nivea market segmentation case study

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We're personalizing our solutions more and more, offering different brands in different segments according to different skin needs, and that's an area where the interaction and ability to connect with customers is especially important ” 

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We're personalizing our solutions more and more, offering different brands in different segments according to different skin needs, and that's an area where the interaction and ability to connect with customers is especially important ”

- Álvaro Alonso, General Manager at Nivea

Nivea produces high-quality products which are accessible to its consumers irrespective of where they live. Nivea listens carefully to its customers in the product development phase. It pays close attention to fluctuations in trends as more and more people take an interest in their health and appearance, in part due to the impact of social media.

NIVEA has never relied on past successes. It continuously improves its products and develops innovations at a globally leading skin-care research and development center. "

- Beiersdorf, 2019

Nivea's R&D team worldwide develops and segments products that fulfil regional customer needs. In Asia, for instance, Nivea offers a variety of products to prevent unwanted tanning. In Latin America, products with a natural tone are very popular. This product helps maintain natural skin tone, which can be affected by ageing, dryness, and exposure to the sun.

The core values of Nivea

Nivea is a firmly-established brand in the skin and body care industry. It is one of the brands manufactured and sold by Beiersdorf. Beiersdorf was found by a pharmacist named Paul C. Beiersdorf in 1882 and has grown globally with a specialisation in skin and beauty care. Nivea's success story started in Hamburg in 1911 with the first-ever oil-based moisturising cream being manufactured on an industrial scale. Nivea has become the largest skin care brand globally with a presence 179 countries.

Nivea is recognised as trusted, reliable, and accessible. It has positioned itself as a 'soft care' and 'well-being' brand.

We have four core values that guide everything we do at Beiersdorf. These are CARE, SIMPLICITY, COURAGE, and TRUST - these apply to the way we run our business, the way we treat our employees, and the way we want our colleagues to treat one another."

- Beiersdorf.com

These four core values guide and shape the way the company operates from a marketing point of view as well.

Nivea market segmentation, targeting, and positioning

Initially, Nivea offered products for women. I t then repositioned itself and introduced products for men called Nivea Men. As a result of its marketing campaigns, Nivea Men became successful. Nivea creates specific market segments that fulfil customer requirements.

Segmentation happens when a market is divided into sub-segments that respond in similar ways to marketing activities.

There are many advantages of niche, segment marketing compared to mass marketing.

Geographic segmentation

Segmentation by region: For example, Nivea might segment the market for roll-on deodorant in regions with a warmer climate.

Segmentation by city: the use of roll-ons is higher in cities than in the countryside, this may be because of factors like income levels and product awareness.

Demographic segmentation

Segmentation by age: for instance, the level of roll-on use may simply relate to age groups. For instance, teenagers might need a stronger deodorant compared to older people.

Segmentation by gender: Nivea has recognised gender as a key factor in the segmentation of its products. Men and women often have different needs. Women tend to have a preference for mild, floral, and refreshing scents, whereas men tend to like heavier, stronger, and distinct fragrances.

Based on market segmentation , Nivea has examined the needs of its customers and has opted to target three major markets. Their main target markets comprise Asian countries in the tropical and equatorial region, the teenage to the young adult market, and the market for men.

Take a look at our explanation on segmentation to find out more about the various ways consumers can be segmented.

Target groups

The demand for roll-on deodorants is higher in the Asia compared to other regions because of climate.

The teenage to young adult market is lucrative. It covers the 15-24 year age range. This target market is largely made up of students or graduates who need affordable products, which Nivea offers.

Consumer groups based on gender (men/women) and age (baby boomers/millennials) have been segmented by the company in order to offer products tailored to their life stage.

To revise the concept of targeting in marketing, take a look at our explanation on market segmentation , targeting, and positioning.

Positioning

• Nivea has established a reputation (position) as affordable and good value for money.

Nivea is one of the top brands in the personal and skincare industry. Their innovation, research expertise, and marketing are the reasons for its success. The brand's close attention to the needs of its customers allows it to offer products tailored to specific market segments .

Nivea Market Segmentation - Key takeaways

Beiersdorf was founded by a pharmacist named Paul C. Beiersdorf in 1882.

Nivea is one of the brands from a variety of brands manufactured and sold by Beiersdorf.

Nivea is a famous brand in the skin and body care industry.

