Naive had created a number of new sub-brands that broadened the company’s product offerings, including the 1997 launch of a creative cosmetics line, Naive Beauty??, and the aggressive expansion of Naive for Men. Naive also introduced a major scientific breakthrough??an anti-aging commence called SQL??that became an unqualified success and was included in a number of sub-brand products. Naive’s growth during this time was reflected by its net sales. Sales in Beresford Cosmos division, primarily driven by Naive, grew from ??1. Million billion in 1 995 to ??3. 8 billion in 2005 (see Exhibit 1). In addition, Beresford share price grew from ??25. 69 in 1 995 to ??85. 6 in 2004 after peaking at ??127. 50 in 2001. AS Naive’s product portfolio expanded, the company faced a new challenge: maintaining growth while preserving the established brand equity. During the 1 9705 and sass, Beds Cosmos Division had successfully extended the Naive brand from a limited range of products??Naive Cry??me, Milk, Soap, and Sun??to a full range of skin care and personal care products.
Over time, these different product lines had established their own identities as “sub-brands,” independent of and yet still connected to the Naive Creme core brand. Given the breadth of products sold under the Naive name, however, there had been debates in the sass as to how to achieve the proper synergy between the Naive Creme core brand and the sub-brands from other product classes. In planning new product developments, Cosmos management sought to ensure that the Naive brand met the market needs while also remaining true to the heritage of Naive, as exemplified by flagship moisturizer product Naive Cry??me.
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Naive’s marketing program in the sass and sass followed a “sub-brand strategy” where individual sub-brands received budget allocations for independent marketing communications activities, rather than an “umbrella brand” tragedy where the Naive corporate brand was promoted first and foremost. Internally, however, executives debated whether the Naive Creme brand should continue to receive significant marketing dollars. Some felt that Naive Creme was the core brand in the Naive brand franchise and therefore played 1 of 22 | Page the most valuable role.
Others worried about how the traditional Naive Creme image could be maintained if the company also needed to innovate and modernize it. Now that the company had a broad spectrum Of successful sub-brands, the big question going forward was how the company could best manage its brand hierarchy. Additionally, management wondered from where the next surge of growth would come and whether it would be crossing Naive’s brand “boundaries. ” DEVELOPMENT OF THE NAIVE BRAND: 1912-1970 Naive Cry??me was first introduced into the German market in 1912.
In the early sass, industrialization led to the emergence of mass markets and branded articles. Society??women in particular??began to appreciate to a greater degree physical appearance and look for products to both care for and beautify the skin. Naive Cry??me’s unique water-in-oil emulsion was the first cry??me to offer both skin care and protection at a seasonable price. The Naive name came from the Latin word, knives, meaning “snow”??reflecting the snow white color of Naive Cry??me. As the world’s first multi-purpose, “universal” skin cry??me, Naive Cry??me was quickly adopted for use by the entire family.
Naive Creme was introduced throughout Europe in 191 2; in the United States in 1922; and in South America and other parts of the world in 1926. 2 Recognizing the value of Naive Creme and the need for other reasonably priced skin care products, Beresford introduced over forthright other skin care products under the Naive brand name between 191 1 and 1970. As BFD expanded its range of product offerings, it maintained a “mono-product” philosophy??typically offering one multipurpose product in each skin care market segment and category it entered.
Throughout this period, Naive Creme remained the company’s primary product and the carrier of the Naive brand name. The famous Naive Creme blue tin with white lettering standardized in 1925, was a familiar sight in millions of households worldwide. In addition to Naive Creme, the brand’s other primary products included body soap and powder and two sun care products??tanning lotion and oil-3 Naive Creme Brand Identity and Values Over the years, Naive??primarily through Naive Cry??me??had acquired a unique, widely- understood brand identity as a “caretaker of skin.
Throughout Europe, most users were first introduced to Naive Creme during their childhood, learning that it was a product that could be used by the entire family to satisfy all kinds of needs. Because of consumers’ own personal history with the brand and the company’s advertising, Naive had become strongly associated with shared family 2 of 22 | Page experiences and had a rich set of other brand associations such as “care,” “mildness,” “reliability,” “gentleness,” “protection,” “high quality,” “feeling DOD,” and “reasonably priced. Over time, the Naive name became synonymous with protection and care for the skin. By the 1 sass, Naive Cry??me could be found in almost every German household and in the majority of households across Europe and was the dominant multi-purpose skin creme worldwide. Early Naive Advertising BFD first began advertising Naive products??primarily Naive Cry??me??in 1912. The company viewed advertising as a means of strengthening consumer perceptions of a quality product. For over 60 years, Naive advertising promoted the basic themes of skin care and protection. Ads were always simple, plain, and informative.
