Nivea:
Managing a
Brand Portfolio
Background
At the 1993 annual management committee-planning meeting, the top managers of Beiersdorf’s (BDF) Cosmed Division had gathered to plot the division’s corporate strategy for the coming year. BDF was the manufacturer of Nivea skin care and personal care products. The Cosmed Division of BDF, headed by Dr. Rolf Kuniseh, oversaw product development and marketing of all Nivea cosmetics and toiletries products internationally. The Nivea brand was known on a worldwide basis, although its presence was strongest in Europe where it was a leading mass market brand.
During the last two decades. BDF’s Cosmed Division has successfully extended the Nivea brand from a very limited range of products – Nivea Creme, Milk, Soap and Sun – to a full range of skin care and personal care products. Over time, these different products lines had established their own identities as “sub-brands,” independent of and yet still connected to the Nivea Crème core brand. Given the breadth of products now sold under the Nivea name, however, there had become increasing debate as to how to achieve the proper synergy between the Nivea Crème core brand and the sub-brands from other product classes. In planning future developments, Cosmed management sought to define a strategy that would ensure the Nivea brand met the market needs of the 1990s while also remaining true to the heritage of Nivea, as exemplified by Nivea Crème.
In planning the division’s marketing plan and communications strategy for the coming year, Cosmed management found itself grappling with a number of fundamental questions. What common brand associations should be communicated for the various sub-brands? What brand association should be unique to specific sub-brands? Would it be possible to promote the sub-brands in conjunction with the Nivea brand and not jeopardize their independent brand identities? What should be the role of the Nivea Crème core brand in the Nivea brand franchise? How could the traditional Nivea Crème image be maintained if the company also needed to innovate and modernize it?
Cosmed management had to resolve these issues at this planning meeting. They had to leave the room with a clearly defined set of guidelines in order to provide the various product managers sufficient time to develop and implement their product marketing plans for the coming year. In particular, they ha to determine the role of Nivea Crème in the brand portfolio and the supporting roles taken by other brands. Also, they needed to decide whether they should introduce corporate or umbrella brand advertising.
Development of Nivea Brand: 1912-1970
Nivea Crème was first introduced into the German market in 1912. In the early 1900s, industrialization led to the emergence of mass markets and branded articles.
Society – women in particular – began to appreciate to a greater degree physical appearance and to look for products to both care for and beautify the skin. Prior to the introduction Nivea Crème, fat-only skin crèmes were all that were available, sold primarily to upper-class women. Nivea Crème’s unique water-in-oil emulsion was the first crème to offer both skin care and protection at a reasonable price. The Nivea name came from the Latin word, nives, meaning “snow” – reflecting the snow white color of Nivea Crème. As the world’s first multipurpose, “universal” skin crème, Nivea Crème took skin care “out of the boudoir and onto the boulevards … democratizing a piece of luxury.” Nivea Crème was quickly adopted for use by the entire family. Nivea Crème was introduced throughout Europe in 1912, in the United States in 1922, and in South America and other parts of the world in 1926.
Recognizing the value of Nivea Crème and the need for other reasonably priced skin care products. Beiersdorf introduced over forty-eight other skin care products under the Nivea brand name between 1911 and 1970. As BDF expanded its range of product offerings, it maintained a “mono product” philosophy – typically offering one multipurpose product in each skin care market segment and category it entered.
Throughout this period, Nivea Crème remained the company’s primary product and the carrier of the Nivea brand name. The famous Nivea Crème blue tin with white lettering, standardized in 1925, was a familiar sight in millions of households worldwide. In addition to Nivea Crème, the brand’s other primary products during this period were body soap and powder and two sun care products – tanning lotion and oil.
Though Nivea products were sold worldwide. BDF was primarily a German company until the mid-1960s/early 1970s. Products were introduced and brands were built primarily around local German needs. This product development strategy reflected the fact that after World War II. BDF did not own the Nivea trademark in many countries where Nivea products were sold. BDF had sold or transferred these rights to its many local distributors in the early 1930s in the wake of the rise of the National Socialism to power in Germany. In those countries where BDF had not transferred the Nivea trademark itself, the local distributors were give trademark rights as part of the distribution of German business assets by the Allied governments at the end of World War II. As of 1945, BDF owned the Nivea trademark in only two countries – Germany and Austria. Within 8 years, BDF begin to repurchase trademark rights – a process that would take over 50 years to complete.
