Divyesh Seksaria – 10 FN-039Gaurav Nagar – 10 DM-054Neha Kaushik – 10 DM-092

Neha Sinha-10 DM-093Nishant Pilania-10 HR-024

Ramya Yarlagadda-10FN-089

Nivea:Managing an

umbrella brand

Table of ContentsIntroductionHistoryBrand Nivea-evolutionCore valuesMarketing strategyCurrent scenarioS.W.O.TRecommendation

IntroductionPresence in maximum product categories and

countries – Queen of Mega BrandsHome country – GermanyParent Company – Beiersdorf15% share in global skin product market

during the late 90’sMaintained double digit growth rate

throughout the 90sOne product wonder to multi product

categories using Umbrella Branding

History120 year old brand based in GermanyThe Beginning of Beiersdorf:

Body care productsAdhesive tapesBandages

Introduced brand NIVEA which acted as a Game Changer

Introduction of brand NIVEA A skin cream based on Eucerit, the first ever

water – in – oil emulsifierRevolutionary product for cosmetic buyers

with stable, long lasting formulaProduct name based on Latin word ‘NIVIUS’

meaning Snow WhiteTarget audience expanded from Upper strata

women to masses

Revamping the BrandFirst ever extensive revamping exercise in

global corporate worldNIVEA was given new packaging – A blue tin

with NIVEA crème written in white on itRevamping advertising imagery to expand

NIVEA’s usage from ladies to the whole family

BEIERSDORF in blueWorld war – II enveloped Beiersdorf with

political problems of GermanyExpropriation of NIVEA brand by other

countriesAssets and trademarks associated with the

brand were forcibly sold offNext three decades were marked by brand

consolidation

Core Values of the brandVisual and physical attributes of the product

formed a complex emotional bond between customer and brand which had strong positive undertones

NIVEA’s blue color denoted sympathy, harmony, friendship and loyalty.

White color suggested external cleanliness and inner purity

NIVEA had an aura of an honest brandBrand Values – Mildness, reliability, gentleness,

protection, high quality and value for money

Umbrella brandingSelling related products under one brand

nameContrast with individual product brandingAdvantage: Several products can be

efficiently promoted with a single advertisement or campaign.

Challenge: Greater burden to maintain consistent quality and brand dilution

Innovations and Product ExtensionBegan with extensions through 1930’sNIVEA Visage in 1960’sMajor breakthrough in 1970’s with the launch of

‘NIVEA for men’ aftershave – A runaway successAlong with Umbrella brand approach the

product diversification was also influenced by competitive pressure.

Research team of 150 researchersOver 300 products across 14 segments of health

and beauty market

Umbrella Branding strategy for NIVEAAny new product was evaluated based on two parameters

The new product had to be based on the qualities that the mother brand offered

The new product had to benefit the consumers in the same way as the other brandProduct extension and expansion

The Global – Local StrategyRapid acceptance all over the world

highlighted its global appealHowever, according to company sources, the

brand retained its strong German heritageConscious decision to globalize the appeal of

NIVEA by forming a team of ‘International Experts’ having ‘local expertise’

Adaptation of international advertising campaigns at the local level to reduce the costs of different product formulations and packaging

Advertising featuresNIVEA advertising was simple, unpretentious

and human.No use of supermodels for promotionPredominant colors in all campaigns were

blue and whiteLocal issues were well kept in mindCommunication strategy was localized

Market PositionPresent across 14 product categoriesPresence across 150 countriesLeadership position as on May 2003

Market Leader for product

Country

Skin creams and lotions 28

Facial cleansing 23

Facial skin care 18

Suntan products 15

Brand NIVEA and what it meant for its customersNIVEA more than a skin care productAssociated with good health, graceful ageing

and better livingSporting, fashion and other lifestyle events

gave NIVEA a long lasting appealPillars of the brand – Innovation, brand

extension and globalization

The BEIERSDORF ownership issueInsurance major Allianz, the largest

shareholder intended to sell its 44% stake in the company

Prospective buyers included Proctor & Gamble, the cosmetics major L’Oreal, and the coffee specialty Tchibo which already had 30% stake in the company.

P&G and Tchibo enter price war to buy out Beiersdorf.

The BEIERSDORF ownership issueGerman household products major player

Henkel and US based FMCG major Unilever also entered the fray for Beiersdorf buy out

Analysts suggest a US based company to be the ideal buyer for the brand sighting low market share of the brand in the US market

Declining growth rate (17% in 2001 and 6.9% in 2002)a cause for worry

S.W.O.T. analysis

StrengthsPresence in maximum product categories in

over 150 countriesMarket leader in skin care and men's careUmbrella brandingGlobal local strategyContinuous expansionEmotional bond between customer and brandCapitalization on strong brand equity

Strengths cont..Advertising: simple, unpretentious and

humanSet of guidelines for marketing mix of any

new product launchBrand of local origin in many countries which

helped them in becoming the market leaderMass marketing

WeaknessPresence in US not as strong as in EuropeLacks size compared to its competitorsDecline in growth rate since this decade

OpportunitiesExpansion to US marketsBring excitement to the brand by interactive

advertisement Build relationship with retailers to make

Nivea products more visible in retail stores

ThreatsIf brand is not managed well, there is a

threat for its associate brandsAssociate brand may overshadow core brandNot able to different segments of market due

to umbrella brandingUnable to capitalize on different segments of

marketCompetitors aggressively undertaking

promotions

RecommendationsShould not let intensifying competition and

the ownership imbroglio affect the brand performance

Should position themselves in such a way that they can influence the big retailers and markets where they don’t have a large presence.

Being acquired by a U.S. firm beneficial to Nivea

Questions??