In the sass and sass, BED advertised three main Naive products??cry??me, soap, and powder. Early ads established the image of the Naive woman as clean, fresh, and natural. Over time, Naive ads were altered to reflect changes in Selfridges and lifestyles. For example, in the 1 sass, when German women were becoming more athletic and active, Naive ads began to show women in more outdoor and active settings. In the sass, when tanning came into fashion, BFD responded by highlighting the skin protective qualities of Naive cry??me and introducing a new product?? Naive oil??for sunburn.
In the sass, following the end of World War II, Naive ads reflected the German population’s desire to enjoy life by showing Naive products used in relaxed and happy settings. While the settings of the ads changed, the clean, fresh, and natural image of the Naive woman remained essentially unchanged. While she was modernized to reflect the styles of the time, she was always a face with whom the average woman could identify. Over time, Naive ads sought to link the clean, fresh, and natural image of the Naive user to related elements of nature??fresh air, light, and sunshine.
NAIVE’ S FIRST COMPETITIVE CHALLENGE: THE 1 sass During Naive cry??mess first fifty years, the market for multi-purpose cry??me grew steadily. By 1970, Naive held over AS percent of the multipurpose cry??me market in Germany and majority market share in Europe. In the late sass and early sass, the multi-purpose cry??me market changed substantially as BFD faced its first strong competition in 60 years. Hinkle-Khans, a small German toiletries company and subsidiary of Hinkle, launched its own multi-purpose cry??me, Cry??erne 21 , in 1972.
A direct copy of Naive Cry??me, this product was backed by extensive advertising and a distribution strategy designed to take 3 of 22 | P age advantage of a broader, fundamental shift in consumer purchase habits for cosmetics from specialized outlets to mass market, selective outlets such as food stores. Also at this time, a number of manufacturers??including Ponds, Milliner, and Linger-Fisher (now part of Procter & Gamble)??introduced a variety of specialized cry??mess into the market, particularly moisturizing cry??mess, designed for specific skin care uses.
Concerned with this new competition, BFD performed a study of the Naive brand image in the German arrest. The study found that the Naive brand enjoyed a high degree of goodwill and represented reliability, quality, and honesty. Yet, the brand had an “older” image and was not viewed as young, dynamic, and modern, as was the case with many of the recently introduced competitive brands. In recognition of these new competitive challenges and current consumer perceptions of the Naive brand, BFD developed a “topping” strategy. First, BFD sought to stabilize the strong historical market position Of Naive Cry??me.
Second, the company sought to exploit the strength of Naive Creme by reinserting the goodwill it had created for the Naive brand to other product classes. Revitalization Naive Creme BFD introduced larger sized units, altered its distribution strategy by shifting from special-line outlets to food outlets, and increased its level of promotional activities with the trade and within stores. The primary means to revivalist Naive Cry??me’s brand image, however, was the introduction of a very aggressive ad campaign aimed directly at the competition. The initial campaign launched in spring 1 971 , and used the tag line “Naive, the Creme De la cry??me. A series of seven ads were developed round the slogan. After two years of the “Cry??me De la cry??me” campaign, Cosmos developed a new series of ads directly aimed at updating the “old” brand image. The “Only Me” campaign ran internationally and made a new brand promise: Naive Creme meets all skin care needs. The Naive brand had been synonymous for the skin cry??me product category but new competition forced BED to tell consumers directly about its actual product benefits. Each ad showed the blue and white Naive tin being embraced by an element of nature and highlighted a specific purpose for the use of Naive Cry??me.
The objective was to negate competitors’ claims for special cry??mess by positioning Naive Creme as the best Creme for every kind of special need. Together, these ads reinforced caring and mildness as key consumer benefits and presented Naive as the universal skin cry??me that embodied all the needs of consumers in one product. 4 of 22 | Page Extending the Naive Brand In addition to strengthening the brand image of Naive Cry??me, Beds second objective was to use the recognition and reputation of the Naive brand name to introduce new products??both in categories where Naive products were sold currently as well as in related categories.
