Profitable market leader
A brief summary of the case shows that the business in question, a German company called Merck, have produced a new medicine to deal with hair loss. Propecia is a new medicine designed to be marketed directly at consumers suffering from hair loss.
The food and drug administration have changed the rules on how information and products can be marketed directly to individual consumers, so the launch of Propecia has two main aims, to provide physicians with the marketing material to sell to a nonprofessional audience, and to give this information freely to these individuals suffering from hair loss and to generate the majority of the profits from this area of advertising.
This part of the business does not yet have any competition to its market share, as there are no alternative remedies available yet. Some of the major problems facing the organization revolve around the marketing strategy and how it will try and aggressively target a big market share of consumers who have never been subjected to this kind of advertising for this kind of product before. These consumers may be generally wary of a pharmaceutical remedy for hair loss.
There are also another couple of ways to market this product, to
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They also have good business expertise in the field of medicine. Merck have been providing pharmaceutical remedies for over 300 years and are a major player in this market. This is demonstrated by some of the other products that they offer, notably FOSAMAX. Merck is considered to be able to deliver useful remedies that are better than the competition. Three alternative marketing courses of action for overcoming problems and further exploiting marketing opportunities are all based around changing the business strategy of the organization.
With the current opportunities and threats that exist towards Merck, a change of strategy is essential if they wish to remain as a profitable market leader. The first of these would be to target a high profit audience for specific medicines and aim to produce a targeted audience who are more likely to buy the product than a person who does not suffer from the problem. This could be done by targeting health care professionals to offer Propecia as their major remedy for this problem.
The second course of action for overcoming problems that Propecia face is to widen the advertising audience and bring a wider audience to the potential of the medicine. Direct marketing to the end user would increase the target audience, however may not be successful due to some of the problems outlined previously, namely that some people suffer from this problem, and others do not. However specific targeted marketing may be able to overcome this potential problem.
Finally Merck could aim to exploit the culture of the organization and build the entire organization around their role as a market leader in providing proven remedies for problems. If the business model is expanded whilst retaining the income from its other operations, profitability at Merck would improve dramatically, and the potential customer base for Propecia could enable Merck to have a unique remedy for a situation faced by nearly all men in the world.