Training on Product Management
Market Segmentation
Market Analysis
Positioning
Outline
Product Profile
SWOT
Strategy
What Is A Segment
A customer group having
Similar buying needs
And/or
Similar reactions to what product offers
Useful Ways To Segment Markets
Geographically
Regions, cities, urban/rural
Demographically
Age, sex, income group, occupation, educational level
Disease
Type, severity, acute, chronic recurrent
Doctor
Specialty, place of practice, age group affiliation, educational background
How To Segment
Example
Patients of all ages suffering from acute URTI
Why Segment
Identifies target group, customer needs
Efficient way of using scarce resources
Creates strong product image to offset competition
A Segment Must Be
Measurable: Potential + Results
Accessible: Via promotion resources, cost effective
Substantial: Large enough Financial Objectives)
Homogenous: Customers with sufficiently similar needs
Important Considerations In Segmentation
Trends of segment
Identification of existing unsatisfied needs
Potential Drawbacks Of Market Segmentation
Tunnel Vision - Losing track of overall market evolution
• Acceptance + Execution by sales force
• Requires market data
Market Analysis
Quantitative questions
The trend of the market
The historical sales trend of your product/competitive products
The relative position of the competitors
Market Analysis
Qualitative questions
Structure of the marketCompetitiveness (fragmented vs concentrated)Price sensitivity
Market needsAny unmet needs/opportunities
CompetitorsCurrent/newOpportunities & threats
Product Positioning
What are theNEEDS of
my customer
WHAT BENEFITS/COMPETITIVE
EDGEDoes my product have?
WHAT product FEATURES substantiatethese claims
Product Positioning Analysis
Examples of product attributes for positioning and mapping
Dosage versus convenience
Price versus severity of medical conditions
Price versus dosage regimen
Efficacy versus safety
Side-effect profile versus efficacy
Duration of action versus onset of action
Product Positioning Analysis
Applications
New product launches
When market share is threatened
Changing population of market segment
Changing market needs
Product Positioning Analysis
Product positioning must be reviewed periodically, at its different life cycle
Comparative positions of products must be the result of MR findings, not the perceptions of PMs
Product Profile Checklist
Target indicators
Target doctors
Dosage recommendation
Presentation, strengths and pack sizes
Key advantages & disadvantages
(Efficacy, contra-indicators, side effects/safety, patient convenience, etc.)
Product Profile Checklist
Product profile Main indications
Main side effects
Contra-Indications
Major Advantages
Major Disadvantages
Average Daily dose
Presentation Target doctors
INFORMATION REGARDING THE MAIN COMPETING PRODUCTS
PRODUCT CHARACTERISTICS
Active ingredient(s)
Main Indications
Main Side Effects
Contra-Indications
Major Advantages
Major Disadvantages
Best Selling Pack Sizes
Average Daily Dose
Cost of Average Daily Dose
Sales in $ (’000)
Market Share
Sales Trend (3 yrs)
Product Profile Checklist
SWOT Analysis
A technique combining all elements to arrive at a strategy, tactics and objectives
StrengthsWeakness
Of your company(or product)
OpportunitiesThreats
In the market/
environment
SWOT Analysis
Strengths
Good side-effect profile
Good efficacy
Good local and international trail program
Support from HQ
New chemical entity
Variety of presentations
SWOT Analysis
Weakness
Company has limited experience here
Limited comparative data
Seen more as a tranquilizer than as antiemetic
Limited resources
SWOT Analysis
Opportunities
Medics aware of benzodiazepine problem
Market decline halted in tranq. Segment
Premium price acceptable in tranq. Market
Future product development
Vale growth
SWOT Analysis
Threats
Strong competition
Dominant brands in both segments
2 new competitor products soon
Opportunities & Threats
From OUTSIDE
Market segment
Environment
Few competitors
From INSIDE
Company
Products
Opportunities & Threats
Market segment
High growth rate
High level of customer interest
Large segment size
High degree of acceptance
High-untapped patients
Low level of price sensitivity
Opportunities & Threats
Environment
Good economic growth
Few government regulations
Little adverse public opinion
Active consumer action
Opportunities & Threats
Few competitors
No new products
Weak sales team
Poor marketing skills
Little promotional activity
Poor promotional mix
Large product range
Poor company image
Opportunities & Threats
Company Excellent image Large size Adequate promotion budgets Good R & D products Effective sales force Well-trained sales force Good management/employee rapport Excellent customer service Excellent distribution
Opportunities & Threats
Products Very reliable Highly efficacy Highly acceptable by opinion leaders Convenient packaging Convenient dosaging Acceptable taste Minimal side effects High market share Acceptable pricing
Definitions Of Terms Used
Concepts Contents
What you need to be achieve, which must be:- Timed- Measurable- Desirable- Realistic
How you intended to achieve your objective:- Target audience- Key product features/ benefits you will stress- The segment you will attack Actions will take or the methods you will use to achieve the strategy, i.e. promotion policy
Strategies
Road
Objectives
Destination
Tactics
Vehicle
Market Penetration Strategy
Increase sales & market share in existing segment with existing product
Examples of tactics
Doubling call frequency on A-class doctors
More A.V. meetings with specialists
Goods on consignment to pharmacies
Market Development Strategy
Increase sales in new markets with existing products
Examples of tactics
Promote to another group (specialists to GPs)
Promote new indications to reach different group of patients
OTC to Rx Switch
Rx to OTC Switch
Product Development Strategy
Introducing new or improved products, line extension to an existing market segment.
