NIVEA:SOFTENING AND STANDARDIZING GLOBAL MARKETS Just as healthy skin requires the proper pH balance to flourish, a strong

global brand must find the rightbalance between marketing efforts that build consistency in overall worldwide positioning and the need toappeal to specific geographic and cultural markets.Beiersdorf (BDF), the German manufacturer of Niveaskin care products, seems to have mastered that balancing act with all the skill of an Olympic gymnast.Introduced in 1912, Nivea Creme was a unique water-in-oil emulsion, a formulation that set it apart from thefat-only creams available at the time.The brand’s positioning also made it distinct from other products on themarket:It was a multipurpose cream sold at a price that made it available to the masses, rather than to onlythe upper-class women who were the competition’s target market.Over the years, Nivea’s positioningstrategy has remained as simple and steadfast as the now-familiar blue-and-white package.Despite all thetechnological developments the company has introduced in skin care products, and all the markets it has soldin, Nivea’s marketing always focuses on key brand benefits—high quality, reasonable price, straightforwardapproach, and mild skin care. This commitment to the mainstream market and focus on multipurposeapplications means that every product introduced under the Nivea name has to conform to guidelines whichensure that everyone working on the brand around the world knows what it stands for.Nivea’s marketingstrategy is well stated by Rolf Kunish, chairman of the Beiersdorf Group:“The strategy of concentration onexploiting market potentials and regional growth opportunities is to be continued.The same applies to movesinto new market segments and to increased investment in research and development.” Exploiting market potentials means constantly introducing new products that meet current market needs andthe needs of newly targeted market segments.One example from the past is Nivea’s emphasis on health andactive lifestyles as more women went to work in the 1920s.Others include the introduction of sunscreen,skin protection, and tanning products to match the more active, outdoor lifestyles in vogue from the 1960s totoday; plus products for every skin type and need.To meet the needs of new market segments, Niveaexpanded its product lines to include children and men.All these new products were guided by the Niveastandards:each product must meet a basic need, be simple and uncomplicated, not offer to solve only onespecific problem, be a quality leader, and be priced such that consumers perceive a balanced cost-benefitrelationship. BDF’s new product strategy was honed in the 1970s when competitive challenges prompted thecompany to take steps to revitalize the brand.It used a two-pronged approach.First, to counteractperceptions that Nivea had an older, less dynamic image, the company for the first time described specificproduct benefits in its advertising.Before this, advertising had focused on the variety of settings in whicheach product could be used.Second, BDF introduced additional products that would leverage the recognitionand reputation of the Nivea name in growing segments of the market.These are sub-brands, such as NiveaShower and Bath, Nivea for Men, Nivea Sun, Nivea Hair Care, Nivea Body, Nivea Visage, and the recentlyintroduced Nivea Baby. During the 1980s, new products were supported by separate ad campaigns that helped build individualpersonalities and associations for each sub-brand, while linking them to each other and to Nivea Cremethrough the use of the word “care” in all headlines.The sub-brands helped establish Nivea as a broad skinand personal care brand, but their success was both pleasing and a problem for BDF.The company worriedthat the

incorporate the same kinds of people.Of course. its appeal and marketing approach can be very similar in many parts of the globe.Because Nivea Creme is a Europeanproduct. it’s much less expensive to run a single global campaign rather than manyseparate regional ones. all ads.After conducting studies.Standardizedadvertising campaigns need be adapted only slightly by translation into the local language. glowing skin will sell cosmetics in nearly all these markets. where a majority of people have much darker skinand may require different sorts of moisturizers and sunscreen products. and South America were all populated by European settlers.The difference in sales is attributable to both market and cultural conditions.Moreover. with the result that many products developedfor the German market can be sold in these markets with little or no product or marketing adaptation. which are characterized by yellow and frequently more pale complexions.The result is a highly standardized approach to global marketing. as one company official notes. all people have skin and many people have the same needs andideas.Doing so. However.This leads to a direct approach and a high degree of consistency.A focuson healthy. such as Indonesia and Thailand.motherhood and a happy family. In 1990 BDF internationalized its brands by creating a worldwide name for each product category and implementing common packaging on a global basis. honesty and trustworthiness. they also reduce headaches.Allads for the core brand.proliferation of products bearing the Nivea name might leave consumers confused about what thebrand represented. The second element of the BDF strategy is exploiting regional growth opportunities. anduse a uniform Nivea logo. and focus on the same benefits not only create a universal brandimage.And it mightdevelop tailored sub-brands and programs for important sub-segments of all these markets.The UnitedStates.Rather thanfocusing on the individual differences among peoples around the globe. and that the image of Nivea Creme. its products may be less well suited tothe market. Nivea Creme.And marketing control is much simpler and easier with a standardized program. the firm focuses on the similarities. might be weakened or diluted.In between the European and Africanmarkets are the Asian markets. the company embarked on a marketing strategy that would deliver on the conceptof the “universality” of Nivea products while reinforcing the image of the brand as a skin care specialist. had to evoke a common emotion. the heart of the brand. had to incorporate its underlying values of timelessness and agelessness.This is particularly true in African nations. Canada.Although Nivea sells well in some Asian markets.may necessitate some adjustments to the standardized approach. consistency. and the product benefits of mildness andquality.Packaging costs are reduced and product recognition is very high when people encounter the product in othercountries and cultural situations.simplicity.Because the costscan be spread around the globe.This producessome commonality in cultural background and light skin type. however. the company might usedarker-haired models with more olive complexions in the Latin and South American markets. it sells less well in Japan. When a firm operates in as manymarkets as BDF. asNivea moves further away from this common European cultural base.After all. regardless of the country in which they ran.Ads for the sub-brands had to reflect elements of these values as well as those that were uniquely their own. use the same typeface. Latin America. .Many fewer marketing decisions have to be made.

