Report on NIVEA's UK Market Entry: Marketing and Management Strategies

This report provides an analysis of the challenges and opportunities facing NIVEA as it relaunches its VISAGE Youth product line in the UK market. It examines the competitive landscape, particularly the threat from The Body Shop, and assesses the effectiveness of NIVEA's current marketing mix, including pricing, promotion, and placement strategies. The report highlights the limitations of the cost-based pricing model and the reliance on traditional marketing methods like magazines, suggesting the adoption of penetration pricing and social media marketing to reach the target audience of teenage girls and their mothers more effectively. Recommendations include introducing pocket-sized packaging and leveraging social networking platforms to improve promotion and maximize revenue generation. The report concludes that while NIVEA's current strategies have some value, strategic modifications are required to ensure sustainable growth in the UK market, considering modern marketing trends and technological advancements.

Marketing and management
Name of the Student
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Author’s Note

Executive Summary
The report discusses about the problems that might occur for the NIVEA Company launching
their new product line in UK market. The analysis of the market mix of new NIVEA VISAGE
Youth reflects their effectiveness and incompetence at the same time. Some of the strategies
taken by the company show potential to generate profit for the company. However, introduction
of social networking in the marketing process, and other recommendation can show potential
advantages for the company.

Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................3
Statement of the Problem.................................................................................................................3
Causes and Symptoms.....................................................................................................................3
Case Analysis...................................................................................................................................4
Alternative Recommendation..........................................................................................................5
Conclusion.......................................................................................................................................6
Reference.........................................................................................................................................7

Introduction
NIVEA is an international brand that delivers high quality skin and beauty care product.
The company was founded in 1882 by a German skin and beauty care company Beiersdorf. The
company’s market research identified a gap in the market that resulted in the launch of NIVEA
VISAGE Young in 2005. The product targets the girls between the age group of 13 to 19. They
are launching this line of product in the UK market and follow the cost based pricing. This report
will identify the potential problems that the company might face in their re-launch of the product.
It will also consider identifying the cause and symptoms and provide recommendations for the
company to overcome the situation.
Statement of the Problem
NIVEA is re-launching their new line of product for the UK market. The Problem the
brand is currently facing is the competitive challenge from the other similar products.
Another problem that can be identified from the case is the pricing of the product. It is
higher than the previously launched product.
The last problem that might occur for the company is in the promotion as they promote
their product through their FYI magazine and sample testing.
Causes and Symptoms
The biggest competitive challenge faced by NIVEA in the UK market is from The Body
Shop. They have a wide range of products for all age group in the biggest advantage for the
competitor company. NIVEA on the other hand is introducing their new line of skin product for

the teenagers under the brand name of NIVEA VISAGE Youth. It is the re-launch of their
similar product with some modification in the product and packaging while considering the
corporate responsibility to increase their brand value (Daellenbach, 2014).
Cost based pricing sets the price of the product according to the production expenditure.
This pricing strategy is unfit for launching a new product in the market. This will make the
company lose their opportunity for generating profit from the product launch.
The company has opted for the promotion through their FYI magazine and sample
distribution which is no doubt a brilliant way for promoting their product. However, the modern
day teenagers show greater attachment in the social networking that limits their contact with the
paper magazines. Moreover, the mothers of these teenagers also tend to purchase these beauty
products for their children who also represent attachment with the social networking. The
influence of the social networking has minimized the use of magazine that is the opted mode of
promotion for the product.
Placement selected for the product on the other hand is through the retailer that is a cost
effective and can potentially decrease their profit margin.
Case Analysis
According to Rajni, Modi and Singla (2015) the social networking is the best possible
way of promoting products in modern market. The product introduced by NIVEA is a skin care
product for the teenage girls. Hence, the brand can gain an additional advantage if they use
social network marketing along with their traditional marketing process.

Baykasoğlu, Gölcük and Akyol (2017) propose the use of price skimming strategies for
the new launches that can gain possible success in the market. The cost based pricing that the
brand is currently using is incompetent for a new product launch in the market. The skimming
process will generate more revenue from the product in its initial stage.
Placing the product between the competitors in the market is the biggest challenge for the
company to launch a new product line (Rahmani, Emamisaleh & Yadegari, 2015). NIVEA plans
to place their products in the high street stores and the supermarkets that are cost effective.
Alternative Recommendation
Though NIVEA’s business and marketing strategies are beneficial for the company in the
present day market, they clearly need to modify their strategies to attain a sustainable growth in
the market.
The company is currently following the cost based pricing for their new product, which is
ineffective for the creating customer base in the market. It is essential for them to follow the
penetration pricing strategy that places the product with initial low pricing. It helps the company
to draw customer and enables the company to develop market share within a short period of
time. Moreover, it facilitates in developing the product habit in the customers. The company can
later increase the price accordingly without hampering the customer loyalty.
The new product launched by the company is for the teenagers of the UK market. The
product is different from other similar products in the market as they use sea salt instead of
petroleum. However, these hardly matters for the teenagers as they only seek for the products
that will make them look beautiful. However, a large number of mothers of the children buy
these products where they will definitely get advantage. Moreover, they are selling their product

in a new large packaging. The company should also introduce a pocket pack as the primary
target segment for the product is the teenage girls. It will make it easy for the girls to buy a small
product and carry it with them. Small packaging also means high profit that can be the primary
medium for the company to generate revenue.
The company should use the social network marketing for their product for promoting
their product. It will decrease their promotion cost and increase the number of addressed
audience.
Conclusion
NIVEA’s business and marketing strategy is gaining them profit in the current market.
However, they will require modification in their strategies with the developing changes of the
market to hold their position. The recommended modification is set accordingly with the
changing market of UK that counts the modernization and technology in the company’s business
and marketing strategy.

Reference
Daellenbach, U. (2014). Competitor Analysis. Wiley Encyclopedia of Management.
Baykasoğlu, A., Gölcük, İ., & Akyol, D. E. (2017). A fuzzy multiple-attribute decision making
model to evaluate new product pricing strategies. Annals of Operations Research, 251(1-2), 205-
242.
Rajni, M., Modi, S. K., & Singla, B. B. (2015). AN EMPIRICAL STUDY ON PRODUCT
PROMOTION ON SOCIAL NETWORKING SITES: A REVIEW.
Rahmani, K., Emamisaleh, K., & Yadegari, R. (2015). Quality Function Deployment and New
Product Development with a focus on Marketing Mix 4P model. Asian Journal of Research in
Marketing, 4(2), 98-108.