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Presented by : SATISH MENON SAURABH KUMAR SHAILENDRA SINGH SUNIL KINI

NIVEA : MANAGING A BRAND PORTFOLIO. Presented by : SATISH MENON SAURABH KUMAR SHAILENDRA SINGH SUNIL KINI. 1. Presentation Flow. Brief Overview of Case Development of Nivea as a brand ( 1912 to 1993) Discussion on Q.1 Nivea’s brand image Nivea’s sources of equity

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Presented by : SATISH MENON SAURABH KUMAR SHAILENDRA SINGH SUNIL KINI

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  1. NIVEA : MANAGING A BRAND PORTFOLIO Presented by : SATISH MENON SAURABH KUMAR SHAILENDRA SINGH SUNIL KINI 1

  2. Presentation Flow • Brief Overview of Case • Development of Nivea as a brand ( 1912 to 1993) • Discussion on Q.1 • Nivea’s brand image • Nivea’s sources of equity • Variation of brand image and equity across product class • Discussion on Q.2 • Pros and cons of various options with Biersdorf • Corporate branding Ad vs Umbrella Ad • Role of Nivea cream advertising • Discussion on Q.3 • Recommendations for Nivea’s future marketing program. 2

  3. Case Overview Biersdorf (BDF) is the manufacturer of NIVEA skin care and personal care products. The Nivea brand is known worldwide but its a leading mass market brand in Europe. NIVEACreme - the first product introduced has over the years successfully extended the Nivea brand to a full range of skin and personal care products. Cosmed div. sought to strategies for the future keeping the market needs and heritage of the Nivea brand in mind. 3

  4. Beiersdorf at a Glance • Beiersdorf • Branded consumer goods company • Founded 1882 in Hamburg • Global footprint with more than 130 affiliates • 16,800 Employees worldwide • 6.1 bn € sales in 2006 • Sales per Region • Germany 25 % • Europe w/o Germany 48 % • Americas 15 % • Africa / Asia / Australia 12 % 4

  5. Development of the Nivea brand 1912 : NIVEACreme introduced in the German market by Biersdorf. 1912-1970 : Range of products - introduced and expanded under Nivea brand - maintaining a mono-product philosophy. NIVEACreme remained the company’s premier product 1970-1993 : Extended the Nivea brand from the limited range of products - Nivea crème,Milk,Soap and Sun to a full range of skin care and personal care products 1993- 2006: At Beiersdorf, now one goal: To meet consumers' skin and beauty care needs. Every day. Throughout the world.  la prairie Luxury Colour Palette Silver Rain brilliance Toddler 5

  6. Product Line NIVEA Visage DNAge Cell Renewal • First Anti-Age Nivea Visage Face Care formulated for skin cell • renewal • Reduces DNA damage in the skin • Patent pending formulas with • combination of Folic Acid and • Creatine 6

  7. Product Line NIVEA body Anti-Age Treatment Product Line • First Anti-Age Nivea Body Care • for mature skin • New formula with skin´s own • Creatine • Proven to reduce sagginess, • wrinkles and dryness • Opening up a new high potential • segment for NIVEA body 7

  8. Product Line NIVEA body Good-bye Cellulite Product Line • Only three months after launch, • Attained No 1 market position • among all body care products in • France, Belgium, Italy, Portugal • and Turkey 8

  9. Product Line NIVEA Hair Care New Assortment Product Line • Further exploit huge market potential • New shape and design to attract • additional consumers • New caring formulas to prove • unique Beauty expertise • Even stronger communication of • consumer benefits 9

  10. Q1 A. What is the brand image and sources of brand equity for the Nivea brand ? B. Does it vary across product class ? 10

  11. Nivea’s brand image • Rich set of brand associations (Strength) • Care, mildness, reliability,gentleness,protection,high quality, feeling good & reasonably priced • The Nivea woman- reflected in Ads as “clean,fresh and natural” • Used by entire family (Favourability) • A universal,unisex acceptance satisfying multiple needs • Strongly associated with shared family experiences: • Mother and child relationships, family vacations on the beach • Caretaker of skin (Uniqueness) • Caring and protective-Sun lotion ,Mens range . 11

