Healthcare and Pharmaceutical Marketing Essay Sample
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- Word count: 1,445
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Health care product line is a strategy of marketing that offers to sell several health products that are related to each other. It is different from health care product bundling in that several products are not combined to one. Health care product line involves offering health care products which are related. (Peterson 2006 page 23). .Analysis of the strategy based under Branding using the Kevin Lane Keller Brand Report Card Creating and
Brand Report Card
Creating and maintaining properly the health product brand is nowadays a priority to all pharmaceutical companies. Strong health product brand usually comes with increase in revenue and customer loyalty. Kevin Lane Keller came up with ten traits that business can use to come up with Brand Report Card. These were; the brands did better when it came to meeting the desires of their customers, the brands are always right, the strategy of pricing relies on the perception of the customers’ on value, the brands are always consistent, the portfolio of the brand has sense, the manager is knowledgeable on what the brand mean to their customers, the brand is well supported and the support is well maintained, the brands are well monitored. (Kevin 2000 page 1)
Products of lower quality are vulnerable to price reduction of higher quality brand. Many consumers prefer moving to a product of higher quality rather using products of lower quality. (Russell. Eta’l. 1989). Competitors with a better quality of health products are usually resistant to competition from health products of lower quality. Incase of a price increase health products of better quality are usually less vulnerable. The symmetrical observed in health products competition has been due to the behavior of the buyer. Different buyers have different perception of the quality of the health product and their prices. According to Bettman (1999) health products consumers do not usually like trading off quality of health product with a better price of the health product.
Stages of Product life cycle
Just like other product health product in the pharmaceutical industry usually undergo through the four stages. The four stages of health product progression are: the stage of introduction, the growth stage, maturity stage, and finally the stage of decline.
- Introduction Stage:
In this stage the pharmaceutical industry tries to create awareness to its customer and to create a market for its health product. This stage has four parts: establishment of the brand of the product and the quality of the product. E.g. the trade mark of the health product is also developed. The pricing of the health product is also determined at this stage. The products are not distributed until the consumers accept the new health products. The health product is also promoted in this stage. Marketing is usually intensive in this stage
- Growth Stage.
In this case the pharmaceutical companies go out to increase the number of their customers. At this stage the quality of the product is increased, the price of the health product remain same the channels of distributing the health products are expanded because of the growth in the number of customers. The intensity of marketing is also increased in this stage. (Keeper.1996 page 28).
- Maturity Stage:
At this stage the rate of sales decreases declines. Competition from other health product becomes so stiff. The pharmaceutical company at this point has to defend the market that they have already established. At this point the features of the product are improved so as to make it differentiate it from the other products; the pharmaceutical company may lower the price of their health product because of the competition, the pharmaceutical companies also intensify the distribution of their products and at times will give out incentives, the main emphasis of pharmaceutical companies is differentiation of the products from the others. (Keeper.1996 page 27).
- Decline stage:
At this stage the pharmaceutical companies have several options. The pharmaceutical companies can either: remove the product from the market, reduce the cost of the product or maintaining the product and keeping on rejuvenating it.
A good example is a drug called Malaria Quinn. When it came into the market it took time for people to accept it (Introduction stage). Stanley health pharmaceutical company had to market it. Soon people accepted it and started using it (Growth stage). It came a time when everyone was using the drugs (Maturity stage). But soon the drug started facing competition from Fansidar and other drugs. Many people started shying away from the product. After some time, the product (Malaria Quinn) became useless and Stanley Health Company had to abandon it. (Decline stage) (Keeper.1996 page 27).
Analysis based on the Pricing strategy
Price is one of the four elements of marketing mix. It relates directly to the position of the health product it also has impact on the other mix elements of marketing. For example, the features of the product, the decision of the channel, and lastly promotion. The following steps should be taken when creating products’ price;
- Come up with a marketing strategy-This one involves analyzing the market performance of other health products, segmentation, positioning and targeting.
- Develop a marketing mix decision-This involves defining the product, tactics of distributing and promoting the products.
- Estimation of the Demand curve – Get to know how the quantity of the health products demanded by the customer affects the price.
- Calculate the Cost – Calculate all the cost related to the product. Include all the variable costs and fixed cost.
- Understand the environmental factors – Get a clear understanding of the product environment. Also evaluate the actions that other pharmaceutical companies are likely to take incase the new product is introduced to the market. Look deep into the legal constraints that are likely to take place in the market incase the new health product is introduced.
- Setting Price objective-Come up with objectives that you want to meet. E.g. maximizing the profit, maximizing revenue, and stabilization of the price (maintaining status quo).
- Determining the Price-Collect the information and then come up with a method of pricing, the structure of the pricing and establish discounts. Several methods can be used to come up with prices of health products these are: Cost pricing method, Target return pricing method, Value based pricing method and psychological pricing method.
Positioning strategy with respect to pricing and branding
It refers to the way the pharmaceutical industries want their customers to view them. The picture they want their customers to view whatever health product they are selling relative to the situation in the market. The pharmaceutical companies need to position their health products their products against their competitors. For example they can reduce their health products to be half of those for their competitors, they can also put emphasis on any unique benefit that their health product have against their competitor’s products. Try to link their health product with something that their customers are familiar with especially if that pharmaceutical company has other products that are fetching well in the market.
When pricing health products pharmaceutical companies need to brand their products in a way that will make the product attractive to the consumer. . The pharmaceutical companies need to position their health products their products against their competitors. For example they can reduce their health products to be half of those for their competitors.
Keller. L. 2000, “Brand report card” Harvard University press, page 1-12.
Peterson. G.2006, “Health Products Marketing Strategies” retrieved from amazon.com on 26th November 2008
Russell. K. and Robert. D. 2004. “Competition in Health Products” retrieved from bussinessblod.com on 26th November 2008.
Keeper. S. 1996 Innovation, Growth, Exit & Entry in Product Life cycle, Dian Press. Page 26 – 35
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