Bausch and Lomb Case Study

Topics: Contact lens, Balance sheet, Income statement Pages: 3 (1067 words) Published: March 13, 2011
Bausch and Lomb
For the first time in the company’s history, Bausch and Lomb (B&L) found themselves losing market share to their competitors in the contact lens division (CLD). This caused Daniel Gill CEO and Harold Johnson, president of the contact lens division, to make a dramatic change to their sales strategy. Bausch and Lomb didn’t consider the effect it would have on their reputation, shareholders, and financial statements. Bausch and Lomb’s Perspective

Bausch and Lomb felt the pressure to maintain the market gains they enjoyed for 25 years. They had a string of successful products including the introduction of conventional soft contact lenses. They had the reputation of developing innovative ideas and were on the cutting edge in launching new products that gained popularity. Due to their success, B&L created unrealistic expectations for their sales and financial performance goals. Johnson & Johnson, Inc. (J&J), a competitor of B&L introduced disposable soft contact lenses and impacted the demands of the consumer. Disposable lenses threatened B&L conventional soft contact lenses. B &L initially chose not to develop disposables, but quickly realized they were missing out on a growing segment. B&L needed to gain market share for disposables and maintain their current conventional lens brand. Currently in the lens market, conventional lenses are a larger and more profitable division, however they are slowly losing popularity among consumers. See figure below:

To adequately catch up and compete in the market, B&L decided to change their sales strategy. This new strategy required conventional lenses to be channeled through distributers to end customers. This would allow the company to free up marketing resources for disposables and distributors would be able to increase their focus and promotion on conventional lenses B&L hoped the result of their new strategy would allow distributors to focus on selling...
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