Nivea's success story started in Hamburg in 1911 with the first-ever oil-based moisturising cream.

The brand Nivea has come to signifiy high-quality products which are accessible to its consumers irrespective of where they live.

Nivea's R&D team worldwide develops and segments products that fulfil the various regional requirements of the customers.

Nivea's core values are care, simplicity, courage, and trust.

Initially, Nivea offered and marketed products for women and later repositioned itself to offer men's products as well.

Nivea's market segmentation consists of geographic segmentation (region and cities) and demographic segmentation (gender and age).

Nivea's target markets include Asian countries in the tropical and equatorial region, the teenage to young adult market, and the market for men.

Nivea has established its current position as affordable and value for money.

CEO magazine, https://ceo-na.com/executive-interviews/diverse-solutions-in-the-skin-market/

Beiersdorf, https://www.beiersdorf.com/~/media/Beiersdorf/newsroom/media-and-downloads/press-texts/2019/Beiersdorf_2_NIVEA_en_2019.pdf?download=true

Marketing91, https://www.marketing91.com/marketing-strategy-of-nivea/

Greenontheinside, https://www.greenontheinside.net/nivea-marketing-strategy-essay-example/

Cosmeticdesign-europe, https://www.cosmeticsdesign-europe.com/Article/2020/06/03/Nivea-most-chosen-beauty-and-personal-care-brand-in-Europe-says-Kantar

Frequently Asked Questions about Nivea Market Segmentation

--> what is market segmentation.

Segmentation happens when a market is divided into sub-segments that respond in similar ways to marketing activities. 

--> What is an example of market segmentation?

An example of market segmentation is Nivea might segment the market for roll-on deodorant in regions with a warmer climate. 

--> What is NIVEA's marketing strategy?

Based on market segmentation, Nivea has examined the needs of its customers and has opted to target three major markets. Their main target markets comprise Asian countries in the tropical and equatorial region, the teenage to the young adult market, and the market for men. 

--> What are the marketing strategies adopted by NIVEA?

Marketing strategies adopted by Nivea are:

• Nivea's R&D team worldwide develops and segments products that fulfil regional customer needs. 
• Initially, Nivea offered products for women. It then  repositioned itself and introduced products for men called Nivea Men.  

--> How do you identify market segments?

Market segmentation consists of geographic segmentation (region and cities) and demographic segmentation (gender and age). 

Test your knowledge with multiple choice flashcards

Nivea might segment the market for roll-on deodorant in regions with a warmer climate. This is an example of...

The use of roll-ons is higher in cities than in the countryside, this may be because of factors like income levels and product awareness. This is an example of...

The level of roll-on use may simply relate to age groups. For instance, teenagers might need a stronger deodorant compared to older people. This is an example of...

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Who founded Beiersdorf?

Paul C. Beiersdorf

When was Beiersdorf found?

How did Nivea’s success story begin?

Nivea’s success story started in Hamburg in 1911 with the first-ever oil-based moisturising cream being manufactured on an industrial scale. Nivea has become the greatest skincare brand globally and with a reach to 179 countries.

What are the core values of Nivea?

Care, simplicity, courage, and trust

What is the consumer perception of the Nivea brand?

Nivea is recognised as a trusted, reliable, and accessible brand worldwide. It has positioned itself as a 'soft care' and 'well-being' brand.

What is segmentation?

Segmentation happens when a market is divided into sub-segments that respond in alike ways to various marketing activities.

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Nivea Sun Protection Products-case study synopsis

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Marketing Strategy of NIVEA

June 13, 2018 | By Hitesh Bhasin | Filed Under: Brand Strategies

The first oil and water based revolutionized cream brand was founded by the parent company Beiersdorf in the year 1911. The logic behind the name Nivea is that it is derived from the Latin word “nix, nivis” which means snow white.

The originally formulated cream was a mixture of oil, water, glycerine, citric acid, and rose fragrance, this formula has changed little over the period of more than 100 years.

In 1980, with rising customer trust in the brand the company introduced new products in skin care, bath care, Men products business segments .

Table of Contents

Segmentation, targeting, positioning in the Marketing strategy of NIVEA-

Customer groups on the basis of gender (Men/ Women) and age (Baby/ Millennial) has been defined by the company to offer them products as per the life stage to which they belong to. The income group to which the offerings will be suitable will be the upper middle and middle-income social class .

