Product Team Cialis Getting Ready to Market Essay

Q1. In 2002, Viagra was the only clinically proven, FDA approved medication for Erectile Dysfunction (ED) on the market (Cialis – Dec 2003, Levitra – Sept 2003). Viagra had the highest brand recognition of any pharmaceutical product on the market. It had generated over one billion dollars in annual sales for 3 consecutive years since its introduction in 1998. In 2002, Viagra accounted for 5.3% ($1.73 billion) in sales of Pfizer’s annual Revenue of $32.37 billion, compared to 4.3% ($1.3 billion) of total revenue ($29.5 billion) in 2000. Viagra was expected to continue to lead the ED market due to its unsurpassed medical profile.

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Future Viagra sales growth was expected to come from increased patient presentation and physician diagnosis. Direct-to-consumer advertising has been effective in encouraging more customers to see a physician about ED. Even though Lilly ICOS and Bayer were in the process of bringing their products to market, Viagra was the front-runner and expected to retain its advantage in the ED market. A short half-life of approximately 4 hours, interactions with fatty foods, blue visions, and interactions with other medications like nitrates, are considered some of the weaknesses of Viagra.

Q2. Our strategic Market segmentation for ED treatment is based on the types of population, by age and sex (socio demographic segmentation).

The options available for market segmentation are: the concentration strategy, multi segment strategy, usage segmentation, and cohort segmentation.

We believe Cialis should target the following segments: Usage segmentation – Lilly ICOS has the advantage of knowing which group is using ED medications (data from PCP’s, urologists and pharmacies). By using this data readily available, they can not only target the current users, but also the dropouts and dissatisfied customers. A large percentage of Viagra users did not refill the prescription. A significant number of them were not happy with the end-result after taking the medication, since duration of the effect was shorter than expected. Baby boomers (cohort segmentation) – because of increased prevalence of up to 60% of ED within this age group. Psychographic segmentation – age specific (40 – 60+) – as ED is increasingly more common in this age group, varying 20% to 60 %. Spouse or partners (during their physician office visits) – 80% of the men using ED medication are married or living together.

Q3. Cialis could either position itself as a “Market Challenger” or “Market Niche.” As a “Market Challenger,” the introduction of Cialis to the marketplace means that the dominance of Viagra is confronted, having alternatives to treat erectile dysfunction. However, the Lily ICOS team could not ride on this wave alone and would need to create brand recognition and loyalty. For doing so, they would need to ensure that consumers recognized Cialis as the solution to ED and not only as an alternative. The pro for Cialis is that they have a superior product; however, they are up against Viagra, with the reputation as pioneer of ED management in the marketplace.

However, as a “Market Niche,” Cialis could segment their market to incorporate the emotional aspect of the product and its positive social implications in relationships, an aspect which the Viagra marketing team did not address. Therefore, to successfully create this concept, Lily ICOS involved its marketing team early into the development of Cialis, as this would enable them to better understand the core product, its benefits and how it affected the overall psychosocial perception of erectile dysfunction.

One of the pitfalls of this approach would be that Cialis, a new product with little or no credibility in the market, would take extensive time and focused marketing effort to build a loyal consumer base. Based on their knowledge of the product, they would create more directed marketing research focusing on the needs, expectations and loyalty of the consumer. In addition, the marketing representatives would approach physicians regularly and remind them to offer Cialis as a potential solution to their patient’s condition and the overall benefits it could have on their social outlook and relationship. Basically, the Lily ICOS team would need to study the reasons why Viagra users were not repeat customers and bridge the gap from an initial user to loyal repeat business.

Q4. The goal of the communication plan would be to ensure that Cialis gains credibility as superior product and consumers are pleased with its effect, both immediate and long lasting. Cialis need to demonstrate its potential to stand as an ideal solution to erectile dysfunction, not as an ‘Me too Viagra like’ alternative. Decreased side effects and the extended half-life of Cialis are the major marketing points to communicate (when positioned as “Market Challenger”); however, the positive social ramifications and increased self-confidence hence forth would add another level of emotional credibility to Cialis (when positioned as “Market Niche”).

Q5. Our goal is to educate married couples and physicians. Patients will play a critical role for this drug to be successful, we need to be focus on their education with Direct to Consumer marketing, choosing programs that are watched by our target age group men who are married or with partners. This includes Television programs, evening news, and leisure sports programming, such as; Golf, fishing, or talk shows like Oprah, which is watched mostly by partners. There should also be emphasis on web-based marketing, including direct email to potential users, AARP sponsored Programs, etc. Advertisement should include magazines that cater to partners, such as; good housekeeping, cooking magazine, etc.

Q6. Viagra was priced at $10 per pill. Since we are promoting Cialis as a better product, with its long-lasting effect and less side-effects – no blue vision or issues with meals, we would price it slightly higher. It is important for consumers to know the benefits of Cialis and create the awareness of a superior product. We would not want to price it significantly higher, since it would be difficult for consumers to switch to a new product from a product with a proven track record and marketed by one of the best companies in the Pharmaceutical industry. It is important for consumers to try Cialis, risk-free and feel the difference. This could be accomplished by providing free product samples, once satisfied; they would be the first customers.

Q7. Pfizer has a number of options available at its disposal. It could wager the legal challenge stating the significant similarities between the products – a patent infringement lawsuit could be filed. However, Lilly ICOS could argue that there are significant differences in terms of onset, duration of action and food interaction, making Cialis different from Viagra.

Pfizer could increase switching costs by incentivizing customers to return to their product. This could be achieved by offering one out of five prescriptions free, or a similar offer. Lowering the price of the prescription could also be considered a preemptive strategy. Lilly ICOS could offer free samples to practitioners during their advertising campaign and possibly offer a similar program later, for the frequent users.

Pfizer could consider attracting new customers while using the increased customer awareness triggered by the Cialis marketing campaign. It could present Viagra as a trusted product with a long track record and safety. Pfizer could introduce new educational material about ED. Lilly ICOS could highlight the major differences between Viagra and Cialis, during their physician and DTC campaign.

Lilly ICOS could target a specific segment instead of going head-to-head with the power of Viagra’s blockbuster title. Cialis could target couples, with a strong message towards intimacy and strong, durable relationships. This could result in increased marketing efficiency, as both partners would be targeted – avoiding the head-on competition with Viagra, which primarily targeted males.

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