase capacity by 40% in 1978, 4,200,000 shares were sold to Nigerian. Nigeria equity participation is now 60% (51,000 shareholders) and overseas 40%.

In 1980, a decision was taken to build a new beer brewery at Ogba in Lagos at a cost of 57million naira and this commenced production of harp beer in 1982.


          Guinness Nigeria Plc was incorporated in Nigeria in 1950 to impact and distribute Guinness Stout from Dublinrel and for sales in Nigeria source.

          Following the success of their product in Nigeria a decision of building a small brewery in the country was taken in 1960 and the first stout factory at Ikeja was constructed in 1962. The first stout was in November of that same year, with the increase demand of the company’s high quality product, the brewery in the country was expanded and output doubled in 1970 to 1974, the company then decided to enter to largest beer market with the contraction of harp larger brewery was also built in Benin where resulted to the growth thirst at Nigeria for larger beer.

          A third brewery was also built in Benin in 1978 to meet the growth of demand of Guinness Stout. The contribution of Guinness Nigeria Plc to the country/economy lies not only providing employment (direct employment) but also indirect employments such as production of bottle, creates, crowens, labels, and many other goods and services. The success Guinness Nigeria Plc depends on people such as shareholders both in Nigeria and overseas who provide the capital required to build and run the company.

          The company becomes a public company in 1985 and now thousand at shareholders from Nigeria are involved in the business.

The company is formally committed to it buttressed by the fact that most of the key positioning the company employs 10,000 (ten thousand) workers and transporters in Nigeria, to convey the company’s product to all deport of which are strategically situated in all part of the world or country. All salesmen sell  stout to their customers through these deport distributions are needed in order to achieve the production target which are raw materials equipment, machines and technical expertise which is responsible for the efficient running growth and the survival of the company.


          Business environment are vastly changing, competitors are daily increasing, business actions and decisional are also becoming more riskily as market as market needs and want are continuously fluctuating, external force facing business in the present circumstance have to surrender and grow or die prematurely.

          Given the rapid changing in taste, technology and competition has become risky for a company to rely on it existing products.

This is also because consumers taste, want the preference are dynamic, customers want and they expect new and improve product innovation.

          The market with similar product, satisfying the same need, it as the result of major competitor. Hence, the mission statement of Guinness Nigeria Plc needs to be reducing beverages company in Nigeria and marketing high quality brand to deliver superior customers satisfaction in our environmentally friendly way.


          The company’s objective of the is to find out the application of product innovation on the growth of firm and exact others to the following

i.       Determine whether product modification increase acceptance of new product of Guinness malt.

ii.      Find out whether innovation of Guinness malt inducts immediate sustainable buying response from customers.

iii.     Determine if product innovation increases the sales volume of new product.


          Some of the research questions that are unfolded were are:

i.       In what ways does product innovation contribute to the growth of Guinness Malt in Nigeria.

ii.      How does innovation induces immediate sustainable buying response from customers?

iii.     In what ways does product innovation increases sales volume of new product?


          Many industries in various countries of the world, today engage in the innovation of their various consumers product.

          Many members, especially the shareholders of firm are concern with the innovation of their various products brand. It is as result of this fact and also due to time factors; financial and other constraint that this study will be factors delimited to impact of product innovation in the growth of Guinness Nigeria.


          The following limitation are inherit in the study:

1.       This study “The application of product innovation” attempt to examine and review the effectiveness of company in the application of product innovation and the growth of firm.

2.       The inability of the researcher to induce all companies in Nigeria, due to lack of funds and time at the researchers disposal. Therefore the finding and generalization are only restricted to some specific companies in the country.

3.       Another obstacle is non – availability of textbooks reference(s), which should have serve as a source of information and data for this write up and also research collection.


          The significance of the study has to do with the benefits that “application of product innovation” has given to Nigerian Economy, Guinness malt, drink industry and myself as the researcher. The significance are as follows:

  1. The application of product innovation has help the economy of Nigeria in improving the productivity and reduction of cost. A lot of process innovation is about reducing unit costs. This might be achieved by improving the productivity capacity and/or flexibility of the business to enable it to exploit economies of scale.
  2. Better quality: By definition, better quality products and services are more likely to meet customer needs. Assuming that they are effectively marketed, that should result in higher sales and profit.
  3. The application of product innovation has help in building business (Guinness) with single product or limited product range would almost certainly benefit from innovation. A broader product range provides an opportunity for higher sales and profits and also reduces the risk for shareholders.
  4. The application of product innovation has added more value and improve staff attention, motivation and easier recruitment.
  5. Product innovation has also improve/increase the flow and usage of Guinness Malt in Nigeria. And it has also help me (researcher) to understand how important and how necessary it is to embark on innovation of product/services.


          The definition of terms has to do with the un-familiar word’s that it is use in your research work. And the words are as follows:

  1. Potential: Has to do with showing or having the capacity to become or develop into something in the future. Potential is also the possible, as opposed to actual. Potential is about the possibility of something happening or someone doing something in future.
  2. Brewery: Brewery is a building or establishment for brewing beer or other malt liavors, especially the building where the brewing is done. Is a place where beer is been produce by steeping, boiling, and fermenting malt and hops.
  3. Harp: Dictionary definition. Harp s a musical instrument consisting of a triangular frame formed by a soundbox, a pillar, and curved neck, and having strings stretched between the soundbox and neck that are plucked with the fingers.
  4. Vastly: Has to do with a large extent or degree or quantity. It has to do with something being extremely large in area, size amount etc.
  5. Fluctuate: Is the opposite of steady. Fluctuation is a change that occurs continually, shift back and front, varying irregularly especially in amount. It can be seen as the change in amount or rise and fall.
  6. Beverages: This is a categorically organized list of beverages. Beverages are liquids specifically prepared for human consumption. Beverages relax and energizes an individual and also provide important nutrients to our bodies.