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Mark Barbato, the executive director and global product team leader had to launch a new male
impotence medicine in a market with an established leader “Viagra”. Rob Brown, Global Marketing
director for Cialis(Lily), Leonard Blum, vice president of sales and marketing, ICOS and Beebe (US Brand
Leader) were responsible to come up with recommendation on the Go To Market, strategy for Cialis.
The main task was to identify the target market and position it against the competition.
The total market was estimated to be around 30 million men in US and 150 million men
worldwide. The world wide focus was segmented into 5 affliliate groups – US, Europe ( France,
Germany, Italy, Spain and UK), Mexico, Canada, Australia and Brazil. Each affiliate group was given the
ability to take tactical decisions. The main decisions to be made were – determining how to segment the
market, tactical allocation of marketing budget for affiliates, competitive positioning and pricing.
I would recommend targeting Cialis to current users of Viagra and Viagra Dropouts for US and
At a strategy level, the market was segmented to five affiliate groups – US, Europe ( France,
Germany, Italy, Spain and UK), Mexico, Canada, Australia and Brazil – to divide the global market of 150
million men. At a tactical level, there was still a need to segment the market on the basis of
demographic, patient, physican and/or current Viagara usage. Viagra had a monopoly and was available
for all segments, being the only player in the market. Further, there were heart related issues on using
Viagara and around 130 deaths were associated to it. Product comparision between Viagra and Cialis is
given below. Consumer research found that efficacy, safety and duration were important
considerations. Cialis is a better product based on the features needed by the consumers. Segmentation
of
users,
based
on
current
Viagra
users,
Viagra
Dropouts
and
not
had
used
Viagra
was
done.
This
was
Cialis:Getting
Ready
to
Market
HBS
9-‐505
038
Case
Analysis
submitted
by:
Taposh
Dutta
Roy
done
across
US
and
Europe.
The
results
indicated
that
people
who
were
currently
using
Viagra
were
more eager to try the new Cialis than the ones that had never taken any drug for ED. Thus, targeting
current Viagra users and dropouts made sense for the initial launch.
Recommentation #2 : Sales and Marketing Budget Allocation with a revenue goal of $500M or higher is
below.
The revenue goal for Cialis was atleast $500 million. Further, based on their company
financials, for year 2000, about 48% was their Sales and General Administrative expenses. Considering
this to be a new block buster product for Eli Lily, I would assume the total spend for Sales and Marketing
to be around $240 million. Pifzer spent around $108 million in advertising for Viagra in 2000. Entering
as an incumbent to Viagra, Cialis product team should spend atleat $120 million for advertising and
remaining $120 million for total world wide sales. Sales force could be divided depending on market cap
of various countries. About 33% (1/3) of the adults that saw about the drug on TV, discussed the drug
with their doctors. Around 44% of these patients, who discussed with their doctor were recomeneded
with a prescription drug. This means advertising should be two fold. I would recommend spending $80
million
on
advertising
on
TV,
print
and
web.
Various
goal
driven
campaigns
could
be
made
and
reaction
Cialis:Getting
Ready
to
Market
HBS
9-‐505
038
Case
Analysis
submitted
by:
Taposh
Dutta
Roy
should
be
measured.
Around
$40
million
should
be
spend
on
marketing
drugs
to
doctors.
Free
samples
should be provided for the doctors to give patients. This will enable our target segment that currently
Cialis should launch at a price of $12/pill, slightly higher than Viagra, but gives a 36 hour
window. Also, TV ads should highlight the extra duration, with real people active in sports. TV ad should
highlight that this drug is safe for heart and the patient can wait for the right time. Physicians should be
given free samples and more guidance about the benefits of the drug and any results of tests done by
FDA.
Viagra had a five year lead and many physicans and patients were used to it. Also, there was a
history of side effects generated. When Cialis comes, there will be no history. Further, Cialis remains in
the system for a longer duration, which is good for the product, but there is a chance of side effects for a
longer duration. In order to launch Cialis, the doctors should be first convinced and given the right
direction to decide what is right for their patients. Given, the clinical trials did not produce any side
effects, the TV ads should highlight the duration – “time is right” within the 36 hour window. This will
give a competitive edge over Viagra. Celebraties always have impact on the audience. However, since
Viagra already did this, Cialis should show regular people engaging in sports and are active.