New Launch Strategy & Product Cycle

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New Launch Strategy & Product Cycle
Muhammad Ali
email: phr_ali91@hotmail.com

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Why Business Development?
• To shape the company’s future.
• To maintain or build sales.
• Customers want new products, which competitors will do their best to
provide them.
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Successful product launching depends on co- ordination and cross-
functional preparation.
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Why develop New Product ?
• To create stars and cash cows for the future
• To replace declining product
• To take advantage of new technology
• To defeat rivals
• To maintain/increase market share
• To keep up with rivals
• To maintain competitive advantage
• To fill gap in the market
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Categories of New Products
• New product
• entirely new market
• New line
• new product in established market
• Addition to existing line
• new product in established line
• Improvement of existing product
• value addition to existing product
• Re-positioning
• existing product in new market
• Cost reduction
• similar performance at lower cost
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Launching Strategy
The objectives of Product Launching is begin, to generate income
from sales of the new product.
Launching Strategy
• First to Market: First to market with New Products
( First Follower: A first follower, learns quickly from those companies who
enter first )
• Delayed Entrant: A delayed entrant which likes to enter established market
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Strategic Core
The strategic core of the launching is to identify –
1. Customer
2. Product positioning
3. Marketing mix to carry the message.
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Marketing Mix Launching Decisions
Marketing Mix Launching Decisions
• Product
• Price
• Promotion
• Place (Distribution)
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Launching Strategy
According to Hultink, the conceptualization of a complete launching strategy
consist of –
1. Strategic Decisions
2. Tactical Decisions
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Strategic Launching Decisions
• Company Strategy
• Product Strategy
• Market Strategy
• Competitive Strategy
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Strategic Launching Decisions
Strategic Launching Decisions are dependent upon –
a) New Product’s Marketing Objectives
b) Target Markets
c) Competitive Environment
d) Production Size of Entry Scale
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Company Strategies
Different therapeutic areas represent different types of opportunities for a
Pharmaceutical Company.
1. Some areas are important current profit sources
2. Some of them are attractive (Strong, Sustainable different advantages)
3. Some looks set to provide long-run growth
4. Relative weakness of the Competition A company needs to balance these
different advantages
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Product Strategy
Product Superiority is the Number One factor for New Product Success.
Product Superiority means –
1. Unique Benefits for the Customers
2. Product Quality
3. Reduced Customer Cost
4. Product Innovativeness
5. Product Superiority in the eyes of the Customer
6. Solution to a Customer’s Problem
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Product Related Decisions
In Pharmaceutical Industry, a new drug’s clinical profile clearly influences the
commercial success.
Clinical Profile means – Efficacy, negligible side effects and a convenient dosing
mechanism, the new drug enjoys a good position in the competition.
• The contribution of the clinical profile varies significantly with different
market conditions and the company’s sales and marketing capabilities.
• Efficacy, Safety, Side Effects Dosage/Administration and Cost comprises
Drug’s
• A new drug can be differentiated by any or all of these criteria.
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Market Strategy
There are two levels of Entry in Market
• First Entry Strategy
• Parallel or Late Entry Strategy
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Early Entry
• Early entry combined with marketing investment and stronger competitive
position lead to better New Product Performance. Market Decisions.
• Being first to market can be the key commercial success and for a market
leader to keep its competitive position.
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Early Entry
First Time Product Launching Success of First time product launching
depends on –
• Sufficient Clinical Data
• Marketing investment to raise disease
• Product awareness with physicians, patients or even chemists.
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Later Entrant Products
• The later entrants benefited from the awareness generated by the earlier
product and physicians confidence in overall class benefits
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Competitive Strategy
• Finally, Product decisions are made by well understanding of the target
market need.
• Market need depends on the quality ,affordability and clinical profile to
position the product in the market.
• Launching = Market Decision + Company Strategy + Product Promotion
Strategy + Right time to enter the right place
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Product Life Cycle
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Product Life-Cycle Strategies
• Product development
• Introduction
• Growth
• Maturity
• Decline
• Begins when the company develops
a new-product idea
• Sales are zero
• Investment costs are high
• Profits are negative
PLC Stages
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Product Life-Cycle Strategies
• Product development
• Introduction
• Growth
• Maturity
• Decline
• Low sales
• High cost per customer
acquired
• Negative profits
• Innovators are targeted
• Little competition
PLC Stages
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Marketing Strategies: Introduction Stage
• Product – Offer a basic product
• Price – Use cost-plus basis to set
• Distribution – Build selective distribution
• Advertising – Build awareness among early adopters and dealers/resellers
• Sales Promotion – Heavy expenditures to create trial
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Product Life-Cycle Strategies
• Product development
• Introduction
• Growth
• Maturity
• Decline
• Rapidly rising sales
• Average cost per customer
• Rising profits
• Early adopters are targeted
• Growing competition
PLC Stages
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Marketing Strategies: Growth Stage
• Product – Offer product extensions, service, warranty
• Price – Penetration pricing
• Distribution – Build intensive distribution
• Advertising – Build awareness and interest in the mass market
• Sales Promotion – Reduce expenditures to take advantage of consumer
demand
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Product Life-Cycle Strategies
• Product development
• Introduction
• Growth
• Maturity
• Decline
• Sales peak
• Low cost per customer
• High profits
• Middle majority are targeted
• Competition begins to
decline
PLC Stages
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Marketing Strategies: Maturity Stage
• Product – Diversify brand and models
• Price – Set to match or beat competition
• Distribution – Build more intensive distribution
• Advertising – Stress brand differences and benefits
• Sales Promotion – Increase to encourage brand switching
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Product Life-Cycle Strategies
• Product development
• Introduction
• Growth
• Maturity
• Decline
• Declining sales
• Low cost per customer
• Declining profits
• Laggards are targeted
• Declining competition
PLC Stages
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Marketing Strategies: Decline Stage
• Product – Phase out weak items
• Price – Cut price
• Distribution – Use selective distribution: phase out unprofitable outlets
• Advertising – Reduce to level needed to retain hard-core loyalists
• Sales Promotion – Reduce to minimal level
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“Don’t find customers for your products, find the products for
your customers”
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