As the Nivea brand enters its centennial year, its Indian operations will be strengthened with its making new inroads into distribution in the tier-II and III cities. After becoming a 100 per cent subsidiary of the Germany-based Beiersdorf AG , the brand is yet to reap profits in the country, and is now looking at ways to take its brand to smaller towns and cities.
Having captured the modern trade outlets, the challenge for Nivea is to reach out to more general trade outlets, apart from building brand saliency in the Rs 4,000-crore skin care market already dominated by stalwarts such as Hindustan Unilever and Garnier.
Speaking to
In the past it was an Indian company, JL Morrison which owned the brand licence for Nivea and was responsible for distributing the brand in the country. But analysts say being a licensee did not entail making adequate investments in brand building, and this unfulfilled task is now being done by its fully owned India subsidiary set up in 2005.
“The challenge for the Nivea brand is to go beyond the top 30 towns. Its distribution needs to get more measured and it has yet to make a mark in the general trade,'' says a former employee of the company.
However, the Hamburg-headquartered Beiersdorf is betting big on India. “India is one of the fastest growing markets for Nivea. The skincare category is growing at 20 per cent and while Nivea has equity in this market, we have to build further saliency and get more users,” added Mr Hargave.
Apart from skin and body care, Nivea has already launched a range of products in several categories ranging from deodorants to lip care. But as face care continues to be nearly half of the skin care market, it has decided to launch more products from its international portfolio to cater to this sub-segment within skin care. For instance, the company plans to bring in anti-aging and sun care products from its international portfolio.
Digital space
Having shifted its agency from TBWA to Interface Communications recently, Nivea is now looking at the digital space to reach out to the younger generation. According to Mr Niteen Bhagwat, Executive Director, Interface Communications, “The chances of the younger generation being aware of Nivea are relatively less as the brand has been focussed more as ‘crème'. Through the digital space we are trying to reach out to the youth and there is also a dedicated Facebook page for the brand.'' With a new baseline, ‘100 years of skincare for life,' Nivea India is getting ready to improve its brand saliency with distribution being the key to ramp up sales.