Cialis Analysis

2016

Cialis Case Study

What are the most relevant dimensions along which to segment the patient

market for ED treatment? Of the segments identified, which would you

target initially with Cialis?

When considering how to segment the patients, the marketing

department must understand the basic needs of the target population.

This target population has basic needs for air, water, food, and shelter.

While Cialis does not help with any of these basic needs, Cialis helps with

basic wants of both men and women to connect and have sexual

relations. After considering the wants, the demands must be taken into

consideration. According to Kotler and Keller, demands refers to the

wants that people can afford. Since Cialis treats a non-life threatening

chronic condition, Cialis is not covered under insurance and very

expensive (pg. 9). These differences allow decision makers to understand

the pre-existing need for this prescription. By taking this in to

consideration, Cialis can create a pre-existing need the customers did not

know they had.

The marketing team can take this identified pre-existing need to

segment the target population based on demographic, psychographic, and

behavioral characteristics. When considering the demographics for Cialis, the

target segment will be men who are 50 or older and their partners who have
a need to intimately connect but cannot because they secretly suffer with

male impotence, or erectile dysfunction (ED). Because the medication is

very expensive at $10 a pill, the population must be employed or retired with

a high level of education who will not be intimidated by the stigma that

follows by admitting they have ED and can afford the high price tag. Since,

Viagra has been proven to not offer the value that Cialis has the target

population must be highly educated with an ability to research and

understand the true value that Cialis brings compared to Viagra. Another

important segment are the Viagra dropouts. This group consist of a large

number of Viagra users who have discontinued the ED medication due to

side effects or negative public perception. Cialis can be presented as a

longer lasting ED option with fewer side effects.

Our recommendation on initial marketing targets would be physician offices,

specifically family practice and Urologist practices. These two sectors make

up the largest percentage of physicians consulted for ED (Exhibit 7a). As in

Exhibit 7b, we must also focus on the patient. Patient awareness of the

medication and the differences as compared to Viagra are equally important.

Lastly, appealing to partners of ED patients is critical. This allows the

partner to influence the patient or decision maker on fulfilling a perceived

lost need.

What is Viagras positioning in the marketplace in 2002? How would you

characterize the Viagra brand?

Viagra has generated over one billion in sales annually to reportedly 3 million

users worldwide. Viagra is one of the most popular and well known ED

medication in the world. The prescription is popularly known for treating this

chronic condition. Viagra in 2002 was so popular that its name has become

a synonym for Erectile Dysfunction. Bob Dole, a popular politician at the

time, was not only one of Viagras first spokesman; he was also involved in

the clinical trials of the medication. Viagras marketing and sales teams in

2002 were not only one of the largest groups, their aggressive approach

towards the marketing and selling of the medication had Viagra as the

premier and most well-known ED treatment.

While Viagra is very popular, many current and past customers are very

dissatisfied with the side effects and the duration. The sexual partners of

users of Viagra or potential users did not feel comfortable talking about the

prescription and were unhappy that they did not know why their partners

had ED. Viagra has been able to retain their customer base after a massive

marketing campaign in 1999 focused on addressing the 130 deaths

associated with the use of Viagra. While Viagra is popular, the reported

deaths are a concern to the target population. The target population also

does not like the stigma associated with taking the drug such as being

labeled as old and playboys.

What would be the most effective way to position Cialis in the marketplace?

We believe a direct compete strategy is the best approach to position Cialis

in the marketplace. Given the demographics we mentioned earlier, Cialis

should target 50+ year old men who are either married or having long-term

relationships. Being that this segment are highly educated with high income

levels we will focus on 3 major categories: Duration of the medication,

safety, and efficacy.

DurationTaken daily, Cialis has a longer drug effectiveness length of time.

Cialis 36-hour time frame is significantly higher than that of Viagras 4-hour

time frame. This gives couples the freedom to find the right time and not

assume such a scheduled feeling. 73%+ of ED patients are married or living

together, Cialis should focus on how the drugs duration can make the

patients partners feel like the process is more natural. Partners of Viagra

users feel more obligated and pressure to pursue intimacy immediately due

to the limited time with Viagra.

