Building Brand Equity: The Mucinex Story - DTC … Casale Presentation.pdf · Building Brand...

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Building Brand Equity:Building Brand Equity:

The The MucinexMucinex StoryStory

Bob Casale

June 4, 2009

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Small Company GrowthSmall Company Growth

Compound Annual Growth RateFrom 2003 – 2008: 102%

Philosophy IB, LLP 2008

•2004

•$61

•2005

•$160

•2006

•$239

•2007

•$331

•2008

•$468

•2003

•$14

•REV

ENU

E IN M

ILLION

S

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QuestionQuestion

How did this happen????

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How Did Mucinex Get To Market?How Did Mucinex Get To Market?

Immediate/Extended Release GuaifenesinOld Ingredient Unapproved Rx ProductMultiple Brand Names – Generic Pricing

Drug Delivery Strategy - 12 Hour Duration of Action

Adams filed NDA based on pharmacokinetic studiesSought FDA removal of unapproved productsBridge to OTC monograph for safety

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The Mucinex Story The Mucinex Story –– Extended Release GuiafenesinExtended Release Guiafenesin

Good News – FDA approved product and takes all other single

ingredient products off the market

“Bad News” – FDA approves Mucinex OTC

Opportunity – Consolidate $130MM Rx Market

Real Opportunity -Tap $3 Billion+ OTC market

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Consumer Market Before MucinexConsumer Market Before Mucinex®®

OTCCough/Cold/Allergy

Market

Complex>10 ingredients aloneand in combination

Growing(with Claritin)+25% since 2000

Big$2.8bn annual sales

Crowded45 SKUs each

Sell >$10MM/year

ConfusingTop 40 SKUs=36% of sales

Basic Characteristics

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7 Manufacturers Controlled 70% of the7 Manufacturers Controlled 70% of theCold/ Flu/Allergy Market Cold/ Flu/Allergy Market

Pfizer, Inc. $350M

P&G 290M

McNeil Consumer Products 260M

Whitehall-Robins 260M

Novartis Consumer Health 250M

Schering-Plough 150M

Bayer Consumer 120M

Private Label 500M

20022002

Clutter ReelClutter Reel

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Play Clutter ReelPlay Clutter Reel

mucinex clutter reel.wmv

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Mucinex Success FactorsMucinex Success Factors

Single minded focus

Small experienced team

Rapid decision making

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TimelineTimeline

April 2004…Board approves $20MM advertising spendProjected on-air date…November 15, 2004

May 2004…Qualitative Research, develop positioning, brief ad agencies, select ad agency

June 2004…Quantitative Research, Creative development

July 2004…Quantitative Results (Uh Oh), refine creative, produce animatics

August 2004…Copy test results (Uh Oh), media planning, select campaign, board approval

September/October 2004…produce commercial including animation, worry

November 15…2004…On Air

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Mucinex ClaimsMucinex Claims

THE ONLY 12 HOUR FDA APPROVED EXPECTORANT

Immediate/extended release bi-layer tablets

Relieves chest congestion

Makes coughs more productive

Thins and loosens mucus

Convenient tablet vs. messy syrup

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Single Minded FocusSingle Minded Focus

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Brand PositioningBrand Positioning

Educate consumers that mucus is the “root cause”of upper respiratory problems

Downplay specific symptoms

Simplify in a confusing category

Take Mucus out of the closet

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MUCUSThickExcess Tenacious Thinner Expelled Normal

Head Congestion

Nasal Congestion

Painful Sinuses

Sneezing

Post Nasal Drip

Chest Congestion

Tight Cough

Sinus Pressure

Frequent Cough

Symptoms

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Mucinex Core EquityMucinex Core Equity

Mucinex = Mucus Out

Mucinex In. Mucus Out. ™

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Strategy TestStrategy Test

White Card Concept Test: Mucinex In, Mucus Out

Results:

BELOW AVERAGE

NOW WHAT?????