Examples of tactics
Develop new product features to offer new benefits or minimize/ eradicate existing product problems
Create high quality version of existing product
Modifying pack sizes
Diversification
Entering new market with a completely new product
Examples of tactics
New product in a new therapeutic class area
New product line in a related or non-pharma industry
Strategy Approach
Undifferentiated MarketingGoing after large part of market to get at as many prescribes for as many patients as possible
Concentrated MarketingGoing after one party of segment alone
Differentiated MarketingGoing after several defined markets, with tailored versions for each segment
Product Strategy Statement
A product strategy statement gives a precise direction as to how you will achieve your objectives
3 questions to ask
To concentrate on the URTI market amongst patients of all ages
Market segmentWhich segment?
Statement
Dosage convenience and efficacy
All general practitioners
Product positionWhich product position?
Target marketWhich target?
What Is The Objective Of Promotion
Objective 1To change the attitudes of target audience from non-usage to repeated usage
Objective 2To generate increased profitable sales
Promotion Methods
Sales presentationMedia mix
Journal advertising Brochures In-house journals Direct mail
SymposiaClinical trials‘Seeding’ trialsExhibitionPublic/professional servicesOthers
Sales Presentation
Advantages
Allows complete sales story
Has the greatest impact
Great flexibility for sales person to react accordingly
Generates vital ‘feedback’
Sales Presentation
Disadvantages
A high-cost element; fixed cost too
A limited resource
Not always readily available
Slow: Restricted access of targets and physical ability to meet
‘Selling message’ may be inconsistent
Sales Presentation
Basic questions to ask before using the sales force
Is material supportive to the personal presentation
Is the message logical, manageable and suitable
Is sales technique well understood and used
Is product knowledge good
Sales Presentation
Comments
Concentrate on a message which meet objectives
Concentrate on neutralizing weakness, reinforcing strengths
Sales force be trained in usage, objection handling and closing
Material flexible to meet different situations
Promotion Material
Advantages
Adds ‘visual’ power to sales person’s words
Samples allow doctor to try product
Complements the sales visit
Promotion Material
Disadvantages
If not practical and well designed, it is very costly
If it is not seen as practical, it will not be used
It has no effect without personal interpretation
Promotion Material
Basic questions to ask before using
Does the material support the promotion objective
It is absolutely necessary
Is it too much, too little, too many or too few
Will the sales person use it; does it help or hinder him
Will it have a positive impact on the target audience
The Buying Process Unawareness
Existence of productAwareness
Succinct summaryInterest
Phase of reasoningEvaluation
Clinical TrailsTrial
Opportunities to useUsage
RemindersRepeat Usage
Promotion
SALES TO PHARMACY/HOSPITAL
Less wholesalers margin (@ 9%)
SALES TO WHOLESALERS
Less sales tax (@ 9% of 3)
NET SALES EX MANUFACTURER
Less production costs (@ 20%)
GROSS PROFIT
Less selling expenses (field force cost)
Less marketing expenses (field force cost) Samples, Advertising, Mailings, Reps. Detailing aids/literature,
Gifts Congresses, exhibits, symposia, Doctor meetings,
Audio visual/films, Market research
Less administrative overheads (@ 16% of net sales ex manufacturer)
NET PROFIT (OR LOSS) BEFORE TAX % of net sales
CUMULATIVE PROFIT BEFORE TAX
Executive Summery
Key featuresEnvironmental, Market Situation, Product review
Product objectivesFinancial/Marketing, Short term/Long Term
Product strategySegment, Position, Target Market, Product Priorities, Tactics
PromotionStrategy, Mix, Spending
Specific Market Opportunities, Threats and Trends
Overall Profits
Key ActionsRepackaging/Hire new team/Monitor generic law
implementation