SafetyCialis has shown to not be influenced by the consumption of high

fatty foods, again giving the user more freedom of choice. Studies have

shown Viagra to be less effective when taken with certain types of food and

beverage.

EffectivenessIn 2002 trials of Cialis, data showed that 8 out of 10 men

dealing with ED responded to sexual stimulation for an extended period of

time. This proves that Cialis is superior to Viagra in providing a simpler and

more approachable way of dealing with ED.

By exercising this direct compete strategy, Cialis could entice both Viagra

dropouts and current Viagra users. These individuals would be interested in

giving the treatment another opportunity since it appears to be a product of

better quality with higher performance.

What marketing mix activities should accompany the launch of Cialis?

A. What would be the most important messages to the target Patients?

Physicians? Partners?
Patient--This is not something that you just have to live with. There is a safe

solution.

Although you have been waiting for it to go away, how long have you been

waiting? It is time for the solution. Nothing to be embarrassed about, this is

more common than you think.

Physician-- Although ED is not an immediate health concern and the

medicine is considered a quality of life medication, this added stress can

lead to more health problems in the long run, increased drinking and or

smoking, stress eating, weight gain, high blood pressure, etc.

Not resolving this, could cause added stress at home and on the relationship

between the patient and his partner.

Partners-- At the age range of 50+, kids are out of the home, most people

are retired. This would be considered their time together again. This is the

time for the couples to be more intimate. ED causes a huge riff in

relationships, the male is feeling like a failure and humiliated with the

problem. The female is feeling as if she is no longer attractive to him. The

relationship overall suffers.

Besides the obvious benefits of Cialis, what it provides that Viagra does not is

duration. Lasts up to 36 hours, this provides the partner with less pressure to
immediately become intimate, makes the process FEEL more natural.

Cialis is ready when you are!

B. What medium would you use to reach each of these parties and what
would your relative resource allocation be to each?
Because we are targeting an older crowd (50+ men) and their partners, we

should focus on Mens health magazines or national and local newspapers.

Reaching the female partner group would include articles dedicated to

womens sexual interest in magazines such as Vogue, Better Housekeeping,

and Elle. As the internal Lilly documentation shows, TV or specific radio

station spots are an effective way of influencing treatment seeking. Other

key areas would include Ads in sports magazines, ads at local pharmacies,

and brochures in doctors offices. Reaching physicians could include

contacting national associations such as the National Association of Urology

in targets countries. These associations hold conferences where the specific

details of ED are covered. Focused sales forces will also be key in targeting

this population. Last, consider publishing studies about Cialis in medical

journals. This would show credibility among physician subscribers.

C. How would you price Cialis (assuming no health care coverage)? What
types of promotions would you offer?
Due to Cialis ability to show superior results in duration, safety, and

effectiveness; I believe Cialis should be priced higher than Viagra. This

would create a perception of higher value and quality. Given our targeted

audience having the ability to afford this quality of life medication, a $2-

dollar increase over Viagra would not scare prospective users away. The

$12 price tag would represent added value and superior results.
 Regarding promotion, it would be advantageous to offer samples the first

time for ED suffers giving them to opportunity to try the new product

entering the market. Offer discounts for the first refill (only 25% of Viagra

users refilled) and provide discounts for AARP members.

What competitive response would you expect, if any, from Pfizer? From

Bayer-GlaxoSmithKline?

Pfizer- We would expect an aggressive response in terms of resources which

will be increasing R&D, likely looking for new drug or ways to improve Viagra.

Given that Pfizer spent more than 5 billion in R&D in 2002, we believe they

will be addressing the attributes that make Cialis superior (duration, safety,

and effectiveness). They will look to regain any market share they may have

lost. They will look to rework their marketing strategy and rebrand their

product. Given the tendency for heavy ad campaigns with celebrities, Cialis

should expect a heavy rebuttal from print and media outlets. This is Pfizers

largest product among the 50+ population sector.

Bayer- Given Bayers main target are diabetic men, we expect a niche

strategy geared toward a very specific group of the population. Bayer would

most likely avoid going head-to-head with Cialis and Viagra. Bayer recorded

$4.5 billion in European drug sales in 2002. Bayer is one of Europe's few

remaining drug powerhouses and thus, may look to focus on Europe as a

market to respond to Cialis.