NIVEA CRÈME BRAND IDENTITY AND VALUES
Over the years, Nivea – primarily through Nivea Crème – had acquired a unique, widely understood brand identity as a “caretaker” of skin. Used by the entire family. Nivea Crème had a universal, uni-sex brand image. Throughout Europe, most users were first introduced to Nivea Crème during their childhood learning that it was a product that could be used by the entire family to satisfy all kinds of needs. Because of consumer’s own personal history and brand advertising, Nivea had become strongly associated with shared family experiences – e.g. mother and child relationships, family vacations at the beach, etc. The childhood and family associations of Nivea users facilitated the development of a rich set of other brand associations such as “care,” “mildness,” “reliability,” “gentleness,” “protection,” “
high quality,” “feeling good,” and “reasonably priced.” Over time, the Nivea name became synonymous with protection and caring for the skin and attained a special almost mythical a status among users. By the 1960s, Nivea Crème could be found in almost every German household and in the majority of households across Europe and was the dominant multipurpose skin crème worldwide.
EARLY NIVE ADVERTISING
BDF first began advertising Nivea products – primarily Nivea Crème in 1912. The company viewed advertising as a means of strengthening consumer perceptions after a Nivea product had established a quality reputation for itself. For over sixty years, Nivea advertising promoted the basic themes of skin care and protection. Ads were always simple, plain, and informative. In the 1910s and 1920s, BDF advertised three main Nivea products – cream, soap and powder. Early ads established the image of the Nivea woman as clean, fresh, and natural. Nivea’s ads in the mid-1920s introduced the “bright and shinning” boys – three brothers from Hamburg – and extended the freshness and natural image to the entire family, capturing the attention of mothers throughout Germany.
Over time, Nivea ads were altered to reflect changes in self-images and lifestyles. For example, in the 1920s when German women were becoming more active athletically. Nivea ads began to show women in more outdoor and active settings. In the 1930s, when tanning came into fashion, BDF responded by highlighting the skin protective qualities of Nivea Crème and introducing a new product – Nivea oil – to protect against sunburn. In the 1950s following the end of the World War II, Nivea ads reflected the German population’s desire to enjoy life by showing Nivea products used in relaxed and happy settings, primarily outdoors in the fresh air and sunshine.
While the settings of the ads changed, the clean, fresh, and natural image of the Nivea woman remained essentially unchanged. Though she was modernized to reflect the styles of the time, she was always a face with whom the average woman could identify. Over time, Nivea ads sought to link the clean, fresh, and natural image of the Nivea user to related elements of nature – fresh air, light and sunshine. The development of these associations was particularly strong in Nivea’s sun care ads. In these ads, BDF additionally introduced special objects and symbols to strengthen the linkage of these associations. For example, in its 1932 sun care campaign, BDF introduced the Nivea weather calendar – a grah that showed the “weatherman’s predictions for the summer months – to help Germans plan their summer holidays. This weather calendar became very popular in Germany and was used for decades to come. Later in 1964, Nivea offered a blue beach ball with the Nivea logo as part of a holiday season pack that contained a variety of skin care products. The Nivea ball was a tremendous success and could be found on beaches all over Europe, and throughout the 1960s and early 1970s, the Nivea ball was a recognizable symbol in Nivea sun care ads.
Nivea’s First Competitive Challenge: The 1970s
During Nivea Crème’s first fifty years, the market for multipurpose crème grew steadily. By 1970 Nivea held over 35 percent of the multipurpose cream market in Germany and majority market share in Europe. In the late 1960s and early 1970s the multipurpose cream market changed substantially as BDF faced its first strong competition in sixty years. Henkel Khasana, a small German toiletries company and subsidiary of Henkel, launched its own multipurpose cream – Crème 21 – in 1972. A distribution strategy designed to take advantage of a broader, fundamental shift in consumer purchase habits for cosmetics from specialized outlets to mass market, self-service outlets such as food stores. Also at this time, a number of manufacturers – including Ponds, Unilever, and Linger-Fisher (now part of Procter & Gamble) – introduced a variety of specialized creams into the market, particularly moisturizing creams, designed for specific skin care uses.
Concerned with this new competition and its effect on consumer perceptions of the Nivea brand, BDF commissioned a German university marketing professor, Reinhold Bergler, to perform a study of the Nivea brand image in the German market. Bergler’s study found that, among both consumers and the trade, the Nivea brand emjoyed a high degree of goodwill and confidence, representing reliability, quality, and honesty. Yet, the brand had an “older” image and was not viewed as young, dynamic and modern as was the case with many of the recently introduced competitive brands.
In recognition of these new competitive challenges and current consumer perceptions of the Nivea brand, BDF developed a tow-pronged strategy. First, BDF sought to stabilize the strong historical market position of Nivea Crème. Second, the company sought to exploit the strength of Nivea Crème by transferring the goodwill it had created for the Nivea brand to other product classes.
REVITALIZING NIVEA CRÈME
To address the first objective, BDF evaluated its current Nivea Crème marketing per gram. Because research showed that consumers liked Nivea Crème’s current product formulation and logo no changes were made there. The company did however introduce larger-sized units, alter its distribution strategy by shifting from special-line outlets to food outlets, and increase its level of promotional activities with the trade and within stores. Nevertheless, the primary means to revitalize Nivea Crème’s brand image was the introduction of a very aggressive ad campaign aimed directly at the competition.
