Thursday, October 10, 2019
Pharmasim Preliminary Market Strategy Essay
Allstar BrandsÃ¢â¬â¢ over-the-counter cold and allergy remedy Allround will continue to be the market leader among OTC cold medicines and continue to increase its stock price over the next decade in order to remain not only competitive, but the premier stock choice among competitors in the OTC cold and allergy remedy market. To further grow the Allround product it is essential to build upon the current strengths of the brand, but also seek additional areas for opportunity and growth. These goals will be accomplished by evaluating competitors entering the OTC cold and allergy remedy market and through careful planning and execution to enhance our current product to meet the desires and needs of consumers. Allstar BrandsÃ¢â¬â¢ Allround product holds a strong position in the over-the-counter cold and allergy remedy market by being the market share leader, but there is no guarantee this trend will continue. Allround recognizes the need to continue to diversify and reformulate its current product line in order to remain competitive in light of an influx of competition. Allround competes in one of four product categories in the OTC market with no emphasis in the cough, allergy, or nasal categories. We will be better enabled to meet the desires and needs wanted most by consumers by enhancing the current Allround product line. Allstar BrandsÃ¢â¬â¢ Allround product has been a profitable brand with manufacturer sales of over $355 million in its most recent period. To further increase sales it is crucial to ensure the Allround brand is being sought by all consumers in the OTC cold and allergy remedy market. Recent surveys show the Allround brand did not receive the best shelf space placement and this is a great concern to the future of the brand. It is important Allround reallocates its resources appropriately to maximize the efficiency of our channels of distribution in order to promote our brand to its fullest potential. AllroundÃ¢â¬â¢s brand effectiveness and high recognition have allowed it to be among the price leaders in the OTC cold and allergy remedy market. This current trend is a great concern to the management team at the OCM group of Allstar Brands. In order to remain competitive Allround must closely monitor all pricing aspects associated with manufacturing and selling the brand. To ensure Allround can maintain a price leadership role in the market it must continually adjust its pricing tactics to better suit its consumers in periods of growth and decline. AllroundÃ¢â¬â¢s success depends on the consumers who buy its product. To ensure consumers are purchasing our product Allround must offer the greatest value. By promoting our product to the appropriate demographics we can develop more sales and grow our customer base. Allround brand recognizes the need to promote its product through all types of mediums including coupons, point-of-purchase vehicles, and trial-size packages in order to maintain customer loyalty. If Allstar Brands is able to understand its customers on a more intimate basis then it can better provide for desires and needs sought by those purchasing medicine in the OTC cold and allergy remedy market. Situation Analysis The following is a situational analysis of all pertinent aspects of the current state of the market and of the Allround product. Using the Ã¢â¬Å"5 CsÃ¢â¬ we have developed an overview of the current situation and hope to present it in a clear and concise manner. This covers the current external factors, major competitor factors, projected customerÃ¢â¬â¢s information, fellow distributorÃ¢â¬â¢s and retailerÃ¢â¬â¢s factors, and current company outlook. -Context: External factors -Collaborators: Who are we using to promote our product, and how do we motivate them? WhoWhyMotivate PharmacistsCustomers value and trust the opinions of pharmacistsMarket that boosting the sales of Allround will also boost drugstores sales Chain DrugstoresStatisticaly a high volume of sales come from thesePromoting this product will boost sales and garner more customers for both Allround and the drugstore Grocery StoresStatisticaly a high volume of sales come from theseConvince that this is the best OTC cold medicine and that stocking this will increase store sales DoctorsDoctors could recommend product to patientsDistribute samples to local doctors to encourage recommendations to patients -Company: Goal? Strengths and weaknesses? GoalsMetricsStrengthsWeaknesses Increase Stock Price10% increase per yearBrand awareness, market share, product quality, high potential growthUnacceptable budget allocation Increase Company Net Income10% increase per yearHigh income, high price, brand awarenessWeak portfolio Increase Company Annual Net Income~$74MBrand awareness, company growth, inelastic pricingSales coverage, Unused R&D capacity Increase Company Utilization~93%#1 product in market, new product line and reformulation optionsAlcohol additive in current formula, budget Increase Shelf Space Rank#1 product in retailBrand awarenessSales coverage