2017

MARKETING LAUNCH PLAN

FOR VOLTAREN

MARKETING MANAGEMENT ASSIGNMENT GROUP 02

JAINI HARIA – B17143
JOBANPREET SINGH – B17144
PATHIKRIT GHOSH – B17154
RITWIKA MAJUMDAR – B17162
ROHIT ALVS – B17163
VARUN SAGAR – B17179
Pharmaceutical Industry Analysis Overview:

The Indian Pharmaceuticals Market (IPM) is the third largest in terms of volume, accounting for
about 2.4% of the global pharmaceutical industry and thirteenth largest in terms of value,
accounting for 10% of the global pharmaceutical industry as per a report by Equity Master. The
IPM was valued at Rs 860 billion for the year ending March 2016. The IPM increased from US$
6 billion in 2005 to US$ 36.7 billion in 2016 at a CAGR of 17.46 % and it is expected to expand
at a CAGR of 15.92 per cent to US$ 55 billion by 2020.
Generic drugs form the largest segment of the
Indian pharmaceutical sector with 70 per cent
of market share (in terms of revenues). Branded
generics majorly dominate the market
constituting nearly 70% of the overall market.
India accounts for 20% of global generic
medicines exports in terms of volume which
makes it the largest provider of generic
medicines globally and it is expected to expand further in future. Over the Counter (OTC)
medicines constitute 21% and patented drugs comprise of 9% of total market revenues. The
number of total drug approvals given by the US Food and Drug Administration (USFDA) to Indian
companies have almost doubled from 109 in FY 2014-15 to 201 in FY 2015-16. The country
accounts for around 30 per cent (by volume) and about 10 per cent (value) in the US$ 70-80 billion
US generics market.
The Indian Pharmaceutical Market comprises of about 24,000 players, 330 being in the organised
sector. The top ten companies like Sun Pharmaceuticals, Cadila Healthcare, Lupin, Cipla, Dr.
Reddy’s Laboratories etc. make up for more than one third of the market. The Union Cabinet has
now allowed up to 100 % FDI under the automatic route for manufacturing of medical devices
subject to certain conditions. According to Department of Industrial Policy and Promotion (DIPP),
cumulative FDI inflows in the drugs and pharmaceuticals sector amounted to US$ 14.53 billion
between April 2000 and December 2016.
Owing to this, many foreign players as well as domestic manufacturers have entered the market.
Also, the new government under Mr.Narendra Modi has given a major boost to the pharmaceutical
sector. The government is trying to implement policies like ‘Make in India’ and ‘Swach Bharat
Abhiyaan’.
However, there are certain hurdles which the companies face such as compliance issues with
USFDA, high fragmentation of the industry, low profit margins, stringent pricing policies by
government, low allocation for research and development, stronger intellectual property right
regulations etc.
There has been significant progress in infrastructure development of infrastructure, R&D and
technical aspects in the Indian Pharma industry. Upon the integration of the Indian market with
the global market, the industry has been facing and tackling new issues every day. Some of the old
issues like IPR and pricing continue to be contentious issues. Some of the issues which are
expected to persist are increased foreign interests and investments in R&D.

Analgesic Industry Summary

• Analgesics continued to be one of the most popular go to treatments for a lot of mid health
concerns and ailments.
• Analgesics posted current value growth of 10% to surpass sales of Rs.22.8 billion in 2016
and is expected to have CAGR of 4% in value sales at constant 2016 prices over the forecast
period to reach sales of Rs.27.9 billion.
• Strongest current value growth was held by topical analgesics/anesthetic recording 12%
growth in 2016 where as Emami retained top position in analgesics in 2016 holding a 23%
value share

Industry Trends
Due to hectic and restless lifestyles of most of the Indians, headaches and muscle aches have
become more common. Along with this, consumers’ inclination towards self-medication has led
to the growth of analgesics, both systematic and topical, industry in India. Because of quicker,
faster and more effective pain relieving actions, analgesics made a permanent place in household
first aid kits. Immediate relief from mild pains and fever ensured that the consumer get back to
daily routine. Being unaffected by the governments interventions of banning some of the major
brands and, analgesics as a whole recorded 10% growth.

