The Blue Agenda

With our strong brands, we are close to our consumers and meet their needs across the globe. In doing so, our brand portfolio makes a decisive contribution to the success of our company. Beiersdorf’s brands stand for trust, quality, and consistency. By applying disciplined brand management, we have succeeded in consistently increasing our brands’ impact during the reporting year. This is especially the case with our brands Eucerin, Hansaplast, and La Prairie, which have increased in strength through our accelerated efforts under the new Blue & Beyond strategy. We have set ourselves the goal of leveraging the growth potential of the brands and making them just as economically successful as our iconic brand NIVEA.

Beiersdorf has built its global reputation on a strong tradition in skin care expertise. Developing innovative products that meet consumers’ expectations is key to strengthening our brand position in the skin and body care business. Ensuring product innovation is of vital importance to us. We therefore focus on new products with high potential for sustainable growth. Furthermore, we aim to extend the lifespan and growth of our major innovations to make full use of their potential. One of the major innovations we introduced to the market during the reporting year was the new NIVEA Sun Protect & Care with an improved formula. The innovative formula not only protects skin from UVA and UVB, but also enables stains from UV filters to be more easily washed out of clothing. This groundbreaking innovation has led to Beiersdorf significantly strengthening its excellent position in the area of sun protection.

We are represented in almost all countries worldwide with our leading brands. Being close to our consumers is critical for us to meet the specific and often very different needs in the regions and to be able to react quickly and flexibly to changing expectations. This close proximity ensures we have sustainable market share, and that we are able to establish and maintain leading positions in our markets.Beiersdorf is positioned very close to consumers through the global presence of our brands and affiliates. Our global network of research and development sites enables us to anticipate trends and to develop our products for individual needs. The proximity to the target markets of our 17 production sites in twelve countries gives us further advantages over global competition. In the year under review, Beiersdorf continued to make targeted investments in increasing local production capacities in order to further strengthen the company’s international activities as well as its presence and impact in key emerging markets.

Beiersdorf sets itself apart through its high level of efficiency and its ability to adapt to changes in the markets. This has allowed us to continue the sustained growth trend of recent years also in the reporting year. Beiersdorf further increased efficiency in 2017 through strong cost discipline exercised across the company, improved cost structures, focused use of the marketing budget, and streamlining and harmonization of the product range. Another focus was on the further reduction of working capital (= inventories plus trade receivables minus trade payables), which went down to a single-digit percentage in the reporting year.

In addition to being close to the consumer at the local level, our global digital presence continues to gain in strategic importance. To strengthen our brand position and close relationship with our consumers, we have been forging ahead with digitalization at Beiersdorf for years. During fiscal 2017, we continued to increase direct communication with our consumers and strengthen brand loyalty through a wide range of digital initiatives and targeted online marketing.

Thanks to our increased digital activities and successful cooperation with e-commerce platforms, e-commerce sales were up significantly again during the year under review. For example, in 2017 our US mass market business across e-commerce platforms (including e.g. Amazon) grew strongly by more than 40% against the prior year. La Prairie even generated more than 20% of its sales in the US through e-commerce alone in 2017. Investments in China, a key growth market for Beiersdorf, included the cooperation with the two leading e-commerce platforms, Alibaba and JD.com. These online platforms provide us access to around 650 million Chinese consumers. During the reporting year, we achieved strong growth now generating more than 25% of our total sales in China in the e-commerce sector.

Our initiatives are directed at where they make the most impact for consumers, employees, partners, and us. Fostering a digital mindset among all employees was a key focus for Beiersdorf during the reporting year. Through inspirational talks and e-learning modules, we intend to further enhance and increase our employees’ digital expertise.

Beiersdorf strives to be an attractive employer for all employees across the globe and promotes a culture of open feedback and dialog on an equal footing. Regular global “town hall meetings” for staff and other local events offer employees worldwide a multitude of opportunities to discuss directly and openly with members of the Executive Board and top management.

For the fifth year in a row, the company carried out a global survey on employees’ motivation and level of satisfaction. In 2017, over 90% of Beiersdorf staff took part. The results show that team cohesion, satisfaction, and employee engagement increased further during the year under review. The feedback generated by the survey serves as the basis for implementing improvement initiatives in the day-to-day working environment.

With the construction of the new headquarters in Hamburg-Eimsbüttel, Beiersdorf is investing in an ultra-modern, attractive new working environment in urban surroundings. Initial construction work has already begun during the reporting year with completion scheduled for 2021. The investment volume for this project amounts to €230 million. An administrative complex with 3,000 working places and the expansion of the research center will be built on an area of 100,000 square meters. The operational units that are in part far away from each other at the moment will be able to work together under one roof in the future. With the construction of the new headquarters, Beiersdorf is sending a clear signal of future growth.