Overview of Tthe Australian Cosmetic Industry: Nivea and the Beiersdorf Company - Coursework Example

of Affiliation Executive summary Nivea is a flagship brand for products manufactured by the Beiersdorf Company. Nivea products are universal brands available in many parts of the world. However, the company’s original market is in Australia. There are a number of companies, which are competing for the market share of Nivea products in order to dominate it with their products. This study gives a universal overview of the Australian cosmetic and beauty industry. The study has a brief review of two competitors and their product categories. There is also an extensive analysis of Nivea products with regard to packaging, labeling and branding with a further evaluation of the market segmentation, positioning and targeting for Nivea products. The study evaluates the application of Abraham Maslow’s theory of needs in evaluating how Nivea products satisfy consumer needs. Basing on the product mix evaluation on Nivea products the study proposes recommendations that are aimed at improving the awareness of Nivea product (Zatwarnicki & Mathis, 2010) Introduction Nivea is an international skin care product manufactured by the Beiersdorf Australia Ltd in Australia. However, the brand is present in many regions of the word. The company has more than 125 years in skin care experience, is a leading research in skin care products, and is credited for its innovativeness in making superior quality cosmetics and toiletries (Zatwarnicki & Mathis, 2010). Nivea is the biggest beauty and skincare brand. Some of Nivea’s brands include Leuko, Elastoplasts, La Prairie, Elastoplasts sport and Eucerin. The Australian cosmetics and beauty products industry has a market worth of more than US$1.6 billion with imports accounting for about 50% of which the US is responsible for 30%. The beauty, toiletries and cosmetics industry in Australia is immensely influenced by the significance attached to personal appearance by both men and women. Many Australians are concerned about their wellness and are usually keen about products that prolong youthful appearance (Holzknecht, Butler, Hoffman, Prager, Raghunathan, Smith, Castalia Media Insight Media, 2007). The cosmetics industry in Australia continues to experience growth in hair care, beauty products and color cosmetics. The growth in color cosmetics is due to advanced formulas, which are spurring growth. The continued increase in the appearance enhancing products had made it favorable for suppliers dealing in products with anti-aging ingredients. Background information The Australian beauty industry is showing strong signs of growth with spa products are leading the growth. The Australian cosmetic and toiletry industry is expected to grow and will present good opportunities to suppliers primarily from the United States who deal in color cosmetics, hair care and beauty products. Competitors Some of the cosmetics and beauty products companies in Australia include Artav Australia and Biocare Products. Artav Australia is a respected supplier and manufacturer of professional beauty and hair care products. The corporation has existed for over fifty years and has immense capacity and experience that suits a variety of customer tastes and needs. Some of its products and service categories include color cosmetics, hair consumer brands, men’s grooming products, and skin care face and salon products (Peter& Olson, 2005). Nivea brand is named after a Latin word Nivius, which means snow white. Branding Nivea is meant to appeal visually to its target customers by the world famous white and blue colors combinations. The white color is meant to imply inner purity and external cleanliness, the blue color implies loyalty, friendship, harmony and sympathy while the combination of blue and white is ideal for an appealing brand (Eliashberg& Lilien, 2003). Biocare Products is a family owned business in Australia, which specializes in the production of and packaging of high quality personal care products that cover skin, body and hair care and private cosmetic labels. Its products and service categories include skincare, hair care, skin care face and private labels (Zatwarnicki & Mathis, 2010). Classification of Nivea products packaging, branding and labeling Nivea products are classified into many categories that include bath care, body care, deodorants, face care, lip care, men care, Nivea cream, sun care and Nivea jelly among others. The labeling of Nivea is meant to successfully to project the product image of purity and quality. It also presents a technical challenge because Nivea’s clear label has to provide extreme clarity even long after the consumer has finished using the product. Nivea’s labeling makes it very competitive when compared to other products about the shelf impact it makes. Labeling of Nivea is one of the strategies that the corporation uses to retain its prime position. Nivea being a universal brand, its labeling is a key ingredient in conveying the true trust and image associated with the brand. To safeguard the brand’s position Beiersdorf had to use a high-speed application in labeling through a material that meets its needs in full, offer enough comfort ability in a unique shaped bottle while projecting the right brand image of Nivea (Zatwarnicki, et, al 2010). Nivea’s package is meant to reduce waste while maintaining the same quality. Irrespective of whether Nivea’s packaging is glass, plastic, metal or paper, its packaging aims at reducing material use and maintaining quality and stability. Every stage of packaging of Nivea products offers possible savings that lead to environmental protection