Friday, 21 January 2011

Nivea’s Promotion within the Marketing Mix

Case study: NIVEA Visage Young.

The world can seem like such a big place, it’s all too easy to get caught up in the hustle and bustle of daily life… Take the time to connect and feel closer to the people who make your world a better one.

The sentence above is a promotion line from the website of Nivea Visage Young. In this case we will study the promotion aspects in the marketing mix used by Nivea.
Nivea is a worldwide known cosmetic brand which is owned by the German company Beiersdorf. The brand is well known for the specialised products for skin and beauty care. In the year of 2005, Nivea launched NIVEA VISAGE Young as a part of the Nivea Visage range. The idea behind this new product range was the focus on a new target group: the young women with the age of 13 to 19. The products of the Visage Young product range help the young woman to develop a proper skin care routine to help keep their skin looking healthy and beautiful.

The moment Nivea launched their new product range; they had to create an effective balance in the product, price, place and promotion. These four elements together make the marketing mix, or just the four P’s. It is vital that Nivea balances these four elements correct in order to make the product successful.
After two years, in 2007, Nivea re-launched the Nivea Visage Young range to further optimise their position in the market. The brand developed the product by creating new formulas, new design and a new name.  Below the four elements of the marketing mix are explained.

The four P’s.

To achieve an effective marketing campaign you have to find a perfect combination of the four P’s.

The first element of the mix is the product. To achieve the goals set, Nivea really has to understand the market. By doing market research, they could understand the market and the needs of the consumer. Nivea does market research in number of different ways:

·         Using focus groups to listen to consumers directly;
·         Gathering data from consumers through a variety of different research techniques;
·         Product testing with consumers in different markets.

Nivea discovered that the younger women wanted other products than the ones Nivea used to make. In general, Nivea was a very parental brand, but the women with the age between 13-19 wanted more specialised face care aimed at their own age group that offered a ‘beautifying’ benefit, rather than a solution for skin problems. Nivea Visage Young provided those needs by targeting at girls who do not want medicated products but want a product for their normal skin.

It seemed to be that, with the new products range, Nivea had discovered a gap in the market. The fact that the direct competitors of Nivea focused and offered medicated solution, gave them a competitive advantage.

To promote this new product and to make it attractive for the potential customer, Nivea had to re-consider the packaging. They already had changed the formula to make the products more natural and introduced new products, but that isn’t enough for promotion. The other improvements they made were the new design, a modern pack design, with a flower pattern and softer colours to appeal to younger women. They also changed the product descriptions and introducing larger pack sizes. Each of these improvements helped to strengthen the product range and to better meet the needs of the market.

Unlike the other factors of the marketing mix, pricing decisions affect profits through their impact on revenue rather than on costs. Naturally, pricing is the only element of the marketing mix which generates revenue more than costs. Just like the other three, pricing is a key element of any promotional activity.

After the re-launch of the Nivea Visage Young products, the price was slightly higher than the one of the products in 2005. This could be explained by the transformation the products had gone. However, Nivea had to take into account that both teenage girls, the direct target group, and their mums buy the product. This meant that the price had to offer high value for the money or the product wouldn’t be a success.

The element ‘price’ provides many different price strategies. The most common are:

·         Competitive pricing
·         Cost-plus pricing
·         Penetration pricing
·         Price skimming
·         Destroyer pricing
·         Price discrimination

Nivea uses a very simple pricing strategy; it only sells its products to retailers at one price. The retailers however are free to use other strategies for their sales promotion. This kind of promotion activities are in this case aimed at the customers. A common used way of sales promotion is the BOGOF, which stands for ‘buy one, get one free’.

The Visage Young product range of Nivea as nowadays one of the leading skin care ranges, which make them effectively the price leader. This means that Nivea can set the price level and the competitors have to follow or undercut. Otherwise they will be banned from the market because nobody would buy those products anymore. Nivea needs to regularly review prices to ensure that their price remain competitive. The strategy they handle seems to be effective; the current strategy now generates around 7% of Nivea Visage sales.

The place where the products of Nivea Visage Young is important for the image of the brand and the amount of sales. Place refers to the point where the products are sold and how the products arrives at the point of sale.

The aim of Nivea is to provide their new products through as many distribution channels as possible. This gives them the opportunity to reach their target group on the best possible way and to ensure the widest reach. The highest percentages of the customers buy the products at large high street shops, this is mainly important for the younger consumer. They will buy the skin care products themselves or with friends. However, since the range of Nivea Visage Young has two kinds of buyers, they also have to consider to mums. This particular group is likely to buy in supermarkets while doing their regular shopping.

