NIVEAAN INSIGHT INTO ITS BRAND EXTENSIONS

Course Instructor: Prof. Sameer Mathur

Submitted by: Priyanka Khowala, PGP30333

Manufacturer - Beiersdorf

NIVEA is owned by Beiersdorf, a German Company. The brand is dedicated to skin and body care products of all kinds.

Beiersdorf ranked fifth in global beauty and personal care market in 2013, with a value share of 3%.

A key challenge for the company is that it is up against strong competitors in the shape of L’Oreal, Procter and Gamble, and Unilever, which have a wider category and geographic presence, and significant resources to invest in product development and marketing.

It is marketed in India by NIVEA India Pvt. Ltd.

It is one of the best skin care brands in the world and it started operations in India in 2006 as a 100 % affiliate of the global cosmetics & toiletries giant Beiersdorf AG

Parent Brand - NIVEA

NIVEA comes from Latin word meaning ‘snow-white’. The name does justice to the idea of beautiful skin, that the brand spreads though its products.

NIVEA Crème was introduced to the world in December of 1911. At that time it was found in a tin yellow box.

In 1924, the company developed a new approach to advertising. The new campaign of ‘NIVEA Boys’ introduced a new image which still exists in its blue and white presentation of all Nivea Products. The blue signifies sympathy, harmony, friendship and loyalty. The white signifies external cleanliness as well as inner purity.

The brand presents itself as a skin care solution for both men and women. It has a wide range of products that cater to various segments of skin care market, like - body care products, sun care products, hand care products, men’s face wash, female face care products, talc and deodorants, shower soaps and body wash and lip care. 

NIVEA Crème was

first introduced in the year

1911

Introduced

NIVEA soap in

1919

Introduced a section of

its haircare

products in 1920

Introduced

the first Nivea

product for MEN: the

NIVEA shaving soap in 1922

NIVEA Whitening

paste for Asian skin was

introduced in 1927

NIVEA Baby fine range was

introduced in 1960

NIVEA VITAL for mature skin was introduced

in 1994

NIVEA VISAGE Anti – Wrinkle

Q10 Day cream was introduced

in 1998

NIVEA later also

introduced its suncare

series

NIVEA – Category Extension of the Brand

Source: - http://www.nivea.in/about-us/beiersdorf/NIVEAHistory#!stories/different-skin-different-needs

Size of the Skin Care Market in India

Source: Euromonitor - http://www.portal.euromonitor.com/portal/analysis/tab

Market share of Nivea in skin care segment in India

Unilever Group48%

L'Oréal Groupe7%

Amway Corp5%

Oriflame Cosmetics SA3%

Himalaya Drug Co, The3%

Emami Ltd3%

Zydus Wellness Ltd2%

Nivea2%

Others26%

Market Share (2014)

Current value growth (%) of skincare segment in India

Source: Euromonitor - http://www.portal.euromonitor.com/portal/analysis/tab

Forecast value growth (%) of skincare segment in India

Source: Euromonitor - http://www.portal.euromonitor.com/portal/analysis/tab

Market share and Growth rate of Nivea India

2014 2015 2016 2017 2018 20190.05.0

10.015.020.025.030.035.040.045.050.0

0.0%1.0%2.0%3.0%4.0%5.0%6.0%7.0%8.0%9.0%10.0%

Nivea in India

Market size growth

Years

Mark

et

size

(U

S m

n$)

Gro

wth

rate

Brand Value worldwide 2015

NIVEA - segmentation

Segmentation is done on the following basis:

NIVEA has products within

its range for everyone – from

kids to young men & women to

mature & old people.

It is a brand that looks after

the personal and skincare

needs of people.

In India NIVEA mostly

concentrates on Tier 1 cities. So in India it is

majorly an urban skin care

product.

NIVEA falls in the category of

lifestyle products.

People feel good and llok

good after using the products.

Demographic

Psychographic

Geographic

Behavioral

NIVEA –Target customers

MEN WOMEN

Age >33 26-32 18-25 >33 26-32 18-25

Income High Medium Low High Medium Low

Price Sensitivity

Low Medium High Low Medium High

Life Style High High Medium High High Medium

NIVEA - Positioning

NIVEA India began operations in 2006. The challenge for the company is that everyone associates NIVEA with the blue tin and as a rather traditional skincare product. While the company wants to be known as a conventional, trusted brand synonymous with the blue tin packaging, it also wants the consumers to know that NIVEA is contemporary and modern with specialized skincare solutions.