Nivea has always made their products with the view to mass market it with different offerings for a different set of buyers and making it available in smaller to large SKU’s (stock keeping units).

The brand has positioned itself based on the moisturizing nature and products which are not harsh to the skin or hair.

Marketing mix – Here is the Marketing mix of Nivea

SWOT analysis – Here is the SWOT analysis of Nivea

Mission - “Not Available ”

Vision - “Not Available”

Tagline – “Trusted, loved and always reliable – For more than 100 years”

Competitive advantage in the Marketing strategy of NIVEA  –

1. Bouquet of products:

Since the company has strong product portfolio catering to each customer segment like Men, Women, and Baby, it is helping the company in increasing its TRV (Total Relationship Value) of the customers during customer Lifecycle which ensures repeat purchases and crosses sell opportunities to the existing customer base of the brand.

2. Experience bought in by the parent company:

As the parent company of the Brand is already dealing in 7 brands in the skin care and body care industry so it is easy for the company to understand the market and come up with the products which are best suited to the changing needs of the customers and at the same time cannot be copied by the competitors.

BCG Matrix in the Marketing strategy of NIVEA-

The brand operates in four reportable business segments i.e. Body care, Suncare, Men product and face cleansing & nourishing business.

The Body care and face cleansing & nourishing products of the brand is the bread & butter since its inception and is, therefore, is Stars in the BCG matrix . However the Baby care products have been the new business segment that the brand has entered into and Nivea in 2017 started strengthening Sun care portfolio, both the portfolio is still struggling to make its marks on the market, therefore, is the question mark in the BCG matrix.

Distribution strategy in the Marketing strategy of NIVEA –

Nivea distributes the offerings of the brand with the help of 17000 odd employees of the parent company Beiersdorf and more than 170 affiliates across the globe.

By using affiliates it makes sure to control the distribution cost and penetrate to the remotest areas of the market.

Also, the skin care products developed by the brand are tailored to the local needs and giving due consideration to the demographic and environmental factors. It distributes its product to all the six continents i.e. North America, Australia, Asia, Europe, Africa, and America.

Brand equity in the Marketing strategy of NIVEA –

To grab the larger market share in the grooming industry the brand has been creating the image of moisturizing, nurturing, no chemicals and appealing brand.

The blue color packaging of the band started in 1925 has become its visual stimulus for creating the association with the brand. Today more than millions of customers use the products of the brand with different skin type and climatic conditions.

Competitive analysis in the Marketing strategy of NIVEA –

Nivea compete in the market on the basis of the array of the products that the brand has for the different customer groups which help it in being connected with the customer in whole customer lifecycle i.e. Men products when the customer is unmarried, Women products when he gets married and baby products when they have a newborn baby.

Nivea competes with its own parent company’s skincare & body care brands such as Labello, La Prairie, Eucerin, Florena, Hansaplast and 8*4 and peer brands in the market such as Loreal, Ponds , Jhonson & Jhonson and Lakme .

Market analysis in the Marketing strategy of NIVEA-

Increase in penetration of social networking sites and people getting crazy over their personality acceptance in the society, there is the rise in the skincare and beauty care industry. Nivea has been following product line extension , market development and product development strategy like introducing Nivea baby care products, licorice extract body lotion in India in 2017, Urban Skin detox, Deep Moisture Serum and sunscreen with the cooling effect.

In order to understand the emerging and developed economies in a better way company have a team of 600 researchers working in research & development labs in Brazil, Japan , USA, China.

Customer analysis in the Marketing strategy of NIVEA –

Customers of the brand are those who give extra care to their skin tone, cleaning, softening and tanning. Majority of the customers of the brand are in the age group of 20-45 years and the brand has been focusing on Men & Women grooming products for those customers who are in the upper middle or upper-income group social class and are either are working professionals or are studying in colleges.

Customer purchase the brand offerings as they feel that it soften their hard screen, have little ono side effects and make customers feel confident.

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About Hitesh Bhasin

Hitesh Bhasin is the CEO of Marketing91 and has over a decade of experience in the marketing field. He is an accomplished author of thousands of insightful articles, including in-depth analyses of brands and companies. Holding an MBA in Marketing, Hitesh manages several offline ventures, where he applies all the concepts of Marketing that he writes about.

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