through low energy technologies in production and reduced transportation. About 100% of Nivea’s packaging materials are recyclable and the corporation is continuously reducing the amount of packaging materials used (Mercer, 2006). Product positioning, targeting and segmenting Product positioning is an effort by a product manufacturer to influence the perception of consumers about a brand or a product relative to the perception they have about competing products or brands. The objective of product positioning is to make a product to occupy a unique, clear and advantage position in the minds of consumers. The brand positioning strategy used by Nivea products entails the specific niches that the corporation’s products targets. Throughout the various niches of the company’s products, there is a great degree of elegance and feminine sophistication and a unique brand personality (Zatwarnicki & Mathis, 2010). Nivea products have been developed over time to be unique products with superior quality in the minds of consumers. In positioning these products, the Beiersdorf Company has made its products to be modern, appealing, unique and trendy to all customer segments. Product positioning of Nivea products is powerful in that despite the number of adverts of other products, the product has covered a unique place in many consumers in the Australian market. Consumers mind is often attached to Nivea products owing to the prior experience and knowledge about it. Hence positioning of Nivea products presents a perpetual location where its products match with the needs of consumers (Czerniawski, et, al 2009). Due to this, a consumer is able to rank skin care and other cosmetic products from the number one brand to the last. Therefore, product positioning of Nivea products has enables the target market to define the products in relation to those of competitors. Key items in product positioning include product quality, pricing, return policies and warranties, customer support, distribution channels among others. The Beiersdorf Company places a lot of importance in ensuring that the customer issues are carefully addressed. The distribution strategies used by the company ensures that customers are sufficiently supplied with quality products, customer issues and service concerns are addressed. Product positioning in Nivea gives it competitive advantage among its competitors and hence making the consumers to believe in Nivea products. Nivea products tagline conveys a unique perception in the minds of customers. For instance, Nivea sun makes the sun gentle, Nivea bath is delightfully creamy and gentle, Nivea hair gently cares for the hair, which is frequently washed by Nivea, and Nivea deodorant is aqua cool and cares for the skin among others. All these attributes by Nivea products create special perception in the minds of consumers about Nivea products (Zatwarnicki & Mathis, 2010). For instance, Nivea for men is based on men’s masculinity and their relationship with themselves. It portrays a Nivea man as one who is well shaved and uses clean products to get a handsome skin. Because men’s skin is different from that of women, men need to use special products like Nivea for men. Nivea for men gives men confidence, social identity and professionalism and all these is contrary to complex beauty rights for women. Market targeting entails evaluating the attractiveness of the various market segments and choosing one or many segments to enter. Market targeting of Nivea products focuses on a wide range of product that range from skin care, deodorants, Nivea shower and bath, Nivea for men and Nivea sun, visage and body among others (Czerniawski & Maloney, 2009). All these segments have a sophisticated moisturizing and cleansing segments. The products have anti aging ingredients that have great benefits to users. This is why many consumers in Australia are associated with Nivea products. The packaging of Nivea products also gives consumers a benefit due to its sophistication. Nivea products are meant to extend their benefit to consumers through the superior ingredients used. Market segmentation entails subdividing and defining a large and homogeneous market into identifiable segments with similar needs and demand characteristics. Market segmentation is done through a product mix, which matches with the expectations of consumers in the market. This is done by the corporation breaking down the market demand into segments and chooses the ones that the company is able to meet best (Czerniawski & Maloney, 2009). Some of the factors that affect product segmentation include identification of the right segment, measuring the effective size, accessing the market through advertising and promotions and the appropriateness of the company to put in resources and policies to operate the market segments. Segmentation strategies are based on demographics, behavior, psychographics and geographical differences. Nivea products segmentation has mostly been based on demographics. The target segments for Nivea products come from all kinds of customers both young and old, men and women. Women products include face creams, skin care products, hair products, salon products. Men products include Nivea for men, Nivea body and Nivea deodorants. Children products include the Nivea bath and body and skin care products. Products for all customer segments include salon products and other cosmetics and beauty products (Quelch, et, al 2000). Key needs of Nivea products using the Maslow theory Abraham Maslow’s hierarchy of needs is a psychology theory that addresses the innate needs of human beings. Maslow ranked human needs into psychological needs, safety needs, love and belonging needs, esteem and self-actualization needs. Physiological needs entail essential needs for human survival like food, water, shelter, sex, homeostasis among others. The safety needs include security of body, healthy, family, morality, resources and employment among others.