While BFD had been selling a variety of different products under the Naive name for years, Naive Cry??me dominated company sales and was the primary image-maker for the Naive brand. Since the market for multi- purpose cry??me was stagnating, BFD actively targeted new and growing market segments in which to extend the Naive brand. The company’s long- term objective was to evolve Naive from a skin cry??me brand into a skin care brand by providing a range of new products that would both complement Naive Cry??erne and broaden the meaning of the Naive brand name. At this time, the Naive family of products included: Naive Cry??me, Naive Milk, Naive
Baby (oil and powder), Naive Sun oil and milk, and regular soap (sold only in Germany). To establish Naive as a skin care brand, the company decided to create a family of products that symbolically could be represented as the “Naive universe. ” At the center of the Naive universe was the Naive Creme core brand. Naive products??some already existing, some new??would function as satellite sub-brands around this center. Cosmos established a set of guidelines for Naive brand extensions. All new products had to be compatible with the Naive brand and be targeted to market segments with attractive, current, and potential size.
The company had a “mono-product” philosophy, meaning that there would be only one product promising consumers universal application in each product category. A second version of a particular product could be introduced only if it satisfied a unique need not met by the current product(s) in its category. To clarify, the company established a set of guidelines that any possible new products had to satisfy: 1. 2. 3. 4. 5. 6. Meet a basic need: clean and/or protect. Offer the special care/ mildness benefit of Naive creme. Be simple and uncomplicated.
Not offer to solve only a specific problem. Maintain a leading position in terms of quality. Offer the product at a reasonable price so the consumer perceives a balanced cost- benefit relationship. 7. Offer the broadest possible distribution. All new products had to offer “continuity plus innovation” that is, maintain the essential Naive core while offering something new. Additionally, existing products had to be continuously improved, 5 of 22 P gag e reflecting the compass philosophy to respond to market trends and to innovate through research and development.
As one long-time Cosmos executive explained: It was like taking a teaspoon of Naive Cry??me and putting t into every new Naive product as a special benefit??as an additional amount of care. In this way the new product was really a јo-in-one product: satisfying a basic need plus offering the care of Naive Creme as a symbol. UNDERSTANDING THE NAIVE BRAND By the early 1 sass, it was clear that BFD had succeeded in extending the Naive brand from skin cry??me to a skin care and personal care brand. In 1992, Naive Creme accounted for only 22 percent of total Naive brand sales.
While Naive Cry??me remained the largest single contributor to total revenues, the newer product lines each made significant contributions. Naive products held strong market positions throughout Europe, especially in smaller volume markets where advertising costs were lower. BFD was a small company relative to its competition (e. G. Milliner, Procter & Gamble, and L’Oreal??al) and its advertising budget was substantially smaller. Naive’s highest percentage market penetration was in Belgium, Switzerland, and Austria. Germany??the largest skin and personal care market in Europe??however, remained Bed’s largest volume market.
Beds success in establishing Naive as a broad skin care and personal care brand now presented the company with a new set of issues and challenges. In the process of establishing sub-brands, there was concern that the Naive brand image??in particular, the Naive Creme image??had been weakened through all the product introductions. Moreover, there was fear that continuing to develop sub-brands independent Of one another would be complicated, risky, and send a confusing set of messages to consumers about what Naive represented. At the time, ad campaigns were developed independently by three different ad agencies.
Although there were similarities in the various campaigns, there was no consistent message strategy or standardized presentation. Cosmos management decided it was time to bring consistency to the marketing of the Naive sub-brands. At the same time, the Cosmos Division came under new leadership. Dry. Roll Sunfish, head of Procter & Gambler’s European Division for 22 years, joined BFD to head the Cosmos Division. Sunfish ??who later became CEO and president of Bed’s board in 1994??joined a task force to define the Naive brand philosophy.
Sunfish believed that in preparing to develop a new Naive communications strategy, a formalized brand philosophy was necessary. Sunfish explained: 6 of 22 P a Naive is the most fascinating brand in the world, second only to Iacocca. The company had done a tremendous job over the last 50 years to keep the Naive brand focused yet diversified in a very reasonable way. But at the same time there was a lack of conscientiousness of what it meant to be a brand. In the good old days, BFD had a brand relationship that was very personalized.
Only three people knew how it had all been done??one retired, one left the company and one died. In addition, there were three advertising agencies that did not talk with one another. Began with the basics and asked: What is Naive? The data was all there, the feeling was there, but no one had put it on piece of paper. While working internally on the Naive brand philosophy, the company undertook a set of market research studies to provide consumer insight of their perceptions and associations with the Naive brand.
One study revealed that consumers associated the Naive brand with traditional family values, communities, and nature. Another study analyzed consumers’ socio-cultural values and compared them to Naive’s positioning. The studies revealed that Naive’s brand associations and needs, including mildness and care, fit well into consumer’s values in the sass. The return to a more simplistic, holistic approach to life; the desire for fairness, authenticity, openness and belonging, and an integration of the past with the present were all values that were also associated with the Naive brand and particularly Naive Creme.
