Cialis Midterm Case Study PDF

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Joshua Guerrero Midterm Case Study Product Team Cialis: Getting Ready to Market Brief Background: The case study examines how to launch and market Cialis, a new drug for erectile dysfunction (ED) into a market that is already dominated by Pfizer’s drug Viagra. Cialis will be launched through a joint venture comprised of Eily Lily, a pharmaceutical giant, and ICOS, a young biotech upstart. In order to compete with Viagra, the Cialis team must carefully identify the best value proposition, in a way that positions the drug as a major differentiator to the existing drug that doctors and patients are already accustomed to. Decision Dilemma: The decision dilemma for the Cialis team is how to develop a marketing strategy to segment the existing market or whether to create a new market. Furthermore, once there target market is identified, they must figure out how to further differentiate their product and how to position it against their competition (Viagra), while also considering the future launch of Bayer’s Levitra. Lastly, the team must decide how to price Cialis. My Analysis: Contradictions: (1) The surveys conducted with doctors were most concerned with efficacy and safety of the drug. Later they suggest that most doctors don’t feel comfortable talking about ED with their patients. Are the more concerned with safety and efficacy, or avoiding uncomfortable conversations with their clients? (2) One of the biggest differentiators for Cialis was its duration, yet the preliminary conjoint study showed that the attribute of duration had a relative importance of less than 10%. (3) Partners were the highest reason for men to seek out Viagra from their doctors, yet the article talks about considering if directing messaging toward partners should be considered? It’s the highest driver for consumption, why would it not?

Case facts left out: (1) One of the major differentiators between Cialis and Viagra is the life span of the pill. Did they conduct substantial surveys to identify if this was the biggest concern for Viagra users? (it talks about how doctors view of this is less than 10%) (2) The case states that some doctors, who seemed contempt with Viagra, might be reluctant to switch to Cialis. Were any surveys done to get accurate data on this. (3) What would it take for doctors to switch away from Viagra?

Joshua Guerrero

(4) Since 67% of Viagra users got the drug from a local drug store, were there any barriers to getting these drug stores to also carry Cialis? (5) Was there a value analysis, getting any information from the Cialis test trial participants on how much they would pay for the drug? (6) What is the size of the JV’s sales force that could be used in the launch, promotion, and selling of Cialis? (in comparison to 1,250 for Bayer and 30,000 for Pfizer. (7) If Cialis is in system longer (36 hours), are there more likely to be side effects that could occur vs the short window of Viagra? Personal Experience: Based on my personal experience with other pharmaceutical drugs in the past, a concern I would have is if taking the medication would begin to inhibit the person’s natural abilities based on a growing reliance and dependence on the drug for performance. Based on my experience in working with couples in my business in terms of communication, trust, intimacy, etc. I think messaging could be targeted at “couples” collectively instead of targeting specifically the male or their partner. Kotler Text: 1. Target Market: “Until it defines and profiles the target market, the retailer cannot make consistent decisions about product assortment, store decor, advertising messages and media, price, and service levels.” (Kotler 557). The Cialis team must first decide the target market before thinking about advertising, positioning, or pricing. 2. Set the Communication Objective: The first step here is to establish a need. Establishing a product or service category as necessary for removing or satisfying a perceived discrepancy between a current motivational state and a desired motivational state. Although there isn’t a high concern for the short half-life of Viagra. Cialis could use advertising and positing to help doctors and patients understand the importance and need for a longer drug life and the benefits that coincide with that. 3. Transformational Appeals: The case study talks about all the long term effects of Erectile Dysfunction, including the increase chance of divorce, lower self-image in males, etc., Cialis can position this drug as a life transformer. These techniques are thought necessary in the tough new media environment of low-involvement processing and competing messages.

Decision Options: Decision 1: Do not Launch Cialis, maintain status quo Decision 2: Sell the pill to competitor (Pfizer or Bayer)

Joshua Guerrero Decision 3: Go with a “direct compete” strategy, and go after same market as Viagra, take advantage of Viagra drop-outs, $8 per pill. Decision 4: Go with a “niche” strategy, going specifically after married couples between the ages of 30 and 65. $10 per pill. Decision Option Pro and Con: Decision 1: Do not launch Cialis, maintain status quo Pros: - Prevent fierce marketing war between Cialis, Pfizer, and Bayer - Less risk of product failure - Ability to put money and resources into less dominated market segment - More time to collect data, surveys, and market research Cons: - Opportunity cost of never introducing proven product - Competitors innovate and fill the gap (Levitra) - Wasted resources on merger, testing, and development of Cialis - Don’t increase revenue Decision 2: Sell the pill to competitor (Pfizer or Bayer) Pros: - Reduce risk of launch failure - Leverage this innovation to increase immediate revenue to further develop R&D for products that are in less dominated market - Learn from the implementation of Bayer, and make tweaks to marketing strategy and positioning Cons: - Major long term opportunity cost - Increase risk of more competition in ED market - Reduced ability for Market Share in long term - Giving away competitive advantage Decision 3: Go with a “direct compete” strategy, and go after same market as Viagra, take advantage of Viagra drop-outs, $8 per pill. Pros: - The most likely strategy to hitting $500m goal - Cialis has superior product - Increase market share - Allows to go after largest market - Maximize profits and market share Cons: - High risk, going against the market dominator - Less resources and sales force vs Pfizer’s Viagra team - Lead to marketing war which could drain resources - Less brand awareness as Pfizer/Viagra

Joshua Guerrero Decision 4: Go with a “niche” strategy, going specifically after married couples between the ages of 30 and 65. $10 per pill. Pros: - Less probability of all-out market war with Pfizer - Position Cialis as “different” from Pfizer, Cialis is for younger people - Could position to be the answer to all Pfizer drop-outs - Gather more interest from younger people since specifically targeted - Less competition with this age range Cons: - Still likely to have some level of marketing war/competition with Pfizer - Opportunity cost of missing out on age range with highest prevalence - Lower profit margin possibilities - Less likely to hit $500m goal - Ignoring part of market segment willing to try switching from Viagra

My Decision My decision is to go with Decision 4: Go with a “niche” strategy, going specifically after married couples between the ages of 30 and 65. $10 per pill. This will reduce the risk of going head to head with a company that is already established in the market and has extensive resources to compete with Cialis. Because of this, I believe Cialis should have differentiated positioning that targets the patient and the partner, keying in on the lack of information around ED in this age group, and the psychological effects that coincide with the male having ED. This will differentiate against Viagra’s initial launch strategy of using a 75-year old Bob Doyle, which targets the much older population groups. Cialis could position itself as being the drug for younger couples, keying in on the long life span of the drug. Due to the niche strategy and ability for psychological influences in the purchases of this age group, In believe the increased price $10 per pill (vs $8/pill) will help the company’s chances of hitting the $500m. There is no right decision There is no right decision because we don’t know what Pfizer’s response to Cialis is going to be. We don’t know if Cialis long term intention is to take up market share or increase profits. We don’t know how physicians are going to respond to the increasing competition between Viagra, Cialis, and Levitra. There is no right way because many strategies could be successful, or all the strategies could fail....