NIVEA: The Use of Marketing Mix in Product Launch Case Study

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Introduction—Case Synopsis

NIVEA is brand produced and sold by Beiersdorf, a global skin and beauty care company that has been in operation for over a century. Beiersdorf’s goal in the UK was to get its products as close to consumers as possible. Its focus with NIVEA was to develop the brand into one of the biggest skin care brands on the planet, a core concept of global marketing (Spillan, 2012). After conducting market research, Beiersdorf found a gap in the market regarding beauty products for young women aged 13-19. There were no organic products available for maintaining healthy skin; products on the shelves were mainly for medicinal purposes. Market research showed that girls aged 13-19 wanted a skin care product that was purely for maintenance purposes and not for medicinal purposes: they wanted something that was preventive, something that would “keep their skin looking healthy and beautiful” (NIVEA, n.d., p. 1). Using a market-oriented approach, Beiersdorf therefore had to come up with the right marketing mix for its new product launch to fill the gap in the market for young girls in need of a great skin care product.

Statement of Problems

Key Issues

In 2005, Beiersdorf developed and launched NIVEA VISAGE Young for the target market of girls aged 13-19. The company used a balance of the 4 P’s—product, price, promotion and place to reach this market. Two years later, the company re-launched the product in order to further enhance its position in the market, the goal being to optimize its product: the product had a new formula, tweaked after examining new market research, a new design, new packaging and a new name. Beiersdorf had to decide on the right approach to the 4 P’s to make its re-launch a success.

Primary Case Problem

The primary case problem was to identify the correct balance of the 4 P’s in order to have an effective marketing mix for its new skin care product marketing girls aged 13-19. This was about finding the right strategy, which is essential to an effective marketing campaign, as Collis and Rukstad (2008) show.

Secondary Case Problem

The secondary case problem was to implement the 4 P’s effectively using the right combination of approaches to keep the product as close to the consumer as possible while also ensuring the product was exactly what the consumer wanted.

Cause, Symptoms

The symptoms of the problem were that no product actually existed for this target. There were medicinal skin care products related to skin problems for the target, but nothing that resembled preventive care products—products aimed to keep skin healthy, fresh and youthful. The majority of products focused on treating acne, dryness, etc.

Theoretical Framework to Identify Problems

The theoretical framework used to identify problems in this case study was that developed by Trout and Rifkin (2006) who say that the marketer must “differentiate or die” (p. 2). For Beiersdorf, differentiation came by way of taking the market-oriented approach. The company sought to see what the market was needing that it did not have. To do this, it had to reach out to the market to better understand it. There are multiple ways for this to occur: focus groups, surveys, product testing, consumer research—all of these techniques offer companies the chance to better understand their market. For Beiersdorf, it not only wanted to understand the market, it wanted to give the market a product that was not there yet. It found a gap in the market for girls who wanted a beauty product that would help them to maintain their skin. This product could differentiate itself from other products because it would not be problem-related but rather preventive-related, and it would not have harmful chemicals and compounds but rather natural and organic compounds that could appeal to young people.

Another framework that would help Beiersdorf was the new media theoretical approach, which focuses on providing consumers with on-demand access to information, tools, tips and help that enables a type of mediation between producer and consumer never seen (Bernhardt, Mays, Hall, 2012; Correa, Rukstad, 2008; Downes, Mui, 1998).

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New media is typically associated with the Internet and since many young people today have grown up in the Digital Age, it makes sense that new media theory should play a pivotal role in address the primary and secondary case problems in this case study.

Case Analysis

Beiersdorf used the 4 P’s to come up with the right marketing strategy to fill the marketing gap identified by its market researchers. This strategy consisted of identifying the right product, price, place, and promotion.

Product

The product was designed to meet the needs of the target market that had no product to meet its needs. First, the company identified the market gap—and then sought answers to the type of product that the target needed. NIVEA knew what kind of product to develop because it conducted focus groups to be able to listen directly to consumers about their needs; it gathered data from consumers by a using various research techniques such as surveys, online questionnaires, social media, etc., and it conducted product testing to help tell which products worked best in which markets. What all of this research told Beiersdorf was that young consumers wanted more specialized face care that had a beautifying aspect to it rather than a solution-oriented aspect. Not everyone who shops for face care products has a skin problem; some people just want to shop for them so as to keep their skin healthy, fresh, glowing and youthful in appearance. Beiersdorf saw this and knew that all it had to do was develop a product that met this target’s needs. It was following the framework of Trout and Rivkin (2006)—the idea that in order to succeed, one must differentiate or die—and since competitor products were all oriented towards being problem-solving skin care products, NIVEA was onto something new that would fill a market gap and differentiate itself from what was already out there for the target consumer.

Price

The company also had to ensure that it did not overprice or underprice its product. It found that the majority of its new product was actually purchased by Mums for their daughters, which meant that the price had to be reasonable and seem like a good deal, otherwise the product would not move. As Ries and Trout (2009) show, price is important when it comes to marketing. It can make or break a product if the target market is price-conscientious. And Beiersdorf saw that in this target market, price conscientious Mums would do the majority of the buying—so it had to be smart about pricing the product and make it reasonable. In this way, the product was a market leader and set the bar for all other products in this sector. Thus, NIVEA used a combination of cost based pricing, penetration pricing, and price skimming in various stages in order to ensure that the price was always attractive. On the product’s relaunch, the price was slightly higher than the original to reflect the new formulation, packaging and product range.

Place

Place was another issue that the company had to consider. It wanted to sell its product in places where the target would purchase it, and the research indicated that the target would purchase the product both in high street shops and in supermarkets. Place does not only refer to where a product is sold, however. It also refers to how a product arrives at the point of sale. In other words, distribution also plays a significant role in place considerations.

NIVEA VISAGE Young wanted to use all the relevant distribution channels available so as to obtain the widest reach possible. This meant it chose to offer its products both on high street and in supermarkets and the distribution it sought was extensive. It….....

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