Brands & Branding and Private Labels Case Study

Beiersdorf AG’s Brand Architecture Strategies: Challenges in Nurturing an Umbrella Brand Nivea

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Abstract:
Beiersdorf, the company behind Nivea, maintained a fairly concentrated portfolio of brands. Yet, the huge success of Nivea, made the company extend the brand across 15 product categories by 2006. However, this strategy of umbrella branding presented the company with a new set of issues and challenges. While the repeated brand extensions could eventually wear out the Nivea brand, the unsuccessful brand extensions could even dilute the equity associated with the brand. Beiersdorf was at a major risk in over-relying on an umbrella brand. As Nivea formed the bulk of its sales, Beiersdorf was highly vulnerable to any loss of consumer confidence in its flagship Nivea brand. By far, Beiersdorf had successfully leveraged upon its flagship brand. But whether capitalising growth on one single brand would make a successful strategy in the long run was yet to be seen?

Pedagogical Objectives:

• To analyse brand architecture strategies at Beiersdorf AG
• To understand the concept of umbrella brand
• To analyse the opportunities and challenges in umbrella branding
• To understand the dynamics of brand building in global cosmetic industry.

Keywords : Brand Architecture Strategies, Brand Portfolio Management, Umbrella Branding, Brand Extension, Brand Equity, Brand Essence, Brand Equity Dilution, Brand Values, Brand Identity, Flagship Brand, Brand Positioning, Beiersdorf AG, Nivea, Product Line Extensions, Brands and Branding Case Study, Cosmetic and Toiletries Industry