Tractor drugs marketing plan (Group 13)

TRACTOR DRUGS MARKETING PLAN

SUBMITTED BY

GROUP 13

(TANYA GOGIA

PANKAJ GUPTA

OJAL GARG)

1.0 EXECUTIVE SUMMARY

Tractor Drugs is preparing to launch a specialized line of international quality lifesaving drug.

Offering is Kadcyla (Emtansine) which is used for treatment of Cancer.

Targeted Market is Southeast Asia.

Our Products are cheaper as compared to same drug of other companies.

We are likely to sustain because of Competitive advantage of Highly Qualified Medical Representatives and brand recognition.

Through its Japanese and Hungarian collaborations, Tractor Drugs has developed a specialized line of international quality life-saving drugs and already had a high reputation with doctors and hospitals in India.

1.0 EXECUTIVE SUMMARY (CONT)

MISSION OF TRACTOR DRUGS

Tractor drug’s mission is to provide the customer with the

best prices and service for prescription medication. We

exist to attract and maintain customers. When we

adhere to this maxim, everything else will fall into place.

Our services will exceed the expectations of our

customers.

CONSUMER PROMISE

Consumer will get product in relatively cheaper price and

having the same market quality as our competitors are

providing. Our product is FDA approved, so we are upto

the expectations of our Customers.

2.0 SITUATIONAL ANALYSIS

Tractor Drugs has developed a specialized line of international quality lifesaving drugs. Tractor products already have a high reputation with doctors and hospitals in India. Now, we want to expand in Southeast Asia and west Asian markets. We found that our medical representatives are much better qualified and trained than the medical representatives of competing multinational drug companies in southeast and west Asia. Our new strategy is calling for creating two international sales forces – one based in Madras and the other based in Mumbai. These sales forces staffed with M.Sc. M. Pharma and even MBBS medical representatives, would detail doctors and hospitals in Southeast Asia and west Asia. Because of the specialized nature of drugs, Our multinational competitors also had to rely on international sales forces operating out of Cairo, Dubai, Europe, Tokyo, Hong Kong or Singapore to service the two target markets. We figured that our India based sales forces would cost 30% to 50% of what the competitors’ sales forces cost and were better trained, With this strategic cost advantage, We are developing time phased plan for market penetration in Southeast and west Asia.

2.1 MARKET SUMMARY

Tractor Drugs possesses good information

regarding their market and the target segments that

they wish to serve in the Southeast Asian Region.

Buying patterns in Southeast Asian:

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2

4

6

Walk in CustomersMail OrderCustomers Others

Series 1

2.1 MARKET SUMMARY (CONT)

Market Needs: The pharmacy seeks to fulfil the following benefits that are important to their customers in India:

1. Selection

2. Accessibility

3. Customer service

4. Pricing

Market Growth

1. In 2000, the global pharmaceutical industry as a whole was a $897 billion dollar industry.

2. The Pharmaceutical industry in India is the world's third-largest in terms of volume.

3. According to India Brand Equity Foundation, the Indian pharmaceutical market is likely to grow at a compound annual growth rate (CAGR) of 14-17 per cent in between 2012-16. India is now among the top five pharmaceutical emerging markets of the world.

2.2 SWOT ANALYSIS

STRENGTHS

1. A unique, current business-

environment-appropriate business

model.

2. Excellent staff who are highly

trained and very customer attentive.

3. Great prices.

4. The ability to scale rapidly for the

mail order side of the business.

WEAKNESSES

1. The lack of visibility and brand

equity of a start-up business.

2. Lack of true experience running a

mail order outfit.

3. Government intervention into

medicine is possible.

.

2.2 SWOT ANALYSIS (CONT)

THREATS

1. The entry into the mail order market by an established company

2. Regulatory legislation that curtails the mail order medicine industry

3. Some event that cripples interstate commerce in regards to shipping.

OPPORTUNITIES

1. Outside pressure on consumers

to purchase meds mail order.

2. The constant growth of the

number of people taking

medication.

3. Newly formed alliances of

insurance companies and mail

order pharmacies.

2.3 COMPETITION

Chain pharmacies

Local pharmacies

Internet pharmacies

Major Competitors: Eli Lilly, Astra Zeneca,

Novartis and Pfizer are in the top 10 medicine firm

of world.

Astra Zenaca,

35

Eli Lilly, 50

others, 15

, 0

Sales Split

Astra Zenaca Eli Lilly others

2.4 PRODUCT OFFERING

o Kadcyla (Emtansine). It’s features are as follows:

1. It is a drug used to treat cancer patients.

2. Kadcyla is available in 2 variants pack, 10mg and 160mg.

3. It has short span life of 6 months.

4. As the drug is temperature sensitive, drug should be kept between 2 to 8 degree Celsius. Below or above the temp. range drug may deform and may lose it’s biological activity. It is advised to use drug within life span and kept in low temperature.

