Through the looking glass

Abstract:

The paper describes a case study carried out in 1994 to examine the potential for a number of new possible line extensions (formulations) of an existing product. Management required an extremely accurate forecast of the likely impact of the new forms on existing business, the degree of cannibalisation that would result and the impact on other competitors. Major investment decisions were likely to hinge on the outcome. Qualitative focus groups conducted in four countries with patients and physicians were able to identify four possible line extension candidates for the Janssen product. A major quantitative study involving 758 physicians and 489 patients was later conducted. A variety of novel approaches were used in order to address the marketing objectives. These involved doctors actually mapping themselves the likely market positions of the new forms, the use of a Choice Based Conjoint approach and the association of the new forms with various words and phrases. The new forms were assessed on the basis of: a written concept -photographs of packaging -placebo forms to taste a series of market scenarios, the preference shares for the new forms were established and converted into an approximate market share estimate. A multi data source modelling process was then set up in order to convert the primary research data into a market model which takes into account pricing, promotion, demographics of the population, etc. The forecasting model was installed at both the local offices of Janssen and at the corporate headquarters to facilitate increased understanding of the impact of each form, taking account of the local market situations. Despite the complexity of the marketing objectives, it was possible to prioritise the range of opportunities which existed, and identify the impact on the existing brand. Over the longer term, the result highlighted the value of certain line extensions as a means of broadening the product range to reduce the vulnerability of the brand to generic alternatives.

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