MK501E

INTERNATIONAL CONSUMER
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BEHAVIOUR
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CASE STUDY N°1

I. Introduction

Cambridge Sciences Pharmaceuticals (CSP) is an international health care company that focus on developing, manufacturing, and marketing products that treat metabolic disorders, gastrointestinal diseases, imm une deficiencies, and other chronic and acute medical conditions. The company captured over $25 billion in sales in 2007.
CSP created Metabical, what would be the first prescription drug approved by the FDA specifically for overweight individuals (those with a BMI of 25 to 30). Its compounds produce dramatic weight loss for overweight individuals. It works on a low-dose formulation, therefore reducing damages to heart and liver functions. Negative effects of the drug occurred when taken while consuming high levels of calories and fat.
Metabical is intended to be taken during a 12-week treatment. The estimated retail price for the drug would be approximately $3 to $5 per day, so that would sum up to $1,800. Many health care insurance companies don’t cover weight-loss drugs in their plans.
Direct competition includes over-the-counter (OTC) drug Alli (a reduced-strength version of the prescription drug Xenical), approved by the FDA for weight-loss use. There are a number of liver damage reports of people who have been taking Alli and Xenical being currently investigated by the FDA.
Because of its recommended intake treatment, Metabical helps with behavior modification and healthier eating habits. In order to take maximum advantage of this, its planned to create a comprehensive support program for patients. This would enable them not only to lose weight, but to learn and achieve a new lifestyle based on habits changes. This program wasn’t included in the trial testing. It is believed, however, that it will efficiently enhance the product advantages.

II. Problem Identification

CPS has spent $400 million in research, development and trials for Metabical. In order to recover this investment, its top priority to correctly identify the drug’s market segmentation and asses its correct target market. This will be done by analyzing CPS’s market research.
Metabical needs a successful launch, so its initial costumers can create a good relationship with the product; this way Metabical can enjoy a long term and steady demand in the upcoming years. This will be achieved by establishing a clear communication and marketing strategy. III. Questions

How should Printup think about the segmentation of potential Metabical customer?

Metabical’s team did a market research for their product, to find where they should implement it. They discovered that the United States suffered from an alarming rise in the number of overweight and obese adults. At the beginning of the 20th century, almost 34% of the population was considered as overweight, and more than 25% as obese. Moreover, they say that health problems coming from overweight are worst between the ages of 60 to 70. Those are the reasons why Printup was enthusiastic about the Metabical product, to help people to lose weight and establish better health.
This is why the director marketing must study the market and do a segmentation when they want to launch a new product. At first they must see it wide and then optimize it. Printup made her segmentation with some main criteria that are:
The gender: male or female
The age: from 18 y.o to 65 y.o
The BMI: that indicates the body mass
The income: from less than 25 000$ to more than 60 000$
The education level: from less than high school to college
After this study, Printup saw that segmentation is easier for women. So, she decided to separate those customers into several categories:
From 18 to 30 with medium education and low income: body image is really important for them, they want to look like movie stars
From 35 to 65 with high education and high income: they are aware of the risks of overweight, they want to be healthier
From 25 to 40 with high education and high income: they want to lose weight and wear their skinny jeans
From 45 to 65 with high education and medium income: they want to lose weight easily
From 40 to 65 with high education and medium income: they are not interested in the product and don’t care about the consequences of their overweight on their health.

Who is the optimal target customer?

After having studied the case of Metabical we chose an optimal target customer which is:
Female
From 35 to 65
High education: at least college education
Really high income: at least 80 000$
With a BMI superior to 25 (an average of 68,3% of the people)
Why? Because first of all, women are more victim of overweight than men. They have the highest BMI. That’s why we are mainly targeting women.
Then, at the age of 35 to 65, women are thinking about their health. They want to lose weight to feel better and healthier because they are getting older each day.
We can think that women aware of health problems caused by overweight are high educated.
Those women are a good target also because they earn a lot of money and the product is expensive. It costs between 252$ and 400$ that cannot be repaid by medical insurance.
Moreover, they have to see a doctor to get the prescription, so they feel safer with Metabical.
By the way, we can say that the prescribers (doctors) can be a good way to reach this optimal target by prescribing and promoting Metabical.

How should CSP identify and employ the differential advantages that Metabical offers to position itself in the market place?

CSP should rely on a SWOT analysis to identify the differential advantages of the Metabical drug. The company will know the strength of the product so they can build the brand identity. The opportunities will allow CSP to determine a long term strategy and assure the longevity of the Metabical. The SWOT analysis highlights the weaknesses of the product so the company will be prepared to response to any remarks they can get. It also points out the threats the brand can meet in the future.

