Nivea Case Study Essay
THE TIMES 100 Downloaded from The Times 100 Edition 13 – http://www. thetimes100. co. uk Edition 13 Nivea : The use of the marketing mix in product launch Answer sheet 1. What is a consumer-led product? When the customer dictates the product market orientated. 2. NIVEA does market research, what are the two types of research? Primary and Secondary research 3. What are the advantages and disadvantages of both types of research and give examples? Primary e. g. questionnaires accurate but slow and expensive to collect. Secondary e. . survey data out of date, someone else has collected it and therefore may not be accurate, but cheap to buy. 4. What is the difference between a niche market and a mass market? A niche market is aimed at a specific gap in the market e. g. Angling Times whereas mass market is aimed at the total population e. g. TV times. 5. A product can either be market-orientated or product-orientated, which of the two types of product has NIVEA adopted? Market orientated. 6. What is the difference between a product range and a product mix?
Product range is the different types of the same product shampoo e. g. for dry skin, oily skin, sensitive skin etc.. Product mix are the different types of product that Nivea produce e. g. shampoo, hair gel, conditioner, hand cream etc 7. Using this case study and NIVEAs website, draw up a product mix, product range table. 8. It has been said that no matter how good the product is, if no one knows about it then no one will buy it, to what extent do you think this is true? True no customers no sales 9.
NIVEA has various promotional processes available to it, what are they and how might they be used? Free samples, adverts on TV, newspapers, billboards, cinema, sponsorship 10. There are various pricing strategies available to NIVEA, explain 3 of them. Skimming set the price high when first introduced and gradually lower it Penetration set the price low and gradually increase it Competitive price according to competitors. THE TIMES 100 Downloaded from The Times 100 Edition 13 – http://www. thetimes100. co. uk 11. NIVEA is a price leader, what or who would be a price taker?
A price taker is someone who follows the price of their competitors in order to be competitive or to avoid a price war or to portray that they are of similar standard to the other products on the market. 12. In the product life cycle, the pricing strategy may vary discuss. Introduction penetration or skimming Growth competitive Maturity competitive Extension loss leader 13. NIVEA sells a wide variety of products but through which channels of distribution would they use? Internet, wholesaler, retailer 14. Using the NIVEA website find an interesting point to tell the class.
Nivea Case Study Essay
Nivea brand has managed to maintain a positive brand image. With consumers, the Nivea products has been identified as a “caretaker” of skin. By the 1960’s Nivea Creme had become the dominant multi-purpose skin care product and a household name throughout Europe and Germany. The product brand equity is also very positive. The brand is characterized as dependable and has attributions such as: care, mildness, reliability, gentleness, protection, high quality, feeling good and reasonably priced.
Most of Nivea’s brand extensions maintained positive brand equity that was consistent with, but independent from that of its brand hierarchy. I would characterize Nivea creme, Nivea’s brand hierarchy as being strong, valuable and honest because it was the product that developed most of the companies brand loyalty through reliability. The Pros of the sub-brand marketing strategy are that each product has an equal chance to succeed in it promotion efforts because they would have their own individual budgets.
This method will help the “weaker” brand extension build awareness with customers while taking nothing away from other products. Cons of sub-brand marketing is that time and money could be waisted on weak products that ultimately would fail. It would be pointless to develop add campaigns for these products. In Theory, the corporate brand strategy seems more effective but according to Nivea’s Vice president of skin care, Norbert Krapp; as a result to the corporate marketing strategy a since of dis association between the products and the customers had developed.
He stated that customers where identifying sub-brand not by name or attributes but by packaging and color. For that reason, I think Nivea could benefit form the umbrella strategy. The role of the Nivea Creme advertising was to keep the core product fresh and relevant for the believed that the creme was the center of equity for the overall brand; otherwise the core brand would loose strength. No, I do not think Nivea advertising efforts should be changed. The risk of brand extension into new product category and customers include market saturation, brand equity dilution and lack of customer interest.
Benefits would include the possibility for new products to build a more youthful image for the company and to help keep up with competing skin care companies. Also, brand extensions will provide new streams of revenue. To help manage to extension process, executive came up with a long term goal of wanting to “evolve Nivea from a skin creme brand to a skin care brand by providing new products that complement and broaden the brand name. ” To reach this goal, the company created a family of products that represented a “Nivea Universe. Also, the company established a set of guidelines to insure sub-brands where consistent with the brand equity and followed their mono-product philosophy. Even though Nivea has branched out quite a bit, I do believe they missed the opportunity to expand in the foot care market since it still falls under the category of skin care. I do not think that Nivea should go outside of the boundaries of skin care products, a perfume may not be a strong market for them because of their deeply rooted reputation of being care takers. As far as a mens grooming line, Nivea already has a mens razor that moisturizes the skin.
I think it would be a great idea to expand that line and make more grooming tools for men. Mens hair dye may also be a good idea. In doing a mens grooming line I dont think it would negatively effect the customer base, it would simply add a new market (which is what the long term plan wanted to do). If I where a Nivea executive, I would create a plan to target the younger demographic in an effort to keep the brand relevant. With competitors such as Revlon, Pro Active and L’Oreal it is important to keep the brand fresh or it will be overshadowed and eventually die out.