The initial campaign launched in spring 1971, used the tag line – “Nivea, the Crème de la crème” – for which a series of ads was developed. One of seven distinct slogans was used as a headline for each ad – for example. “There is one better,” No crème is better for your skin,” “For sixty years, we have produced skin-care crème,” and “if there was a better one, we would make it.” These ads ran in magazines across Europe, though primarily in Germany.
After two years of the “Crème de la crème” campaign, Cosmed developed a new series of ads directly aimed at updating the “old” brand image. The “Only Me” campaign ran internationally and made a new brand promise: Nivea Crème meets all skin care needs. With this campaign, Cosmed wanted to preserve Nivea’s reputation for skin care competence and safeguard Nivea Crème’s unique historical market position while also differentiating it from the competition. Prior to Henke’s Crème 21 introduction, the name Nivea had been synonymous for the skin cream product category. This new competition now forced BDF to more directly tell consumers about Nivea Crème’s actual product benefits. Previous ads had always shown Nivea Crème used in a variety of setting but had never emphasized specific product benefits. Each ad in this new campaign highlighted a single, but different aspect of product performance. The objective was to negate competitors’ claims for special creams by positioning Nivea Crème as the best cream for every kind of special need. Taken together, these ads reinforced caring and mildness as key consumer benefits and presented Nivea as the universal skin cream that embodied all the needs of consumers in one product.
The initial set of “Only Me” ads were introduced in 1973 in both print and television form. In Germany, the campaign made an emotional appeal to the hearts of the consumer by using folk art-like cartoon drawings. Each ad showed the blue and white Nivea tin being embraced by an element of nature – day, night, wind, snow, winter summer, spring at holiday time at home, and others – and highlighted a specific purpose for the use of Nivea Crème. At the bottom of each ad was the slogan. “There is no better crème>” The cartoon campaign ran in Germany from 1973-1988. Over the entire fifteen-year period, the ads consistently emphasized Nivea Crème’s heritage and superiority through, the same fundamental brand associations of caring, mildness, protection, quality and confidence.
EXTENDING THE NIVEA BRAND
In addition to strengthening the brand image of Nivea Crème. BDF’s second objective was to use the recognition and reputation of the Nivea brand name to introduce new products – both in categories where Nivea products were currently sold as well as in related categories where Nivea did not have a product. While BDF had been selling a variety of different products under the Nivea name for years, Nivea Crème – dominating company sales – was the primary image maker for the Nivea brand. Bergler’s study clearly demonstrated that the Nivea brand had a strong, positive reputation in the market place with a great deal of consumer loyalty. Since the market for multipurpose cream was stagnating, BDF actively targeted new and growing market segments in which to extend the Nivea brand. The company’s long-term objective was to evolve Nivea from a skin cream brand into a skin care brand by providing a range of new products that would both complement Nivea Crème and broaden the meaning of the Nivea brand name.
At this time, the Nivea family of products included: Nivea Crème, Nivea Milk, Nivea Baby (oil and powder), Nivea Sun oil and Milk, and regular soap (sold only in Germany). To establish Nivea as a skin care brand, the company decided to create a family of products that symbolically could be represented as the “Nivea universe.” At the center of the Nivea universe was the Nivea Crème core brand. Nivea products – some already existing, some new – would function as satellites around center. Through this universe schematic, it was easy to identify the relationship between Nivea products. For example, the more distant the product class from the Nivea Crème core brand, the weaker the image link. Certain product classes – cream and sun in particular – were close to the core of the Nivea brand image, while other products were only distantly related..
Cosmed established a set of guidelines for Nivea brand extensions. All new products had to compatible with the Nivea brand and targeted to market segments with attractive current and potential size. While the company wanted to expand the Nivea brand to include new product classes, their “mono-product” philosophy meant that there would be only one primary product promising consumers universal application in each product category. A second version or variety of a particular product could only be introduced if it satisfied a unique need not met by the current product(s) in its product category. The company further established a set of guidelines for any possible new products. Each product must:
- Meet a basic need: clean and/or protect
- Offer the special care/mildness benefit of Nivea Crème
- Be simple and uncomplicated
- not offer to solve only a specific problem
- Maintain a leading position in terms of quality (at a minimum be as good as the leading product)
- Offer the product at a reasonable price such that the consumer perceived a balanced cost-benefit relationship.
- Offer the broadest possible distribution.
These criteria were established to ensure that all products reflected the desired Nivea brand image and were consistent with the philosophy of providing high quality skin care products at a reasonable price. All new products were to offer “continuity plus innovation” - that is, maintaining the essential Nivea core while offering something new through the product itself. In addition, existing products were expected to be continuously modified and improved, reflecting Cosmed’s product philosophy to follow market trends and to innovate through research and development. As one long-time Cosmed executive explained: