How to successfully reinvent a brand @ Oil of Olay

Reinventing Oil of Olay

In the 90s, “Oil of Olay” was the most famous skin care brand of Procter&Gamble (P&G). Despite its popularity, competition with similar products and the same target group increased. “Oil of Olay” had difficulties to compete with innovative brands and was considered old-fashioned.

To regain its image and market share, the brand had to be reinvented. The senior managers at P&G used Design Thinking and achieved spectacular results.

Approaching the problem

P&G had three options to address the problem. They could create a new brand, buy out an established innovative competitor, or reinvent the Olay brand. The decision was to be answered from the customer’s point of view with the help of Design Thinking. P&G’s first step was to examine the current process and analyze the customer in detail. Therefore, they began by observing shoppers in both retail channels and high-end department stores.

Four key observations could be identified:

  1. “Oil of Olay” was a strong brand that many people were familiar with.
  2. The existing customer group consists of women over 50 years of age.
  3. The customers were price sensitive and wanted to spend a minimal amount of money on high quality skin care products.
  4. The growth opportunities were limited due to fierce competition on a small target group.

Having the right focus

The next step for P&G was to change its focus from customers to non-customers. Striking about their research observation was that many women in their mid-thirties used hand and body cream on their faces. Unlike the existing customer group, they do not want to reduce wrinkles, but prevent skin aging. This opens up a new market for P&G with undiscovered customer needs. Younger women had a higher willingness to pay with the hope of healthy young-looking skin. They were highly committed to skin care and the expected frequency of use was 2-3 times a day.

The change in perspective allowed P&G to achieve a new value proposition for the brand that offered huge potential.

Drawing the right conclusions

P&G concluded from their research results that “Oil of Olay” is a well-known strong brand in a difficult market segment. Therefore, P&G decided not to start a completely new project, but to reinvent the “Oil of Olay” brand. They realized that their industry had primarily targeted women over 50 years of age who were worried about wrinkles while pretty much ignoring those in their 30s who were concerned about other issues. The strategy from now on was value innovation. P&G experimented with new formulations that would tackle multiple skin care problems such as dry skin, uneven skin tones, and age spots. For the final product they tested different prototypes, price points, and store displays. In 1999, P&G launched its “Olay Total Effects”, which was quickly followed by “Olay Regenerist”, “Olay Definity” and “Olay ProX”. The value innovation strategy paid off and Olay had double-digit sales growth. To make the new positioning clear, the name of the brand was changed from “Oil of Olay” to “Olay”.

In addition to its rapid commercial success, P&G also transformed the brand’s image and Olay served as a benchmark for many other beauty brands.

What can we learn from P&G

The example of “Oil of Olay” shows us that a successful reinvention of a brand is possible. For this it is important to deal with the needs of the customers and to think from the perspective of the customer. However, not only the previous customers but also non-customers should be examined. This can lead to considerable economic success as well as to a pioneer for new brands.

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