Introduction to PharmaSim Marketing 3349 March 18, 2008
Purposes of PharmaSim <ul><li>To introduce and reinforce the logical  process of marketing planning </li></ul><ul><ul><li>...
Purposes of PharmaSim <ul><li>To understand that the keys to profitability are market driven and customer-focused  decisio...
PharmaSim Decision Process <ul><li>Situation Analysis </li></ul><ul><li>Identification of Problems and  Opportunities </li...
PharmaSim Environment <ul><li>Similar to the United States in the Early  1990s </li></ul><ul><ul><li>Population = 250 Mill...
Competitive Companies Allstar Brands   $355 Allround, 4hr cold liquid B&B Health Care   $286 Believe, 4hr allergy capsule ...
Basic Consumer Needs <ul><li>Relief of Symptoms </li></ul><ul><ul><li>Aches and Fever--------------Analgesic </li></ul></u...
Produce Attributes Affecting Basic Consumer Needs <ul><li>Side Effects </li></ul><ul><ul><li>Drowsiness, Upset Stomach, Al...
Consumer Buying Behavior <ul><li>Is Based on: </li></ul><ul><ul><li>Illness/Symptoms </li></ul></ul><ul><ul><li>Age </li><...
Consumer Purchase  Process <ul><li>Awareness </li></ul><ul><li>Intention to Buy </li></ul><ul><li>In-store Attractiveness ...
Segmentation Process <ul><li>By  Illness </li></ul><ul><ul><li>Cold </li></ul></ul><ul><ul><li>Cough </li></ul></ul><ul><u...
Distribution Options <ul><li>Retail Outlets </li></ul><ul><ul><li>Independent Drugstores------------ 22% of sales </li></u...
Distribution Options <ul><li>Considerations for Shelf Space, Stocking  & Sales Force: </li></ul><ul><ul><li>Margin earned ...
Preliminary Questions <ul><li>Who is the likely Allround Customer? </li></ul><ul><ul><li>Their likely purchase process </l...
Preliminary Questions <ul><li>What do you think of Allround’s  pricing? </li></ul><ul><ul><li>How many units to maintain n...
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Introduction to pharma sim