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Plan of ActionPlan of Action

Say the consumers in the test were stupid and did not understand our brilliance

Make the strategy work we still believed in it

Capitalize on Adams culture

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Creative ChallengesCreative Challenges

Need to make single-minded concept of mucus highly memorable

Mucus is a new and potentially risky story

Present “mucus” in an engaging way

Animatic VideosAnimatic Videos

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AnimaticAnimatic

Shortcut to Mr_Mucus.lnk

Video_ts.ifo

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Mr. Mucus Actively Involves the AudienceMr. Mucus Actively Involves the Audience

Philosophy IB, LLP 2008

•8

•7

•6

•5

•4

•3

•2

1%

6%

17%

30%

27%

15%

3%

0.5%

‘Mr. Mucus’ (6.84)

Average (5.14)

OTC Average (5.46)

•Base: 775 USA - English Animatic ads

Database distribution

Active words

interesting, unique, involving, irritating,

unpleasant, disturbing.

nice, boring,ordinary, soothing,

mellow, weak.

Passive words

Rating scale

Finished Commercial Finished Commercial VideoVideo

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Finished CommercialFinished Commercial

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Initial Results: MucinexInitial Results: Mucinex®® SalesSales3/04 3/04 -- 2/05 (Four Week Total Dollar Sales)2/05 (Four Week Total Dollar Sales)

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

3/21/2004

4/18/2004

5/16/2004

6/13/2004

7/11/2004

8/8/2004

9/5/2004

10/3/2004

10/31/2004

11/28/2004

12/26/2004

1/23/2005

2/20/2005

Mucinex SE 20s Mucinex SE 40sMucinex DM 20s Mucinex DM 40s

A dvert ising B eg ins

11/ 15/ 0 4

Source: IRI Cold/Allergy/Sinus Trend Ranking Report, February 2005

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ConsumerAdvertising

Professional Detailing

GeneratesConsumerAwareness

GeneratesProfessional

Recommendations

TrialPurchase

Consumer and Professional:Consumer and Professional:Working Together to Build Trial & ConversionWorking Together to Build Trial & Conversion

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Mucinex Success Factors Mucinex Success Factors –– Part 2Part 2

If it ain’t broke, don’t fix it

Actively utilize knowledge of the consumer

Leverage the brand name through innovation

Married to Mucus VideoMarried to Mucus Video

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Keep Pounding Away At MucusKeep Pounding Away At Mucus

Married to Mucus

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Know Your ConsumerKnow Your Consumer

Of the consumers who use Mucinex…

~90% intend to buy it again~30% try more than one type of Mucinex~70% actually plan their purchase~50% would rather make an additional trip to another store if their store did not have Mucinex

Source: Proprietary on-line research conducted 12/06.

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Fiscal 2007

Fiscal 2007

New Products Fiscal 2007 New Products Fiscal 2007

Fiscal 2006

Fiscal 2006

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Expansion Accelerates in FY08Expansion Accelerates in FY08

Fiscal 2008

37

Mucinex Circa 2008Mucinex Circa 2008

Children’s line

Nasal Spray

Max Strength

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ChildrenChildren’’s Lines Line

Consumer Need Mucus and Kids…Perfect TogetherGuiafenesin Bitter…Taste Masking Required

Searched US and Europe for taste masking technologyMini Melts!Unique coating technology sourced from Losan (Germany)

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Launch of ChildrenLaunch of Children’’s Lines Line

Tested on Employee’s Children…No other consumer testing

Launched Traditional Liquid and Mini Melts line

Achieved $30 million sales Year 1

#4 Brand in Children’s Respiratory Market

Mucinex MiniMucinex Mini--Melts VideoMelts Video

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Mini Melt CommercialMini Melt Commercial

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Mucinex Nasal SpraysMucinex Nasal Sprays

Full Force

Effective nasal decongestant“Sensory signal” lets consumer know it is working“12 Hour Concentrated Vapor Technology”

Moisture Smart

Effective nasal decongestantSpecially formulated to soothe irritated nasal membranes“12 Hour Membrane Hydration Technology”

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More CommercialsMore Commercials

Nasal Spray

Max Strength

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Maximum Strength MucinexMaximum Strength Mucinex

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More CommercialsMore Commercials

Nasal Spray

Max Strength

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The Future The Future –– BeforeBefore

Other Mucinex Rx and OTC combinations utilizing extended release guaifenesin platform

Continued penetration of US market

Global expansion

New Rx and OTC respiratory products

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The Future The Future -- AfterAfter

Sold for $60 cash per share37% premium to recent share price250% premium over IPO price of $17 per share in July 20057 times FY07 sales

Acquirer Reckitt BenckiserGlobal leader in household products businessSales in 180 countriesWill add significant value in globalizing MucinexWill culture of innovation survive?

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