Strength:
The Metabical has been approved by the FDA. It made it the only prescription drug approved by this organization on the market
CSP is not only offering a pill but an entire program that will follow the consumer for two years. It should allow the consumer to keep its weight down and develop healthier habits.
Contrary to other loss weight drugs, The Metabical is easier to take. You don’t have to take a pill per meal, you just have to take a pill per day.
The product has been developed to treat people with a specific BMI (25-30). It allows the brand to narrow the target and respond to a need (a prescription drug for overweight people)
There was no prescription drug available on the market for overweight people. CSP will be with the Metabical the only one on the market

Weakness:
The Metabical will not be covered by most of the health insurance plan. It will represent an obstacle for the consumer. It will be an “out of the pocket purchase”. They may prefer an other drug which is covered.
CSP price positioning is high and target the CSP+. They might lost the lower a revenue which are the most affected by excess weight.
The drug is under prescription. It means that people will have to go to the doctors to have access to the product. Meaning it will cost more time and money.
The Metabical has side effects. The company is explaining that there are reduced compare to competitors and handle by the program but it will still have an impact in the mind of the consumer. It may create a bad image for the product.
The target is only the overweight people (BMI between 25 and 30). It excludes obese people and severely obese people.

Opportunities:
Since 1980 the percentage of overweight people grow of 2.4% in the US. It shows that people concerned by the product is increasing.
People are dissatisfied by the current treatments available on the market. As shown in exhibit N°2, 65% of the women who already tried this kind of treatment failed to loose weight. It means they need to be convince and to have proof that this new product works.
Threat:
CSP has the patent for the drug for the next 10 years. After that companies will be able to develop generic versions of the Metabical at a lower price. It means that they might loose market.
The weight loss drugs have a bad image due to deceptive marketing claims by other products (Ephedra)

Given the positioning strategy what would be communication strategy and IMC position mix for each of your target audience?

Our general strategy:
We choose to organize our marketing strategy around two main targets:
The final consumer and the prescribers.
From what we have seen so far, it’s the best way to create brand and product awareness for both segment.
We choose to divide the final customer segment into two groups.
The first group will be woman from 35 to 50 years old
The second group will be women from 51 to 65 years old
For all the segments we will use a two years timeline.

Why dividing our final customer segmentation in two different groups?

Our objective is to catch the interest of the majority of our target. We take into account the lifestyle variables relying on the differences of ages, incomes, situations… that’s why we need to adapt our IMC tools on theses criteria.
Based on our two slogan:

Losing weight is tough
“You don’t have to do it alone. Let Metabical and your health care provider start you on the road to a healthy weight and better life”.

Those extra 20 pounds could be killing you
“Being overweight leads to overweight to heart disease, high blood pressure, diabetes, and gallbladder disease. It’s time to get healthy. We can help.”

For the first group we’ll use a 360° communication through all the communication channels available.
It means we will use all the tools that IMC communication offers: * Public relation through de pharmacies, clinical, doctors, digital campaigns (how to be referenced on google for example with strategic key words) * Interactive marketing: Contest with Before and After photography * Viral marketing: e-mailing campaign * Personal Selling: We want to organize a pre launching time with personal selling to reinforce the awareness about Metabical and his weight loss program. * Create the buzz with the support of speakers, bloggers, tester people who are used to do tutorial on YouTube to demonstrate the benefit of an innovative product * Social network: Twitter / Facebook * Advertisement
Fashion / Housewife / fashion magazine like: Allure, Cosmopolitan, Elle, Glamour, Heatlh, Ladies’home journal, Marie Claire, Mc Call’s, More, O: The Oprah Magazine, Redbook, Self, Shape, Vogue, Women’s day, Modern beauty, American Lifestyle, Fitness, Vogue, Health, American family magazines (housewife) More, Cooking and light, Ebony, Radio with audience adapted to our target. * Shopping canals * Promotion: As Metabical don’t make the customer pay for the support program, our strategy is to balance the fact that the cure is quite expensive. We will communicate about the promotion we offer to our customers by providing them a support program which helps them to be fit with a healthy advice and all of these tips, exercises and advice for free.

IMC mix for the 35 to 50 years old women
Leader of opinion / speaker people => Oprah Wimphrey,
Promotion: support program for free
Direct marketing (magazine, radio, television)
Advertising
Shopping canals
Flyers: Inform the public in the waiting room in all the clinics
Public relation

Target the professional medical community:
We need to adopt a different approach. We can’t adopt the same strategy with the final customer.
The objective: Increase significantly the amount of prescription
That’s why we planned to print ads in professional medicals magazines, send emails to all the professionals and create a platform where all the information about the product are available (medical tests, statistics, competitive assets of our pills). In this part we have to highlight the almost nonexistence of side effects in our pill compared to the other products available in the market.
Also we want to underscore that we are the only cure approved by FDA for the overweight section (25 to 30).
Why insist about the FDA approbation?

It’s a marketing way of communicating because it guarantees our reliability and it shows that the medical community approves the drug as an effective and safe cure to lose weight. Thus doctors will be able to recommend our product and play the role of public relation for us.

I want to be healthier | | | | | 35 to 50 | 51 to 65 | Prescribers | Advertisement | X | X | X | Publicity | X | X | X | Magazine | X | X | X | Radio | X | X | | Television | X | X | | Viral marketing | X | X | X | Social network | X | | | Person speaker | X | X | | Public relation | X | X | X | Flyers | X | X | X | Conference | | | X |