Marketing Management Assignment help on : Nivea

Introduction

Nivea is a brand by one of the famous international skin care company named Beiersdorf. The company is present across the globe offering its range of skin care cream for every age, every gender, and every need people have. The last decade has seen the company grow manifolds in the Australian markets by developing a balanced as well as a very well managed portfolio of products. Under the brand name of Nivea there are about 9 segments of products the company manufactures. Nivea Sun is one of the segments among the range of Nivea Beauty and Personal Care products. In the Australian continent the Brand Nivea Sun had recorded a year on year growth of 4% in the year 2011. The sales also had seen a rise of 5% against the previous year sales. The brand believes Sun care as one of the most important issues for all and made sure that the protection message was the key to the proposition of the brand. With high standards of products the brand aimed at bringing fun to the market by recognising the situation when the sun care products were applied.

Current Marketing issues

There were several marketing concerns which came in between the plans of Nivea to market its Sun care products across the Australian markets. Some of the known marketing issues can be listed as follows: (Business Case Studies n.d.)

Slow Industry growth: The personal care market in Australia saw a moderate value growth in the year 2011. The unit price declines in the skin care products which includes the sun care products had already been anticipated with the price competition getting much more intensified.
Strong Australian Dollar: With internet retailers selling products at discounted prices and the strong Australian dollar encouraged the consumers to buy products online. Moreover the retailers were also importing beauty and personal care products at a much lower price compared to the previous year.
Competition: The competition in the Sun Care products has intensified over the past few years. The increased awareness and growing demand has resulted in several companies manufacturing newer products. As the manufacturers are offering the best possible UV protection products the challenge to stay at the top has increased drastically. The other key players in the market are Avon Products Inc. Estee Lauder Group, Johnson & Johnson, LÓreal, Neutrogena Corp, etc.
Technology: With advanced products come the advanced technologies behind them. Each and every brand today is trying to get the most advanced technological support to provide high quality products. Nivea Sun has been upgrading its technology from time to time but it would need to keep doing so in order to manufacture better products as per the need of the current market.

Potential Market Development

Sun care protection is one of the most common features in the range of personal care product industry. With increased awareness by the consumers on the aspects of skin health the segment has a tremendous potential in the coming years. Nivea Sun has done pretty well to capture about a 12% market share in the Australian markets with its range of sun care products. In the recent times the company has rolled out its products to meet the rising consumer expectations in terms of product characteristics like its durability, absorption, self-tanning as well as water resistance. Although there are several players in the market today the sun care market still has a huge potential for bigger brands to tap upon (Instant 2012).

Quite recently the R&D and technological up gradation by Nivea Sun has enabled them to roll out products which are instilled with sunless tanners, insect replant features, and offers protection from a huge range of UV rays which has been a major driver of its increased sales in the market. As the current trend seems to intensify the competition even further the company is in the plans to manufacture sun care products for every age group, every kind of skin, and every gender.

Company Vision

Nivea Sun’s vision has been to be number 1 brand across the Asia Pacific which includes the Australian continent as well. The market penetration which reflects the potential customers willing to purchase productshas been well addressed by the company while providing innovative products to their consumers. In order to meet the expectations of its consumers and further manufacture products which can help the company expand its consumer base the company has been continually segmenting its customers.

Market segment and category lifecycle stages

Nivea Sun comes in three main product segments, namely:

Protection: It is an established fact today that the skin is well protected against the harmful effects of the sun. The range of products by Nivea Sun provides the maximum protection to keep the users as safe as possible. The company also promotes other forms of protection such as wearing a sun hat or avoiding the midday sun. Within the sun care market protection falls the largest segment in terms of value i.e. the company spends a large amount in the Nivea Sun protection segment. Broadly the Sun Protection sunscreens are available based on:
- Skin Type: This depends upon the skin texture, or the age group which is using the sun care product. For example children require the maximum protection as their skins are thinner and the repair mechanism has not fully been developed.
- Location: Nivea Sun provides several lotions and sprays which are targeted at different climates and for the users with different skin types. Within Australia it may happen that people having fair skin would require the SPF20 product in one region while SPF 40 product for another.
- After Sun: This segment is largely dominated by Nivea Sun and has been growing rapidly for the past few years.
- Self-Tan: Opposite to the protection and the after sun segment, this category focuses on cosmetic appeal. Many people like to use these products to get a sun kissed glow throughout the year.

While in terms of customer segmentation the company has segmented its consumers as follows:

Demographics: It is very well known that different groups of consumers behave in a different manner. The demographic differences relevant to Nivea Sun has been based on different buying behaviours of men/women and adults with children. The fact that there is a huge difference in terms of awareness of usage of the sun care products between men and women the company has developed different products and campaigns for both. While on one hand men prefer convenience women prefer a sun care product which is luxurious. In the same manner the adults who have kids are a broad segment having different needs. The demographics segment is quite large and research by the company has shown that the level of awareness of sun care transcends income and social class.
Attitudinal:Another consumer segment identified by the company is the consumer’s attitude towards the influences of a sun care product. The company has created several sub-segments here with consumers having different expectations while purchasing a sun care product:
- Concerned Consumers: The Company identifies this segment to constitute of the ones who consider a good tan is not important. They have segmented these consumers to be conscious of the harmful effects of the sun and purchasing products which are most likely to offer high sun protection factors.
- Sun Avoiders: This is the other segment which Nivea Care has segmented for the people who lack awareness of a sun care product and are less likely to use one for them. They belief with increased education and promotion they could sell more products to the people within this segment. It has produced easy to use products such as sprays to promote it among the people within this segment.
- Conscientious Sun Lovers: This segment is viewed by the company to include those who adore sunshine and prefer using a trustworthy brand that suite the protection factors. They belong to the more knowledgeable consumers who are aware of the requirements they have for the specific products they buy.
- Careless Tanners: This includes the people who adore sun but do not take adequate protection against the harmful dangers. This group aims at getting protection against tanning but not a long-term damage to their skin. Products such as low SPF product are available for this segment of consumers.
- Naïve Beauty Conscious: The people within this segment like to have a good sun tan while recognising that sun protection is important; however do not consider Sun Protection Factors that important. The company sees these consumers as possible targets to purchase sun protection products with core features.
- Usage occasion: This includes holiday, gardening, working, etc. Here the requirement is of a Sun Protection Factor i.e. SPF where it differs from one region to another. For example a holiday in the warmer regions in Australia would require a product with SPF 40 or 50. The requirement of the products differs from time to time and needs of the consumers. They purchase sun protection ranging from SPF4 to 50 depending on the season or the occasion.
- Benefits required: Protection being the primary objective of using a sun protection the company produces all their products with it being an important element. However the preference varies drastically among the consumers i.e. convenience is preferred by men or parents prefer maximum protection for children. Benefits sought are a determinant of the demand consumers have. This is also characterized by the skin types of consumers who require specialised product. For this need Nivea Sun brand offers a sensitive skin product range (Persona Care Magazine 2010).

The market segment and product requirement is based on two aspects, namely:

Potential and future competitive advantage strategies for the brand

The company has been very spontaneous to evaluate the emerging trends within the market and has been taking measures to get the competitive advantage for their brand. The competitive advantage strategy developed as the ‘Long Lasting Water Resistance’ for children was a great branding strategy applied by the company. It manufactured products which provided sun protection from 80 to 120 minutes to the children. This meant that the children were safer for a much longer time period. The company with the view and knowledge that women are the primary buyers of sun care product for both themselves and their families targeted advertising campaigns to attract them. It was reflected in the advertising campaigns which the company usually published or aired.

Although children do not directly purchase their sun care products the company sees them as potential targets to sell their products. To gain competitive advantage the company has recently been educating children of younger ager for being safe while going out in the sun. AN initiative by the company to spread this awareness has been through distribution of school resource packs to over 10,000 teachers for communicating this key message. Further in order to devise a competitive strategy the company needs to continuously segment their consumers to understand their needs and changing habits. It would be highly beneficial to gain the competitive advantage the company looks forward to.

Branding Strategy

Overall Strategic Objectives

Protection has been the key proposition of the Nivea Sun brand. The main elements of this proposition have been:

Simplifying sun care
Educating and raising awareness about sun tanning and protection
Reinforcing immediate protection message

In the year 2005 Nivea Sun had launched the immediate protection formula that provided instant and full UVA as well as UVB protection.

Product innovation is the major driver to the branding strategy at Nivea Sun for achieving its long term objectives. It considers timely product launches for enabling the brand for a closer evaluation of the consumer needs. For example the launch of the spray products was in accordance to the demands of convenient products for men (Euromonitor 2012).

Product Strategies

The product strategies of the company have been to reformulating products which are more effective and provides the maximum satisfaction to the consumers. With products for every age, every gender, and every occasion Nivea Care has a much diversified portfolio of products.

Price Strategies

Under this head the strategy of the company has been to reflect good value but at a premium price. It believes in providing quality product and has made its name to offer them at premium prices. Although the products are comparatively higher than the other competitors the company has fared well to explain to the consumers that good quality products come at a price.