Beiersdorf has done very well with its own.Unfortunately for Japanese merchants.” which means that ads shouldstate explicitly what the product will do.All these differences argue for more adaptation of Nivea products and marketing to match culturaland market differences outside Germany and the European market. and cultural factors affect the worldwide marketing of Nivea products? 2. Questions for Discussion 1.Price is not the crucial variable in the purchase decision—men are buying based on product characteristicssuch as fragrance and brand awareness.If the company is worthyof consideration. Old Spice. . because Japanese consumers want to form relationshipswith companies.The Nivea line grew by 13.When BDF first entered the Japanese market. where men—especially younger men—are beginning to spend more on cosmetics. theytend to acquire many of the same tastes as developed economies. andprices have fallen. and focused on the moreprofitable ones.They are buying many of the samebrands as their Western European counterparts—Gillette. Nivea for Men. legal. then the quality of its products is assumed to be high. the United States.However. Guy Laroche. the company itself should be prominently featured in advertising. but grew by 36. and Paco Rabanne.4 percent. affected bythe downward trend in Japan and China. is a “high-context” country in which productclaims do not need to be stated explicitly.Compounding the Japanese losses are unfavorable exchange ratesbetween the yen and the mark.3 percent.An example is Russia. Japanese markets were strongly protected and there was relatively little competition from non-domestic manufacturers.As a result. although the overall globalpicture for Beiersdorf is quite good.Nivea held its own in the United States. andJapan. which reduced earnings even further. Boss Lancome. an advertising campaignprepared for Germany requires more than just a little tweaking in order to promote products successfully inJapan. it’s still just a little fuzzy in some parts of the world.Even so. Aramis. Gucci. How do economic. the market seems quite responsive. far outpacing the more expensivecosmetics and skin care products. BDF has reduced the number of products sold there. There are cultural differences between markets such as Germany. as economies develop. and SouthAmerica.Although BDF’sbrands experienced double-digit growth in Eastern Europe. Scandinavia. in contrast. which are willing tospend on advertising.Total sales for Beiersdorf’s cosmeticsbusiness grew at 5.But asJapanese markets have opened up.7 percent in 1996.For companies such as Nivea and Gillette. it was highly successful. sales in Asia and Australia fell by 10. competition has increased. Armani. price maintenance has been abolished.3 percent in Mexico. sales growth within Germany and some Northern European countries has been much lower due tothe difficult economic situation.Germany and the United States are classified as “low-context countries.Rather.However. Speaking of bottom lines. growth around the world has been uneven. the resulting high prices provided a stronglure to foreign producers. Southern Europe.Japan.Thus.Despite strong growth in Thailand and Indonesia.In the past. despite decreased sales of the company’s higher priced Labella andAtrix lines and lower sales in Japan. and a few designerbrands such as Christian Dior.The bottom line is the increasing homogenizationthat argues against customization of products for specific markets.

1997. 1997. 5. and information from the Nivea Web site (nivea. 12-14. pp. or something else?What are the arguments for and against this strategy? 3. p. p.” Cosmetics International. 1997. Find a Nivea ad and try to adapt it for the Japanese market. Should Beiersdorf continue with its fairly rigid standardized marketing strategy? Sources:“Men’s Lines Grow in Russia.274 Uploaded: 10/14/2008 Category: Uncategorized.”Cosmetics International. p.Is BDF engaging in product adaptation.”Womens’ Wear Daily. 2. “Beiersdorf Beauty Sales Get a Boost from Nivea. 1996. 4. “Sales Indicate Global Direction of Beiersdorf. March 1. 11. pp.” Women’’Wear Daily.” Cosmetics International. “Beiersdorf Increases Profits as Nivea Sees Continued Success. Rated: (4 Ratings) Download this Document for FreePrintMobileCollectionsReport Document api_user_11797_Shree Follow Share & Embed Link / URL: þÿ þÿ Embed: Related More from this user . 12 NIVEA Intl Mktg Case Reads: 4. “Beiersdorf’s Growth Bolstered by Nivea. February Would you say that Beiersdorf engages in global rather than international marketing? Explain your answer. March 25.Describe Beiersdorf’s product and promotion strategies for Nivea. From a marketing viewpoint. July 10. dual adaptation. is this homogenization good or bad? 6. 11. 1996. June 25. is the homogenization of global markets good or bad?From a national viewpoint. Melissa Drier. 12.

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