In-Depth SWOT Analysis of Nivea – Good for Nature & Great for Skin

About Nivea

Owned by the German company Beiersdorf, Nivea is one of the most popular and leading skincare and personal care companies in the world.

Nivea started its journey for the first time in 1911 by introducing ‘Nivea-Creme’, the world’s first stable oil and water-based cream. The main ingredient of this creme was an innovative emulsifying agent called Eucerit (a Greek word for beautiful wax). Snow white color was obtained from the emulsion and so they named it NIVEA which means snow in real too.

Though its chemical formula remained almost the same over the last 100 years, the tin box went through many different kinds of designs as you can see in the above picture. But one thing to notice is that the impressive dark blue color has become very consistent and contributed a lot to the brand’s unique identity.

After the launching of the moisturizer, they gained popularity all over Europe and were able to expand their business by introducing various kinds of sunscreen and many other products for children too. They have constantly reframed the brand to appeal more widely in the global market.

Quick Stats about Nivea

Parent Company	Beiersdorf AG
Category	Personal Care
Sector	Fast Moving Consumer Goods (FMCG)
Year Founded	1911
Brand Value	6.6 billion U.S. dollars
Founder	Dr Oscar Troplowitz
Origin Country	Germany
Headquarter	Hamburg
Company Type	Public
Nivea’s Segmentation	People who are into skincare
Nivea’s Targeting	Middle and upper middle class people
Nivea’s Positioning	Positioned itself as a “Gentle Care” and ” Wellness” brand.

Current News of The Brand

• Nivea India appoints Geetika Mehta as Managing Director.

Nivea SWOT Analysis

A SWOT Analysis helps us to identify the company’s strengths, weaknesses, possible opportunities, and threats. It’s an excellent tool to understand where a company stands strong, its weak points, what areas it can excel in, and what are its threats.

1. Strengths of Nivea

Strengths indicate what a company excels at what sets it apart from the competition and how it is unique in the market. Let’s see some of the strengths of Nivea.

• Domination in the cold cream industry: There’s no denying the fact that Nivea rules the cold creme industry. Nivea’s cold cream is very popular in the market because customers love its unique formulation, creamy texture, and pleasing fragrance. No other brand has achieved this much brand-recall stage of being a cold cream like Nivea.
• Umbrella Brand Development – Studies say that consumers highly trust the Nivea brand. Recognizing this for more growth, the company launched a variety of new products. They also introduced many products for men by branding them under ‘Nivea Men’.
• Economic Miracle –  Despite the raw material shortages after some years of World War 2, they faced it with great efforts and strongly established themselves again by the 1950s. The company took inspiration from market trends and reframed its products accordingly.
• Geographical Presence – Nivea has about 20 products and is present in a total of 50 countries. This adds to its capacity for distribution, which is rising year after year.
• Packaging – The white and blue colors of the brand are visible on a wide shelf of personal care items. Since 1925, the blue color has stood for the brand values of NIVEA such as Trust, Closeness, and Care.  Till now, the colors have remained unchanged and have become synonymous with the brand. 
• Brand Equity: There’s no denying the fact that Nivea’s cash cow and primary product has always been its cold cream. Because of its high focus on this specific niche, the company has gained significant brand equity in the space of personal care and cold cream. Nivea is estimated at 6.7 trillion dollars.
• Use of latest technology: With its top-notch state of the art infrastructure, Nivea has been using the latest technology and is heavily investing on research and development. This gives the company an upper hand over its competitors and marks them out of the clutter.
• Strong marketing: Apart from its super affordable and quality products, Nivea markets itself quite well. Nivea’s brand ambassador included big names like Anushka Sharma, Taapsee Pannu, etc. The brand uses multiple marketing mediums like newspaper, billboards, TCVs, radio ads and digital platforms to promote its products.
• Strong employee base: Investing in your employees and their growth is equally important as investing in your products. Nivea conducts training programs and upskilling sessions for its employees on a regular basis. By doing this, the company inculcates necessary skills within its employees which adds value to the company and facilitates mutual growth.

2. Weaknesses of Nivea 

Every coin has two sides, now after a bunch of the strengths there come the weaknesses of Nivea.

• Tough Competition – Despite Nivea’s dominance in the cold cream segment, some old and upcoming new brands in the market provide the same or similar types of products at an affordable range to users. Also, It’s not so easy for Nivea to position itself in the personal care market of body care and facial care products because there is already huge competition in this segment.
• Changing Brand Identity –This is a double-edged sword. On the one hand, Nivea has a fantastic benefit by covering a lucrative market: cold cream. But on the other hand, if it has to thrive, it has to change its brand name and become more of a personal care brand. It’s for the men’s cream. Yet the brand as a whole is heavily geared towards cold creams.
• Expansion-  Many experts say that Nivea is only present in 50 countries, even though it has such a good brand name. It has to be gradual with expansion. Saturation is an issue with Nivea and brand expansion is the key to higher sales.
• Investment Requirements: To keep up with the competition, Nivea needs heavy investment to expand its brand offerings and give a tough competition to its competitors. This is a  major weakness for Nivea as new brands are emerging with a variety of offerings at low prices.