Topical analgesics/Anesthetics was the best performing category in 2016, recording 12% value
growth. Anesthetics accounted for a 75% value share of total analgesics in 2016. Because of the
increase in communication of side effects associated with systematic analgesics, topical analgesics
were preferred by consumers for mild pains, fever, headaches and sprains. Analgesics came in
three forms – gel, ointments and sprays. Cream/Gels were the most popular followed by balms.
Ointments were being used by lower-income demographics whereas sprays registered highest
growth figures as it gained popularity among the urban consumers. Most of the purchases were
OTC.

Pediatric analgesics only formed a marginal share, also parents opted to seek advice from the
doctors first before buying analgesics for kids. Migraine, Menstrual Pain, Arthritis treating
analgesics are treated as prescriptive drugs by the government of India.

Brand image and trust played a major role while purchasing analgesics from retail counters.
Whereas among the rural consumers price was the issue. Majority of the modern consumers looked
for quicker reliefs with fewer side effects, irrespective of price.

Sales (INR Million) of

Analgesics by Format

TOPICAL
ANALGESICS/ANAESTHECTI 17,000.00
CS

SYSTEMIC ANALGESICS 5,804.70

Total sales = 22804.70

Future Scope:

• Analgesics is expected to cross Rs 28 billion in gross sales by 2021 and a maintain constant CAGR
of at least 4%. The consumer’s tendency of using OTC medicines without a doctor’s prescription
for minor injuries/aches will be an important factor for this growth.
• Analgesic companies plan to fund activities aimed at generating customer trust towards their
products, positioning them as a healthy and safe remedy for usual injuries.
• Recent government activities against a few drugs, including Saridon, could slow the demand pace
for systemic analgesics brands in the short term.
Competitive Landscape:

• Emami’s Zandu led the analgesics industry in 2016, with Zandubalm and Menthoplus performing
strong. Emami’s strength lay in its Ayurvedic HCD range, which grew by 25%. The company also
launched Zandu gel balm to target pain management in children. International players, such as
GlaxoSmithKline Consumer Healthcare, Wyeth, Reckitt Benckiser and Piramal Enterprises
dominated the systemic scene, while domestic companies, such as Paras Pharma, Amrutanjan
Health Care and Elder Pharmaceuticals held the lead in topical analgesic.
• A major disruption was Dr. Reddy’s Laboratories’ launch of the Nise D spray under its Nise
umbrella of analgesics, available in gel as well as tablet formats. There was a recorded slow growth
for private labels/OTC generics, thereby affecting the competition landscape.

Shares(%) of Sales of Analgesics in 2016 for

Top 20 Products

14.8

10.5
9.1
7.2 7.2
5.7
4.2 3.9
3 2.8 2.7 2.4 2.3 1 0.6 0.5 0.5 0.3 0.3 0.3

Sources:

 www.ibef.org
 www.moneycontrol.com
 Euro monitor database
GlaxoSmithKline India:
GlaxoSmithKline Pharmaceuticals Limited (GSK India) is an Indian subsidiary of GlaxoSmithKline
Plc. with its head office in Mumbai, Maharashtra, India. Established in 1924 GSK India manufactures
and sells medicines across therapeutic areas such as anti-infectives, dermatology, gynaecology,
diabetes, oncology, cardiovascular diseases and respiratory diseases, as well as vaccines for critical
diseases like pneumococcal disease, meningitis, hepatitis, rotavirus, whooping cough, small
pox and influenza.
The company operates in the following key segments:
• Pharmaceuticals
• Vaccines
• Consumer Healthcare, selling nutritional and OTC products.
o Nutritional Products like Horlicks, Boost, Foodles, Maltova and Viva
o OTC products like Crocin, Eno, Iodex and Sensodyne

