1) What course of action should Datril take?
It should solidify its position in the analgesic market and gain share in the rapidly growing acetaminophen market. It should target both Tylenol Users and Aspirin Users. On one hand, it should explain to customers that Datril’s effect is identical to Tylenol and use low-price promotion. On the other hand, it should leverage Bristal-Myers’s name to facilitate its market penetration. Generally, it should focus on advertisement and promotion.
2) What are the pros and cons of targeting Tylenol Users?
Pros: Datril is a substitute of Tylenol, but compared to Tylenol, it’s cheaper. Besides, Tylenol almost controls the market of acetaminophen and it controls nearly the whole potentials customers for Datril. Cons: Tylenol dominated the acetaminophen market for a long time. On one hand, many customers have strong loyalty to Tylenol. On the other hand, since it’s a new drug, many people neither know it nor trust it, Datril has to spend a lot of time and money in advertisement. Besides, its effect is identical to Tylenol, which means in quality it doesn’t have any advantages over Tylenol. In this way, low price becomes a big attraction for customers. But the low-price strategy means lower profit per unit.
3) What are the pros and cons of targeting Aspirin Users?
Pros: Datril’s effective element is acetaminophen, which has the same function as Aspirin but less side effects. In contrast, acetaminophen analgesics raised the pain threshold and reduced fever without having the anti-inflammatory effect of aspirin, thus meeting the needs of people who suffered from upset stomach. The data shows that acetaminophen’s market almost doubles while Aspirin’s only increases by 9%. It means that more and more people prefer to use acetaminophen. Targeting acetaminophen users apparently is a very promising action.
Cons: Datril, Bufferin and Excedrin all belong to Bristal-Myers. And Bufferin and...