Place strategies

Although the company has built a decent distribution network and the products have been made available to small as well as large departmental stores the marketers have always been on the lookout to spread its network by searching for newer outlets to sell their products.

Promotion strategies

Nivea Sun has always been releasing ads based on its consumer targets. With products promoted differently for the purpose they have been built for the company has done well to attract the targeted users. For example the convenience sprays which have especially been manufactured for males who look forward to an ease to use sun care product has been a win-win situation for the company. Both in the print media as well as the television, media promotional ads can be seen on a regular basis. Action plans will need to address the overall brand strategies and each element of the mix as follows:

Brand marketing action plans and tactics

The gist of every product is the number of products it sells. The entire process of brand marketing and action plan of a brand revolves around the amount of sale made. The brand marketing action plans and tactics for Nivea Care could be the follows:

Adjusting the marketing mix: Depending on the demand and the consumer segment the company would need to adjust its marketing mix accordingly. Although the company had been doing well to mix its products in different segments with the range of products of offer it needs to continuously amend the mix as per the changing needs, trends and other factors.
Market Development: Australia being a large country is divided into different regions. There has to be a clear geographical focus for the products it manufactures which would need the company to define its geographical priorities. For example it needs to provide better protection products for the warmer regions such as central Australia with higher SPF whereby the colder regions require less SPF products. A possible plan should be putting more emphasis of the sizeable regions and dedicated solutions for some of its product categories for addressing the local consumer needs.
Diversify its product portfolio: Although the company has been providing a range of sun care products a possible plan to diversify further addressing every market and customer segmentation should always be on its priority list.
Advanced protection: Nivea Care has created several products based on the industry research and consumer needs. For example the Children Sun care cream which came with advanced protection increased from 80 to 120 minutes gave an edge to the company to provide extended protection to the children. Similarly the company launched the spray for men which were a reply to the convenience aspect men looked forward to for their sun care.
Better distribution channels and promotion: Expanding its networks and promoting its products on a continuous basis should always be on the priority list for a company. So with innovative ad campaigns educating the people about the benefits they get from their products would be important for the company in future. Also the marketing plan should include the aim of expanding the places where the products of the company are available such as general and departmental stores.

Activities and other measures to back the Marketing plans

Although all the activities listed above need to be done independently as per the dedicated teams within the company, it is important to complement the implemented strategies by the company. For example if the company is carrying out a new campaign to launch a product and using every media to promote it, it needs to back it by instant supply of the products in the market. In case the product is not available in the market the effect of the promotions may not be useful to the brand. Also the experts within the company need to ensure that the sellers are educated enough regarding the products and the protection they provide. In case the sellers may not be aware of the protection the product yields it would be difficult for the company to sell both its old as well as new products (Oup n.d).

Brand Action Plan

The brand action plan of Nivea Sun should be to carry out the following process. This would help the company ascertain its present position and evaluate the steps it could take to enhance its brand’s awareness:

Assess the Market: Conducting research like SWOT, PESTEL, and other marketing strategies for analysing the current positioning of the brand the firm could understand where it stands.
Set the objectives: The next step of the plan to set up its targets in the coming years for the entire country. It could be in terms of sales of in terms of revenues it aims to achieve.
Devise Marketing Strategies: With all the above things in consideration the company needs to devise a comprehensive marketing strategy by a well-organized Marketing Mix. This would include the following:
- Product Action Plan: The Company should include in its action plan to produce more products and diversify the products on offer. Studying the trends and exploiting the market which demands innovative products the company can come up with new products with enhanced protection and results.
- Pricing Action Plan: This is one of the other issues the company should address. Till now the company has been selling products at premium rates. It meant that it was losing out a considerable market due to the price barriers. Manufacturing products with lower prices and reducing the margins of the other popular products so as to capture a larger market share.
- Place and Distribution Action Plan: As mentioned in the report above Nivea Sun care has segmented its consumers as per tastes, needs, preferences, genders, etc. It further needs to create products specific to regions such as better protection for the regions required higher SPF etc. The segmentation of products and made for specific places would definitely contribute towards the increased sales for the company. Further it needs to plan out an efficient distribution channel in order to make its products available to consumers at the right time. Making several storage units at dedicated places could well be the option that the company might adopt.
- Promotion Action Plan: The Company needs to devise a strong promotional action plan to promote its products. Promoting the right products at the right point of time holds the key to better sales. Also Nivea Care would need to reach the targeted customers through the most popular channels such as the Television media during the busy hours of the day. This increases the possibility of converting the targeted customers into possible consumers.

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