Voltaren Gel:
For this project we have chosen the product Voltaren gel. It is the world’s No. 1 body pain reliever. Its
uniquely developed Emulgel rapidly penetrates deep into the skin, reaches the pain to reduce the
inflammation and provides instant recovery. This combination of cream and gel has a pleasant smell,
soothing cool sensation and is non-greasy.
But in India even with sufficient funds and network GSK has, it has shown very poor penetration in
the market. A qualitative market research study was done in order to understand the reason behind this
performance.
Qualitative Research:
Pharmaceutical companies generally sell pain relief products through 2 avenues – 1) through
pharmacists or 2) directly to end customer. They also have ties with doctors. But on interviewing 2
doctors we found that the patients who visit them either suffer from acute pain or are elderly people.
In general, doctors then prescribe tablets and rarely some cream which is of the non-commercial
variant.
For our analysis, we interviewed 10 people –
 2 Pharmacists
 4 from the young age category (20-35 years) – 2 athletes (male & female) and 2 non-athletes
(male & female)
 2 from middle age category (35-50 years)
 2 from elderly age category (above 50 years) – generally suffer from osteoarthritis

Insights drawn from Interview with Pharmacists:

• Volini is the number 1 selling product in the market
• A pharmacist prefers to sell spray over ointment/gel when nothing is specified by the customer.
This is because the profit margin on a spray is more than that of gel
• At least 80% of the customers ask for pain relief medicine without a prescription
• Prescribed pain relief medicine by doctors are generally never the highly marketed products
like Volini, Moov, etc.
• People in the age group >50 years generally rely on pain relief tablets like Combyflam,
ibuprofen, etc.
• All the major products come in 4 different pack sizes starting at 50gm to 150gm (gel variant)
Insights drawn from Elderly People (Age above 50):
• Either strictly follow doctor’s prescriptions or for minor cases self-medicate
• Pain medication pills are the preferred choice
• Are not brand-conscious and not affected by advertising
Insights drawn from Middle-Aged People (Age between 35 – 50):
• Usually loyal to brands but can be influenced by advertising
• TV advertisement is most effective in this case
• Mostly self-medicate and buy their preferable brand at the pharmacist
• Use a mix of both spray and cream/gel, but the latter is the preferred choice
• Average usage found to be anywhere between 4 to 6 times a year
Insights drawn from Young People (Age between 20 to 35):
• Very brand conscious and extremely loyal to their preferred brands
• Online medium of advertisement would have the most effect in this demographic
• Highest consumption rate among all the demographics
• Almost always rely on self-medication for most cases
• More than 95% prefer the spray form due to its ease of use
From the interviews, some common conclusions drawn are:
1. The products like Volini, Moov, etc. sell purely because of the high investments in the
marketing of the brand. From the color associated with the product to its ads the brand recall is
found to be phenomenally high. Hence leveraging on it being an OTC product, sales of these
brands continue to remain high
2. 100% of the people interviewed, preferred no pungent smell emanating from the pain relief
medicine. First preference was for an odorless spray or gel, while second being a mild odor that
didn’t alarm the people in the surrounding vicinity
3. Another characteristic of the present analgesic product that people preferred not to have is the
burning sensation post application. They preferred no effect or a cooling effect instead
4. When a new product is introduced in the market the younger people generally tend to form first
opinions based on the brand marketing/selling it
5. The greasy nature of the current products makes it second preference in comparison to the spray
Marketing Objectives:
Image –
Unlike other pain relieving products in the market, the Voltaren gel is odorless and provides a
cooling sensation when applied. Two major characteristics that on customer survey was desired for.
It would be important and crucial that this message be conveyed through our promotions, word of
mouth and other marketing media.
Segmentation & Targeting –
The product is such that it finds application amongst all segments – young, old, athletes, housewives,
etc. The way we would like to build awareness would be through 3 ways:
1. Schools/Colleges – The brand would support some of the junior to senior inter-school and
college tournaments. The idea here is to target the primary consumers of tomorrow. Other
opportunities are by sponsoring junior teams of other sporting activities like roller skating,
gymnastics, athletics, etc.
2. Sports clubs/Gyms – By linking up with the local running & cycling clubs and popular gyms
we spread the awareness of our product. Also by sponsoring running events and marathons in
the city or by setting up a Post-race massage stall are some other ways we can improve our
brand awareness
3. Households – Today a pain relief gel is part of every household’s first aid kit, we would not
want to miss targeting this segment as well. Advertisements depicting the advantages of pain
relief even for housewives or for any family member while at home or work will be produced