and promotion, diluted advertising plan, budget constraints Target Market: The Allround initial marketing plan will be focused on four core groups. The four groups include empty nesters, mature families, singles, and retirees. The main marketing focus will be on singles and empty nesters, as those are our core customers. Singles and empty nesters is AllroundÃ¢â¬â¢s primary demographic. These 2 groups are the perfect candidates due to their age. Young singles are defined as young adults living alone; Allround was made for fast relief for adults. Young singles, being largely independent, require fast and effective relief from cold symptoms. Empty nesters are classified as older people whose households are now empty. Mature families are also a large group of interest. Mature families usually have older children and are less cautious of the side effects on a teen. The parents of the household are also usually middle aged and still in the workforce, this is a perfect demographic for a fast relief cold medicine. Retired is an important, but already established, market for Allround. Due to this fact the company should focus less advertising on retirees. People past the point of retirement have already been largely exposed to the product. The chance of acquiring new customers from this demographic is low, and the advertising opportunity is past its prime. The marketing team has decided against advertising to young families, at least for the moment. Young families are especially concerned with side effects of medicine. Many families with young children wonÃ¢â¬â¢t be as interested in adult cold medicines. Therefore, advertising efforts should be focused elsewhere. Allround should look into developing a childÃ¢â¬â¢s cold medicine in the future; bundle that with the original formula and market it to young families. Recommendations: Our recommendations are focused on the initial four major company expressed at the beginning of this report. First we will discuss how to improve our product, and by extension customer satisfaction, as well as possible new product lines. Second, we will focus on product placement and improving distribution channels. Third, we discuss possible pricing options and contingencies. Finally, promotion plans and increasing our circulation through major markets. The Allround product is a well recommended and widely trusted OTC cold and allergy medication. To maintain this image we need to further show our customers that we are listening. A major issue with current customers is the alcohol content, and resulting side effects, of the current Allround formula. To improve AllroundÃ¢â¬â¢s image even further we must reformulate the current product to rid it of alcohol while still maintaining its effectiveness. Customers have also expressed interest in chest decongestant; by again reformulating the product we can add expectorant to further the overall quality of cold symptom relief. A final possibility would be to explore new product line options, such as an improved Allround product or a childÃ¢â¬â¢s cold medicine, to diversify the company and reach more markets. Allround has a very high shelf stock, however due to a large number of new competitors this number is decreasing. The first recommendation regarding placement of the product would be to increase the number of detailers to increase support of wholesalers and merchandisers; it is recommended that the number of initial detailers be at least doubled. Secondly, support must be shown for independent drugstores, therefore it is advised that the company allocate more of its sales force to that resource. Finally, more advertising and trial promotions need to be focused on chain drugstores and grocery stores. Allround has consistently been one of the higher priced OTC cold and allergy medicines, justified by its proven quality. Price is more mercurial than other factors in marketing; pricing must be determined on a yearly basis. Inflation rate and marketing forecast must be closely monitored to determine the companieÃ¢â¬â¢s actions regarding price. If the market outlook is favorable then price increase should match that of inflation rate; if the market outlook is not favorable the price increase must stay below inflation rate. Following this plan should ensure sales will follow a steady or upward trend, minimizing loss. Allround tries, and largely succeeds, at being a household name. To ensure this stays true promotion must be increased to compete with the influx of competition into the market, to do this we go back to reformulating the product. Due to Allrounds alcohol content, and subsequent side effects, doctors are more apt to recommend competitors with alcohol-free products. Removing the alcohol content would go great lengths in increasing doctor and pharmacist recommendations. More focus needs to be placed on trial promotions, while couponing should stay the same for the base product. Promotion funds need to be more targeted toward our major retailers, chain drug stores and grocery stores, as these largely use circulars and other promotional strategies.