The results of this research clearly suggested that the sass presented an opportunity to grow and expand the Naive brand. Developing Commode’s Corporate Strategy Combining the results of the external research with their own internal research and discussions, the Cosmos task force developed a common brand philosophy for Naive to be adopted by the entire company and become the Asia for developing a corporate strategy that the Cosmos Division could implement at the product level. The brand philosophy centered on maintaining the association of “universality’ for Naive products.
Now that the Naive brand represented comprehensive skin care and personal care, the company wanted to develop a marketing strategy that would continue to nurture core Naive associations while widening their applicability and enhancing their meaning via sub-brands. Sunfish explained, “We want to build on the image of the blue tin where we are number one almost everywhere in Europe. ” Naive Creme continued to represent the heart of the Naive image, evoking the most trust and sympathy of the consumer.
Even as Naive’s sub-brands continued to expand in the 1 sass, Naive Creme was to remain the primary representative of the brand’s history and myth. Though its sales share had declined over the years, Naive Cramer was still considered the company’s most 7 of 22 | P age important product for its role in establishing and renewing basic trust in the Naive brand. The company wanted to develop a marketing strategy that would continue to nurture core Naive associations while widening their applicability and enhancing their meaning via suburban’s.
The role of the other sub-brands was to continue to cater to the specific skin care and personal care needs of their target market segments and contribute back their particular product class associations to reinforce and elaborate on the image of Naive as a skin care specialist. Because facial skin care represented 75 percent of the European skin care market and was very closely related to Naive’s strong association of “general skin care” from Naive Creme, Naive Visage was considered the primary sub-brand to upgrade Naive’s image into the sass.
Naive Visage, the company s face care brand, had the most biophysicist, contemporary and specialist brand image of all Naive sub- brands. At the same time, it benefited from the “halo” of the Naive name that represented trust, care, mildness and fair price. The primary challenge facing Naive Visage was how to effectively upgrade the Naive image as a skin care specialist while continuing to represent the universality and accessibility Of the Naive brand.
As with Visage, other sub-brands were expected to offer something back to the Naive brand. Through this combination, BFD sought to maintain Naive’s leading position in the mass-market segment of the European skin care market. While the Naive brand was Beds leading skin and personal care brand, the company sold other skin and personal care products under different brand names, including ex. deodorant and bath products, Label lip balm, and Atria lotion. 4 In total, these other brands represented nearly 40 percent of Commode’s sales in 1991.
Although these brands would continue to be part of Bed’s product offerings, the company decided that the company’s primary focus in the future would be the further development of the Naive brand through the introduction of new products. Only “extra” efforts and investments would be devoted to the development of these other rand. 8 of 22 | Page EXECUTING THE NAIVE BRAND PHILOSOPHY Having established corporate objectives, Cosmos now needed to design a communications strategy.
Cosmos worked with its advertising agency, TUBA, to develop a set of guidelines that would communicate a certain “Inverness” in all ads and promotions. This “Inverness” was to be represented in the layout, message, and image of the ads. Any campaign for Naive Creme would have to incorporate the brand’s values: timeless and ageless; motherhood and a happy family; honesty and trustworthiness; and the product benefits of mildness and quality. Any campaign for a sub-brand would have to reflect elements of these values. Cosmos was able to establish additional guidelines for the ad agency to follow.
These guidelines included: using common emotion in all ads, a uniform Naive logo, consistent lettering and typeface, real, inspirational people in the ads, and understandable copy about the product. Expansion of Naive Sub-Brands During the sass, the Naive category extensions grew into distinct sub-brands and adopted separate ad campaigns for each sub-brand. Consequently, each sub-brand had built its own personality and developed its own set of brand associations that were insistent with, but independent of, the Naive Cry??erne core brand image.
Through advertising, each sub-brand promoted specific product attributes and benefits that best satisfied the needs of its target market, and contained a common “Naive” message of quality and care. By 2005, the Naive brand portfolio had grown from six product groups in 1993 to fifteen, including: C I:] Skin Care??Naive Body, Naive Visage, Naive for Men, Naive Sun, Naive Baby, Naive Cry??me, Naive Vital, Naive Soft, Naive Hand, and Naive Lip. Personal Care??Naive Doe, Naive Beauty, Naive Hair Care, Naive Bath Care, and Naive Intimate Care.