Distribution and Pricing:

The prime objective of the brand being a major relaunching, the company is targeting a particular
section of India to start with a particular section and gradually expand. For this reason, the South
Indian region is targeted because of the following reasons: -
• It has some major cosmopolitan cities like Bangalore, Chennai and Hyderabad where the
product can be really pushed.
• The south has a good ratio of both young, middle-aged and old people, which is perfect for
the three product lines being offered. Specifically, there are a lot of marathons, rallies and
sporting events which can be used as the perfect platforms for aggressive promotions
 • GSK has quite a few distribution centres already set-up in and around Bangalore, which
would help in the easy and effective rollout of the products.
• A lot of small-scale drug manufacturing plants are present in the area, with which tie-ups can
be made to produce our drug locally. Not only does this help in bringing down cost of
manufacturing but also reduces distribution costs, thereby giving us an opportunity to
increase company margins as well as those of pharmacists.

All these factors combined would help us maintain an equal pricing as that of our competitors while
increasing internal profits. Feedback from the sales in this region can be used to gradually adjust the
product positioning as well as expand to other parts of India.

Branding:

Name: PRAX
Tagline – Simple, Effective Pain Reliever
Purpose: Pain free World
To remove pain so that it does not hinder anyone from doing everyday chores.
Emotional: We care.
Building Brand Equity:

Brand Revitalization: Cooling effect after sensation has lost its strength as a positive association of
the product and product’s name being similar to the competitor has resulted in lost sales. We like to
reposition our product from only gel based to spray based analgesics and pain relieving patches.

Promotions

1. Roadshows- The purpose of roadshows is to take the company’s message and brand on the
road to increase brand awareness and product knowledge. Our main geographic focus pertains
to the southern part of the country. Hence roadshows done in sequence across multiple target
cities are a great way to spread the word in an in-person, interactive format and reach those that
we may not have been able to otherwise. Roadshows are aimed to bring customers, prospects,
and partners together for thought leadership, product demonstrations, and networking and are
a great way to jumpstart demand generation efforts.
2. Brand Ambassadors- Embracing brand ambassador programs helps to get the word out about
a company’s product or service. With social media marketing taking off, it would only make
sense to get our best customers chatting in-person and over social channels. A sportsperson is
likely to be more relatable to consumers of all ages groups.
3. Advertisements- This top spending comprised 75% of all pharmaceutical adverts spending in
2014, according to Nielsen data. Effective and crisp outreach via the media helps in
highlighting the features of the product and targeting the right customer base.
4. Brand linking- Tie-ups and sponsorship deals during local sporting events, college fests,
marathons are ways to enhance the product image and shape consumer attitudes. Sponsoring
events that appeal to our market are likely to shape buying attitudes and help generate a positive
reaction. Having a comprehensive media campaign can be used to augment the regular media
coverage promoted by the organizers of the events we tie-up with. Sponsorship can often
generate media coverage that might otherwise not have been available
SWOT Analysis
Voltaren Brand Revitalization

Strengths
n International Credibility: It has been launched in markets across the world and has
attained the status of worlds #1 pain reliever gel in the American and European markets
n Cooling Effect: The gel gives a soothing cold effect on application instead of a
burning sensation resulting in instant relief for the user
n Modes of Administration: It is the only NSAID pain reliever on the market which is
available in gel, spray and pain reliever patch forms in different sizes of S, M and L
n Deep Parent Pockets: The parent brand GSK is the 3rd biggest pharmaceutical
manufacturer in India with an annual revenue of rupees 2730 crores
n Parent Brand Reputation: GSK enjoys a high customer trust and loyalty in India
n High margins: The high margins can be used to lure pharmacists and distributors to push
the products
n Well connected Distribution network: GSK has a well-established and connected
distribution and pharmacist network in India which reduces fixed costs incurred
n Odorless and easy to carry: The product is odorless in all its forms. The patch
variant makes it extremely easy to carry around and also comes in different
flavors