Finally, the marketing mix can be made complete by adding the promotion. When promoting make sure you show the benefits of your product, inform about it and show why the customer must buy yours instead of the one from the competition. The main goal is to increase your market share and extend the life of a product. Since everything has to be balanced and related, promotion must be considered properly. When launching a new product, everything can succeed or fail with the promotion.
There are two ways of promoting your product for the customer:

·         Above-the-line promotion, this is a promotion channel where is directly paid for, like TV or advertisements;
·         Below-the-line promotion, this is where the business uses other methods to tell the target group about the new product. This can be done be participating to trade fairs or events, direct mail, to reach a large audience, public relations and activities like sponsorship of high profile event like Formula One. This is the one Nivea uses in a way.

Nivea uses an unique way of promoting the Visage Young products. They realised that a one-way message provided by television or advertisements is not the most effective way. The promotion of Nivea is consumer-led, this means they respond to the needs of customers in the market. In the section above is already explained that Visage Young uses below-the -line routes so they can come in contact with the teenagers and mums directly. Nivea Visage Young uses three main routes and methods:

·         They want to get close contact with the potential customers, so they want to give them the possibility to touch, smell, feel and more important try the products. In 2008, Nivea provided over a million samples by making them available on the internet and giving them in goody bags.

·         Nivea launched an interactive online magazine to attract the young women. This concept identifies them with the products of Visage Young. The name of the magazine is FYI (Fun, Young & Independent). This lead to an increasing awareness of the product. Since this is a very original way of communicating with the target group, Nivea really understood the needs and way of life of them.

·         Related to the launch of the FYI magazine, Nivea Visage Young recognised the power of social networks to reach a wide audience. This was a very clever move and pretty revolutionary in those days.

All four elements of the marketing mix are important equally and without one working properly, the whole campaign will fail. Everything has to be related to each other and must be perfectly balanced. The products of Nivea Visage Young are now in an advanced stage, so currently the promotion would be the most crucial to expand the life line of the products. In the beginning everything has to come together, they developed the right product by finding a gap in the market, the price is competitive and they are price leader at the moment. By keep reviewing the market they can keep the price competitive.
Next to that the distribution strategy and points of sale of well-chosen and so they reach a wide number of people. Last, but certainly not least, the promotion is the finishing touch. Above I explained the different ways of promotion Nivea uses. By using below-the-line routes and with the consumer-led focus they made themselves a very well-thought, effective marketing mix. The market and the people change continuously and so the promotion methods have to be up-to-date in order to keep the innovative products of Nivea Visage Young popular.


We now know more about the marketing mix and promotion tools used by Nivea to promote their Visage Young products. In the final section I will explained how the promotional aspect is integrated and used with the whole marketing mix of Nivea to achieve its business aims and objectives.
Well, the main goal of Nivea Visage Young is to come and stay as close to the consumers as possible. But how did they do it, is the question here. The continuing market research programme they carried out showed a gap in the market, as already is explained in the section above. With this new product range they wanted to reach the young women with the age of 13-19 and help them to develop a good skin care routine. The focus was on making the skin looking healthy and beautiful instead of providing medicated products.
Nivea carried out its own market research. They used the following tools:

• Using focus groups to listen to consumers directly;
• Gathering data from consumers through a variety of different research techniques;
• Product testing with consumers in different markets.

This research made them really understand the market. With this knowledge they started the Visage Young product range and launched it in 2005. Of course, businesses don’t want their customers to search for their products, but that the stores that sell them can be find easily. Nivea distributed the products to wholesalers and those wholesalers sold it to retailers. NIVEA distributes through a range of outlets that are cost effective but that also reach the
highest number of consumers. They use a many relevant channels to sell as possible. This is the first step of bringing the product close to the customers.

The aim of being close to the target group is related to the other aim, which is understanding its consumers. The market research provided a lot of valuable information. With this information, Nivea could investigate the target group and so truly understand them, no matter where they live. They way of promoting is the next step to accomplish their goal and aims. Nivea carries out specials ways of promotion and they promote through below-the-line routes. The tools they use are already explained in the promotion section. I think that especially the use of social media has been a very smart move. They not only launched the FYI online magazine to communicate with the young women, its promoted using the
Hit40UK chart show and the TMF digital TV channel. On top of that, no business can come closer to their consumers when Nivea communicate with their young audience through pages on MySpace, Facebook and Bebo. The company is using the power of new media as part of the mix to grow awareness amongst the target audience. In my opinion is this the best way of promoting they had ever could done.

Of course every for-profit organisation wants to make a high profit. This can be seen as an objective of Nivea. They achieved this by becoming price-leader and the pricing strategy they use. Nivea sells their products for a set price to the wholesalers, who are free to change to price of course. Nivea only have to be aware of the prices of the competitors in the same market.

In conclusion we can definitely say that Nivea achieved their aims and objectives. They integrated the promotional aspect in the elements of the marketing mix in a proper way by communicating through social media with the consumers, give away goody bags and be close to the customer with the many selling points. Nivea Visage Young used all elements, balanced them perfectly and finally, they integrated the promotion aspect in it to become the high standard in skin care products.