  12. Nivea’s sources of equity • NIVEACrème ‘s unique water in oil emulsion - snow-white in color • Nivea name from Latin word- “nives” - snow • Nivea products - blue color background with white lettering • - extended from the NIVEACrème tin • Nivea’s core brand associations – “mildness and caring” • - Correlated with the key skin needs of consumers • - Enjoyed high degree of confidence & goodwill • - Reliability,quality and honesty. • Nivea’s brand associations fit with the values of the consumer • - Desire for fairness, authenticity, openness and belonging • Nivea name - synonymous with skin care & protection 12

  13. Variation of brand image and equity across product class • Nivea - Exploited the strength of NIVEACrème brand associations and • transferred it to other product classes • New products • Positioned with a promise to contain the core brand associations of NIVEACrème • With some new benefit provided by the product • 1992 : Nivea crème - largest contributor to total revenues(22%) • The newer product lines had each made significant contributions of their own • 1996-2006- Diversified and consolidated • -Successfully carried brand associations of Nivea crème • - Global presence • - Established Nivea as a skin care brand • - Rather than only a skin cream brand. 13

  14. Brand associations of core brand extended across the product class Nivea Sun – the new Nivea Sun makes the sun gentle Nivea For Men- Less alcohol,more care Nivea Shower and Bath-Delightfully Gentle and creamily mild Nivea Hair - Entire care for frequently washed hair Niveo Deo-The deo that even cares for your skin 14

  15. Q2 • What are the pros and cons of the various options available to Biersdorf management? • Should they run a corporate brand ad or umbrella ad for all their products? • What is the role of Nivea skin cream ad? • Should it be changed? 15

  16. Various Options Available: • Corporate Brand –Biersdorfas a corporate brand for all products • Family Brand (Umbrella) –NIVEA family • Individual Brand –Nivea individual Products Nivea “Passion for Success” strategy 16

  17. Corporate Brand • A successful Corporate Brand has:- • Corporate Image – Role of Company/Corporate Brand in the adopted • Branding strategy • The company’s role in society - its reputation • Firm keep a high public profile - influencing and shaping more abstract • types of associations • Corporate Brand Equity- Constituent responds more favorably to a • corporate ad campaign as compared to an unknown company. 17

  18. Corporate Brand –Biersdorf for all Nivea products • Biersdorf as a Brand • Never Introduced in market • The "NIVEA Boys" poster campaign-1920 - introduced the modern blue and • white packaging – Till Date • Brand Awareness - No Recall - Never Heard – Never Seen • Brand Image –“No Niveaness”i.e. Natural, Mild, Skin caring etc. • Hence Biersdorf as a Brand has negligible equity When compared to Brand Nivea 18

  19. Post 2000-Case Build up 2001: Tesa to become an independent affiliate. Tesa AG is formed as a wholly owned affiliate of Beiersdorf  Professional wound care is spun off and contributed to a joint venture between Beiersdorf and Smith & Nephew. BSN medical, domiciled in Hamburg, is founded. 2002: Florena becomes a wholly owned Beiersdorf subsidiary. The cooperation dates back to 1989, and was intensified following the reunification of Germany. 2003: A new functional group organization focusing on the areas of brands, supply chain management, finance and human resources replaces the previous divisional organization. 2004: The new skin research center opens in Hamburg, underscoring the innovative strength of the globally successful Beiersdorf group.  2005: Beiersdorf AG and Smith & Nephew plc realising the investment in BSN medical – sale to Montagu Private Equity. 19

  20. People Speak “In many countries, consumers are convinced that Nivea is a local brand, a mistake which Beiersdorf, the German makers, take as a compliment.” As quoted on leading brand consultancy Wolff-Olins' website, www.wolff-olins.com “Coca-Cola as a brand does not have a lot of extendibility. Whereas Coke means Coca-Cola, Nivea is not Beiersdorf.” MD of A C Nielsen's Global Services Division, on Nivea's brand extension successes 20

  21. Family/Umbrella Brand • Family brands – evoke a specific set of associations across related products • w.r.t. : • common product attributes, • benefits and attitudes • programs and values • and corporate credibility • to similar set of people and relationships. • Family Brand is used when : • Company level associations are less salient. – Weak Corp. Brands • Dissimilar Products - harder for the corp. brand to retain any product meaning 21