(Lund, 2012). The third rank of needs entail friendship, sexual intimacy, love, originality and friendship. Esteem needs entail confidence, achievement and respect of others and by others. Lastly, self-actualization needs include morality, creativity, problem solving and spontaneity, lack of prejudice and acceptance of facts. Nivea products use Maslow’s hierarchy of needs in segmenting its customers and satisfying their needs. The human body requires Nivea products for it to function properly. Everybody needs to feel beautiful and be appreciated by everybody. Nivea body products guarantee security of the body right from bath products to skin care and hair care products to give consumers healthy bodies because of using Nivea products (Lund, 2012). By using Nivea products, consumers can be appreciated and respected by others hence satisfying love and belonging needs (Czerniawski & Maloney, 2009). Nivea products give their customers self-confidence achievement and respect hence satisfying the esteem needs of consumers. On equal measure, Nivea products help solve problems faced by consumers like aging; the products have anti-aging ingredients, which make consumers to have a youthful appearance hence satisfying their highest needs of self-actualization. The satisfaction of needs in the Maslow hierarchy of needs of sequential in that once a needs has been satisfied, it no longer motivates consumers. This is the reason why the Beiersdorf Company keeps innovating and researching on new products in order to meet the dynamic changes of consumer needs (Holzknecht, et, al 2007) Market mix analysis for Nivea products The marketing mix for Nivea products entails the product, pricing, promotion and distribution or place. Nivea products include everything that the Beiersdorf company has offered to the market for acquisition, attention and consumption to satisfy various consumer needs. Nivea has products specifically intended for skin and body care for men and women (Czerniawski & Maloney, 2009). It also has hair products, salon products and bath wash among others. Its products include organizations, persons and places where the corporation’s products give value to consumers. Products for men are different from those of women in many aspects like packaging and even the product textures that are meant to address the diverse needs between male and female consumers. Promotion for Nivea products is dynamic. The corporation uses a number of avenues to promote its various products to various product segments. For men, TV is the most used medium for advertisement. Other media are used mainly to target the female market segments like the internet, newspapers, journals, periodicals among others (Czerniawski & Maloney, 2009). Other communications include personal selling, public relations, market response and promotion of sales that constitute non-media promotion. The pricing strategy for Nivea products is based on demand and the various data from the market. Nivea products are of different sizes and prices to meet the various pricing needs of customers. The pricing strategy for Nivea products is based on product choice and the evaluation of competition and the value perceived from the pricing. On the same note, the distribution channels for Nivea products are divided into three parts. Nivea products are available in superstores, drugstores and perfumeries and other places like beauty shops, the internet among others (Lund, 2012).  Recommendations To increase Nivea products awareness, the Beiersdorf Company needs to use integrated ways of promoting its products. Through advertising, the corporation should communicate to potential and current customers through the media and other advertising avenues. Sales promotions especially during hard economic times to keep the products being sold. Personal marketing should be encouraged to reach more targeted consumers through direct contacts. Conclusion Nivea brand is a universal brand. The Beiersdorf Company should continue innovating on new products and keep on improving on its products. The corporation should also internalize its brands in the various markets through universal branding, packaging and labeling. With its brand name in place, the corporation needs to evoke common advertising standards to reach wide customer segments while cutting costs. References (Lund, 2012) Market segmentation, targeting & positioning: Developing a focus. Los Angeles, Calif.: Quisic. Czerniawski, R. D., & Maloney, M. W. (2009). Creating brand loyalty: The management of power positioning and really great advertising. New York: AMACOM. Eliashberg, J., & Lilien, G. L. (2003). Marketing. Amsterdam: North-Holland. Holzknecht, J., Butler, J. S., Hoffman, E., Prager, K. J., Raghunathan, R., Smith, S. M., Castalia Media (Firm), ... Insight Media (Firm). (2007). Maslows hierarchy of needs. Austin,Tex?: Castalia Media. Lund, Kaisa. (2012). Transfer of brand associations over time : The brand extension of Nivea. Linnéuniversitetet, Ekonomihögskolan, ELNU. Mercer, D. (2006). Marketing. Oxford [England: Blackwell Business. Peter, J. P., & Olson, J. C. (2005). Consumer behavior and marketing strategy. New York: McGraw-Hill. Zatwarnicki, T., & Mathis, W. N. (2010). A Revision of the Nivea Group of the Shore-Fly Genus Ditrichophora Cresson (Diptera: Ephydridae). Transactions of the American Entomological Society, 136, 199-215. Read More