Case study: Nivea

Branche: Cosmetics

Introduction

For decades (since 1882) Beiersdorf‘s Nivea has been a household name, virtually known for just one product - a hand cream in the iconic blue tin. Nivea expanded into different markets in the 1980s.

New products, new markets, new target groups: enter gay men in 2001.

With health and cosmetics products, it is easy to justify using handsome models and half-naked men to demonstrate the qualities and usage of your products. So, the attraction to gay men - just like Abercrombie & Fitch started its path to gay popularity - is apparent in your advertising material. You only need to convince them of the benefits, but that seems like an easy push. Or does it? Nivea Germany (the home market) did not use barechested models, or even make the effort of creating special content. Instead, they photoshopped the existing visual of a man and a woman into one that only showed the man… OK, with the addition of a disco ball. Very targeted.

The beginning

"Gay men are the most sophisticated men in terms of appearance and grooming," said Joe Venezia, product manager of Nivea for Men. Beiersdorf did no research into the gay market but went in with gut instinct, partly by

recommendation of its ad agency FCB. The company hoped to achieve sales of USD 20 million domestically by 2003, winning over straight men later through gay men's early influence.

Marketers introducing new products are now more frequently targeting gays -- considered "early adopters" and influential "taste makers" -- as a way to build a fan base who can create buzz with other consumers down the line.

Nivea for Men, just six months old, is already "moving faster than we imagined," according to Venezia, but that's not necessarily being attributed to gay men. "We're making assumptions that more than the gay market is buying," he said, though he admits that the company has no way of determining how much of those efforts are resulting in sales. Still, Nivea's gay advertising is to stretch to "2003 and beyond."

AdRespect's Mike Wilke, reporting about this development, concludes his article with: “While it is progress that more marketers now feel comfortable pursuing gay buyers without past fears, traditional market research should not be forgotten. After all, if you don't know whether your advertising is working, why bother?”

In other words: gut feelings may work well for love, but in business…?

Next steps

Interesting note: in 1991, Beiersdorf acquired the top luxury brand la prairie. It would seem that this brand would appeal to gays more, considering the starting point that gays are “the most sophisticated men” and have money to spend. Funnily enough, in spite of the lack of specific gay marketing by la prairie, there is a La Prairie Gay Personals website - unrelated to the brand ("Meeting Gay singles from Portage La Prairie, Manitoba has never been easier").

Suzanne Grayson, a beauty industry consultant and former Revlon executive, said in 2004 that Nivea is well positioned compared to rivals. (Its aftershave balm has been marketed in Germany and France since the mid 1980s.) Yet, she said, men still need to be educated on how to use grooming products. "You're not going to get guys over 45 to buy this stuff even if their faces are falling off," she observed, adding that gay men could prove an exception. Men's grooming may get a big boost from advertising and shrewd positioning, said Grayson, "not product, per se, because there's not going to be a product that I believe is significantly different for a man that would make it a breakthrough, like a 10-hour lipstick. The category doesn't lend itself to that."

Market profile

The market for male cosmetics, like facial cleansers, was infinitely smaller than that for women (accounting for less than 10% of the market volume in 2004), but that also means there was all the more room for growth. These modest figures do not suggest that guys are flocking to stores for skincare items, though some do buy or borrow traditional women's products. But that changed due to popular culture with its gender-bending TV shows and movies reflecting more accepting attitudes toward primping and individual style. Meanwhile, men are running off to get Botox, spa treatments and plastic surgery like never before.

Added Nivea's Susan Savoie: "It probably won't happen right away, but once it becomes culturally acceptable for guys to to use skincare products—because magazines say it's OK, more athletes speak up about it, wives and girlfriends buy it for them—it'll put men in a different mindset."

No mention is made of the gay consumer (because the volume of this market segment is too small) or role model (because their lead may not be followed by hetero men).

Although the picture on the left depicts two women in - what looks like - an intimate setting, this was not aimed at lesbians. The ad did cause controversy over the claims it made and the pay-off.

Nivea (Beiersdorf) took up a good position in the market. Katherine Garvey, Beiersdorf's director of marketing for men's grooming, estimated in 2004 that the men's facial cleanser and moisturizer category would grow from about USD 25 million to USD 70 million in five years, and surpass USD 100 million in 10 years.

More (direct) gay marketing

In the summer of 2004, a targeted marketing campaign on the web sites Gay.com and PlanetOut.com led to a dramatic increase in brand awareness among gay men for Nivea for Men. An online advertising campaign was set up and the goal of the campaign was to show an overall increase in aided brand awareness, online ad awareness, message association, gay community support, brand favorability and purchase intent.

"Nivea’s branding campaign was a tremendous success," said Mark Elderkin, PlanetOut president and founder of Gay.com. "All of the brand metrics established by Nivea’s online campaign showed significant increases."

"We believed the brand would benefit from targeting gays," said Joe Venezia. "Our ad campaign case study results showed that we had been missing out on a huge market. We couldn't be more thrilled with our decision to launch an advertising campaign with PlanetOut."

The study also demonstrated product need and interest in the gay market. Nearly two-thirds of respondents from the exposed group felt that skin condition was either extremely or very important to them. Frequency of exposure to the advertisements was also important. When respondents saw the ad four or more times, the study showed an estimated 12-point increase (a 37% lift) in the perception that Nivea is supportive of the gay community. Various independent studies show that a majority of gays and lesbians go out of their way to purchase products and services marketed directly to them in gay media.