Weaknesses
n Lack of Awareness: Voltaren is largely unheard of in India due to lack of advertising
and a sober product launch causing it to go largely unheard
n Cooling effect perceived as ineffectiveness: Market research has shown that
customers from a largely uneducated background associate healing with pain
n High similarity of name and packaging with market leader: ‘Voltaren’ and ‘Volini’
sound quite similar and customers often end up buying the more famous Volini.
Also they have similar packaging
n Higher pricing compared to competitor offerings: Due to its multi-functional
uses of treating joint, muscle and osteoarthritis, Voltaren is priced higher than its
competitors
n Cannibalization: There is a high chance that the multiple variants might eat into
each other’s sales

Opportunities
n Supermarkets: All the big supermarket chains have considerably improved their
cosmetics and toiletries departments in recent years, as well as opening pharmacies
in some cases, and the power and convenience
of ‘one-stop shopping’ at supermarkets is an opportunity to increase presence in the market
n First Mover Advantage: The Indian market has still not witnessed the launch of
pain relieving patches which have become a rage in the international scene.
Voltaren can be the first player to do so
n Unexplored Kids Segments: The kids segment presents a huge opportunity for Voltaren to start and expand its
market share. The product through kids can be pushed to the adults
n Cater to Osteoarthritis patients: 40% of the Indian population suffers from osteoarthritis. This can be used as a
selling point/ differentiating factor for Voltaren

Threats
n Highly competitive market: The market already has many established players who have gained a significant share over
 the years with a loyal customer following
n Aggressive spending by parent players: The other market players are continuously pushing their marketing spends
in other to capture more market share
n Customer Stickiness: There is a high probability that customers will not change their preference from long existing brands
of Moov and Volini.

Financial Opportunities:
In the financial year 2016-17, the pharmaceutical industry’s operating margin was around 25.6% and
the net margin was around 14.5% of the total sales. The operating and net margins have eroded as
compared to FY 2015-16.
Being a new entrant in an extremely competitive market, we expect the profit margins of Voltaren to
be relatively lower than the industry average. Also, Voltaren spray and patch being introduced as a
part of brand extension, the price and profit margins shall be kept lower so as to capture more and
more market share.

Expected profit margins shall be as follows:

Optimistic Moderate Pessimistic

Product Operating Net Operating Net Operating Net margin
margin margin margin margin margin
Voltaren Gel 25 % 14 % 21 % 11 % 17 % 5%
Voltaren Spray 20 % 10 % 17 % 6% 11 % -3 %
Voltaren Patch 23 % 12 % 18 % 8% 13 % -10 %

In a highly optimistic scenario, the profit margins of gel have been considered almost equal to the
industry average. However, the net margins of spray and gel are relatively low owing to lower selling
price and heavy advertisement expenditure to introduce new products in the market. In a highly
pessimistic scenario, however, owing to heavy advertisement expenditure, we expect the new brands
to incur losses assuming lower market capture.
Launch Strategy
Launch Strategy
Schools/ Colleges Targeting the primary customers of the future- sponsoring
sporting activities of junior teams
Sportsclubs/Gyms To spread the awareness of the product, we would tie up with the
local running/cycling clubs and gyms. Sponsoring marathons
and setting up stalls during
Households Households can be targeted via advertising depicting the
relieving effects of the product

Implementation
Voltaren (Prax) is distributed by GlaxoSmithKline (GSK) and hence possesses a large amount of
resources. These resources can be used to aggressively increase market share of Prax. For the entire
launching campaign, a budget of Rs. 14 crores has been allocated. The implementation details of the
advertising and promotional campaigns are as follows:

1. Branding - All our promotions will convey the message of our brand revitalization. Through
targeted marketing, we will create a perception of superiority of our product’s functioning as well as
the usefulness of its various features. We will concentrate on differentiating ourselves from Volini. A
proposed tagline for ads is - “Strengthen your mind, leave the body to us”

2. Advertisements- Amongst our target customers, it is the household segment which is most
influenced by ads even now. To target them, we are concentrating solely on TV ads. This method
reduces costs and also gives us a chance to monitor the outreach of our marketing channel effctively.

