INSIGHT BASED INNOVATION Barcelona April 2015, Susanne Jentsch (Consumer Centricity Unit)

WHAT DOES OUR CONSUMER CENTRICITY UNIT DO?

Foster Insight Based Marketing

CCU

Enhance Consumer & Shopper Centricity

WHO OR WHAT IS BEIERSDORF?

• Founded in 1882 in Hamburg

• More than 130 years of competence in

research and development

• Business segments: Consumer

and tesa

• Over 16,500 employees worldwide

• More than 150 affiliates

• DAX-listed since 2008

• € 6.285 billion Group sales in 2014

WORLDWIDE LEADER IN SKIN CARE

• Our global brands:

NIVEA, Eucerin,

Hansaplast,

and La Prairie

• Close to our consumers

around the world

GLOBAL BRANDS, LOCAL ORIENTATION

MILESTONES IN SKIN CARE

• We are the forerunners in skin care research

• Highly innovative over the entire company history

SKIN CARE COMPETENCE FOR OVER 130 YEARS

Founded

1882

1900

1909 1922

1911

1951

1950

1975

1963

1987

1980

2006

1998

2013

2011

“ “ INNOVATION IN SKIN CARE IS OUR LIFE BLOOD

We focus on big product

innovations and introduce

them in best-in-class time-

to-market.

Our Innovations ground in

strong Consumer insights,

delivering outstanding

value to our Consumers

MAIN SUCCESS FACTORS OF BIG INNOVATIONS

Closest to our consumers at all times!

HOW TO INNOVATE CLOSEST TO OUR

CONSUMER?

1. EMBED A DEFINED INNOVATION PROCESS!

Early Innovation Integrated Innovation

Management Go To Market

“concept to product” “product to consumer”

Innovation Process

”via consumer insight to concept”

Blue Agenda

It starts with the consumer, it ends at the consumer

Category Strategic Frames

1

Consumer/Shopper Closeness

2

Strong Insights

3

Insightful ACTIVATION

Connect

Act

Great Concepts for :

• Product

• Packaging

• Communication

• POS

2. CONNECT BEFORE YOU ACT!

Insight Based Marketing Systematically turning Insights into market-winning activities

Insightfulness Always asking questions, looking beyond the obvious, connecting the parts

Insight Deep understanding of consumer and shopper needs, behaviors and beliefs that offers exciting business building oppportunities

3. SYSTEMATICALLY TURN INSIGHTS INTO ACTION!

DEFINITION: INSIGHT BASED MARKETING

Grounded in a deep understanding of our brands and guided by

foresight, we identify and leverage strong consumer and technology

insight to further build our brands and drive future growth

Foresight Technology

Brand

Consumer

We act as one team acoss functions and regions, closest to our consumers

TURNING INSIGHTS INTO INNOVATIVE CONCEPTS

Strong INSIGHT

Unique IDEA

Compelling STORY

DEFINITION: INSIGHT

A deep Understanding of people’s

behaviours, attitudes or beliefs

that offers exciting business

building opportunities for our brands

or business

An Insight is the seed, the starting

point that enables our activity to fit

meaningfully into our target

audience lives

“

”

If I had asked people what they wanted, they would have said faster horses…

“

” Henry Ford

A lot of times, people don‘t know what they want until you show it to them...

“

” Steve Jobs

Insights help us to recognise the needs of our consumers...

…even before they do

EXAMPLE NIVEA DEO INVISIBLE FOR BLACK & WHITE

“It’s embarrassing when I see that my deodorant has

left white marks on my black tops/shirts. It’s even worse if, after a while, I see stains

that never come out and really ruin my white clothes.”

Consumer Insight

There are only two sources of competitive advantage, the

ability to learn more about our consumers faster than the

competition and the ability to turn that learning into action, faster

than the competition

Jack Welch Former CEO General Electric

“

”

TURNING INSIGHTS INTO ACTION Challenge for NIVEA Body to address non-users of body lotion

FROM CHALLENGE TO INSIGHTFUL ACTIVATION

Define the Challenge 1 Build deep

Consumer knowledge 2

Generate Understandings 3

Develop Activation 5 Identify Insights 4

THE CONSUMER CHALLENGE

How to encourage non and occasional users of body lotion

to use Nivea Body ? Challenge

Less than 80% of women use body lotion, even in saturated markets

20% do not use body lotions

Users

Non users

Body lotion usage in a saturated market

Define the Challenge 1

A CROSS-COUNTRY, CROSS-CATEGORY

TEAM APPROACH

Key countries and various functions like Marketing, R&D, Packaging and

Market Research were all deeply connecting with our consumers, trying to

solve the challenge

Build deep Consumer knowledge 2

THEY IDENTIFIED KEY CONSUMER

TENSIONS

It’s a duty!