  22. Family/Umbrella Brand –NIVEA family May 2003 - survey of 'Global Mega Brand Franchises' Nivea present in maximum number of • Product categories • Countries yahoo.com news article - named it the “Queen of Mega Brands.” NIVEA family • A strong Brand Depth & Breadth • Even Stronger Brand Image • Uniqueness –Caretaker of Skin • Continuity Plus innovation (since 1910) • Association- Men as well as Women 22

  23. Individual Brands–Nivea Individual Products • Restricted to essentially one product category • Though Multiple product types could be offered on basis – different models, package,size, flavors etc. • Main Advantages • Brand as well as marketing – customized. • All Brand Elements-Design,Communication programs ,pricing & distribution focus on certain target market. • On failure- no risk to other brands • Main disadvantages • Difficult, complex expensive in creation of separate marketing programs • Does not enhance the parent brand image • Does not offers variety to customers Nivea’s presence : • 14product categories and over 300 products • Available in more than 150 countries. • Market leader in skin creams and lotions in 28 countries, • In facial cleansing - 23 countries, • In facial skin care - 18 countries, • and in suntan products - 15 countries 23

  24. Advertising –Nivea • NIVEA advertising - Over 60 years • Promoted the basic themes of skin care and protection • Ads - always simple, plain and informative • Early advertisements - image of the NIVEA women as clean, fresh and natural. • Mid-1920’s - introduced the ‘bright and shining’ boys - three happy, healthy lads whose loveable looks captured the hearts of mothers • Extended the freshness and natural image to the entire family. 24

  25. Advertising –Nivea • NIVEA’s visual identity - world-famous blue and white color Combination. • NIVEAblue - is not just any old blue, but “Ivocart NIVEA Blue B 65711” A special color mixed exclusively for NIVEA in a complex development process Blue = sympathy, harmony, friendship and loyalty. White = external cleanliness as well as inner purity Blue and White = ideal for honest and appealing brand NIVEA. 25

  26. Advertising –Nivea Brand NIVEA • Closely linked to people • Always adapted to current consumer needs • Success - based on forward-looking product development. “NIVEA must carry on with Umbrella Ads so as to maximize upon the strong Brand Equity earned over decades.” 26

  27. Nivea Skin Creme (An Introduction) Creme NIVEA • The name NIVEA - Latin word “nivis” meaning snow - reflecting the snow white color of NIVEA Crème’s association with purity. • Nivea Crème - created by a team of dermatologists –1911 • Over 98% of the ingredients within NIVEA Creme are natural. • It was claimed as - "the world's first long-lasting skin cream." • Every second, a pot of NIVEA Creme is sold . • Enough tubs of NIVEA Creme have been sold to supply one pot to every person who’s ever been alive or is alive now. • NIVEA Creme is sold in some 160 countries around the world. 27

  28. Role of –Nivea Skin Crème ad • NIVEA - primarily through Creme NIVEA - acquired a unique, universal brand image as a caretaker of skin. • Creme NIVEA is synonymous with protection and caring for the skin for its • “Mildness,” • “Reliability,” • “Gentleness,” • “Protection,” • “High quality,” • and “value for money” All these attributes are strongly associated with the NIVEA Brand ,curtsy - Creme NIVEA 28

  29. Role of –Nivea Skin Crème ad Two researches conducted by BDF– 1990’s A “Inner Visuals” - imagery study - Pictures were associated to skin care brand - Nivea was associated to pictures denoting : Traditional Family ideal, Communities Earth – The Blue Planet - relating it to Creme NIVEA. B “Semiological Analysis”of consumer’s socio-cultural values in 1990’s - To evaluate Socio-cultural position of Creme NIVEA and other major sub brands. These studies revealed - NIVEA’s Brand association fit well into values of 1990’s.consumer. -The return to more simplistic and holistic approach to life , -The desire to more fairness, openness & authenticity and belongingness These were the values associated to NIVEA and particularly- Creme NIVEA 29

