Beiersdorf


Table of Contents

I.        BEIERSDORF – COMPANY OVERVIEW        

   1.    History……………………………………………………………………………...…3

   2.   Philosophy………………………………………………………………………….....4

   3.   Beiersdorf’s Brands…………………………………………………………………4

   4.    Research and Development…………………………………………………………4

   5.    Environmental Protection and Safety……………………………………………4

   6.    Indicators……………………………………………………………………………...5

II.        THE INTERNATIONALISATION PROCESS OF BEIERSDORF        

1.        Beiersdorf  – A transnational group which sells global brands        

2.        Internationalisation strategy of Beiersdorf – Two dimensions        

3.        Illustration of Beiersdorf’s strategy - NIVEA        8

4.   Comparison of  Nivea's marketing-mix France - Hungary.........................….11

III.        L’OREAL……………………………………………………………………………..13

1.        L'Oreal - Company overview        13

2.        L'Oreal goes international        4

3.   The Beauty of global branding…………………...………………………………16

4.   Conclusion……………………………………………………………………..……16

ANNEX        19

SOURCES…………………………………………………………………………………..22

Introduction

        Beiersdorf is a leading international consumer goods group, selling cosmetics, plasters, cremes, and many other products for personal care and health. It focuses on the development and care of a few global consumer brands of products of everyday use.

With 90 subsidiairies and a developped network of distribution partners, Beiersdorf works in more than 100 countries all over the world and the group has known a huge international success through its different brands.

        We were interested in knowing more about its internationalisation process and about its way of doing business internationally, and we wanted to try to discover the keys of its success.

        In this report, we will first present the group Beiersdorf. Then, we will focus on its internationalisation process. And finally, we will compare its international strategy with the one of L’Oreal, one of Beiersdorf’s main competitors.

  1. Beiersdorf – Company Overview

1) History

The company was established in Hamburg in 1882, when the pharmacist Paul C. Beiersdorf took out a patent, which described a new method for manufacturing medical adhesive dressings containing medicinal substances. In 1890 the pharmacist Dr. Oscar Troplowitz acquired the laboratory from Paul Beiersdorf and recognised the long-term potential of products that make an effective contribution to solving everyday problems. Troplowitz brought out a large range of products, such as pomades mouthwashes shaving soaps, adhesives tapes, paraplats, lipsticks. However the most far-reaching changes came in 1911, when he initiated development of a long-lasting cream, which in December of that year came onto the market. It was a well-balanced completely new cream. It was called NIVEA, coming from the Latin word “nivius” meaning snow-white. Troplowitz also began to internationalise at an early stage. In 1892 the company started to sell its products in the United States, imported via New York. From 1898 it made regular deliveries to Vienna, or Austria-Hungary, in 1906 it established an office in London’s Idol Lane. By the beginning of the First World War there were also production facilities in Buenos Aires, Copenhagen, Mexico, New York, Paris and Sidney. However this internationalisation process was repeatedly interrupted by the world wars, Troplowitz laid the foundations for Beiersdorf as a global player. Today Beiersdorf’s products are sold in nearly every country in the world, by more than 90 affiliates, distribution and licence partners. It achieves 70 per cent of the sales outside Germany.

2) Philosophy

Beiersdorf’s mission statement: to increase people’s well-being and make their life a little better every day.

The combination of brands and people accounts for Beiersdorf’s success. Beiersdorf focuses on the continuous development and care of a few global brands. The centre of its activities is always people: consumers and the dedicated and experienced employees. The company has more than 17.500 employees around the world.

3) Beiersdorf’s Brands

Beiersdorf owns 11 different brands : NIVEA, 8x4, atrix, Eucerin, Labello, la prairie, JUVENA, FUTURO, tesa and the plaster bands Hansaplast and Elastoplast.

The characteristic features of Beiersdorf’s brands are: reliable quality with a high degree of benefit for the consumer, at a reasonable price. The company is constantly working to develop and improve these brands and their product ranges.

4) Research and Development

Beiersdorf places a high emphasis on research and development and pursues the ongoing development of brands and concentrates on the three competence fields: cosmetics/personal care, wound care/health and adhesives technology. In 2001 the company spent 2 per cent of its sales (92 million euro) on R + D.

In the personal care, the latest techniques are used to develop future technologies for innovative, high-performance active cosmetics. They are using new plaster production technologies to develop innovative products for the consumer goods industry. The tesa AG focuses on successful processing of solvent-free adhesives and coating processes.

5) Environmental Protection and Safety

The two main principles for Beiersdorf are: “conserve the environment” and “maximum safety for all employees”. The company’s environmental and safety strategy is integrated in all business workflows. It consists of three stages:

  • Product development
  • Production process
  • Environmentally sound waste management.

6) Indicators

Beiersdorf’s products are sold in nearly every country in the world by more than 90 affiliates, distribution and licence partners. It achieves 70 per cent of the sales outside Germany.

                

Group sales (in million Euro)                               Group profit after tax (in million Euro)

Source : the annual report of Beiersdorf in 2001

As the graphs show, the sales have been increasing from 1999 to 2001 (+24.85%), as well as the group profits after tax (+62%) : the group has known a huge growth.

        After this brief overview of Beiersdorf, we are going to focus on the group internationalisation process, trying to evaluate the company’s behaviour as an international player.

II. The internationalization process of Beiersdorf

As we have seen, Beiersdorf is an international group that sells its products almost in every country in the world, and 70% of its sales are done outside of Germany (for instance, the group achieves 9.3% of its total turnover in France). But how has the group reached this? What is the internationalisation process of Beiersdorf ?

  1. Beiersdorf AG – Beiersdorf : a transnational group which sells global brands

First, Beiersdorf focuses on developing a few global brands in order to fully respond to people’s diversified interests and wishes, it invests in a small number of strong consumers brands. This constant work to develop and improve the brands and their products range enables to offer reliable quality products at a reasonable price, so that consumers trust the brands.

Consumers are really the central concern of Beiersdorf and the groups clearly defines it in its mission statement : its aim is to increase people’s well-being and to “make their life a little more pleasant every day”.

According to Beiersdorf, “a brand can only be successful worldwide if it is successful locally”. Consequently, the group works in order to meet the local needs of people, so that the brands will be successful locally, and the global success and strength of its global brands come from their local strength. In other words, we can say that Beiersdorf brands have a global success throughout the world, but the group keeps a consumers-driven orientation that enables it to meet regional needs and to adapt to each country. Beiersdorf wants to understand and to respect the different cultures that exist throughout the world and this strategy led it to success.

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Now, we can raise a new question : how does Beiersdorf deal with its internationalisation in order to reach its objective (i.e. to develop global brands that meet local needs) ?

The group’s head office is in Hamburg (in Germany) and there are 100 affiliates worldwide, with a centre of production, a marketing and sales department, a R&D department, etc…For example, in Thailand, there is the second largest manufacturing base of the group in Asia, with a production capacity of over 62,000 tons and 180 employees. This important base has both administrative and production facilities, it provides support, supervises ...

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