In the shower

It’s a pleasure!

vs.

Personal care

after the shower

Me-Time

“It’s an hour or two, only for me”

Relaxation

“It’s a moment of de-stress, like a vacation, a nice nap or good food”

“I feel that I’m doing something good for me, treating myself”

Negligence

“I don’t devote much time to body care, the family negatively affects

the care, I devote much more effort and attention to them”

Burden

“I do my duties, I have to, because of my dry skin”

“I often think that it’s really tedious”

Build deep Consumer knowledge 2

Body care is part of her daily routine but does not play a central role in her life

Shower is always connected to a real pleasure experience, the body lotion

application afterwards is compared to that a harsh step into reality

She is short with time and her priority is spending time with her family

Although there are moments where she really enjoys it, the daily routine is not

such a moment

She wants effective care for her dry skin

THEY JOINTLY GENERATED

KEY UNDERSTANDINGS FROM THE DATA Generate Understandings 3

… AND IDENTIFIED A KEY INSIGHT Identify Insights 4

… WHICH THEY TURNED INTO A TRUE

GAME CHANGER

Not applicable in

china

Not applicable in

china

Develop Activation 5

BRINGING IT TO THE MARKETS

360 ° SUPPORT

Driving Growth in the saturated body segment

TVC

Print

Web/ Digital

Sampling

Experience

POS

PR

5 5

PRINT CAMPAIGN IN

KEY WOMEN’S

MAGAZINES

ON-LINE ACTIVITY 5

Get it in your hands

Website / display ads‘A look into your future’ on Facebook

5

PR CAMPAIGN 5

Video Fact sheet Research

5TVC EDUCATED CONSUMERS ON HOW

TO USE THIS NEW PRODUCT 5 5

STRONG IMPACT IN-STORE

Sou rce: Facebook, NIVEA France, 2012

5

Develop Activation 5

RESULTS

CREATING A GAME CHANGER:

A NEW CATEGORY IN THE BODY SHELF!

89% new category users

SUCCESSFULLY CONVERTED NON-USERS

KEY FACTORS OF SUCCESS

• A thorough strategic analysis of growth opportunities

• A clear consumer challenge definition

• An empowered cross-regional, cross–functional team

• A deep dive into consumer‘s worlds

• A globally relevant insight

• A creative ideation led by the insight

• Closeness to our consumer at all times!

FOR INSIGHTBASED INNOVATION

THANK YOU!

BACK UP

NIVEA

• NIVEA is the world’s largest

skin care brand*

• The most trusted skin care

brand in Europe**

• Over 500 million consumers

worldwide

• Present in approx. 200 countries

• Over 100 million creme tins

sold per year

• 7.5 % sales growth in 2013

• Market leader in 46 countries

THE ICONIC BRAND

* Euromonitor International Limited; by umbrella brand

in the categories face, body and hand care retail sales 2012.

** Source: Most Trusted Brands Study 2013.

TOP POSITIONS WORLDWIDE NUMBER 1 IN MANY CATEGORIES

Source: Nielsen Market Positions, Status: 12/13

= No. 1 market position = No. 3 market position = no market presence/

no data

Countries DE BR UK FR RU IT TH CN PL US JP ES NL CH AU No. 1/2

Body 14x (93 %)

Face 7x (47 %)

Sun 9x (60 %)

Men 13x (87 %)

Deo 9x (60 %)

Shower 6x (40 %)

= No. 2 market position

RESEARCH AND DEVELOPMENT

• 990 employees in Research

and Development

• €154 million invested in 2013

• More than 1,300 studies with

approx. 40,000 participants

• Globally recognized skin

research center

• Development centers in

China and Mexico

130 YEARS OF EXPERTISE