  30. Role of –Nivea Skin Crème ad So the dominance of Creme NIVEA brandand its communicationsin creatingNIVEA as a brand has been proven scientifically also, therefore : In our view this must be carried on & focus while advertisement must be maintained on Creme NIVEA, the BDF’s flagship product. But it must now focus on experience effect in newer markets like India to expand – Mainly through Nivea Creme 30

  31. Q3 What would you do now? Provide recommendations to Nivea concerning next steps in their Marketing Program? 31

  32. Key approaches that Nivea could adopt to grow i. Market Penetration ii. New Product Development iii. Market Development iv. Diversification 32

  33. Market Penetration • Market Penetration • Selling more products involves either growing the market as a whole or taking market • share from competitors. • Adjusting the marketing mix: • Product - Reformulating products to make them more effective e.g. better at moisturising. • Price - Reflecting good value but at a premium to retailers' own or private labels to • represent quality. • Place - finding new outlets through which to sell the products. • Promotion - finding more effective ways of reaching the target market, e.g. samples on • beauty magazines. 33

  34. NIVEA Lip Care is a good example of the way in which NIVEA is building an existing product in an existing market, i.e. market penetration. Despite the seasonal nature of demand for lip care products and their relatively low selling price. NIVEA lipcare has developed the brand through monitoring trends in the market and matching these with its existing core competencies in skin care. 34

  35. New product development • ii. New product development • Beiersdorf's investment across a broad range of existing products illustrates its commitment to new product development which should be • carried along. • Focus on Core Competence of R&D to provide Quality Products • Matching Science With the Consumer's Needs • Developing new concepts for active ingredients against skin aging • Higher focus on organic and Herbal formulations • Communication to the larger audience highlighting the thrust on R&D. 35

  36. New product development • A good example of new product development was the • launch of NIVEA Visage Soft Facial Cleansing Wipes in • 1999. • Market research at the time showed only 66% of UK women used a facial cleanser • Whilst only 27% has a face care regime (cleanse, tone, moisturise) • Women were looking for an easy, convenient, face care routine. • NIVEA's Soft Facial Cleansing Wipes remove eye make-up and • cleanse and tone in one simple step thus meeting customers • known requirements. • This is the basis of the product's success. Not surprisingly, NIVEA • rapidly became the No.1 brand. 36

  37. Market development • iii. Market development • Clear Geographical Focus -To focus on clearly defined geographical • priorities. • Western Europe should remain in focus. • China, Russia, Brazil, and India should be geographical priorities • delivering superior growth. • Should put more emphasis on sizeable regions, like Latin • America and Asia. • Should focus on dedicated solutions for some product categories to • address local consumer needs. 37

  38. The UK launch of NIVEA deodorant is a good example of market development within the NIVEA range. • The UK deodorant market is currently worth £300m annually. It is a highly competitive • market, dominated by one major manufacturer, Unilever, who account for over 60% of all sales. • NIVEA identified a strong match between traditional NIVEA brand values and those required in a skincaring deodorant, i.e.: • Protection • Suitable for skin • Mild/skin friendly • Pleasant fragrance • Reliable brand • High quality. • This allowed NIVEA to enter the market in the more specialist skin caring deodorant segment, away from the bigger, high-performance focused brands, with which the NIVEA brand image had fewer synergies. 38

  39. Diversification • iv. Diversification • Develop new products for new markets. • This is well illustrated by the development of the NIVEA FOR MEN range. • This development resulted from several trends. These include: • The softening and blurring of "male" and "female" gender roles. • Increased spending on lifestyles with more people attending gyms and caring about • their appearance. • New media developments, e.g. the revolution in men's magazines provide direct • contact with men through advertising. 39

  40. NIVEA was the first mass-market brand to set out to develop male • facial care/moisturising. • The NIVEA FOR MEN range provides straightforward practical • solutions to men's skincare needs. • It targets men who value their appearance and who see it as a key • contributor to self-confidence i.e. NIVEA has diversified into the male sector of the market. 40

  41. Conclusion In 60 years Creme NIVEA has made Nivea Brand synonymous to skin care When compared to Brand “Nivea”,“Biersdorf” as a Brand has negligible equity NIVEA must carry on propagating there Family Brand through Umbrella Ads so as to maximize upon the strong Brand Equity earned over decades. 41

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