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Introduction to pharma sim

  1. 1. Introduction to PharmaSim Marketing 3349 March 18, 2008
  2. 2. Purposes of PharmaSim <ul><li>To introduce and reinforce the logical process of marketing planning </li></ul><ul><ul><li>Situation analysis and assessment </li></ul></ul><ul><ul><li>Development of integrated plans – linking strategic and tactical decisions </li></ul></ul><ul><ul><li>Monitoring and evaluating results; using lessons learned in subsequent planning cycles </li></ul></ul>
  3. 3. Purposes of PharmaSim <ul><li>To understand that the keys to profitability are market driven and customer-focused decisions </li></ul><ul><li>To learn by doing in a low stakes environment </li></ul>
  4. 4. PharmaSim Decision Process <ul><li>Situation Analysis </li></ul><ul><li>Identification of Problems and Opportunities </li></ul><ul><li>Identify and Evaluate Alternatives </li></ul><ul><li>Make Decisions </li></ul><ul><li>Monitor Results </li></ul>
  5. 5. PharmaSim Environment <ul><li>Similar to the United States in the Early 1990s </li></ul><ul><ul><li>Population = 250 Million </li></ul></ul><ul><ul><li>GNP = 2% per year </li></ul></ul><ul><ul><li>Moderate Inflation (2-4%) </li></ul></ul><ul><ul><li>Over 80% of the population suffered from some cold-related symptoms in the past year </li></ul></ul><ul><ul><li>OTC cold-medicine retail sales = $2B with growth of 4% per year </li></ul></ul><ul><ul><li>5 companies competing in the industry </li></ul></ul>
  6. 6. Competitive Companies Allstar Brands $355 Allround, 4hr cold liquid B&B Health Care $286 Believe, 4hr allergy capsule Besthelp, 4hr cold capsule Curall $199 Coughcure, 4hr cold capsule Driscoll Corp. S255 Defogg, 4hr allergy capsule Dripstop, nasal spray Dryup, 4hr cold cpasule Ethik Inc. $395 Effective, nasal spray End, 4hr cough liquid Extra, 12 hr cold capsule Company Sales Brands
  7. 7. Basic Consumer Needs <ul><li>Relief of Symptoms </li></ul><ul><ul><li>Aches and Fever--------------Analgesic </li></ul></ul><ul><ul><li>Runny Nose-------------------- Antihistamine </li></ul></ul><ul><ul><li>Nasal Congestion-------------Decongestant </li></ul></ul><ul><ul><li>Cough---------------------Cough Suppressant </li></ul></ul><ul><ul><li>Chest Congestion-------------Expectorant </li></ul></ul><ul><ul><li>Allergy Symptoms------------Antihistamine </li></ul></ul><ul><ul><li>Trouble Sleeping--------------Alcohol </li></ul></ul>
  8. 8. Produce Attributes Affecting Basic Consumer Needs <ul><li>Side Effects </li></ul><ul><ul><li>Drowsiness, Upset Stomach, Alcohol </li></ul></ul><ul><li>Form </li></ul><ul><ul><li>Capsule, Liquid, or Nasal Spray </li></ul></ul><ul><li>Duration </li></ul><ul><ul><li>4 to 12 hours </li></ul></ul><ul><li>Price </li></ul><ul><ul><li>MSRP, Discounts, Channels, Promotions </li></ul></ul>
  9. 9. Consumer Buying Behavior <ul><li>Is Based on: </li></ul><ul><ul><li>Illness/Symptoms </li></ul></ul><ul><ul><li>Age </li></ul></ul><ul><ul><li>Day vs. Night Use/Work vs. Home Use </li></ul></ul>
  10. 10. Consumer Purchase Process <ul><li>Awareness </li></ul><ul><li>Intention to Buy </li></ul><ul><li>In-store Attractiveness </li></ul><ul><li>Purchase </li></ul><ul><li>Post Purchase Usage/Satisfaction </li></ul><ul><li>Repurchase </li></ul>
  11. 11. Segmentation Process <ul><li>By Illness </li></ul><ul><ul><li>Cold </li></ul></ul><ul><ul><li>Cough </li></ul></ul><ul><ul><li>Allergy </li></ul></ul><ul><li>By Demographics </li></ul><ul><ul><li>Young singles </li></ul></ul><ul><ul><li>Young Families </li></ul></ul><ul><ul><li>Mature Families </li></ul></ul><ul><ul><li>Empty Nest </li></ul></ul><ul><ul><li>Retired </li></ul></ul>
  12. 12. Distribution Options <ul><li>Retail Outlets </li></ul><ul><ul><li>Independent Drugstores------------ 22% of sales </li></ul></ul><ul><ul><li>Chain Drugstores----------------------28% of sales </li></ul></ul><ul><ul><li>Grocery Stores------------------------37% of sales </li></ul></ul><ul><ul><li>Convenience Stores-------------------4% of sales </li></ul></ul><ul><ul><li>Mass Merchandisers-------------------9% of sales </li></ul></ul>
  13. 13. Distribution Options <ul><li>Considerations for Shelf Space, Stocking & Sales Force: </li></ul><ul><ul><li>Margin earned per unit </li></ul></ul><ul><ul><ul><li>[volume discounts and promotional allowances] </li></ul></ul></ul><ul><ul><li>Sales volume and turnover rates </li></ul></ul><ul><ul><li>Sale Force Influences </li></ul></ul><ul><ul><ul><li>Direct and indirect </li></ul></ul></ul><ul><ul><li>Co-op advertising funds </li></ul></ul><ul><ul><li>Other promotional activity </li></ul></ul>
  14. 14. Preliminary Questions <ul><li>Who is the likely Allround Customer? </li></ul><ul><ul><li>Their likely purchase process </li></ul></ul><ul><ul><li>Marketing mix elements-most effective </li></ul></ul><ul><li>What advantages does Allround brand offer? </li></ul><ul><li>Who are Allround’s competitors? </li></ul>
  15. 15. Preliminary Questions <ul><li>What do you think of Allround’s pricing? </li></ul><ul><ul><li>How many units to maintain net contribution at $5.00 or $5.60 </li></ul></ul><ul><ul><li>What are the advantages of a higher price, lower price? </li></ul></ul>

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