3. Opportunities of Nivea 

Opportunities are like a cherry on the top which we cannot ignore as they play a very important role in expanding the business.

• Incorporating New Products and Targeting Men’s Market – There are only a few personal care products in the men’s category compared to the women’s section. The addition of new products for men can contribute a lot to growth as men are also recognizing the importance of taking care of their skin. Nivea has already launched facial wash, body wash, and shaving gel in this category and has been favorably received.
• Demand for Organic or Fewer Chemicals Products is Growing: Many people are searching for products that include natural ingredients, are good for their skin in the long run, and are affordable at the same time.So introducing such kinds of products can surely ensure a strong future for the brand.
• Expansion of the Territories: In addition to the introduction of new items, Nivea should continuously extend into new geographies. If this is not done, there are other brands such as Ponds, which will fill the market.
• Improvement in the Living Standards: Due to multiple positive circumstances, the living standards of the society is improving. This gives brands like Nivea a chance to market its products and persuade its target market to use Nivea. Doing this benefits the brand as people have more purchasing power and are willing to spend money when it comes to personal care.

4. Threats of Nivea 

• Many Competitors: Competition is taking away its core strength while Nivea aims to grow into uncharted territories, brands are targeting its core strength in heading to cold cream. Two brands are the dominant rivals: Cool Cream Ponds and Johnson and Cold Cream Johnson. They’re both good rivals for Nivea because they have deep pockets and excellent delivery reach.
• Small Businesses: As reaching people has become comparatively easy with digital media, many small businesses are stepping out in the market taking the help of technology, and customers easily get attracted to local products. So this can impede the company’s rise.
• Changing Buying Behavior of Customers:  Nivea has faced a pandemic situation and for ease, many people prefer online buying. So it’s very important to sell products through e-commerce companies online. Also, engaging customers on social media is a new task for every business.
• Government Regulations: overnment rules and taxes for cosmetics and skincare creams can directly or indirectly affect the company’s business.
• Marketing Backslashes: There were times in the past when Nivea faced heavy backlash from the audience for its marketing ads. Nivea needs to be very careful with its marketing message to avoid such situations.

Nivea SWOT Analysis: Example of a Failed Campaign Or Backlash from Viewers

What was the issue?

With the slogan “White is purity,” Nivea debuted an ad in South Africa in 2020. The problem with the slogan “White is purity” is that it perpetuates an unfavorable racial perception. There is a long history of using the adage “white is purity” to support racism and white supremacy. It is frequently used to contrast darkness with filth, evil, and danger while associating blackness with cleanliness, goodness, and purity.

What backlash did the brand face?

As they used this campaign they faced numerous individuals accusing Nivea of racism and racial supremacy in response to the advertising, which was received with a strong outcry. The company was accused of promoting the false notion that white people are more pure and clean, while black people are more dirty and impure.

What did the brand do in this situation?

Yes, Nivea removed the entire advertising. Additionally, they apologized and said they do not support any form of bias or racism. This is what Nivea said:

We sincerely apologize if our most recent social media post offended anyone. The goal of the advertising effort was to draw attention to how well the cream maintained clean, radiant skin. We are aware, however, that the usage of the inappropriate and insensitive slogan “white is purity” was used. In order to prevent this from happening again, we have deleted the article and the campaign and will be thoroughly reviewing our internal procedures.

Nivea’s Top 5 Competitors

• L’Oréal: The largest cosmetics firm in the world, L’Oréal has its headquarters in Clichy, France. It specializes in hair color, skincare, sun protection, makeup, perfume, and hair care. It also provides its product to any part of the world which is one of the biggest competitors of Nivea
• Amorepacific Corporation: The South Korean beauty and cosmetics chaebol Amorepacific Corporation manages more than 30 beauty, personal care, and health brands, including Sulwhasoo, Laneige, Mamonde, Etude House, Amorepacific, and Innisfree. As it has begun supplying its product in India, it can be a good competitor to Nivea.
• Olay: It is a 1952 product from an American firm that makes cosmetics. It produces and markets a range of skincare goods. The oil of Olay was originally from South Africa, and the goods had a distinctive pink fluid rather than cream. It promoted its product without giving it much description. Over time, the corporation started marketing its goods internationally, changing the brand for each nation. It has gained popularity in the beauty industry. This may help Olay compete against Nivea.
• Ponds: Ponds is a skincare brand meant for Indian skin tone that offers super affordable products. The company sold its first product back in the 1840s and since then, there’s been no turning back for Ponds. The majority of female consumers testify for Ponds cream as the most secure. With its wide popularity, the brand now sells anti- aging, skin brightening, oil-control, moisturizing and other skincare products.
• Vaseline: Unilever, a multinational corporation, owns the American brand Vaseline for petroleum jelly-based goods. Products available include unflavored petroleum jelly as well as a variety of skin creams, soaps, lotions, cleansers, and deodorants.