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Introduction to PharmaSim. Marketing 6202 June 29, 2010. Purposes of PharmaSim. To introduce and reinforce the logical process of marketing planning Situation analysis and assessment Development of integrated plans – linking strategic and tactical decisions

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introduction to pharmasim

Introduction to PharmaSim

Marketing 6202

June 29, 2010

purposes of pharmasim

Purposes of PharmaSim

To introduce and reinforce the logical process of marketing planning

Situation analysis and assessment

Development of integrated plans – linking strategic and tactical decisions

Monitoring and evaluating results; using lessons learned in subsequent planning cycles

purposes of pharmasim1

Purposes of PharmaSim

To understand that the keys to profitability are market driven and customer-focused decisions

To learn by doing in a low stakes environment

pharmasim decision process

Situation Analysis

  • Identification of Problems and Opportunities
  • Identify and Evaluate Alternatives
  • Make Decisions
  • Monitor Results

PharmaSim Decision Process

pharmasim environment

Similar to the United States in the Early 1990s

    • Population = 250 Million
    • GNP = 2% per year
    • Moderate Inflation (2-4%)
    • Over 80% of the population suffered from some cold-related symptoms in the past year
    • OTC cold-medicine retail sales = $2B with growth of 4% per year
    • 5 companies competing in the industry

PharmaSim Environment

competitive companies

Company Sales Brands

Competitive Companies

Allstar Brands $355 Allround, 4hr cold liquid

B&B Health Care $286 Believe, 4hr allergy capsule

Besthelp, 4hr cold capsule

Curall $199 Coughcure, 4hr cold capsule

Driscoll Corp. S255 Defogg, 4hr allergy capsule

Dripstop, nasal spray

Dryup, 4hr cold cpasule

Ethik Inc. $395 Effective, nasal spray

End, 4hr cough liquid

Extra, 12 hr cold capsule

basic consumer needs

Basic Consumer Needs

Relief of Symptoms

Aches and Fever--------------Analgesic

Runny Nose-------------------- Antihistamine

Nasal Congestion-------------Decongestant

Cough---------------------Cough Suppressant

Chest Congestion-------------Expectorant

Allergy Symptoms------------Antihistamine

Trouble Sleeping--------------Alcohol

produce attributes affecting basic consumer needs

Side Effects

    • Drowsiness, Upset Stomach, Alcohol
  • Form
    • Capsule, Liquid, or Nasal Spray
  • Duration
    • 4 to 12 hours
  • Price
    • MSRP, Discounts, Channels, Promotions

Produce Attributes Affecting Basic Consumer Needs

consumer buying behavior

Consumer Buying Behavior

Is Based on:



Day vs. Night Use/Work vs. Home Use

consumer purchase process

Consumer Purchase Process


Intention to Buy

In-store Attractiveness


Post Purchase Usage/Satisfaction


segmentation process

Segmentation Process

By Illness




By Demographics

Young singles

Young Families

Mature Families

Empty Nest


distribution options

Distribution Options

Retail Outlets

Independent Drugstores------------ 22% of sales

Chain Drugstores----------------------28% of sales

Grocery Stores------------------------37% of sales

Convenience Stores-------------------4% of sales

Mass Merchandisers-------------------9% of sales

distribution options1

Distribution Options

Considerations for Shelf Space, Stocking & Sales Force:

Margin earned per unit

[volume discounts and promotional allowances]

Sales volume and turnover rates

Sale Force Influences

Direct and indirect

Co-op advertising funds

Other promotional activity

preliminary questions

Preliminary Questions

Who is the likely Allround Customer?

Their likely purchase process

Marketing mix elements-most effective

What advantages does Allround brand offer?

Who are Allround’s competitors?

preliminary questions1

Preliminary Questions

What do you think of Allround’s pricing?

How many units to maintain net contribution at $5.00 or $5.60

What are the advantages of a higher price, lower price?