NIVEA is introducing many mass premium and premium products that go beyond mosturising and fairness. NIVEA Visage range for example.

Positioning ladder

Attributes

Skincare product

NIVEA products make the skin more supple, younger

looking, and lighter. (according to product

type)

‘NIVEA cares for your skin’ encapsulates the

brand value

Functional Benefit

Emotional Benefit

Value

Reliable, Quality, User – friendly, Value for money

NIVEA – Perceptual Map

NIVEA

LorealDove

Olay

The Body Shop

Chanel

Fair & Lovely

Clean & Clear

Rexona

Low

Price

Hig

h P

rice

High Quality

Low Quality

NIVEA – 4 P’s

Product

Core values of the brand are : Security, Trust, Closeness and Credibility.

NIVEA focusses heavily on market research to develop new products that cater to the growing needs & changing preferences of its target market in different regions.

While NIVEA cream remains the brand’s signature product, the range now encompasses several sub brands which cater to different segments of the market so that customers can choose from amongst the sub brands according to their personal needs, age and maturity.

The Company now has over 500 different products under its umbrella brand.

NIVEA – Product Categories

NIVEA

Skin Care

NIVEA Cream

NIVEA Body

NIVEA Hand

NIVEA Sun

Face Care/ Cosmetics

NIVEA Lip care

NIVEA Visage

NIVEA for Men

NIVEA Vital

NIVEA Beaute

Personal Care

NIVEA Deodorants

NIVEA healthcare

NIVEA Bath care

Products

NIVEA lip care NIVEA Whitening

NIVEA Men Range

NIVEA Sun care range

NIVEA Deodorants

NIVEA Shampoo

PRICE

NIVEA has today positioned itself as the skin care brand for the entire family. To support this image, it offers its quality products at affordable price points. Further, NIVEA also offers promotional discounts to stay competitive in the market and to attract consumers.

Keeping in line with the main segment that it caters to (mass premium segment) the prices of some of its products are given below:

Product Price range (INR)

NIVEA bath gels (250ml)

150 - 200

NIVEA Creams (100 ml)

100 - 150

NIVEA lotions (400 ml) 300 - 400

NIVEA Deodorants (150 ml)

150 - 200

Product Price range

NIVEA Face washs (150 ml)

100 - 200

NIVEA lip balms (4.8 gm) 100 - 150

NIVEA after shave (100 ml)

150 - 200

NIVEA sunscreen lotions (75 ml)

200 - 250

Place

NIVEA India being a relatively new facility in the country currently focusses only on the top 30 – 35 cities. The company sticks to its mass premium image and wants to consolidate its business around this. The focus of the company is not on tier-II and III markets for the time being. But, in the long run, the company will tap these segments. Nivea cream, for example, is distributed in smaller towns and cities too, but the company does not distribute it directly in these markets.

NIVEA products are sold through the traditional mom & pop retail stores. It has a heathy presence in modern trade (mainly super – markets). It also sells through the chemist distribution.

Nivea is currently importing most of its products from Germany and Thailand but they are evaluating opportunities for local production since they do pay a high import duty and local manufacturing would lead to lower consumer prices and reduce dependence on imports. But there are no immediate plans for the same and local manufacturing could be some time away.

Promotion

Nivea has a strong marketing heritage, with campaigns as far back as the 1920s focusing on many of the benefits and values that the brand still stands for today. Nowadays, each of its sub brands is also supported by a fully integrated multi-media strategy, which includes sampling, direct marketing and ambient media. Education goes hand in hand with many campaigns, as Nivea sees it as its responsibility to promote skin protection and the association between healthy skin, general fitness and well-being. This strategy of educating the consumer through promotion has helped Nivea build new markets, such as the male skincare segment.

Whilst this may prove costly in the short term, long-term investment in the skincare sector serves to consolidate Nivea's position as a leading skincare manufacturer and a source of valuable advice that inspires consumer trust and loyalty.