Define Propecia’s potential customer base. What is Propecia competing against in the consumer’s mind? What can be learned from Rogaine’s experience in the marketplace? Propecia is a drug against hair loss, effective both on stopping and reversing the Male Pattern Hair Loss. According to Tom Casola, the brand manager of Propecia, the potential customer base is at least half of the male population, as MPHL occured in 30-40 million American men, which is around 50% od Caucasian men under the age of 50, with the lifetime incidence to reach 100%. But when compared to others race and nationalities.
Neither black men, Japanese men nor Chinese men were as likely to develop MPHL as frequantly as Caucasian men, at least not until later ages. What Propecia is competing against in consumer’s mind is that, according to the research Merck did, consumers believe hair loss to be a slow process and they do not seek treatment early enough, at least not before trying a couple remedies of their own including brushing, wearinh hats, combing the hari over bold spots, which is mainly because they are not fully aware of the degree of their hair loss, as it is most likeley happening at the back or top of their head.
Although 2/3 of men losing hair consider of it to be a problem, half of those consider it to be a futre problem, and the remaining 1/3 does not even consider it to be a problem. The consideration of this problem to be a future problem, or an inevitable problem, builds kind of a resistance in terms of the willingness to fight it. And Merck needs to focus on showing that it is a current problem and not a future problem and shoudl be addressed as soon as possible, in order to have success over it, and making it not inevitable.
Rogaine, a topical including minoxidil, affective against hair loss, as long as used, was the frst FDA approved topical hair loss intervention, which was not successful as a prescribed medicine despite the belief of its potential success in revenue, until it became an on-the-counter product. What Propecia can learn from Rogaine is that, the product should be very careful with the creation of consumer expectations, because if it fails to keep up to those expectations, it can end up like the
first launch experience of Rogaine, not coming even close to the expected revenue levels. Although it would not be easy to set the right level of consumer expectation, lowering expectations should be blaned with also creating a positive hop efor the product in the eyes of consumers. 2. How does a customer come to use Propecia? How can Merck best influence that process? Because hair loss is not conceived by physicians to be an urgernt problem, consumers should be directed in terms of marketing in order for them to use Propecia.
As mentioned earlier, hair loss is a common problem for most of the men and a remedy is needed not because it is an urgent or a fatal problem but for improving the lives of those people, which is one of the objectives of Merck. According to past experience of Merch with other products, especially those it advertised through direct-to-consumer advertising, which it plans to do for propecia, consumers who asked their physician for an advertised drug, receieved a presciription for it (75%-85% of the the patients).
3. What type of ads, if any, should Tom Casola run at product launch? What message should Propecia convey to potential customers? It is a pretty tough decision to make, choosing one of the three add types. Help Seeking ads would have a negative affect mostly because the ads should be brandless, but the launch is at similar times with the extra strength formula Rogain’s launch time, and as the brand awareness of Rogaine is high, our ads would benefit them more than it would Propecia.
On the other hand, product claim ads, although seems like a sound decision to go with, has a high potential risk, becase the side affects are to be mentioned in the ad, and creation of a brand awareness assosicated with seemingly high risks of sexual side effects for men and pregnancy problems for women, it would not be a good timing for highlingting these side effects, where the competition is coming with a more effective product compared to the strong product already dominating the market at some level, with not necessarily this kind of serious side effects, although they are not high risks.
Third option of reminder ads, which do not seem to be the best strategy at any other given time, as mentioned by Casola, there is no point in having an ad that creates brand awareness where you cannot even tell that the product is an hair loss product, at this time it seems like the soundest road to take. There is a risk that the brand awareness would be empty inside, but along with working with doctors, mostly dematologists who would be more eager to prescribe Propecia, and urging people to see a dermatologists in the ads, would be the best of the options.
This way, making the problem a health issue, which should be handled through a dematologists would create some sort of barriers for the on-the-counter competition especially the new Rogaine to come. 4. What role does a physician play in this context? How much detailing effort is necessary? Pysicians are primarly the customers of prescribed drugs, as they are the ones prescribing the drugs to the patients, the realt consumers.
In order for the making the pysicians to prescribe the intended drugs, pharmaceutical companies have sales representatives, who directly go to the physicians and describe the drug, which is called detailing. According to the data given in the case, the potential face-to-face interaction between a sales representative and a physician is about 2 minutes, where the sales representative is supposed to do detailing of 3 drugs.
In order to have an effective detailing to persuade pysicians to proescribe the intended drug almost 6 visits on average paid to the pysician. 5. Do you think a first year sales forecast of $60 million would be conservative or optimistic? First of all we need to consider that the potential hair loss markets accounts for about $1. 5 billion of annual sales. Half of the market is hair loss surgery and the rest is divided between mechanical and topical solutions. In order to forecast a $60 million sales a year, Propecia needs 100.
000 customers who spent $50 per month. When we compare this to the unsuccessful lounge of Rogaine, as a prescribed drug, costing $60 per month, it created 400. 000 customers and generated $100 million sales. So compared to this with the knowledge that being scientifically proven- at least among a majority of the clinical trials- and having a better success potential than Rogaine, even on the eve of Rogaine more effective product coming, it is conservative to think Propecia would reach $60 million sales forecast for the first year.