Nivea

Question 1 (2.4) What aspect of ‘Nivea’s’ New product being offered was modified or changed, based on customer feedback' ‘Beiersdorf’ programme of market research showed a gap in the market. This led to the launch of ‘Nivea Visage Young’ in 2005 as part of ‘Nivea Visage’ range offering a comprehensive selection of products aimed at young women, aged between 13 and 19 years old. The whole campaign was testing through direct response offer to ensure they are were meeting their own business objectives. ‘Nivea’ used market research to target market segments. Understanding and knowledge from direct responses offer, help in developing and modification of new products and customer price perceptions. By promoting new product ‘Nivea’ used information from customer`s feedback which was analyzed using database. ‘Nivea’ identified that younger consumers wanted more specialized face care aimed their own age group that offered a beautifying benefit, rather than a solution to skin problems. ‘Nivea Visage Young’ is targeted at girls who do not want medicated products but want a regime for their normal skin which provides ‘Nivea’ with a unique bridge between the teenage market and the adult market. After 2 years in 2007 the company re-launched advertising campaign with added features of promotional direct response offer using coupons offering Buy one get one free and gift vouchers of $50 or $100 at points of sale, further optimizing via ‘Nivea’ website its position in the market using the product new formula, new design, new packaging and similar but a little bit higher price. Question 2 (2.5) How does ‘Nivea’s’ selected direct response offer, match its organizational marketing objectives in solving marketing problems. Beiersdorf company realizes that a one way message using TV or the press is not as effective as talking directly to its target group. Therefore company did not plan to use any above-the-line promotion for ‘Nivea Visage Young’. Its chooses direct response offer promotional strategies that reflect the lifestyle of its audience and the range of media available. The part of strategy is to use of product samples. It allow customers to try the product before purchasing it. Over a million samples was given away during 2008. These were available through the website, samples in store or in goody bags given out at ‘Nivea’ road shows up and down the country. Company started promotion with launching an interactive online magazine called FYI to raise awareness of the brand. The concept behind marketing acivities is to give teenage girls the confidence to become young women and to enjoy their new-found independence. Communication channels are engaging to enable teenagers to identify with ‘Nivea Visage Young’ and focuses on first time experience relating to ‘Nivea’ being their first skincare routine. It was promoted using the Hit40UK chart show the TMF digital TV channel. NIVEA has also community pages on portals such as ‘Myspace’ or ‘Facebook’ and use this media as a part of mix to grow awareness amongst the target audience to gauge their response. Question 3 (2.6) What material requirements do ‘Nivea’ use to match the type of direct marketing sale. Part of the material requirements which ‘Nivea’ needs to promote its new product line is information from customer`s feedback which was analyzed using database and then re-used to match the type of direct marketing sale. ‘Nivea’ used different way to conduct their marketing research such as: o Gathering data from consumers through a variety of different research techniques and direct response offers o Product testing and sampling with consumers in different markets to listen to consumers directly. To support direct marketing sale the sales persons should use the samples of the products. In my opinion it is important when consumers can try, see how it works on their skin, compare with other products before they will purchase the product. In this way the company can sells more product and it can start building awareness of ‘Nivea’ brand. Future benefit for company can be – when customers of ‘Nivea Visage Young’ will grow up, they will switch product for ‘Nivea Visage’ products. Question 4 (3.1) How have ‘Nivea’ evaluated factors affecting pricing to determine normal or average selling price of offer' Lots of factors affect the end price of a product, for example the cost of productions or the business need to maximize profits or sale. A product’s price also needs to provide value for money in the market and attract consumers to buy. On re-launch the price of ‘Nivea Visage Young’ was slightly higher than the first time. This reflected its new formulations packaging and extended product range. However the company also had to take into account that the target market was both teenage girls and their mums buying product for them. This means that the price had to offer value for money or it would be out of reach of its target market. ‘Nivea Visage’ is one of the leading company in skin care product – especially products for teenagers, that makes this company a price leader. This means that it sets the price level that competitors will follow or undercut. ‘Nivea’ needs to regularly review prices by researching customers response through the use of coupons and vouchers during advertising promotions, they can take counteractive measures should a competitor enter the market at the market growth point if the product life cycle to ensure that its pricing remains competitive. The pricing strategy for ‘Nivea’ is not the same as that of the retailers. It sells product to retailers at one price, however retailers have a freedom to use other strategies for sale promotion. They may use: • loss leader - the retailer sells for less than it cost to attract large volume of sales for example by supermarkets • discounting - beside other special direct offer such as ‘buy one get one free’ or ‘two for one’, coupons, vouchers and competitions to measure customer perception on the normal or average selling price and opinions in regard to payment methods for added discount. Question 5 (3.2) What plan of action have ‘Nivea’ incorporated to determine short-term pricing strategies' To determine short term pricing strategy ‘Nivea’ should use the ‘Penetration price’ strategy, which involves an initial low price to ensure that there is a high volume of purchase and market share is quickly won. This strategy encourages consumers to develop a habit of buying the ‘Nivea Visage Young’ products. After two years on the market when product was re-launched, price was slightly higher, but when customers have already habit to buy it, it wasn`t much difference to them. Still we have to remember that the ‘Nivea Visage Young’ is marker for mums and daughters to the price should be appropriate to interest the people. The price should be different in different product’s life stages, but the short term pricing strategy is suitable for new product just introduced onto the market. Question 6 (3.3) ‘Nivea’ discounts wholesalers and retailers for prompt payment on bulk purchases. What payment term and options might be offered to customers' We can offer to customers the ‘Nivea’ Credit Cards. Buying using this method of paying customers can get 10% discount for any product of ‘Nivea’. Longer payment for retailers, for example 60 days after delivery. Special prizes of products for retailers who paid before delivery. Using ‘Nivea’ website the customer can buy products with discount (for example 15% for ‘Nivea Visage Young’ and 10% for ‘Nivea Visage’ for adults), when they sign into newsletter. Buying one product of ‘Nivea Visage Young’ and any other product of ‘Nivea’ in sale point they can 15% discount on this other product. Using the voucher from the press 10% Buy one product of ‘Nivea Visage Young’ and get product from the same line for free.