3. Sponsorships- To generate an awareness among the youth segment, we will be partnering up with
leading schools like DPS and several eminent colleges for their sports/adventure events. Continous
presence of this brand will efficiently create an interest in this target segment, and will also get a lot
of potential customers to try our product and verify its usefulness. We will also be targeting events
like IPL to get our brand names accross to the

4. Events- To further increase penetration, we will be partnering with marathons and other sporting
events in and around the area. This can be in the form of recovery centres at the end of races, etc.
Also, we plan on having one marathon of our own, which will be on the theme of “realizing your
potential”, which will further boost the notion that PRAX is there to take care of physical limitations
like pain. This will also be a very good platform to launch our Patch, trials of which we could
provide to increase its visibility.

5. Distribution- Costs saved from advertising through multiple channels will be used to give
increased margins to pharmacists, who are our chief distribution channels. Not only will that
encourage them to push our markets, but will also give us an advantage if we are more profitable
than our customers for them to push.

6. Brand Ambassador- We are planning on getting P.V. Sindhu as our brand ambassador. Fresh off
getting an Olympic silver medal and winning several tournaments thereafter, her popularity is at its
peak. Also, having her will help us appeal to the woman segment more effectively, and will also
portray an image of us as promoting sports and woman empowerment.

Budget allocation
PROMOTION CHANNEL Budget (In Crores)
TELEVISION 7
ROAD SHOWS 0.8
SOCIAL MEDIA 0.5
MARATHON RUN SPONSORSHIPS 1.2
SPONSORING ISL, IHL AND INDIAN CRICKET TEAM MATCHES 3
PROMOTION WITH BRAND AMBASSADOR 1.5
Total 14

Goals
3 stage semiannual goal setting process involving different metrics-
• Goal 1: Increase brand reach to at least 90% of the target audience. All the potential
customers and target segment should be aware of the product ‘VOLTAREN’
• Goal 2: Have a distribution reach/ penetration of-
o 75% of the chemists in Tier 1 cities
o 65% of the chemists in tier 2 cities
o Sponsor at least 5 major marathon runs across cosmopolitan cities
o Tie up with sports teams and brand ambassadors across 400+ schools and 100+
colleges
• Goal 3: Achieve sales of (Over 6 months)
 o Rs. 6 crores for Voltaren spray
o Rs. 3.5 crore for Voltaren pain relieving patches
o Rs. 1.5 crores for Voltaren gel

Contingency Planning -
While we have tried to forecast as much as possible, there are always some measures that can churn
out unexpected results. As a safety measure, we have addressed contingencies for the most probable -

1. The cooling after effect, which is one of our USPs, may not be immediately associated by
customers with healing. This could lead to people questioning the product’s efficiency. To remedy
that, we would have to release an ad campaign specifically to address this point if and as soon as we
get feedback of such a thing occurring

2. Our price is slightly higher than our customers, because of our assumption that our target
customers are not price sensitive and instead, look for value. However, if feedback points to the
opposite, we will decrease prices and continue to focus on market growth. Our parent companies
have sufficient means to sustain this strategy.

3. While we feel that the patch is going to be a very successful product, there is a chance that
customers do not respond to it. In such a case, we will suspend the product and look into detailed
feedback. Then we will decide how to modify the product so that its appeal increases and in the
worst case, decide to scrap the product itself
 BIBLIOGRAPHY
1. www.ibef.org
2. www.moneycontrol.com
3. Euro monitor database
4. www.inc.com
5. www.marketingdonut.co.uk
6. www.mmm-online.com/pharmaceutical/voltaren-gel/article/105104/
7. www.indus.edu.pk/publication/Publication-24.pdf
8. www.drugs.com/voltaren.html
9. brandequity.economictimes.indiatimes.com/news/advertising/do-we-deserve-a-patontheback-
asks-volini-in-its-new-ad-campaign/58834963