Nigerian consumers are increasingly switching to smaller product sizes, cutting non-essential spending and reprioritising household needs as rising prices squeeze disposable incomes, according to NielsenIQ executives, who urged businesses to adopt data-driven and region-specific strategies to remain competitive.

This was disclosed at the NielsenIQ Annual Nigeria C-Suite Breakfast Conference 2026, themed “Leading the Next Wave”, held in Lagos.
‎
Speaking, Deputy Vice-Chancellor (Academic) of Pan-Atlantic University, Prof. Uchenna Uzo, urged businesses to embrace innovation and step outside their comfort zones to survive economic turbulence and remain competitive.
‎
He said the current business environment presented companies with two choices: to innovate or remain stagnant and face the consequences, stressing that leading the next wave of growth would require businesses to rethink their strategies.
‎
Uzo said Nigerian businesses were operating in an environment characterised by economic pressure, uncertainty and rapid technological changes, making innovation indispensable.
‎
He warned that the challenges posed by emerging technologies, particularly artificial intelligence, underscored the need for businesses to anticipate disruptions and develop strategies that would enable them to remain resilient.
‎He identified Nigeria’s informal market as a major opportunity for businesses seeking growth, urging companies to rethink their perceptions of the sector and build stronger relationships with its players.
‎
He noted that informal markets remained significant to Nigeria’s economy, with more than 90 per cent of retail transactions taking place within the sector, despite growing interest in technology-driven business models.
‎
Uzo explained that businesses could build trust and expand their reach by learning from established grassroots networks and community structures, stating the importance of community engagement, visibility, accessibility and availability in building effective routes to market, particularly in an environment where trust remained a major consideration.
‎
Uzo also urged businesses to develop pricing strategies based on consumer insights and the wider market ecosystem rather than making decisions solely from the manufacturers’ perspective.
‎
He said bargaining remained an important feature of consumer behaviour in Nigeria and across Africa, noting that businesses needed to understand regional differences in price sensitivity and engage customers, distributors, retailers and regulators when reviewing pricing decisions.
‎
The professor said businesses seeking to lead in the next phase of growth must align their market positioning with what consumers actually value, including proximity, relationships and flexibility. According to him, companies must also embrace strategic collaboration with customers, competitors and trade partners, stressing that collaboration was becoming an important source of competitive advantage in an increasingly uncertain business environment.

Commercial Director, West Africa, NielsenIQ, Joyce Nwachukwu, said changing consumer spending patterns were reshaping the fast-moving consumer goods (FMCG) market, with some categories recording growth while others experienced a decline as households adjusted their purchases to match available income.

She said the contribution of leading FMCG categories to market value had increased from 55 per cent to 61 per cent, highlighting the changing composition of consumer spending. She added that biscuits had emerged as the fastest-growing category, driven partly by affordable pricing strategies that appealed to consumers facing financial constraints.

Nwachukwu said traditional trade channels, particularly open markets and neighbourhood stores, continued to dominate Nigeria’s retail landscape, despite the increasing adoption of online shopping. She noted that digital retail was gaining ground, particularly among Generation Z consumers, while millennials were also contributing significantly to the growth of online shopping.

She said regional differences in consumer behaviour required businesses to develop tailored market strategies rather than rely on uniform approaches across the country. According to her, emerging cities were expected to drive future market growth, making precise market execution essential for businesses seeking to meet consumer needs and maximise returns on investment.

Nwachukwu also highlighted the growing influence of artificial intelligence on consumer behaviour, noting that the technology was transforming shopping experiences through personalised product recommendations.

She urged businesses to leverage AI and data-driven insights to better understand consumer preferences, anticipate changing demands and strengthen their competitiveness in the evolving market.
‎
Senior Lead, Retail Measurement Service (RMS) West Africa, NielsenIQ, Oluwatosin Onayemi, said Nigerian consumers were reprioritising their spending as rising prices affected their purchasing decisions, with some fast-moving consumer goods (FMCG) categories gaining while others experienced declines.

He noted that food and non-alcoholic beverages were recording growth, while beer consumption was declining, partly because of price increases that had made some product sizes less affordable.
‎
Onayemi said consumers were increasingly anticipating higher spending on essential needs, including utilities, transportation, groceries and household items. He noted that rising fuel prices and the possibility of further increases in living costs were prompting households to adjust their spending, while some consumers were cutting down on eating out.