SKIN CARE Naive Creme Naive Cry??me, Naive’s first product, was introduced in 191 1 and was the first stable water-in-oil emulsion available in the world. Original Naive Cramer tins were pale yellow with “Naive Cry??me” in blue print in the center and a red and blue Art Nouveau border, but were changed in 1926 to the now-familiar blue and white design. The tin design and advertising style evolved over the years, but both always reflected the simplicity and caring embodied by the brand. Package Historically, most Naive ad campaigns had been developed from a predominantly German perspective, largely because BFD had built the Naive rand around the local needs Of the German market. With the increasing internationalization of the cosmetics and toiletries market and the international strength of its main competitors, BFD felt that it was very important in going forward to build the Naive brand through a strong European base. Consequently, in the 1 sass, the company developed a true international ad campaign that presented a common brand image for Naive Cry??me.
The “Blue Harmony” campaign, introduced in January 1992, included a series of television and print ads highlighting Naive Cry??me. Because Naive Creme was still the company’s most important image carrier, but was plagued by stagnating sales, Cosmos decided first to develop a worldwide ad campaign that presented a common brand image for Naive Creme. The first ad showed a group of seagulls flying together through the air as circus music played in the background. The headline read: “Harmony in Blue. “Harmony’ was written in the Naive logo lettering while “in Blue” was written in white cursive letters. At the end of the ad a picture of a tin of Naive Creme flashed on the screen with the tagging ” All that skin needs to live. ” Naive Soft Naive Soft, a lighter skin cream distinct from Naive Cry??me, was first introduced in Europe in 1994. The Naive Soft formula was designed to be lighter than the heavier, greasier feeling of Naive Cry??me’s Oil and Water formulation. The company was careful to position Naive Soft as a Separate identity so not to cannibalize sales from Naive Cry??me.
Naive Soft initially launched in the United Kingdom with an innovative marketing strategy called “fast marketing” internally. The fast marketing strategy collapsed the Ann al marketing budget into a single week of intensive television and print advertising, sampling, and promotion. After the fast marketing was deemed successful in the United Kingdom. Naive employed the strategy for Naive Soft introductions in other markets. Following the European launch, Naive Soft expanded to South America, Asia, Africa, Canada, and Mexico during the sass. Awareness for Naive Soft was low initially, but sales continued to climb.
By 2001, Naive Soft was the number two product in its category throughout most of Europe. Despite the fact that Naive Soft and Naive Creme were similarly positioned as all-purpose creams, there was little centralization of sales. Naive Creme sales held steady while Naive Soft grew and many consumers started archiving both products. In 2004, Naive Soft launched in the united States in two sizes and revolved around extensive sampling targeting women ages 18-49. The campaign also included coupling, an online sweepstakes, and radio 10 of 22 | page spots.
Naive Softy’s launch in the United States was very successful and by February 2005 Naive (Soft and Creme sub-brands combined) had moved to the number one position in the U. S. Hand and body lotion market in terms of dollar sales. 5 That same year, Naive Soft also introduced three new sizes in Europe, including a mini tube for traveling. Naive Visage In 1982, Cosmos introduced in Europe its first set Of face care products for women, called Naive Visage after a line of products sold in France since the early sass. Early Visage ads stressed the mildness of Naive products in caring for the face.
Within one year, Visage became a leading face cleanser in many European countries. For the next five years, Naive Visage’s message focused on mildness. In 1987, BFD introduced a beauty fluid (liquid moisturizer) to try and established itself as a face care specialist. The product performed poorly and BFD learned that the benefit of “mildness” which had been such a successful point of difference in the cleansing segment of the market was not as unique in the moisturizing segment of the market. Rather, consumers in this market segment were looking for proof of a product’s effectiveness.
Cosmos upgraded Naive Visage’s image through a series of actions. First, Cosmos changed the packaging of its products from plastic to glass. Second, the company altered the logo for Naive Visage. Third, the company improved its product offerings, including the introduction of a moisturizing day cry??me and night cry??me in 1989. Finally, Cosmos introduced a new series of ads that soused on highlighting specific benefits of Naive Visage products. The ads moved away from Naive’s traditional codes of simplicity and universality to develop a more sophisticated specialty image.
With the addition of its first “anti-age” products in 1991, BFD introduced a third ad campaign, “Science in all confidence” that sought to blend the image of the best in face care science with the trust historically attached to the Naive brand name. By 1 996, Naive had passed L’Oreal??al to become the number one face care brand in Europe, with an 18 percent market share compared to 13 percent for L’Oreal??al. In 1998, Naive introduced a scientific breakthrough called IQ O that would soon become one of the company’s best-selling products. IQ O is a commence produced naturally by the skin that helps reduce wrinkles.