Question

Nivea Sun Protection Products: A Case Study in Market Segmentation A careful market segmentation is critical to successfully selling products; you need to understand what makes different consumers tick and how best to reach them. Skincare giant Nivea conducted an impressive market research campaign that can be modeled by other firms. First, a little background: Beiersdorf is an international skincare company with leading brands such as Nivea and Eucerin. They have expanded significantly in the UK market through effective segmentation that matches consumer needs. The company has become the value leader in the field, meaning people spend more on Nivea sun protection products than any other brand. One important product line for Nivea is sun-related skincare products, worth upwards of £173.6 million in the United Kingdom alone. Nivea’s reputation in this broad segment is bolstered by robust scientific research and development focused on providing the best protection possible from the sun’s skin-damaging rays. The key was to further segment the sun protection products market by two important factors: Skin type and the climate where the products are used. Skin types include very light, fair, normal, dark and children (who tend to have thinner, lesser developed skin) while the climates include moderate, hot and very hot. The level of protection is measured by SPF, which stands for Sun Protection Factor. The lighter the skin and the higher the temperature, the higher the SPF that is needed. SPF 20 may be adequate protection for a fair-skinned person in the UK, but SPF 40 might be recommended for the same person if they were in a more tropical environment. The company’s market research revealed significant demographic differences between men (who go for convenience), women (who gravitate towards more luxurious products) and children (a market reached through adult parents, mostly mothers). Through the use of surveys and focus groups, Nivea was able to determine the attitudinal differences between distinct segments of consumers. They discovered concerned consumers who were not at all concerned about getting a tan but instead were more focused on protection from sun damage. Sun avoiders don’t buy these products at all because they avoid high-exposure situations, although with education they may be convinced of the need for sun protection product purchases. Conscientious sun lovers love being out in the sun but are concerned about protection. Careless tanners, on the other hand, don’t worry about the sun at all and buy low-SPF products if they buy any at all. Finally, the naïve beauty conscious people are the ones who want to have a good tan but don’t adequately understand the relation between SPF and protection. Nivea used this research to develop their unique brand positioning that includes making sun care as simple as possible, providing education about the importance of protection and finding ways to reinforce that protection message. One product innovation that came from this research was a product that offered full and instant protection from both UVA and UVB sunrays because many consumers fail to apply such products in the necessary time frame for effectiveness (20-30 minutes before exposure). Other product innovations have included sprays that are easy to apply, colorful products for children and water-resistant products for both children and adults. Advertising for children’s products targets the mothers of children with a protection message. Through targeted research, Nivea develop an understanding of customer segments that takes buying habits and motivations into account. Using this segmentation, product development and messaging both become more effective and sales and revenue increase.
Questions:
What are the different market segments identified in this case Study? Explain in detail with the help of the content given in the case. (You are supposed to find all the segments) What are the techniques Nivea company has adopted for collecting customer information? How Nivea company is improving its brand positioning through the information they get from customer research?

Answer 1

Nivea Sun Protection Products: A Case Study in Market Segmentation

Careful market segmentation is critical to successfully selling products; you need to understand what makes different consumers tick and how best to reach them. Skincare giant Nivea conducted an impressive market research campaign that can be modeled by other firms. Nivea’s reputation in this broad segment is bolstered by robust scientific research and development focused on providing the best protection possible from the sun’s skin-damaging rays.

The key was to further segment the sun protection products market by two important factors: Skin type and the climate where the products are used. Skin types include very light, fair, normal, dark and children while the climates include moderate, hot and very hot. The level of protection is measured by SPF, which stands for Sun Protection Factor. The lighter the skin and the higher the temperature, the higher the SPF that is needed. SPF 20 may be adequate protection for a fair-skinned person in the UK, but SPF 40 might be recommended for the same person if they were in a more tropical environment. So, therefore, those who live in a tropical monsoon climate would need to buy SPF 40.

The company’s market research revealed significant demographic differences between men (who go for convenience), women (who gravitate towards more luxurious products) and children. Through the use of surveys and focus groups, Nivea was able to determine the attitudinal differences between distinct segments of consumers.

How Nivea collected information?
There are distinct types of people in the world. Nivea founded that two things have to be taken into consideration, the skin type & the climate in that country. Thus there were people who were much concerned about their skin they usually use the cream before stepping out, some avoid being on Sun. For light skin tone its necessary for them to apply SPF 40 because they are more prone to get tanned. For darker skin tone, they need to apply SPF 20. The lighter the skin and the higher the temperature, the higher the SPF that is needed. SPF 20 may be adequate protection for a fair-skinned person in the UK, but SPF 40 might be recommended for the same person if they were in a more tropical environment.

Thus through their research, these things were concluded by Nivea. They made creams for men, women & children as well. They targeted everyone.

They discovered concerned consumers who were not at all concerned about getting a tan but instead, we're more focused on protection from sun damage. Sun avoiders don’t buy these products at all because they avoid high-exposure situations, although with education they may be convinced of the need for sun protection product purchases. Conscientious sun lovers love being out in the sun but are concerned about protection. Careless tanners, on the other hand, don’t worry about the sun at all and buy low-SPF products if they buy any at all. Finally, the naïve beauty conscious people are the ones who want to have a good tan but don’t adequately understand the relation between SPF and protection. There are few people who don't bother at all about being out on Sun.

How they are brand positioning through research?

Brand Positioning of Nivea

Now the marketing team had a new product idea that consumers liked. It had a name and packaging design that was well received. They now needed to check how this fitted with the rest of the NIVEA Deodorant brand positioning and range. Nivea is on a high these days. One of the world's largest skincare brand has decided to up the ante in the highly cluttered Indian market. In the process, the company has rebranded and repositioned its offering for men. Nivea had its presence in the men's grooming market with the brand 'Nivea for men' in 2007. The men's range was promoted with the tagline " What men want ". The brand started its serious foray into men's category with an Advanced Whitening range.

This year, the brand has gone for a makeover. Nivea had rebranded its men's range with the new brand name " Nivea Men". Along with the new name is the new positioning. The Nivea Men is positioned on the user. The typical brand user is profiled as the one who tackles things on their own. The brand has the new tagline " It starts with you "

Through targeted research, Nivea developed an understanding of customer segments that takes buying habits and motivations into account. Using this segmentation, product development and messaging both become more effective and sales and revenue increased.