Competition : Kadcyla is manufactured by Novartis, Astra Zeneca, Eli Lilly, Pfizer and Tractor Drugs.

Cost & Pricing : Retail price for a 10mg vial is Rs. 2000 and 160mg vial is Rs. 6,000. The estimated cost of production is 75% of retail price.

2.4 PRODUCT OFFERING (CONT)

The Demand and Supply : There is a considerable

demand supply gap in the drug industry.

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50

100

150

200

250

300

1990 1995 2000 2005 2010 2014

No.of Customers in '000s Actual Supply

2.5 DISTRIBUTION

Before considering the various distribution centers

of Tractor Drugs, let us focus upon the value chain

analysis that the pharmacy follows:

2.5 DISTRIBUTION (CONT)

Distribution includes all the activities necessary to move products from producers to customers:

Tractor Drugs will focus more on Traditional channels: company has some 50 independent distributors and over 200 retail outlets that will be opened in India.

Selling directly to the consumers will be more focused upon as this will reduce the cost of various retailers and wholesalers which maybe otherwise involved.

3.0 MARKET STRATEGIES

Medical representatives shall meet doctors and

acknowledge them of our products which is FDA

approved, cheap and with same performance

metrics as other companies. Retailers would be

another target as they will order this drug in doctors

preference. Retailer would be given good margin

with cheap availability of drugs to Customers.

3.1 OBJECTIVES

1. Increase repeat customers by 7% each quarter.

2. Decrease customer acquisition costs by 8% per

year.

3. Increase customer awareness of Tractor Drugs as

evidenced by an increase in product requests

solely generated by knowledge of The Pharmacy's

name.

4. To attain approximately 5% share of the estimated

volume for medicines.

3.2 TARGET MARKETS

The Discount Pharmacy will have different strategies

for the two different groups:

1. The walk-in customers will be targeted through

advertisements in the local paper.

2. The mail order customers will be targeted

through an advertising campaign in magazines

and newsletters that have an older (over 55)

crowd that regularly needs medication and knows

in advance what their needs are.

3. One of the main newsletters that “Tractor Drugs

Review” will be visible in is the A.A.R.P monthly

newsletter.

3.3 POSITIONING

The Tractor Drug’s competitive edge is superior pricing.

Tractor Drugs is able to decrease operating costs by not offering all of the typical services traditionally offered by pharmacies.

Tractor Drugs is able to maintain industry margins through the use of other operating efficiencies.

Lastly, although there is a pharmacist on hand, Tractor Drugs is not designed to hold the patients hands when they purchase their medications. The vast majority of Tractor Drug’s customers is veteran drug takers and is already aware of how to take the medication and any side effects or drug interactions that should be avoided. Regardless, Tractor Drugs will provide each patient with a print out of all the information they need for the consumption of the drugs.

3.4 STRATEGIES

Target Market

Positioning

Product Line

Price

Distribution

R&D

Advertising

Customer care

3.5 MARKETING MIX

Product

Drug Kadcyla

Price

Low prices

Place

Various outlets being opened in various cities and direct

selling

Promotion

3.6 MARKETING REASEARCH

Several focus groups will be held

Survey will be handed out

In-depth analysis of the pharmacy industry,

focusing on consumer decision models within the

industry

4.0 FINANCIALS

We, at Tractor Drugs wish to achieve:

1. A double digit growth rate for the first five years

2. Reduce the variable costs associated with

servicing each individual order by 4% a year

3. Profitability by the end of year three

4.0 FINANCIALS (CONT)

Total first year sales for Emtansine is projected to 4 crore with an average realised price of Rs. 2000 for 10mg vial and Rs.6000 for 40mg vial for sales volume of 20,000 vial. Projected Variable cost for production is Rs.1000 and fixed cost is 500 for 20,000 vials.

Total cost would be 1500*20,000= Rs. 30,000,000, a profit of 1 Crore. Advertising cost is not included in this. Our other drugs are already available India. So, advertising cost would be less as advertising amount will be shared.

For 2nd, 3rd,4th and 5th year, sales is forecasted as 30000, 38000, 42000 and 45000 respectively.

4.0 FINANCIALS (CONT)

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5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

Year 1 Year 2 Year 3 Year 4 Year 5

5 year sales forecast

Sales Expected

Sales will show introduction-growth-mature phase split in 5

years.

5.0 CONTROLS

5.1 IMPLEMENTATION

The following areas will be monitored to gauge

performance:

Revenue: monthly and annual.

Expenses: monthly and annual.

Repeat business.

Customer satisfaction.

5.0 CONTROLS (CONT)

5.2 MARKET ORGANIZATION

Tractor Drug’s Chief Marketing Officer, Mr. Manish Kumar, holds the overall responsibility for all of the company’s marketing activities that will be carried out in India. The pharmacy’s structure of marketing organisation will be as follows: